Benj Edwards / OpenAI / Microsoft
Microsoft has withdrawn from its non-voting observer role on OpenAI’s board, while Apple has opted not to hold a similar position, Axios and the Financial Times report. The maker of ChatGPT plans to update its business partners and investors through regular meetings instead of board representation. The development comes as regulators in the EU and US step up their scrutiny of Big Tech investments in AI startups due to concerns about stifling competition.
Axios reports that on Tuesday, Microsoft VP Keith Dolliver sent a letter to OpenAI saying the tech giant’s board role was “no longer necessary” given the “significant progress” made by newly formed board. Microsoft accepted a non-voting position on OpenAI’s board in November following the ouster and reinstatement of OpenAI CEO Sam Altman.
Last week, Bloomberg reported that Apple’s Phil Schiller, who heads the App Store and Apple Events, may join OpenAI’s board in an oversight role as part of an AI deal. However, the Financial Times now reports that Apple will not take such a position, citing a person with direct knowledge of the matter. Apple did not immediately respond to our request for comment.
Instead of boardroom watchdog roles, OpenAI plans to hold regular meetings with partners such as Microsoft and Apple, as well as investors Thrive Capital and Khosla Ventures, according to an OpenAI spokesperson who spoke to the Financial Times. The decision is part of “a new approach to informing and engaging key strategic partners” under Sarah Friar, who came on board as OpenAI’s first chief financial officer last month.
OpenAI’s current eight-person board of directors consists of Altman, former US Treasury Secretary Larry Summers, former Bill & Melinda Gates Foundation CEO Sue Desmond-Hellmann, former NSA Director Paul M. Nakasone, former Sony America president Nicole Seligman, Quora CEO Adam D’Angelo and Instacart CEO Fidji Simo, with former Salesforce co-CEO Bret Taylor serving as chairman.
Regulatory pressure intensifies
Microsoft remains a critical financial and technology source for OpenAI, having invested over $10 billion in the company since early 2023. The partnership has given Microsoft early access to key generative AI models (though the value of this in the long run long remains to be seen) while providing OpenAI with Microsoft’s computing muscle that powers both new AI model training programs and services like ChatGPT.
While no official source has yet officially linked Microsoft’s board withdrawal (and Apple’s shift in direction to a possible OpenAI board position) to the regulatory review, it’s unlikely to be a coincidence. Regulators in the US and Europe are concerned that Big Tech’s outsized influence on fast-growing AI startups could unreasonably outpace the competition and create de facto monopolies on key technologies that will suffocate smaller competitors .
In June, the FTC began looking into investments made by Big Tech companies (such as Microsoft, Amazon and Google) in AI-generating startups. Meanwhile, the European Commission also announced that it was considering the possibility of an antitrust investigation into the Microsoft/OpenAI partnership after deciding not to proceed with an investigation under merger control rules.
Although Microsoft’s financial ties run deep in OpenAI, as the Financial Times notes, ChatGPT’s creator says: “While our partnership with Microsoft involves a multi-billion dollar investment, OpenAI remains a completely independent company governed by the NGO OpenAI.”