The artificial intelligence startup OpenAI has reportedly chosen not to accept board seats from IT behemoths Microsoft and Apple due to growing regulatory scrutiny. Citing an unnamed source with knowledge of the situation, Bloomberg reported on July 10 that Microsoft had announced its departure from the board in a letter to OpenAI.
Microsoft’s Withdrawal from the Board
About a year has passed since Microsoft invested a whopping $13 billion in OpenAI in April 2023. “Over the past eight months, we have witnessed significant progress from the newly formed board and are confident in the company’s direction,” Microsoft wrote in a memo to OpenAI.
“We no longer believe our limited role as an observer is necessary.”
In response to Microsoft’s exit, OpenAI made it clear that it will not have any board observers, despite prior rumors indicating that Apple would have an observer position on OpenAI’s board as part of a historic agreement signed in June. “We’re grateful to Microsoft for voicing confidence in the board and the direction of the company,” said OpenAI in an expression of thanks. “We look forward to continuing our successful partnership.”
Regarding their board involvement at OpenAI, we contacted Microsoft and OpenAI, but as of the time of publication, we had not heard back.
Regulatory Pressure on Big Tech Firms
The announcement of Apple’s and Microsoft’s withdrawal coincides with growing regulatory pressure on Big Tech companies over their possible influence on AI and market domination. Regulators in the European Union warned in June that OpenAI may be the subject of an EU antitrust inquiry because of its Microsoft cooperation. Margrethe Vestager, the EU commissioner for competition, also hinted that regional authorities would poll businesses about their AI collaborations, including Microsoft, Google, TikTok from ByteDance, and Meta.
A request for information about Microsoft’s Bing search engine and related generative AI services was made earlier, and the European Commission threatened to punish the company with up to 1% of its annual revenue in the EU if it did not reply.
The extreme attention and interest that big tech businesses have in the development and implementation of AI technologies is further highlighted by reports that Apple and OpenAI were actively negotiating the inclusion of generative AI technology on iOS in April 2024.
Photo by Andrew Neel
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