What you need to know
- Microsoft CEO Satya Nadella is reportedly concerned about OpenAI’s new deal with Apple to bring AI capabilities to the iPhone.
- Nadella worries about the impact the deal will have on Microsoft’s products and services, which are already heavily infused with AI capabilities.
- OpenAI is seemingly on good terms with Apple, having launched its ChatGPT desktop app exclusively for Mac users, claiming it prioritizes where its users are located.
Apple is expected to make its debut on the AI landscape at its annual developer conference WWDC 2024, scheduled for June 10, 2024. Reports indicate that Apple recently signed a deal with OpenAI to bring its AI advances, including ChatGPT, to the iPhone as part of the long-awaited iOS 18 update. Interestingly, Bloomberg’s Mark Gurman reports that most of these AI-powered features require advanced hardware and software that are consistent across the iPhone 15 Pro or newer.
While it’s great to see Apple finally getting into AI, Microsoft CEO Satya Nadella seems concerned about the iPhone maker’s deal with OpenAI. According to The Information, Nadella’s concerns center on the impact the deal could have on future Microsoft products and services.
OpenAI’s new deal with Apple is potentially worth billions of dollars, although it is unclear whether this figure will surpass Microsoft’s hefty $10 billion investment. As you may know, Microsoft leverages OpenAI technology to power its flagship AI models like Copilot. OpenAI, on the other hand, relies on Microsoft for its data centers.
Since the emergence of generative AI, we have learned that it is a resource-intensive technology. And despite being on the cusp of the biggest technological revolution in AI, projections indicate that there may not be enough energy by 2025, even though Sam Altman, CEO of OpenAI, has been exploring nuclear fusion as an alternative energy source for AI.
Apart from the power issues, AI consumes an exorbitant amount of water for cooling (up to 1 bottle of water per search), which comes at a high cost. OpenAI reportedly spends up to $700,000 per day to keep ChatGPT running.
In the meantime, reports also indicate that Apple is also in discussions with Google, which could see the Gemini chatbot making its way to the iPhone as an option or alternative to ChatGPT/Siri.
OpenAI joins Apple
In recent months, OpenAI has seemingly become more Apple-centric in terms of progress. For example, at the Spring Update event, the company unveiled its new flagship GPT-4o model and announced the general availability of ChatGPT exclusively for Mac users, rejecting Windows despite Microsoft’s billion-dollar investment.
OpenAI indicated that the exclusive launch was its way of “prioritizing” where its users are. An indication that the majority of users use Apple devices. Elsewhere, Sam Altman made headlines for all the wrong reasons, including withholding important information from the hot startup’s board, to the extent that they found out about ChatGPT’s existence via Twitter. Former board members alleged that two OpenAI executives reported Altman for psychological abuse, creating a “toxic atmosphere” at the company.
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Given this, Microsoft’s partnership with OpenAI remains complicated at best. Insiders have openly expressed their concerns, indicating that Microsoft has seemingly turned into a glorified IT department for the hot startup. While filing a lawsuit against OpenAI and Sam Altman for a stark betrayal of its founding mission, Elon Musk claimed that OpenAI has seemingly transformed into “a de facto captive subsidiary of the largest technology company in the world.”
In the past, Microsoft CEO Satya Nadella has openly admitted, “OpenAI would not have existed without our early support.”
We had a lot of confidence in our own abilities. We have all IP rights and all options. I mean, look, if OpenAI goes away tomorrow, I don’t want any of our customers to have to worry about that, honestly, because we have all the rights to continue the innovation, not just operate the products. But we can just do ourselves what we did in partnership, and so we have the people, we have the computer, we have the data, we have everything.
Microsoft CEO Satya Nadella
It will be interesting to see how OpenAI’s new partnership will impact ties with Microsoft once the announcement is made official at the upcoming WWDC 2024 developer conference.