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Microsoft to invest more in OpenAI as tech race heats up

Jan 23 (Reuters) – Microsoft Corp (MSFT.O) said on Monday it would invest more in OpenAI, staking its future on the startup and tech behind the chatbot sensation ChatGPT, as well as setting the stage for more competition with its rival Alphabet Inc’s (GOOGL.O) Google.

Recently touting a revolution in artificial intelligence (AI), Microsoft is building on a bet it made nearly four years ago on OpenAI. In 2019 it dedicated $1 billion for the startup co-founded by Elon Musk and investor Sam Altman, and has since built a supercomputer to power OpenAI’s technology, among other forms of support.

In a blog post, Microsoft said, “Today, we are announcing the third phase of our long-term partnership with OpenAI through a multiyear, multibillion dollar investment to accelerate AI breakthroughs to ensure these benefits are broadly shared with the world.”

A Microsoft spokesperson declined to comment on the terms of the investment, which some media outlets earlier reported would be $10 billion.

Microsoft is committing even more resources to keep the two companies at the forefront via so-called generative AI, technology that can learn from vast data how to create virtually any type of content simply from a text prompt. OpenAI’s ChatGPT, which produces prose or poetry on command, is the prime example that last year gained widespread attention in Silicon Valley.

Microsoft last week said it aimed to imbue such AI into all its products, as OpenAI continues to pursue the creation of human-like intelligence for machines. Microsoft is already adding OpenAI’s tech to Bing, its search engine that for the first time in years is being discussed as a potential rival to Google, the industry leader.

The widely anticipated investment shows how Microsoft is locked in competition with Google, the inventor of key AI research that’s now planning its own unveil for this spring, a person familiar with the matter previously told.

Reporting By Jeffrey Dustin in Palo Alto, Calif.; Additional reporting by Eva Mathews in Bengaluru; Editing by Krishna Chandra Eluri, Kirsten Donovan

Our Standards: The Thomson Reuters Trust Principles.

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