Apple Inc. AAPL is reportedly set to secure an observer role on the board of ChatGPT-parent OpenAI, matching the position of Microsoft Corporation MSFT.
What Happened: Cupertino’s former marketing chief, Phil Schiller, has been chosen for this role, which is part of a landmark agreement announced last month, reported Bloomberg, citing people familiar with the situation.
Schiller, who is currently leading Apple’s App Store, will not serve as a full director but will gain insights into the company’s decision-making process. Despite not leading Apple’s AI initiatives, his experience as a company steward makes him a suitable choice for the observer role.
In addition to overseeing the App Store, Schiller manages the tech giant’s product launch events and serves as a director at medical technology company Illumina Inc. The 64-year-old stepped down from his role as head of marketing in 2020 and now holds the title of Apple Fellow.
Apple did not immediately respond to Benzinga’s request for comments. OpenAI declined to comment.
The announcement follows Apple’s decision in June to integrate ChatGPT into its suite of artificial intelligence features on the iPhone, iPad, and Mac. The board arrangement is expected to take effect later this year.
This role will put Apple on par with Microsoft, OpenAI’s primary AI technology provider and largest supporter. The observer role allows attendance at board meetings without voting rights or other directorial powers.
However, having both Microsoft and Apple present at board meetings could lead to complications, given their history as both rivals and partners. Some OpenAI board meetings may discuss future AI initiatives between OpenAI and Microsoft, discussions from which Microsoft may prefer Schiller to be excluded, the report noted.
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Why It Matters: The partnership between Apple and OpenAI has been a topic of interest since earlier this year.
In May, it was reported that Microsoft CEO Satya Nadella met OpenAI CEO Sam Altman to express the company’s concerns about the potential agreement with Apple. Microsoft’s concerns were primarily about the potential impact on its product ambitions.
Last month, it was reported Apple and OpenAI’s partnership did not involve any cash payments. Instead, Cupertino reportedly believed that the exposure of OpenAI's brand and technology to its extensive user base was of equal or greater value than monetary transactions.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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