Microsoft is considering a $10 billion investment in ChatGPT

ChatGPT, is a machine learning model developed by OpenAI, that opened in December 2022 and quickly gained popularity, having already been used by millions of users.

The language model, that can understand and generate human language, meaning it can respond to questions, provide information, and even generate text such as stories, articles, and essays, is selling existing shares of the company, as the Wall Street Journal reported last week. Microsoft reportedly wants to invest about $10 billion into OpenAI, the owner of ChatGPT, which would value the company at $29 billion.

OpenAI was co-founded in December 2015 by investor Sam Altman, Tesla’s Elon Musk, Greg Brockman, Ilya Sutskever, Wojciech Zaremba, and John Schulman, aiming to develop and promote friendly AI in a way that benefits all of humanity. In 2019, Microsoft has formed a partnership with OpenAI to develop and promote advanced AI technologies, investing $1 billion and working closely with the organisation to develop Azure, a cloud computing platform that is optimised for AI workloads. Additionally, OpenAI has also used Microsoft’s Azure platform as the cloud infrastructure for running the models that power its abilities.

Both, Microsoft and OpenAI declined to comment, but The Semafor reported that the funding terms included Microsoft getting 75% of OpenAI’s profits until it recoups its initial investment. The report said that “after that threshold is reached, it would revert to a structure that reflects ownership of OpenAI, with Microsoft having a 49% stake, other investors taking another 49% and OpenAI’s nonprofit parent getting 2%.”

Meanwhile, New York City public schools banned access to the chatbot “due to concerns about negative impacts on student learning, and concerns regarding the safety and accuracy of content.” Jenna Lyle, the deputy press secretary for the New York public schools, explained that “while the tool may be able to provide quick and easy answers to questions, it does not build critical-thinking and problem-solving skills, which are essential for academic and lifelong success.”