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Microsoft Resigns From Openai Board Amid Governance Improvements

OpenAI CEO Sam Altman, left, appears onstage with Microsoft CEO Satya Nadella at OpenAI's first developer conference, on Nov. 6, 2023, in San Francisco. Microsoft has quit its seat on the board

Microsoft has announced its decision to step down from its observer seat on the board of OpenAI, citing the significant progress made by the artificial intelligence company in enhancing its governance structure. The tech giant confirmed its resignation in a letter, expressing gratitude for the support received from OpenAI leadership and the board.

The move comes at a time when antitrust regulators are closely scrutinizing the partnership between Microsoft and OpenAI, with reports indicating a substantial investment of $13 billion by Microsoft in the AI firm. Regulatory bodies in the European Union, the United States, and the United Kingdom have all been examining the alliance under their respective antitrust rules.

Microsoft's involvement in OpenAI's board stemmed from a period of internal turmoil within the company, which saw the removal and subsequent reinstatement of CEO Sam Altman. Following the restructuring of the board and the progress witnessed over the past eight months, Microsoft deemed its role as an observer unnecessary.

With Microsoft's departure, OpenAI will no longer have observer seats on its board, signaling a shift in the dynamics of the partnership. OpenAI expressed appreciation for Microsoft's confidence in the company's direction and emphasized its commitment to maintaining a successful partnership.

Industry experts suggest that Microsoft's decision reflects a broader trend of increased regulatory scrutiny on tech companies and their relationships with AI startups. The evolving landscape necessitates a careful consideration of the structures of such partnerships to align with regulatory expectations.

OpenAI has outlined plans to adopt a new approach in engaging key strategic partners and investors, including Microsoft, Apple, Thrive Capital, and Khosla Ventures. Regular meetings will be held to update stakeholders on progress and enhance collaboration on safety and security measures.

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