Microsoft May Invest $10 Billion In Creator Of Buzzy AI Tool ChatGPT

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Microsoft May Invest $10 Billion In Creator Of Buzzy AI Tool ChatGPT
13 Jan 2023
5 min read

News Synopsis

According to a report, Microsoft plans to invest $10 billion in OpenAI, the startup that developed the well-known artificial intelligence tool ChatGPT.

According to those familiar with the situation, the purchase, which also includes additional investors, would value OpenAI at an astounding $29 billion. This information was provided on Tuesday.

Although term sheets offered to potential investors said the deal was to be closed by the end of 2022, it is unclear whether the deal has been concluded, according to report.

According to reports, Microsoft will receive a 75% cut of OpenAI's income up until it recovers its investment, at which point it will take a 49% ownership position in the company.

When the reporter contacted Microsoft and OpenAI, neither company was immediately available for comment. The tech world has been buzzing about ChatGPT for a number of weeks. The tool is a natural language processing model, which means it is made to produce content that seems to have been written by a human.

The AI model, which is a variant of the GPT-3 family of large language models, has been applied to a variety of tasks, including code and college essay writing.

A bet on ChatGPT might aid Microsoft in stepping up its web search initiatives, a field dominated by Google. Although the company's Bing browser only has a small part of the worldwide search engine market, it is believed that the transaction will enable the company to challenge Google's hegemony by providing more sophisticated search features.

An analysis from Morgan Stanley in December looked into whether ChatGPT posed a danger to Google. Language models may steal market share and "challenge Google's position as the entrance point for consumers on the Internet," according to Brian Nowak, the bank's top Alphabet analyst.

In late November, OpenAI, which was established by Silicon Valley businessman Sam Altman, made its ChatGPT available to the general public. Despite hopes for its future, the initiative is losing money because of the extreme amount of demand on its servers brought on by its virality. Altman reported that 1 million users had used ChatGPT five days after OpenAI released it.

TWN Special