OpenAI has attracted about as much attention in recent times as its much-talked-about chatbot, ChatGPT. The artificial intelligence (AI) research lab has collected billions of dollars in funding -- including a total of $13 billion from Microsoft (MSFT 0.37%). That's brought OpenAI to a valuation of about $29 billion.
With companies racing to advance in AI, it's easy to imagine a bright future for OpenAI. And Microsoft, as an investor and OpenAI partner, is set to benefit. But something happening in the European Union could disrupt this exciting story. Let's find out more.
The idea of sharing data
First, it's important to note that OpenAI, launched with the idea of sharing data, is doing just the opposite. For example, when it announced its next-generation language model -- GPT-4 -- it didn't offer information about its training method for the platform and certain other details. This spurred criticism.
But supporters of OpenAI's new approach say sharing too much could result in competition. As tools become more and more valuable, it's understandable that OpenAI would want to protect its work. There's also the fear that too much of OpenAI's data in the wrong hands could result in unwanted and even dangerous situations down the road.
This question of whether or not to share key data leads me to the subject of what's going on in the EU. The countries are working on AI regulation, known as the European Union AI Act. And OpenAI chief executive officer Sam Altman has "many concerns" about it, according to The Verge.
A big concern is that the legislation would mark platforms like ChatGPT as risky -- and that means OpenAI would have to fulfill certain requirements in order to continue operating.
The Verge mentioned a couple of specific points in today's draft of the legislation. The draft calls for creators of certain AI platforms to share data about how their systems work -- such as the level of computing power needed and details about training time. It also requires the release of "summaries of copyrighted data used for training," The Verge noted.
Every detail counts
Each detail in the legislation could be critical in determining OpenAI's future in the European market.
"We will try to comply, but if we can't comply we will cease operating," Altman said in a report by The Financial Times.
The legislation isn't yet completely finalized. So, at this point, elements could change. But so far, the situation in Europe looks complicated for OpenAI. And if the ChatGPT creator is forced to say "au revoir" to Europe, it could signal a big slowdown in AI development across the region. It also wouldn't be the best news for Microsoft -- the company invests in OpenAI but also works behind the scenes by offering it computing power.
So, should we be worried about the future of AI in Europe -- and the spillover effect? Not necessarily. AI regulation is complex. That's because this technology is so vast and we're only in the early days of its development.
Companies around the world see the potential of AI to make business more efficient. This means governments may not be quick to slam the door on leading players, such as OpenAI. And a particular law may end up being a work in progress, with new additions as the technology progresses.
All of this means I would keep an eye on the situation in Europe. But I would remain hopeful that AI developers and governments may find a solution that could keep this exciting technology advancing.
