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Illustration depicting Microsoft's partnership with OpenAI and the potential benefits for Google. The image features the logos of Microsoft, OpenAI, and Google connected by data streams and AI elements, symbolizing the transfer of AI research. The background includes representations of digital security and a futuristic tech landscape

Author: Alicia Shapiro

Estimated Reading Time: 3 minutes

Microsoft Outsourcing AI Research to OpenAI Could Benefit Google, Says Okta CEO

Microsoft is outsourcing a significant portion of its artificial intelligence research and development to OpenAI, according to Todd McKinnon, CEO of cybersecurity firm Okta. McKinnon believes this strategy could ultimately benefit Google, which has a more organic approach to AI R&D.

Microsoft's AI Strategy

McKinnon, speaking to CNBC, highlighted that while Microsoft invests heavily in OpenAI, Google maintains in-house development of its AI technologies. He emphasized that Google pioneered much of the foundational research in AI, particularly the development of transformers, a type of deep-learning model crucial for generative AI technologies.

“This all came from Google, with DeepMind and the research,” McKinnon stated. “The breakthrough was the research from Google, the transformers which are the algorithm that all these LLMs [large language models] are using to make these big advancements.”

Microsoft as an AI Consultancy

McKinnon expressed concerns that Microsoft’s role in AI could diminish to that of a consultancy rather than a leader in innovation. He pointed out that several of Microsoft's top products, such as the generative AI chatbot CoPilot and PCs equipped with AI software, are increasingly reliant on technology developed by OpenAI. Microsoft has invested around $13 billion in OpenAI, aiming to accelerate AI advancements and share the benefits globally.

“It’s so bizarre,” McKinnon remarked. “Imagine working at Microsoft. OpenAI is over there making all the exciting stuff. It’s almost like Microsoft is going to turn into a consulting company.”

Google's AI Efforts and Challenges

Despite its pioneering role in AI, Google faces significant challenges in commercializing its AI innovations. Google's AI chatbot, Gemini, encountered issues when an advertisement showcased it providing incorrect information. Additionally, the Gemini image generator tool created inaccurate historical images, leading Google to temporarily pull the feature for further investigation.

McKinnon noted that AI development requires substantial investments, contrasting it with previous technology cycles like personal computing, which saw more organic growth and disruption. “There’s no new AI model that’s like a toy. The only reason OpenAI can get it working is because the great R&D that they needed — $10 billion from Microsoft, to run the model — that wasn’t like a disruptive thing, that was a $10 billion investment,” he explained.

Investment and Competition Concerns

The immense investments from major tech companies into AI raise concerns about competition and market dominance. McKinnon warned that the cybersecurity industry might face challenges as AI-related issues, such as disinformation, could hinder technological progress. He also predicted that stringent regulations could limit AI development to the most powerful companies.

“The potential [for] artificial intelligence is really high,” McKinnon said. However, he cautioned, “I actually expect the swing of regulation to go so far that we leave only the biggest, most powerful companies in control of AI.”