Microsoft Crushes OpenAI with Databricks

Microsoft is planning to sell a new version of Databricks’ software on Azure
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After playing with OpenAI, Microsoft now has moved on to exposing its flaws, and is looking everywhere else for support and strategic alliance to up its game in generative AI for enterprise. 

A recent exclusive by The Information might come as a shocker for OpenAI. 

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The report said Microsoft is planning to sell a new version of Databricks’ software that helps customers make AI apps for their businesses. The tech giant plans to sell it through its Azure cloud-server unit, which will help companies make AI models from scratch or repurpose open-source models as an alternative to licensing OpenAI’s proprietary ones. 

Microsoft’s actions are clearly indicating that everything is not well between the two entities. Although OpenAI hasn’t done anything to Microsoft which should make them unhappy. Instead, it seems that Microsoft’s focus has been primarily on its Azure services, which has led to a self-centered approach and possibly contributed to the current state of affairs between the two. 

The partnership of Microsoft and OpenAI had their own agendas for both parties. While the tech giant needed generative AI push in its cloud services, the ChatGPT creator aimed to secure financial support for building advanced AI systems, and eventually AGI. 

Despite the efforts made by OpenAI, it could not fully gain the trust of enterprises. Large tech companies like Apple, Spotify, Wells Fargo, Samsung, JP Morgan ,Verizon had wayback ditched ChatGPT and banned it for their employees from using it. Clearly, the awareness is lacking among enterprise customers. 

Ironically, for Azure-Databricks service, Microsoft is leveraging OpenAI’s technology to develop a chatbot similar to ChatGPT. The purpose is to assist less tech-savvy users in navigating Databricks’ software, originally tailored for advanced data scientists. 

As a consequence, certain Microsoft clients might find themselves utilising open-source models rather than the closed-source alternatives from OpenAI. This move by Microsoft is hinting that it is moving away from OpenAI and looking out for more partners which can help them make Azure OpenAI services better specially for its enterprise customers. There is no stopping. 

Not the first time

A few days back Microsoft posted “Azure ChatGPT” on GitHub (now deleted) repository which was marketed as safe, secure and private ChatGPT for enterprise. 

The reasoning behind launching Azure ChatGPT given by Microsoft was that ChatGPT risks exposing confidential intellectual property and it would be better to use Azure ChatGPT as data remains safe and secure on Azure. Microsoft had specifically mentioned that they would not share any data with OpenAI.

Microsoft did one more thing that put OpenAI’s reputation at risk. It collaborated with IBM Consulting. The collaboration with IBM Consulting  is focused on helping clients to implement and scale Azure OpenAI Service. Notably, IBM also forged a recent partnership with Meta, aiming to integrate Llama 2 into, a formidable competitor to OpenAI’s GPT-4.

Who is spreading the rumors? IBM recently released a blog post cautioning on the use of ChatGPT for enterprise. According to IBM, employing ChatGPT directly within an enterprise context introduces various potential risks and obstacles. These encompass matters like security vulnerabilities leading to data exposure, issues related to confidentiality and legal responsibility, and the intricate landscape of intellectual property.  

OpenAI has taken steps to address this concern by providing clarity. They have explicitly stated in their policy that user data from chat histories is not employed to train their model if users have disabled the chat history feature. Recently, Sam Altman clarified on X, saying that OpenAI doesn’t use API-submitted data to train or improve models unless a user explicitly opt-in.

Despite OpenAI’s diligent efforts to be transparent, Microsoft’s actions seem to undermine their attempts to maintain transparency and integrity. 

Microsoft’s Unquenchable Thirst for Partnerships

Microsoft’s partnership with Meta appears to have strained OpenAI’s relationship. The tech giant’s collaboration seems to be creating a competitor for OpenAI’s closed-source models. By teaming up with Meta and leveraging Llama 2, Microsoft gained a sense of security and reduced their reliance on OpenAI, altering the dynamics in their favor. 

Similarly for Microsoft, providing Databricks services on Azure gives them potential to expand its cloud service offerings to a wider range of enterprises. With Databricks it aims to capitalise on the AI trend and make progress in competing with Amazon Web Services (AWS).

OpenAI’s partnership with Microsoft provided them with GPT-4 while AWS multi-LLM approach gave its customers the options to choose from a buffet of models like AI21, Cohere, Anthropic Claude 2, and Stability AI SDXL 1.0. 

By providing Databricks services on Azure cloud, Microsoft is mimicking AWS strategy where it is trying to provide more options to its enterprise customers all under one roof. Databricks recently acquired Mosaic ML, which created MPT-30B, an open-source foundation model. Who knows if there is a chance that it might be made available on Azure cloud in the coming months.

Siddharth Jindal
Siddharth is a media graduate who loves to explore tech through journalism and putting forward ideas worth pondering about in the era of artificial intelligence.

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