Microsoft in Talks to Acquire 49% Stake in OpenAI
It has been reported that Microsoft is in talks to acquire a 49% stake in OpenAI, the company behind the popular language model, ChatGPT. The deal, reportedly worth $10 billion, is being considered a major move by the tech giant.
Details of the Deal
According to the reports, Microsoft would receive 75% of OpenAI’s income until it has recovered its initial investment. Once that threshold is reached, Microsoft would hold a 49% stake in OpenAI, with other investors holding another 49% and OpenAI’s nonprofit parent holding 2%. Reportedly, OpenAI is planning to roll out the Premium Version of ChatGPT soon.
OpenAI is currently raising funds at a $29 billion valuation and is allowing employees and early investors to sell their shares at that valuation. Microsoft has already invested $1 billion into the company in 2019.
OpenAI’s Potential Revenue and Impact on Microsoft
OpenAI is expected to generate around $1 billion in revenue in 2024. With this acquisition, Microsoft plans to integrate OpenAI’s Chatbot, and ChatGPT’s Artificial Intelligence technology into its products such as Bing, Word, Outlook, Excel, and PowerPoint.
With over 1.4 billion users worldwide, Microsoft Office could greatly benefit from the integration of advanced AI technology. It is believed that this deal could be one of the best tech deals of all-time, similar to the acquisition of WhatsApp and Instagram by Facebook.
Satya Nadella, CEO of Microsoft, is being credited for the potential acquisition, with many praising his leadership in making this move.
What is ChatGPT and Who are its early investors?
ChatGPT is a language model developed by OpenAI, a research company that focuses on creating and promoting friendly AI.
The model is based on the GPT (Generative Pre-training Transformer) architecture and is trained on a diverse set of internet text. It is designed to generate human-like text for various natural languages processing tasks such as language translation, summarization, and question-answering.
ChatGPT was made available to the public in 2019, and since then, it has been widely used in various applications such as chatbots, language translation, and content generation.
OpenAI was founded by Elon Musk, Sam Altman, Greg Brockman, Ilya Sutskever, Wojciech Zaremba, Infosys, and some other early investors. The company has also received funding from a number of venture capital firms and individual investors, including Andreessen Horowitz, Founders Fund, Obvious Ventures, and more.
Conclusion
The acquisition of OpenAI would be a significant move for Microsoft, allowing the company to integrate advanced AI technology into its products and potentially increase its revenue.
The reported $10 billion deal is being considered a major achievement for the tech giant and its CEO, Satya Nadella. The acquisition could potentially be one of the best tech deals of all time, similar to the acquisition of WhatsApp and Instagram by Facebook.
