Microsoft plans to invest $10 billion in OpenAI, the startup behind popular artificial intelligence tool ChatGPT, according to a report from Semafor.
The deal is part of a funding round with other investors involved that would value OpenAI at a whopping $29 billion.
It isn’t clear whether the deal has been finalized but term sheets sent to prospective investors indicated the plan was to close the deal by the end of 2022, Semafor reported.
Microsoft will reportedly get a 75% share of OpenAI’s profits until it makes back the money on its investment, after which the company would assume a 49% stake in OpenAI.
ChatGPT tool is a natural language processing model, meaning it is designed to generate text that appears as though a human wrote it.
A bet on ChatGPT could help Microsoft boost its efforts in web search, a market dominated by Google. The company’s Bing browser has only a small share of the global search engine market, however it is hoped the deal could help the firm chip away at Google’s dominance by offering more advanced search capabilities.