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Microsoft Is Distancing Itself From OpenAI and Spreading Its AI Bets

Microsoft‘s top executives appeared to distance themselves from OpenAI on Thursday during the software giant’s annual shareholder meeting, telling investors its strategy doesn’t rely solely on the startup.

AI was a major focus of questions from Microsoft investors during the event. The company has emerged as a leader in generative AI and much of that is thanks to its OpenAI partnership and a major investment in the startup.

OpenAI suddenly became a less reliable partner in late November, though. The board fired CEO Sam Altman and most employees threatened to leave. That put the future of the startup in doubt and sparked unease among developers and other businesses that use OpenAI’s platform.

In the end, OpenAI rehired Altman, and the employees stayed, but the episode sowed doubts about whether the startup can really be relied upon as the next big tech platform.

On Thursday, Microsoft executives made a point to assure investors that it has many irons in the fire when it comes to AI, not just OpenAI.

Microsoft CEO Satya Nadella said that, while its OpenAI partnership has given the company a “leading frontier model,” it’s working on internal AI projects, such a language model called Phi, and offering open-source models on Azure, including Mistral, Llama, and Cohere.

“The approach we are always going to take is a broad tent approach,” Nadella said.

Microsoft Chief Financial Officer Amy Hood jumped in to emphasize the company has AI partners beyond OpenAI. “We’re working with lots of other companies and partners in the AI space,” she said.

As Business Insider recently reported, the chaos at OpenAI caused some partners to start looking for a “plan B” for their AI model needs. The episode has made open-source models look relatively more attractive because those AI alternatives don’t rely on a single company that could suddenly lose all its employees.

“We want developers to be able to come to our platform and be able to experience the best of what the partners of the world have to offer,” Hood said. “It’s terrific for companies of all sizes to be able to come to us and have the confidence they are going to the platform that always has the most innovative choices.”

Are you an OpenAI, or Microsoft employee, or someone with a tip or insight to share?

Contact Ashley Stewart at astewart@insider.com, or send a secure message from a non-work device via Signal +1-425-344-8242.

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Leah Sirama
Leah Sirama
Leah Sirama, a lifelong enthusiast of Artificial Intelligence, has been exploring technology and the digital realm since childhood. Known for his creative thinking, he's dedicated to improving AI experiences for all, making him a respected figure in the field. His passion, curiosity, and creativity drive advancements in the AI world.
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