Microsoft (MSFT.O) has relinquished its board observer seat at OpenAI, which had attracted regulatory scrutiny in both Europe and the U.S., citing significant improvements in the AI startup’s governance over the past eight months.
Apple (AAPL.O), which was also expected to take an observer role on OpenAI’s board, will not be doing so, according to a report by the Financial Times that references a person with direct knowledge of the matter. Apple did not respond to a request for comment.
Microsoft assumed the non-voting observer position on OpenAI’s board in November last year after OpenAI CEO Sam Altman returned to lead the company, which operates the generative AI chatbot ChatGPT. This position allowed Microsoft to attend board meetings and access confidential information without having voting rights on decisions such as electing directors.
The observer seat, along with Microsoft’s more than $10 billion investment in OpenAI, raised concerns among antitrust regulators in Europe, Britain, and the U.S. about the extent of Microsoft’s control over OpenAI.
In a letter to OpenAI dated July 9, Microsoft cited OpenAI’s new partnerships, innovation, and expanding customer base since Altman’s return as reasons for relinquishing the observer seat. “Over the past eight months, we have witnessed significant progress by the newly formed board and are confident in the company’s direction. Given all of this, we no longer believe our limited role as an observer is necessary,” the letter stated.
EU antitrust regulators recently determined that the partnership would not be subject to the bloc’s merger rules because Microsoft does not control OpenAI. However, they plan to seek third-party opinions on the exclusivity clauses in the agreement. Meanwhile, British and U.S. antitrust watchdogs continue to have concerns about Microsoft’s influence over OpenAI and the latter’s independence.
Microsoft and OpenAI are increasingly competing to sell AI technology to enterprise customers, aiming to generate revenue and demonstrate their independence to regulators to address antitrust concerns. Additionally, Microsoft is expanding its AI offerings on the Azure platform and has hired Inflection’s CEO to head its consumer AI division, a move widely seen as an effort to diversify beyond OpenAI.
 has relinquished its board observer seat at OpenAI, which had attracted regulatory scrutiny in both Europe and the U.S., citing significant improvements in the AI startup's governance over the past eight months.Apple (AAPL.O), which was also expected to take an observer role on OpenAI's board, will not be doing so, according to a report by the Financial Times that references a person with direct knowledge of the matter. Apple did not respond to a request for comment.){kind=link}