Microsoft chief executive Satya Nadella’s decision to throw his company’s lot in with OpenAI in 2019 has turned into one of the tech industry’s most successful partnerships, giving the software company a huge head-start in the booming market for generative artificial intelligence. His closeness with OpenAI chief Sam Altman, underlined when Nadella turned up on stage at the AI start-up’s developer day earlier this month, has also highlighted how much he has personally riding on the alliance. Beneath the camaraderie, a hard business logic has shaped the relationship. For Microsoft, OpenAI’s language models have become a key ingredient in the company’s latest AI-infused services, while the AI company needs Microsoft’s cloud platform — and money — to support its giant AI models. Speaking in a Financial Times interview this year, Nadella admitted the two companies had developed a “mutual dependence”. That made last week’s shock sacking of Altman a potential threat to Microsoft’s core AI strategy. He was reinstated five days later, but the episode has highlighted a vulnerability and brought an end to the halo effect from the partnership that has benefited both companies this year. That, in turn, could make it harder for Microsoft to satisfy Wall Street’s hopes that its lead in generative AI will quickly translate into higher revenues, according to some analysts. After months of development, the software company has only recently increased efforts to sell its new generative AI services, said Jason Wong, an analyst at IT research firm Gartner. “It was pedal to the metal,” he said after the company’s annual Ignite conference early last week. But with the debacle at OpenAI, “that momentum has been broken”.
Full opinoon : OpenAI turmoil exposes threat to Microsoft’s investment.
