Microsoft targets $10B AI investment

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Microsoft may have closed on a deal to invest $10 billion in OpenAI after the company released its latest software ChatGPT and was subsequently valued at $29 billion

Announced in November last year, ChatGPT is a chatbot built atop the parent company’s GPT-3 series of language models.

The conversational bot utilizes large databases and will respond to user questions and create other content on a wide array of subjects. Among many other forms, responses include answers, essays, legal briefs, and computer code. The Wall Street Journal reported last week that OpenAI was in talks to sell existing shares at a roughly $29 billion valuation in a tender offer that would attract investment of at least $300 million.OpenAI charges developers licensing its technology about a penny or a little more to generate 20,000 words of text, and about 2 cents to create an image from a written prompt.

It spends about a few cents in computing power every time someone uses its chatbot, Altman recently said in tweet that has raised concerns about OpenAI's cash burn. Reuters reported last month a recent pitch by OpenAI to investors said the organization expects $200 million in revenue next year and $1 billion by 2024.

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