What Microsoft’s New Investment in OpenAI Means for Google

After weeks of speculation, Microsoft confirmed on Monday that it plans to make a multi-year, multi-billion dollar investment in OpenAI, the startup behind ChatGPT and Dall-E 2. The move puts pressure on search engine giant Google.

Microsoft first partnered with the research institute in 2019 when it invested $1 billion. Later in 2021, it secured exclusive rights to OpenAI’s GPT-3 core language model. Microsoft’s new investment, which comes just days after the tech giant cut 10,000 jobs, will be worth $10 billion, The New York Times reported.

Microsoft said that with this collaboration, it will intensify the development and deployment of specialized supercomputing systems to accelerate the R&D of OpenAI, which remains independent for now.

The retailer also plans to include the startup’s new models in its consumer and enterprise products. Meanwhile, it has launched Azure OpenAI services, which allow companies to use the startup’s technologies to enrich their applications. Finally, Microsoft plans to power all OpenAI workloads across API research, products, and services.

In November, OpenAI launched its ChatGPT app, capable of writing academic essays, coding and answering large numbers of questions, and the system’s popularity has grown worldwide, though concerns about its accuracy and precision have grown. the ability to encourage plagiarism.

Microsoft is committed to artificial intelligence

Despite reports in The New York Times and other publications citing the $10 billion figure, a Microsoft spokesperson did not confirm the information with Techtarget. [propriétaire du MagIT]. “We are not disclosing financial details and terms of the agreement, nor are we sharing other details of this expanded partnership,” he said.

Regardless of the context, namely forced layoffs at Google and Amazon, industry observers say Microsoft wants to get its message across.

“Microsoft wants everyone to know that it’s doing cutting edge artificial intelligence,” said Johna Till Johnson, CEO and analyst at Nemertes.

Additionally, Microsoft’s investment in OpenAI allows the tech giant to spend time developing its AI capabilities and not be under too much pressure to quickly realize the value of its products and services, adds Forrester analyst Will McKeon-White.

So, instead of trying to figure out which areas of AI need the most development or focusing on the most profitable technologies, Microsoft will let OpenAI lead its research activities, according to the Forrester analyst.

“It’s a good thing to trust a neutral third-party organization that goes through all of this, and it makes no sense to keep funding it,” Will McKeon-White assures.

Google is waiting

With Microsoft investing heavily in OpenAI, many are wondering how Google will react to this move and the popularity of ChatGPT.

Google is reportedly looking for ways to outrank ChatGPT, which could threaten its search design. Currently, Google’s work consists mostly of optimizing the results of the search engine, playing in the placement and coverage of publications on the Internet according to given topics.

According to the New York Times, Sundar Pichai, the CEO of Google’s parent company, Alphabet, recently recruited Google founders Larry Page and Sergey Brin to plan and develop a new chatbot and app image creation tool. This includes, among other things, turning to its subsidiary DeepMind and continuing the development of the conversational agent Sparrow, which is the subject of an academic publication at the end of September 2022.

“They [les dirigeants de Google] they know that if someone else has the ability to deliver high-performance AI, their ability to search for content will simply be destroyed. [dans ce domaine] said Mr. Johnson.

Google did not immediately respond to a request for comment.

However, Google’s advantage over Microsoft is that it doesn’t need to turn to outside resources to develop new AI features, John Till Johnson says.

“Microsoft has historically bought companies, then closed them down and sometimes absorbed them into its own organization,” he says. “Google doesn’t tend to do that. They rely more on home-grown products.”

McKeon-White said Google’s biggest problem right now is that many of its generative AI products are not yet commercially available.

“They probably have products. It’s just that they’re not quite ready for primetime, they’re more conservative about their availability, or they’re actively integrating it into other systems,” he says.

Bigger AI team

Google may also need to beef up its AI development team.

The Forrester analyst continues that compared to many other types of technology, the development of artificial intelligence “requires a lot of work.”

“OpenAI has been very successful in expanding the talent pool,” he said, adding that the company can otherwise commit large amounts of money to a particular problem. OpenAI CEO and co-founder Sam Altman praised the “density of talent” at his 375-employee company on Twitter.

Instead, Google should spread its funds across its projects, which cover the gamut of AI technologies, according to McKeon-White.

“It’s really the difference between a small organization that’s very well-funded and very focused, and a big company that has to focus on all of the company’s activities,” suggests the analyst.

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