What’s at Stake in a Strained Microsoft-OpenAI Partnership

The ouster of Sam Altman, left, as C.E.O. of OpenAI last year shocked Satya Nadella, right, Microsoft’s C.E.O.Credit…Justin Sullivan/Getty Images

“The best bromance in tech” is under pressure

Few partnerships in the technology world in recent history have been as transformative as Microsoft’s alliance with OpenAI, which paired a computing giant with a start-up that is among the leaders in artificial intelligence.

But that alliance is showing signs of strain, The Times’s Cade Metz, Mike Isaac and Erin Griffith report. Any disruption could shake up the A.I. world, even as other companies, including Google, take steps to better compete.

It’s hard to overstate the importance of the Microsoft-OpenAI relationship. The tech giant has poured tens of billions of dollars into OpenAI, most recently in the start-up’s $6.6 billion funding mega-round that closed this month. That has included both cash and access to the hugely expensive cloud-computing resources needed to develop A.I. services. (OpenAI expects to spend as much as $37.5 billion annually on compute by 2029, according to internal documents.)

In return, Microsoft has incorporated OpenAI services into the A.I. offerings that it has staked its future on. Access to the start-up’s products is so important that Satya Nadella, Microsoft’s chief, intervened in the revolt at OpenAI last year that briefly led to Sam Altman’s ouster as C.E.O.

But tension is building in what Altman once called “the best bromance in tech.” Microsoft began to get worried after last year’s upheaval at OpenAI and moved to hedge its A.I. bets. That included spending at least $650 million to hire most employees from Inflection, an OpenAI rival led by the former Google executive Mustafa Suleyman. At Microsoft, Suleyman’s role includes building tech that could supplant OpenAI’s products, which has riled some of the ChatGPT parent’s executives.

From The Times:

OpenAI executives are also complaining that Microsoft isn’t providing enough computing power. The start-up has already negotiated their to let it sign a $10 billion contract with Oracle for additional compute, and secured reductions in how much Microsoft charges for its cloud resources.