Deal with Apple Brings OpenAI neither Data, nor Money

apple openai chatgpt deal

Apple and OpenAI recently announced a partnership to integrate ChatGPT into Apple’s Siri and writing tools. However, the financial terms of the deal remain unclear.

According to reports, Apple is not paying OpenAI as part of the partnership. Instead, Apple believes that promoting OpenAI’s technology to millions of Apple device users is a fair exchange. OpenAI gains the benefit of a wider audience and potentially increased user engagement.

While OpenAI doesn’t gain an upfront monetary gain, there could be downsides. ChatGPT runs on Microsoft’s Azure cloud-computing systems, and with more users, OpenAI’s expenses could rise significantly. Being backed by Microsoft, the impact could indirectly impact Microsoft. Additionally, the deal doesn’t involve data sharing, which could limit OpenAI’s ability to improve ChatGPT.

However, there is a possibility of future revenue generation for both parties. OpenAI could convert free ChatGPT users on Apple devices into paid subscribers, with Apple receiving a cut through its payment platform (duh).

Even though there are some pros, my query still stands. Doesn’t make sense! Why would OpenAI agree? This would increase the load on their servers massively, which would cost them money. And moreover, as mentioned, no data will be shared with OpenAI. What’s in it for OpenAI in this deal? Other than seeing distant profits, I see nothing but loss for OpenAI. But I am sure this was a well-thought-out decision from OpenAI and Microsoft. MSPowerUser user the right words: No cash, just exposure.

Overall, the Apple-OpenAI deal appears to be more strategically motivated than financially beneficial for OpenAI in the short term.

More here.

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