Microsoft is reportedly in discussions to invest $10 billion in OpenAI, the company developing the popular ChatGPT chatbot and the deep learning model DALL-E. According to a report from Semafor citing people familiar with the matter, Microsoft’s investment could give Open AI a $29 billion valuation.
The funding could also include other venture firms, and the report says that documents sent to prospective investors mentioned that the investment round was expected to close at the end of 2022. Microsoft and OpenAI both declined to comment.
This latest report comes just a couple of days after The Information revealed that Microsoft is planning to integrate ChatGPT features within Office and its Bing search engine. Microsoft also announced last year that it’s planning to add image creation capabilities powered by OpenAI’s DALL-E into Bing.
If ChatGPT made a lot of headlines in recent weeks, OpenAI’s servers have been struggling to keep up with the interest. The company needs money as it figures out a business model for its AI-powered tools, and it also needs a cloud partner like Microsoft to make its products available at scale.
According to the report from Semafor, the terms of the investment round could see Microsoft get 75% of OpenAI’s profits until the company recoups its initial $10 billion investment. Microsoft would be making a pretty big bet on how AI algorithms could transform productivity as we know it, but OpenAI may well help Microsoft lead the competition in that field.
Microsoft seems to be very interested in AI these days. Last week, Microsoft researchers unveiled VALL-E (via Ars Technica), a new text-to-speech AI model that can simulate anyone’s voice with just a three-second audio sample. The bleeding edge AI can also use this sample to imitate a speaker’s emotional tone.