According to online sources, TikTok, a short-video service owned by Chinese company ByteDance, is one of Microsoft’s largest clients in the field of cloud computing artificial intelligence. As of March, TikTok was paying Microsoft almost $20 million per month for access to OpenAI’s AI algorithms. However, this could soon change if ByteDance creates its own neural networks.
Last year, the media reported that ByteDance was “secretly using” OpenAI algorithms to develop its large language model (LLM). In the field of AI technology development, this approach is condemned by many companies. In addition, it is a direct violation of OpenAI’s user agreement, which states that content generated by neural networks cannot be used “to create language models that compete with the developer’s products and services.” Microsoft, through which ByteDance gets access to OpenAI algorithms, adheres to a similar policy.
Controversy and Consequences
After reports emerged that ByteDance was using OpenAI’s AI algorithms to create its language model, the Chinese company’s account was suspended. OpenAI explained this by the need to conduct an investigation to determine whether the license agreement was violated. At the same time, a ByteDance representative told CNN reporters that the company uses the technology “in a very limited way” to develop its own language models.
Microsoft has signed a multi-billion dollar investment agreement with OpenAI, making the software giant the exclusive provider of cloud AI computing. In addition, Microsoft had to spend “several hundred million dollars” to build a supercomputer to run the ChatGPT algorithm. In its financial report for the fourth quarter of fiscal year 2024, published this week, Microsoft said that revenue from its Azure cloud division grew by 29%, which is only slightly less than the previously forecast 30-31%.
The situation between TikTok, ByteDance, Microsoft, and OpenAI remains fluid, and we’ll keep you updated on any new developments as they unfold. The outcome of this controversy could have significant implications for the AI industry, particularly in terms of how companies access and utilize advanced AI algorithms.
As the investigation into ByteDance’s use of OpenAI algorithms continues, it remains to be seen how this will affect TikTok’s relationship with Microsoft and its access to AI technologies, notes NIXsolutions. The potential development of ByteDance’s own neural networks could reshape the landscape of AI in social media and content creation.
The ethical and legal questions surrounding the use of AI algorithms for competitive purposes are likely to become increasingly important as more companies seek to develop their own AI capabilities. This situation highlights the complex interplay between technological advancement, business competition, and intellectual property rights in the rapidly evolving field of artificial intelligence.