Apple is reportedly considering a significant investment in OpenAI during the company’s upcoming fundraising round, marking a new chapter in the tech giant’s foray into artificial intelligence.
This potential move follows Apple’s June announcement of a collaboration with OpenAI to integrate AI capabilities into Apple Intelligence.
Apple’s interest in OpenAI arrives in a landscape where Microsoft, one of its fiercest competitors, has already established a substantial foothold, having invested $13 billion in the AI leader. This investment not only complicates the competitive dynamics but also raises questions about potential returns for new investors.
Despite being a late entrant to the AI race, Apple is making bold strides to catch up. During its Worldwide Developer Conference in June, Apple revealed its partnership with OpenAI, signaling its commitment to bringing advanced AI features to its products. Now, The Wall Street Journal reports that Apple is considering further solidifying this relationship with an investment in OpenAI, which is valued at over $100 billion.
This move could deepen Apple’s ties with OpenAI but might also encroach on the territory of Microsoft, which has enjoyed a close relationship with the AI powerhouse. OpenAI’s enduring influence in the AI industry underscores the high stakes involved, as major tech players, including Apple, seek to secure their positions in this rapidly evolving field.
Jacob Bourne of Emarketer notes that Apple’s potential investment is an unusual step for the company but highlights the intense competition and high stakes in the AI sector. “While this investment may dilute Microsoft’s role as OpenAI’s primary benefactor, it reflects the shifting dynamics in the AI landscape where major players, including Microsoft, are diversifying their partnerships to stay competitive,” Bourne said.
Other major investors, including Joshua Kushner’s Thrive Capital and Nvidia, are also reportedly considering participation in this funding round, signaling widespread interest in OpenAI’s future.
However, Microsoft currently holds a 49% share of OpenAI’s profits, a factor that could complicate the financial prospects for Apple and other potential investors.
The rivalry between Apple and Microsoft, dating back to the days of Steve Jobs and Bill Gates, continues to shape their strategies today. Both companies are valued at over $3 trillion, and the ongoing AI boom has only intensified their race toward a $4 trillion market cap.
Bloomberg previously reported that when Apple’s partnership with OpenAI was announced, the company would not be paying for the integration of ChatGPT into Siri, a deal that reportedly raised concerns for Microsoft CEO Satya Nadella.
Both Apple and Microsoft were set to take observer roles on OpenAI’s board, but ultimately decided against it due to antitrust concerns.
By investing in OpenAI, Apple aims to keep pace with its competitors and reinforce its presence in the AI arena, as noted by Bourne. While Apple may have started late, this investment could help it stay competitive in the ongoing AI race.
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