- Elon Musk scorned Apple and OpenAI after the companies revealed their team-up on Monday.
- But Musk's hating on the partnership may not be solely due to his misgivings about OpenAI.
- In a big blow to Musk's xAI, OpenAI will soon have access to Apple's sprawling user base.
Elon Musk has had an awful lot to say about Apple's partnership with OpenAI.
The deal, announced on Monday, involves integrating ChatGPT into Apple's operating systems. And boy, has it riled Musk up.
Besides threatening to ban Apple's devices at his companies, Musk has also floated the possibility of getting either his social media company X or his EV giant Tesla to make a smartphone themselves.
"We could, but hopefully it isn't needed," Musk said in response to a Morgan Stanley analyst predicting that Tesla could make its own phone one day.
"Tesla is one of the few companies that has its own tech stack (not iOS, Android or forked Android," he continued.
But Musk's full-throated condemnation of the Apple-OpenAI team-up may not be solely due to his misgivings toward OpenAI and its CEO, Sam Altman.
To be sure, Musk does have a long-running feud with Altman and OpenAI. Musk filed a lawsuit against the ChatGPT maker in February, accusing the company of violating its nonprofit mission by partnering with Microsoft.
Musk might have dropped the lawsuit on Tuesday, but there's no evidence to suggest that that had anything to do with him wanting to bury the hatchet with Altman.
Moreover, Musk's contempt for the Apple deal may stem from more practical considerations. For one, Apple seems open to cutting deals with Google for the use of Gemini, but xAI doesn't appear to have been part of those conversations just yet — if the WWDC keynote on Monday was anything to go by.
Apple, an AI kingmaker
Bloomberg columnist Dave Lee called Apple a kingmaker in the AI race — and it's not hard to see why.
For one, the Cupertino-based tech giant has over one billion iPhone users at its disposal. Such a massive user base would be a boon for any AI company looking to gain a foothold in the highly competitive field.
In Musk's case, letting OpenAI grab the precious mindshare of Apple's users could prove to be a major blow to his AI company, xAI. This is because xAI doesn't have easy access to a wide-ranging consumer platform like OpenAI will soon own.
OpenAI can now count on both Apple and Microsoft to promote its AI offerings to their user bases. Even Google, whose AI products have been hit with scathing reviews, can turn to its mobile operating system, Android, which boasts over three billion users.
Musk still has X, but the social media platform averaged only 22 million daily active users in April, which pales in comparison to Apple's and Google's numbers.
That said, one shouldn't rule out Musk and xAI just yet. The company said in late May that it raised $6 billion for its Series B funding round, giving it a total valuation of $24 billion.
Altman's OpenAI, meanwhile, is worth around $80 billion.
And while Musk might not have a product with iPhone-levels of popularity, he still has the "Muskonomy" to back him up.
Musk's constellation of businesses, which includes Tesla and his satellite internet service Starlink, could give xAI the type of boost most AI startups can only dream of.
Musk may have been preoccupied with the Tesla shareholder vote, but there's no telling when he will refocus his attention on xAI and fire the next salvo in the AI race.
"There will be more to announce in the coming weeks," Musk said on May 27, shortly after xAI's funding announcement.
Representatives for Musk and Tesla did not immediately respond to requests for comment from BI sent outside regular business hours.