Microsoft’s multibillion-dollar bet is now paying dividends

In 2019, Microsoft invested $1 billion in OpenAI, which has now exploded on the internet with its ChatGPT artificial intelligence function, molding human-like responses to questions.

CNBC reported, “Microsoft’s once under-the-radar investment is now a major topic of discussion, both in venture circles and among public shareholders, who are trying to figure out what it means to the potential value of their stock. Microsoft’s cumulative investment in OpenAI has reportedly swelled to $13 billion and the startup’s valuation has hit roughly $29 billion.”

Because of the massive demand for the product, Microsoft’s cloud servers are seeing huge workloads due to companies and individuals flocking to the product.  

“Microsoft is integrating the technology into its Bing search engine, sales and marketing software, GitHub coding tools, Microsoft 365 productivity bundle and Azure cloud,” the report notes.

Michael Turrin of Wells Fargo notes that OpenAI could hit $30 billion in annual revenue, half of it being generated from the Azure cloud.

ChatGPT’s incredibly human-sounding responses have given it a major piece of the AI market share, although it faces challenges.

Google is trying to break into the AI sector with its artificial intelligence model called Bard. 

However, AI is under attack, with the non-profit Center for Artificial Intelligence and Digital Policy demanding the Federal Trade Commission stop OpenAI’s new commercial releases of GPT-4, calling it “biased, deceptive, and a risk to privacy and public safety.”

OpenAI’s likely next path is to start an IPO and go public, with a likely acquirer being Microsoft, although there remain FTC concerns. Despite this, Microsoft’s investment appears to be paying dividends, with ChatGPT the hottest and most talked about AI product on the market. 

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