OpenAI's Space Race
Various
One day there will be a great case study written about the strange love/hate relationship between OpenAI and Microsoft. For now, more twists and turns. Here's the latest reporting from Anissa Gardizy, Aaron Holmes, and Amir Efrati for The Information:
Last week, after OpenAI CEO Sam Altman and Chief Financial Officer Sarah Friar raised $6.6 billion in capital, mostly from a slew of financial firms, they told some employees OpenAI would play a greater role in lining up data centers and AI chips to develop technology rather than relying solely on Microsoft, according to a person who heard the remarks.
Friar previously told some shareholders Microsoft hadn’t moved fast enough to supply OpenAI with enough computing power—hence the need to pursue other data center deals, which it had started to do, said a person who was involved in the conversation. For instance, OpenAI’s growing impatience with Microsoft recently prompted it to arrange an unusual data center deal in Texas with one of Microsoft’s rivals.
The companies previously included a provision in their contract that gave OpenAI room to work on such deals, despite agreeing to make Microsoft its exclusive cloud server provider, said a different person with knowledge of their agreement.
I've yet to see any reporting in terms of just how much – and in what form – Microsoft funded OpenAI's latest round. Presumably it's less than the $1B+ that the lead, Thrive Capital, invested (alongside an SPV they put together). But is it also less than the $500M than SoftBank is said to have put in? And was it mostly in cloud credits, as has mostly been the case with previous fundings? Presumably it was since it's cash that would largely just be going back to Microsoft anyway for compute use of their cloud and data centers. Though as the above notes, perhaps that is changing as well...