iPhone users stand to lose as the tie-up between Apple and OpenAI allegedly increases prices and offers less features, said the lawsuit.
Elon Musk’s artificial intelligence (AI) startup xAI and its subsidiary X Corp. sued Apple and ChatGPT maker OpenAI on Monday, alleging monopolistic practices and illegal conspiracy to control the AI in smartphone devices.
The lawsuit, filed in federal court in Texas, features 10 claims altogether.
“Defendants Apple and OpenAI have locked up markets to maintain their monopolies and prevent innovators like X and xAI from competing,” said the lawsuit, claiming billions in damages.
In June 2024, Apple announced a partnership with OpenAI whereby ChatGPT capabilities were integrated within the iOS platform.
The lawsuit claimed that this “exclusive arrangement” made iPhone users dependent on ChatGPT without access to other generative AI chatbots such as xAI’s Grok.
“Generative AI chatbots improve their models based on a continuous feedback loop. More users beget more prompts, and more prompts offer more opportunities to train the model, whose better features then attract even more users,” said the lawsuit.
AI prompts used by millions of iPhone users solely benefit ChatGPT, making it difficult for competitors to “scale and innovate.”
Furthermore, Apple has allegedly taken steps to “preference OpenAI” apps on its App Store.
These actions have allegedly resulted in customers losing out on cheaper and better alternatives, said the lawsuit.
“Apple is behaving in a manner that makes it impossible for any AI company besides OpenAI to reach #1 in the App Store, which is an unequivocal antitrust violation,” Musk said on X in an Aug. 11 post.
The lawsuit’s claims say Apple and OpenAI violate several clauses of the Sherman Act, which promotes fair competition between businesses in the marketplace while combatting formation and proliferation of monopolies.
In an emailed statement to The Epoch Times, an OpenAI spokesperson responded to the lawsuit, saying, “This latest filing is consistent with Mr. Musk’s ongoing pattern of harassment.”
In April, OpenAI had countersued Musk for engaging in a harassment campaign against the company.
The issue arose from Musk accusing OpenAI of failing in its commitment to retain its nonprofit status, claiming that a for-profit entity will cause broader harm to the public.
The OpenAI lawsuit accused Musk of engaging in a “relentless” campaign against OpenAI through the press and “malicious campaigns” that have been broadcast to more than 200 million people on his social media platform, X.
Musk is considered very active on his platform, with a subscriber base of more than 220 million.
