As one of the most important AI companies in the world was revealed this weekend, Satya Nadella made sure Microsoft becomes even more powerful.
By david jeans And Richard Neeva, forbes staff
MMicrosoft CEO Satya Nadella’s move to hire OpenAI co-founders Sam Altman and Greg Brockman after their sudden departure from the startup is being hailed as a genius business move for the tech giant, giving it years of will help strengthen its growing power over one of the most exciting new technologies in the U.S. ,
After being shocked by the OpenAI board’s decision to oust Altman on Friday, Nadella worked out a deal between Altman and the board over the weekend to bring him back as CEO — which failed multiple times. before announcing that Altman and Brockman would be joining. Microsoft will run a new AI research arm late Sunday night before the markets open. On Monday, Microsoft’s stock rose 2%, pushing its market cap to $2.81 trillion — more than 30 times its recent valuation of $90 billion in its latest effort to raise OpenAI funding.
On Monday, as hundreds of OpenAI employees called for his resignation from the company’s board and reinstatement of Altman as CEO, Nadella reaffirmed Microsoft’s commitment to OpenAI, announcing the arrival of his new employee. “We look forward to moving quickly to provide them with the resources they need for success,” he wrote on social media platform X.
However, to observers it appeared that Nadella had made one of the tech industry’s most notable acquisitions , Without actual acquisition. Two decades after the US Justice Department took Microsoft to trial in a landmark case over antitrust claims involving its Internet browser, the absorption of OpenAI’s leadership proved an impressive maneuver for a company with a notorious history of competition problems. “Microsoft bought OpenAI without getting involved in antitrust,” said Rishi Jaluria, a Microsoft analyst at RBC. forbes,
“This is the best step taken right now for Satya,” said Margaret Mitchell, chief ethics scientist at Hugging Face and a former Microsoft researcher. forbes, “This is an interesting confirmation of the view that many people were beginning to believe that OpenAI was becoming an offshoot of Microsoft.”
Microsoft had not responded to a request for comment at the time of publication.
Once one of the most feared tech giants in the industry, Microsoft’s image as an innovator has diminished over the years as Internet giants like Google and Facebook have risen. Nadella’s surprise announcement underlined how far Microsoft has regressed. “If you had told me 10 years ago that a group of the smartest engineers in the country would threaten, “Do what I say or I’ll go work at Microsoft,” then I wouldn’t have believed you,” said Benchmark investor Bill Gurley. Would.” Tweeted, “A surprising turnaround in corporate reputation (and a huge credit to Satya).”
Altman himself issued some contradictory assurances about his future on Monday. In a post on X seemingly directed at his former OpenAI employees, “We are all going to work together in some way.” A few minutes later, he sent another post in an apparent nod to the Microsoft CEO, writing, “Satya and I’s top priority is to ensure that OpenAI continues to grow.” He vowed to continue operating for OpenAI’s customers, adding that “the OpenAI/Microsoft partnership makes much of this possible.”
A report in The Verge on Monday suggested that the inconsistency between Altman’s tweets could be quiet confirmation that the pair were still willing to return to OpenAI on the right terms. By Monday afternoon, Nadella appeared to acknowledge that the appointments were not a done deal.
Asked on CNBC about his level of clarity on whether Altman, Brockman and hundreds of their OpenAI colleagues are actually joining Microsoft, Nadella responded: “It’s up to OpenAI’s board and management and staff to choose.” He added, “We want Sam and Greg to have a great home if they’re not going to OpenAI.”
When Nadella was asked if he knew why Altman was ousted from OpenAI, he said he had no idea other than a “communication breakdown.”
TeaUntil recently, it did not seem that Microsoft would easily take the opportunity of AI. “I’ve been close to Microsoft and two years ago I never thought Microsoft would be a leader in AI and almost everyone I know would say that,” said Bob Muglia, former CEO of Snowflake and a longtime Microsoft executive. forbes, ,[OpenAI] It was the golden hen that laid the golden egg, but Satya was feeding that hen.”
Nadella’s position as AI overseer has led to nearly a decade of record growth at Microsoft — thanks largely to the success of its cloud computing unit Azure, which leveraged Microsoft’s long-standing relationships with enterprise customers. After joining Microsoft in 1992, he spent decades working his way up through the company before being appointed CEO in 2014, taking over the reins from Steve Ballmer. “I have long viewed Satya as the wise man, the Yoda, of the tech industry who helps do the right things,” said Muglia, who was replaced by Nadella as Microsoft executive in 2011. “And here it feels like he’s taking on that role as being the adult in the room.”
However for years, Microsoft appeared to be losing the AI race to Google as the Internet giant pioneered breakthroughs in this area, such as inventing the Transformer concept that underpins OpenAI’s ChatGPT, and building an AI machine that Can beat a human in the strategic game Go.
But Microsoft initially bet on OpenAI, and in 2016, both organizations announced that OpenAI would use Microsoft Azure as its primary cloud partner. As they got closer, there were more product announcements – including supercomputing AI technology built on Azure and a collaboration with Github – as OpenAI released unprecedented advancements in its technology, first with GPT3, which brings computer code to Generates text for things up to blog posts and DALL. -AI, AI photo generator.
In return, Microsoft invested a total of $3 billion as OpenAI grew. “What excites me is the opportunity that both organizations have,” Nadella told Altman in an interview announcing another partnership in 2019.
While Google and Amazon bet on OpenAI spinoff Anthropic by the end of 2022, Nadella has positioned Microsoft to take advantage of the most thought-provoking product the tech world has seen in ages: ChatGPT. Charles Simonyi, the billionaire creator of Microsoft Office, who forbes Estimated to be worth $6.9 billion, he said Nadella is overseeing Microsoft’s next frontier. “You asked if this is the biggest thing in the history of Microsoft,” Simoni said, “it certainly is in terms of technology, it rivals Moore’s Law.”
However Nadella’s future as an AI leader appears to be linked to Altman. Earlier this month, Nadella took the stage with Altman for a surprise appearance at OpenAI’s first Developer Day conference and a call to arms to AI researchers around the world. “Our job number one is to build the best systems, so you can build the best models and deliver them to developers,” Nadella told the audience. Altman turned to Nadella and echoed this sentiment: “I think our partnership is the best in technology.”
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