Microsoft Secures Board Seat at OpenAIDec 04, 2023
Microsoft is now firmly in the driver's seat for the AI industry
In an important epilogue to last week's OpenAI drama, Microsoft has announced that they have secured a non-voting board seat at OpenAI. This is pretty big.
After Sam Altman returned to OpenAI and a new board was established, the company left the door open to expand that board as they continued to resume operations. The first step in that process came last night when Microsoft announced they would have a non-voting seat on the OpenAI board. Even without voting rights, this helps deepen the relationship between Microsoft and OpenAI and gives Microsoft a lot of control over the future of the AI industry.
Microsoft will have plenty of opportunity to get voting rights for this board seat, but even a presence at board meetings and important decisions will give the company much more influence than they've had before. This has also helped calm the market about further potential volatility coming out of OpenAI.
WHY IT MATTERS
For now, it looks like Microsoft is the undisputed winner of the current phase of this AI race. It's been exactly a year since ChatGPT launched this whole AI boom in the first place and it's honestly wild looking back at how much has already shifted thanks to the first real iteration of LLM chatbots. Until the market sees something more compelling from Google or Facebook in the future, Microsoft has positioned themselves brilliantly as the major leader in AI development. Sometimes it really is best to be first, and Microsoft is riding that momentum all the way to unseating Apple as the world's most valuable company. Microsoft initially tested all-time highs after this news broke, but that price action has cooled substantially as trading opened this morning.