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Microsoft Makes Multi-Billion Dollar Investment in OpenAI as Partnership Enters Third Phase

Microsoft commences the third phase of its long-term partnership with the artificial intelligence (AI) research and development company OpenAI.

Microsoft is continuing its work with its partner OpenAI through a multiyear, multibillion-dollar investment following two previous investments in 2019 and 2021. This partnership seeks to pioneer AI development and distribution across the world.

This agreement extends Microsoft’s ongoing association with AI supercomputing and research with the commercialisation of the resulting advanced technologies. Although this figure is thought to be somewhere around the $10billion mark, 10 times its first investment in OpenAI back in 2019, the exact figure remains unconfirmed.

This third investment by Microsoft has three intended outcomes in mind:

  • Supercomputing at scale

Microsoft will increase its investments in the development and deployment of specialised supercomputing systems to accelerate its partner’s independent AI research. The tech giant will also continue to build out the AI infrastructure of Microsoft Azure, its cloud computing platform, to help customers build and deploy their AI applications on a global scale.

  • New AI-powered experiences

Secondly, Microsoft will deploy OpenAI’s models across its consumer and enterprise products and introduce new categories of digital experiences built on OpenAI’s technology.

Above all, this includes Microsoft’s Azure OpenAI Service, which allows developers to build AI applications through direct access to OpenAI models backed by Azure’s, enterprise-grade capabilities and AI-optimised infrastructure and tools.

  • Exclusive cloud provider

As OpenAI’s exclusive cloud provider, Azure will power all OpenAI workloads across research, products and API services.

Microsoft OpenAI
Satya Nadella, chairman and CEO, Microsoft

“We formed our partnership with OpenAI around a shared ambition to responsibly advance cutting-edge AI research and democratise AI as a new technology platform,” comments Satya Nadella, chairman and CEO of Microsoft.

“In this next phase of our partnership, developers and organizations across industries will have access to the best AI infrastructure, models and toolchain with Azure to build and run their applications.”

The past three years of our partnership have been great,” adds Sam Altman, CEO of OpenAI. “Microsoft shares our values and we are excited to continue our independent research and work toward creating advanced AI that benefits everyone.”

Movers and shakers of the AI industry

Since 2016, Microsoft has continually tried to shape its Azure platform into a widely-applicable AI supercomputer.

Through the initial investment and collaboration, Microsoft and OpenAI pushed the frontier of cloud supercomputing technology. The partnership developed and introduced one of the world’s top-five supercomputers back in 2020, and subsequently constructed multiple AI supercomputing systems at scale.

OpenAI leveraged this infrastructure in the development of its own AI models, many of which are now deployed on the Azure platform. This includes, among others, its AI-powered chatbot ChatGPT, which has broken numerous headlines since its 30 November launch for its ability to produce eerily human-like text.

These innovations introduce large-scale AI as a powerful, general-purpose technology platform forecast to transform the abilities of the personal computer, internet, mobile devices and the cloud.

The partnership has also worked to ensure the safety and security of the AI technology it’s producing. OpenAI has produced research regarding ‘AI alignment‘, while Microsoft’s efforts are most pronounced in its developed ‘responsible AI standard‘. These collaborative efforts have not only readied the ground for the deployment of its own AI technologies but are also leading the industry in generating responsible outcomes with the advanced technology.

The new industrial revolution

Offering a valuable outsider perspective to the news of Microsoft’s latest investment, Marshall Choy, SVP product at SambaNova Systems, explains how “we are witnessing the fastest industrial revolution in history – and it’s happening right in front of our eyes.”

Microsoft OpenAI
Marshall Choy, SVP product, SambaNova Systems

All in all, Choy comments that the investment “validates how game-changing this technology is; if you don’t start working on it now, you will be out of business.”

As a distinguished figure in the AI industry himself, Choy explains how Microsoft’s decision to make Azure the exclusive cloud provider for OpenAI workloads “limits accessibility,” adding “for AI to reach its revolutionary potential, companies require flexibility around how they adopt and deploy it.”

“That said,” Choy continues, “this innovation will impact us all – any software open on your computer right now will be changed by generative AI forever.

“The next challenge is taking generative AI and making it productive in enterprise environments. SambaNova is one of only a handful of companies that are already doing this.”

Author

  • Tyler is a fintech journalist with specific interests in online banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.

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