Elon Musk Warns ‘OpenAI Could Overtake Microsoft,’ Satya Nadella Hits Back

305
08 Aug 2025
5 min read

News Synopsis

OpenAI has officially launched GPT-5, which it describes as its “smartest, fastest” AI model to date. Microsoft, a key investor in OpenAI, announced that GPT-5 will be deeply integrated across its ecosystem, including Microsoft 365 Copilot, Copilot, GitHub Copilot, and Azure AI Foundry.

Microsoft CEO Satya Nadella called GPT-5 “the most capable model yet,” praising its improved reasoning, coding, and conversational skills. “Today, GPT-5 launches across our platforms, including Microsoft 365 Copilot, Copilot, GitHub Copilot, and Azure AI Foundry. It's the most capable model yet from our partners at OpenAI, bringing powerful new advances in reasoning, coding, and chat, all trained on Azure,” Nadella shared on X (formerly Twitter).

AI Rivalry Heats Up Between Elon Musk and Satya Nadella

The release of GPT-5 has intensified the ongoing artificial intelligence rivalry between xAI CEO Elon Musk and Microsoft CEO Satya Nadella. Both tech leaders are vying for dominance in the AI space, promoting their respective models and platforms.

Shortly after Nadella’s announcement, Elon Musk reacted with a sharp comment aimed at OpenAI, writing that it is “going to eat Microsoft alive.” This remark reignited discussions about the competitive landscape in AI development and deployment.

Satya Nadella’s Playful Yet Confident Response

In response to Musk’s jab, Nadella maintained a playful but confident tone, writing:

“People have been trying for 50 years and that’s the fun of it! Each day you learn something new, and innovate, partner, and compete.”

Nadella also expressed his enthusiasm for Musk’s AI progress, stating, “Excited for Grok 4 on Azure and looking forward to Grok 5!” His reply highlighted Microsoft’s openness to both collaboration and competition in the AI industry.

Musk Claims Grok 4 Already Surpasses GPT-5

Not stopping at a single post, Musk went further by sharing customer feedback that favored his Grok 4 Heavy model over OpenAI’s GPT-5. He claimed:

“Bottom line, though: Grok 4 Heavy was smarter 2 weeks ago than GPT-5 is now and G4H is already a lot better. Let that sink in.”

The statement underscored Musk’s belief that his company’s technology is already ahead in terms of intelligence and performance.

Grok 5 Coming Before Year-End

In a follow-up post, Musk revealed xAI’s plans to launch Grok 5 before the end of this year. He teased that the upcoming model would be “crushingly good,” signaling a direct challenge to OpenAI’s latest release.

With both GPT-5 and Grok 5 set to shape the AI landscape in 2025, the battle for AI supremacy between OpenAI (backed by Microsoft) and xAI (led by Musk) is only expected to intensify.

The Bigger Picture: Competition Driving AI Innovation

The exchanges between Musk and Nadella, while competitive, also reflect the rapid pace of AI innovation. Industry giants are pushing boundaries in reasoning, conversational intelligence, and coding capabilities, offering new tools for developers, businesses, and end-users.

Whether GPT-5 maintains its lead or Grok 5 surpasses it, one thing is clear — the AI race is accelerating, and the biggest winners could ultimately be the users benefiting from more advanced, efficient, and creative AI models.

Podcast

TWN Special