Microsoft chief executive Satya Nadella supported OpenAI’s transition into a for-profit company structure while testifying in the legal dispute involving OpenAI and Elon Musk.
Nadella said Microsoft’s large investments in OpenAI were made with the expectation that the company would continue evolving its business model to support the massive costs of artificial intelligence development.
He explained that building advanced AI systems requires huge investments in computing infrastructure, data centres, and research.
According to him, a sustainable business structure is necessary to support long-term AI development.
Nadella also commented on Elon Musk’s criticism of OpenAI. Musk, one of OpenAI’s co-founders, has accused the company of moving away from its original non-profit mission and becoming too commercially focused.
During his testimony, Nadella said Microsoft did not see any issue with OpenAI creating a for-profit structure alongside its original non-profit entity.
He added that Microsoft believed the arrangement was appropriate for scaling AI technology responsibly.
Nadella defended Microsoft’s partnership with OpenAI and described it as one of the most important collaborations in the technology industry.
Microsoft has invested billions of dollars into OpenAI and integrated OpenAI’s AI models into products such as Microsoft Copilot, Azure cloud services, and other enterprise tools.
Nadella reportedly said Microsoft’s investment decisions were based on OpenAI’s technological capabilities and future potential rather than internal disputes among the company’s founders.
The testimony came as part of a legal battle in which Musk is seeking damages and challenging OpenAI’s current corporate structure.
Musk has argued that OpenAI abandoned its original goal of developing artificial intelligence for the benefit of humanity and instead shifted towards profit-driven operations.
The case could have major implications for OpenAI’s future corporate structure, governance model, and relationships with investors such as Microsoft.
Nadella also emphasised that AI development requires partnerships between research organisations and large technology companies because of the enormous financial and infrastructure demands involved.
