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Microsoft fires 10,000, invests $10bn in 375-person OpenAI

Days after laying off over 10,000 people, Microsoft has invested a reported $10 billion in OpenAI -- a company with just 375 staff -- as Artificial Intelligence applications start to go mainstream

Microsoft said it would move to “deploy OpenAI’s models across our consumer and enterprise products and introduce new categories of digital experiences built on OpenAI’s technology”.

(Microsoft has grown its headcount 22% this year. The layoffs represent 5% of total staff.)

OpenAI already uses Microsoft infrastructure to train its models, which are now also deployed in Azure to power AI products like GitHub Copilot (which turns natural language prompts into coding suggestions), DALL·E (a service that creates images from a description in natural language) and ChatGPT (the viral AI bot that can carry out sophisticated natural language and code generation tasks on the simplest of written prompts.)

Microsoft deployments will include its “Azure OpenAI Service, which empowers developers to build cutting-edge AI applications through direct access to OpenAI models” Redmond said in a blog on January 23.

(The OpenAI Service on Azure started out in a limited preview back in November of 2021. As of today, it includes access to OpenAI APIs built on GPT, DALL-E, and CODEX (programming aid) models.)

Whilst thousands of companies have been deploying various forms of AI and machine learning in production for years, the impressive performance of natural language processing models like GPT 3.5 has catapulted the potential of AI into the public consciousness, even if for many CIOs and CTOs, knowing what to actually do with this clever and very accessible new tool is an open question; most are still struggling to access and clean up the vast majority of their own data, let alone train algorithms to help them solve novel problems with it.

“Big Tech” meanwhile is pushing ahead aggressively with investment in the space, as Microsoft’s OpenAI deal illustrates, while Alphabet CFO Ruth Porat said on the company’s last earnings call that “we’re working to realign resources to fuel our highest growth priorities” with AI flagged as an investment priority by CEO Sundar Pichai who said: “Over a decade ago, focusing the company's efforts on mobile helped us to build and grow our business for the shift to mobile computing. We are at a similar point now with AI, another transformational technology. Our investments in AI and deep computer science mean that we can deliver a wide range of breakthroughs..."

The number of jobs lost to automation will reach 12 million across Europe by 2040, according to Forrester and between throwing absurd prompts at ChatGPT, many are wondering what the future holds as AI generated images, music, art, text and more start to merge more convincingly with direct-from-human efforts.

“As the late French cultural theorist Paul Virilio observed, when things work in new ways, they also break in new ways,” said Sebastian Buckup, the WEF’s Head of Network and Partnerships this week: “When we invented the ship, we also invented the shipwreck. The same holds true for new technologies – and the stakes are high.”

As Shamika N. Sirimanne, of UNCTAD’s Division on Technology and Logistics noted this week, white collar workers in the global north are not the only ones set to be dramatically affected by easy access to AI.

"With gig work and digital transformation, the expectation was that some skilled workers in developing countries were getting ready to compete for more skill-intensive jobs around the world as “telemigrants” in jobs such as accountants, legal clerks, software developers, or even X-ray analysts. The risk is that these jobs will be taken by the ChatGPTs of the world" she wrote.

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