{"id":29263,"date":"2023-01-11T12:58:52","date_gmt":"2023-01-11T12:58:52","guid":{"rendered":"https:\/\/mailinvest.blog\/index.php\/2023\/01\/11\/microsoft-in-talks-to-invest-10-billion-in-chatgpt\/"},"modified":"2023-01-11T12:58:52","modified_gmt":"2023-01-11T12:58:52","slug":"microsoft-in-talks-to-invest-10-billion-in-chatgpt","status":"publish","type":"post","link":"https:\/\/mailinvest.blog\/index.php\/2023\/01\/11\/microsoft-in-talks-to-invest-10-billion-in-chatgpt\/","title":{"rendered":"Microsoft in Talks to Invest $10 Billion in ChatGPT"},"content":{"rendered":"

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AI-focused startups are a dime a dozen right now, but OpenAI is getting a lot of attention from investors following the public release of the DALL-E image generator<\/a> and ChatGPT chatbot. Microsoft, which is already working with the company, is reportedly planning to invest $10 billion in OpenAI. Neither company has yet to confirm the details, but if true, this investment would value OpenAI at an impressive $29 billion.<\/p>\n

Reporters for Semafor<\/a> got a look at the terms sheet describing the plans, but it\u2019s unclear if the deal has been signed yet. Sources claim the company intended to have the contract signed by the end of 2022, but there\u2019s no official announcement. However, the firm is allegedly letting employees sell their shares at the proposed $29 billion valuation.<\/p>\n

The deal includes some unusual provisions for OpenAI, which has been open about the rate at which it burns through money. According to CEO and founder Sam Altman, each time someone interacts with one of its products like ChatGPT, it costs the company a few cents in server time. Microsoft previously invested $1 billion in cash and cloud computing credits \u2014 OpenAI uses the company\u2019s Azure web services. If ChatGPT becomes as popular as some expect, this could help Microsoft compete with market leader Amazon Web Services.<\/p>\n

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OpenAI has been upfront about the capabilities and limitations of ChatGPT, which is based on the GPT-3 language engine.<\/p>\n<\/div>\n

The investment as revealed in the terms sheet includes some unusual stipulations for splitting profits. Microsoft would get 75% of OpenAI\u2019s profits until it recoups the initial investment \u2014 a process that could take years, depending on how successful OpenAI is at turning its research into products. When Microsoft is paid back, the arrangement would switch back to a typical ownership stake, with Microsoft getting 49% of profits and other investors taking 49%. That leaves 2% for the non-profit behind OpenAI.<\/p>\n

This report lends credence to another claim that Microsoft is exploring ways to integrate ChatGPT into Bing search results<\/a>. The conversational AI has a knack for digesting and explaining large volumes of data in a human-friendly fashion. Late last year, Morgan Stanley published a report that suggested ChatGPT could be a threat to Google\u2019s search dominance. If Microsoft sees things the same, $10 billion might seem like a real bargain. After all, that\u2019s less than a quarter of a Twitter.<\/p>\n

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