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Microsoft tells OpenAI it no longer requires observer board spot

OpenAI CEO Sam Altman testifies before the Senate Judiciary Subcommittee on Privacy, Technology, and the Law on Capitol Hill on May 16, 2023. Microsoft said Tuesday it no longer needs its board observer position with Altman leading the organization. File Photo by Jim Lo Scalzo/EPA-EFE
OpenAI CEO Sam Altman testifies before the Senate Judiciary Subcommittee on Privacy, Technology, and the Law on Capitol Hill on May 16, 2023. Microsoft said Tuesday it no longer needs its board observer position with Altman leading the organization. File Photo by Jim Lo Scalzo/EPA-EFE

July 10 (UPI) -- Microsoft told OpenAI on Tuesday that it no longer needs an observer seat on its board, saying it is satisfied with the company's progress with the reinstallation of leader Sam Altman.

Microsoft, which has a $10 billion investment in OpenAI, the creator of Chat GPT, demanded the overseer spot after the board removed Altman last November. The tech giant then worked behind the scenes to bring Altman back as CEO and tweak OpenAI's governance.

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"As you know, we accepted the non-voting board observer role at a time when OpenAI was in the process of rebuilding its board," Microsoft said in a letter to OpenAI, according to Axios.

"This position provided insights into the board's activities without compromising its independence, and we appreciate the opportunity to serve as an overseer during this period of change. Over the past eight months, we have witnessed significant progress from the newly formed board and are confident in the company's direction."

Keith Dolliver, Microsoft's deputy general counsel, said because of that progress, the tech giant's observer status is no longer needed.

The European Commission announced in January that it opened an investigation into Microsoft's $10 billion partnership with OpenAI, suggesting that the combination could curtail competition. Britain's Competition and Markets Authority is also looking into the Microsoft-OpenAI union, saying it wants to probe the partnership's potential impact on the AI market there.

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