Microsoft CEO Satya Nadella Says 'OpenAI Wouldn't Have Existed' Without Microsoft's Support

Apr 22, 202412:09 UTC

Microsoft Corp. MSFT CEO Satya Nadella emphasized the pivotal role the company played in the growth of leading artificial intelligence company OpenAI, a leading artificial intelligence company, during a recent interview posted on YouTube

"OpenAI wouldn’t have existed but for our early support. Today, they are an incredible company, and we are thrilled to be a part of their journey," Nadella said.

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Microsoft invested $1 billion in OpenAI in 2019, followed by an additional $10 billion in 2021. Despite these substantial financial contributions, Microsoft does not hold any ownership in OpenAI. Instead, it is entitled to a share of profits, limited to a certain amount, from a specific OpenAI subsidiary.

“While details of our agreement remain confidential, it is important to note that Microsoft does not own any portion of OpenAI. We are simply entitled to a share of profit distributions,” Microsoft spokesman Frank Shaw said in December.

“Microsoft, employees and investors hold an economic interest in the for-profit subsidiary, which entitles them to a share of the profits,” a source familiar with the arrangement told the Financial Times.

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Other investors in OpenAI include Khosla Ventures and the Reid Hoffman Foundation.

In addition to his comments about OpenAI, Nadella discussed the broader artificial intelligence (AI) landscape, noting the healthy competition among major tech firms. He believes this competition is beneficial, creating significant opportunities for global advancement.

"One of the things that I think is understated is competition amongst big Tech players. I think it’s very healthy when you have all of the folks competing with each other, that means it’s creating a real opportunity for the world to benefit. Whenever anyone gets excited about the existing incumbents, you have to watch out for new entrants," Nadella said.

This highlights the fact that even Microsoft is watching for the latest innovative startup looking to disrupt an industry.

Microsoft, which is committed to advancing AI and cloud infrastructure globally, also has invested in other AI companies such as Figure AI, Mistral AI and Vengo AI. Last week, the company announced plans to invest $2.9 billion in AI and cloud infrastructure in Japan.

“As digital activities increase, it is crucial for the Japanese industry to collaborate with global companies like Microsoft, equipped with robust digital infrastructure,” Japanese Prime Minister Fumio Kishida said.

The investment in Japan follows Microsoft's previous commitments of $3.2 billion in the U.K., $3.5 billion in Germany and $2.1 billion in Spain, highlighting its continuous investment in technology across various regions.

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