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Rivals look to take advantage of the leadership turmoil at OpenAI

By Nithya Bose in US business news, posted November 23, 2023

Rival companies are looking to lure OpenAI customers by offering incentives to switch to their platforms.

Google and Amazon are leading the charge, matching OpenAI's pricing and emphasizing the advantages of their diversified generative AI strategies.

While Sam Altman's return as CEO signals a resolution to the internal dispute, competitors are pitching their platforms as more reliable and less susceptible to leadership uncertainties.

Tech giants such as Google, Amazon, Microsoft, Meta Platforms, and startups actively target businesses.

They urge customers to consider alternatives amid OpenAI's recent challenges.

The pitch centers on diversifying AI suppliers to mitigate risks and reduce "vendor lock-in."

Amazon, in particular, is leveraging its position as a platform for various AI systems, challenging the dominance of OpenAI and Microsoft's partnership.

Amazon and Google believe companies' hesitancy to engage with OpenAI during its leadership crisis bolster their strategies.

Meta is also forging partnerships with enterprise technology vendors like Snowflake.

The tech giant aims to enhance its appeal to businesses seeking stability in their AI providers.

OpenAI tries to reassure customers through posts on the X social-media platform and leadership changes.

However, competitors see the situation as a "free-for-all."

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Scott Bickley, advisory practice lead at Info-Tech, said rival firms mobilized their sales teams over the weekend to capitalize on the uncertainty and swiftly target OpenAI's customer base.

Some customers express confidence in OpenAI's reinstated leadership but acknowledge the appeal of competitors' platforms.

Brian Woodring, CIO of Rocket Mortgage, said: "We remain extremely confident in OpenAI, but if that changes in the future or if a competitor offers a more compelling option, we will be well prepared to switch seamlessly.”

The upheaval has led to a surge in interest for OpenAI competitors, with Cohere reporting a significant influx of inquiries.

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Similarly, Writer, which provides generative AI-based writing assistance, experienced a twofold increase in interest from businesses for its services on Tuesday, November 21.

Competitors like AI21, which recently completed a $208 million funding round, see the events at OpenAI as reinforcing the importance of not relying solely on one provider.

AI21 builds smaller, specialized AI models that it claims outperform OpenAI's large, generic GPT models in specific business applications.

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