Microsoft has given up its seat as an observer on the board of OpenAI while Apple will not take up a similar position, amid growing scrutiny by global regulators of Big Tech’s investments in AI start-ups, Financial Times reported.
Microsoft, which has invested $13bn in the maker of the generative AI chatbot ChatGPT, said in a letter to OpenAI that its withdrawal from its board role would be “effective immediately”.
Apple had also been expected to take an observer role on OpenAI’s board as part of a deal to integrate ChatGPT into the iPhone maker’s devices, but would not do so, according to a person with direct knowledge of the matter. Apple declined to comment.
OpenAI would instead host regular meetings with partners such as Microsoft and Apple and investors Thrive Capital and Khosla Ventures — part of “a new approach to informing and engaging key strategic partners” under Sarah Friar, the former Nextdoor boss who was hired as its first chief financial officer last month, an OpenAI spokesperson said.
The move comes as antitrust authorities in the EU and US examine the partnership between Microsoft and OpenAI as part of broader concerns about competition in the rapidly growing sector.
CNBC reported Microsoft said it would give up its observer seat on the OpenAI board amid regulatory scrutiny into generative artificial intelligence in Europe and the U.S.
Microsoft’s deputy general counsel, Keith Tolliver, wrote a letter to OpenAI late Tuesday, saying that the position had provided insights into the board’s activities without compromising its independence.
But the letter, seen by CNBC, added that the seat was no longer needed as Microsoft had “witnessed significant progress from the newly formed board.” CNBC reached out to Microsoft and OpenAI for comment.
The European Commission previously said Microsoft could face an antitrust investigation, as it looked at the markets for virtual words and generative artificial intelligence.
The commission, which is the executive arm of EU, said in January that it is “looking into some of the agreements that have been concluded between large digital market players and generative AI developers and providers” and singled out the Microsoft-OpenAI tie-up as a particular deal that it will be studying.
9To5Mac reported: Just eight days after it was revealed that Apple Fellow Phil Schiller would join the OpenAI board as an observer, it’s now being reported that this won’t happen.
Instead, OpenAI will simply commit to regular meetings with Schiller and other partners and investors…
The change of plan appears to relate to antitrust concerns. Regulators in both the U.S. and Europe are already investigating Microsoft’s investment OpenAI, and it was possible that Apple could have opened itself up to a similar investigation by taking a seat on the board, even without voting powers.
In my opinion, OpenAI needs to rethink if they really want a board of people from larger corporations involved in what OpenAI does. Microsoft and Apple seem to not want to have a seat on the board.