Big Tech’s AI Arms Race: OpenAI’s Funding Round Attracts Giants
OpenAI, the company behind the revolutionary ChatGPT chatbot, is once again the center of attention. A new funding round valuing the AI pioneer at over $100 billion has drawn interest from the three most valuable tech companies: Nvidia, Apple, and Microsoft.
)
Sources familiar with the matter, speaking on condition of anonymity, revealed that Nvidia Corp, the leading chipmaker, has discussed participating in the funding round. Apple Inc and Microsoft Corp are also reportedly in talks. The proposed round is expected to be led by Thrive Capital, which is investing approximately $1 billion. Nvidia is considering an investment of around $100 million.
If the discussions conclude favorably, the investment would unite three tech giants behind OpenAI, highlighting the company’s growing importance. Microsoft is already OpenAI’s largest backer, having invested roughly $13 billion to date. Apple, which has been slower to integrate AI, is relying on OpenAI to integrate advanced AI features into a future version of its iOS operating system. Nvidia’s rise in value has also benefited from its critical role in providing the infrastructure needed to develop and run AI tools.
“Each firm has become dependent on the startup in recent years,” a source said.
OpenAI Chief Financial Officer Sarah Friar recently informed employees about the company’s search for fresh capital, without detailing the specifics. The company has been negotiating to secure funding at or above a $100 billion valuation since at least December. The successful financing will provide OpenAI with the resources to obtain more expensive computing power and manage operational costs.
This new funding round is occurring at a time when the influence of Big Tech on artificial intelligence is attracting increased scrutiny. Regulators are concerned about Nvidia’s dominance in AI chips and Microsoft’s close ties with OpenAI. Microsoft has already tightly integrated OpenAI’s services into its Windows operating system and Copilot AI platforms, hoping these integrations will spur additional growth.
The surge in ChatGPT’s popularity kickstarted an AI arms race across the technology sector. Tech companies are scrambling to integrate AI technology into their products and are funding other promising startups. According to Friar, the financing would be used to get more computing power as well as to fund other operating expenses.
The Wall Street Journal earlier reported about the talks involving Apple.
The increased investments and partnerships underscore AI’s crucial role in shaping the future of technology and the significant competition to secure a leading position in this next-generation technological field.
