Microsoft Drops Board Observer Seat At OpenAI; Deems The Move Unnecessary

Microsoft rejected the board observer seat at OpenAI less than eight months from the time that it was able to secure the non-voting seat. The said position has drawn scrutiny from antitrust watchdogs both in the U.S. and Europe.

Reuters reported that Apple also planned to join the nonprofit board of the tech company, however, The Financial Times reported that it will no longer do so. The company also did not respond to a request from the news outfit for a comment.

Keith Dolliver, the deputy general counsel of Microsoft, wrote a letter to OpenAI on Tuesday.

"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 open letter noted.

OpenAI's spokesperson expressed its gratitude to Microsoft for the "confidence."

"We're grateful to Microsoft for voicing confidence in the Board and the direction of the company, and we look forward to continuing our successful partnership," said Steve Sharpe, the spokesperson of OpenAI.

"Under the leadership of CFO Sarah Friar, we are establishing a new approach to informing and engaging key strategic partners – such as Microsoft and Apple – and investors – such as Thrive Capital and Khosla Ventures," he added.

It was in November last year that Microsoft took a non-voting, observer position in the board of OpenAI, after its CEO Sam Altman took the reins of the company again, the one that operates ChatGPT, the generative AI chatbot.

The seat of Microsoft meant that it does not have any voting rights on matters like choosing or electing directors, but it could attend board meetings and gain access on confidential information.

According to The Verge, the new approach of OpenAI towards Apple and Microsoft will involve having "regular stakeholder meetings to share progress on our mission and ensure stronger collaboration across safety and security."

The investment of Microsoft of $10 billion in OpenAI and the observer seat, have caused anxiety among antitrust watchdogs in the U.S., U.K., and Europe, sending worries on the control that it would be exerting over OpenAI.