Microsoft is in talks to invest $10 billion into OpenAI, the company that created the popular artificial intelligence chatbot ChatGPT, having already invested $1 billion in the company in 2019.
This follows a Wall Street Journal report that said OpenAI was in talks to sell existing shares at around a $29 billion valuation, with venture capital firms such as Thrive Capital and Founders Fund buying shares from existing shareholders.
Microsoft is preparing to launch a version of its Bing search engine that uses the artificial intelligence behind ChatGPT to answer some search queries rather than just showing a list of links, according to two people with direct knowledge of the plans, the Information reported.
Microsoft hopes the new feature launches before the end of March to help it outgun Google, its biggest search rival.
Founded by Sam Altman as a non-profit in 2015, OpenAI had initial backers such as Tesla and Twitter Chief Executive Elon Musk and LinkedIn co-founder Reid Hoffman.
Since launching on Nov. 30, ChatGPT has gone viral, attracting over one million users in under a week, Altman tweeted in December.
The Semafor reported the funding terms included Microsoft getting 75 percent of OpenAI's profits until it recoups its initial investment once OpenAI figures out how to make money on ChatGPT and other products like image creation tool Dall-E.
On hitting that threshold, Microsoft would have a 49 percent stake in OpenAI, with other investors taking another 49 percent and OpenAI's nonprofit parent getting 2 percent, the report said, without clarifying what the stakes would be until Microsoft got its money back.
Microsoft's cloud services arm, Microsoft Azure, also provides the computing power needed by the AI firm.
