How Microsoft may be heading towards a “collision” with its most-important AI partner, ChatGPT maker OpenAI

Microsoft has begun building an in-house competitor to OpenAI inside the tech giant, according to a report by The Wall Street Journal. This development has the potential to put Microsoft on a collision course with its most important AI partner, OpenAI, as the company aggressively expands its AI empire.
The Wall Street Journal revealed that Nadella recruited Mustafa Suleyman, a longtime rival of OpenAI’s co-founder Sam Altman, to lead this internal AI effort. Suleyman, known for his role in launching DeepMind and co-founding Inflection AI, has brought most of his team from Inflection to Microsoft. This new team is reportedly developing its own AI model, designed to be on par with the OpenAI technology Microsoft currently relies on.

Microsoft could soon ditch OpenAI for it’s own AI system

Sources familiar with the matter told The Wall Street Journal that some future Microsoft AI products could switch from OpenAI technology to the model being developed by Suleyman’s team. This potential shift raises questions about the future of Microsoft’s partnership with OpenAI and the balance of power between the two companies.
The move to build an in-house OpenAI competitor is part of Nadella’s strategy to reinvent Microsoft and stay ahead in the AI race. The company has been investing heavily in AI startups, forming partnerships with companies like Cohere and Mistral AI, and offering incentives to attract AI talent to its Azure cloud platform.
However, Microsoft’s aggressive AI expansion has drawn the attention of regulators and competitors. The Federal Trade Commission is investigating the company’s acquisitions and investments, while lawsuits have been filed against Microsoft and OpenAI for allegedly using media companies’ content without permission to train their AI software, according to The Wall Street Journal.