The Elon Musk-founded AI startup xAI is suing competitor OpenAI and the tech giant Apple for anticompetitive practices.
Or, in the words of the lawsuit, Apple and OpenAI are accused of “a conspiracy to monopolize the markets for smartphones and generative AI chatbots.”
The move comes weeks after Musk had threatened to sue while claiming that Apple was “making it impossible” for other AI companies to reach number one in the app store.
What’s Behind the Lawsuit?
The lawsuit, which was just filed in the US federal court in Texas, alleges that a 2024 deal that allowed OpenAI’s ChatGPT to integrate with the operating system of popular Apple devices is stifling the competition, while also alleging that Apple prioritizes OpenAI in its App Store rankings.
xAI’s own chatbot, Grok, has struggled to compete against ChatGPT since it was first launched in November 2023.
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Back on August 11, Musk had posted on X, the social media platform he owns, to threaten the same legal actions that xAI is now taking.
“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. xAI will take immediate legal action.” -Elon Musk
What the Lawsuit Covers
The lawsuit says that Apple and OpenAI have “locked up markets to maintain their monopolies and prevent innovators like X and xAI from competing,” according to the public 61-page filing.
The stated goal of the suit? To “stop Defendants from perpetrating their anticompetitive scheme and to recover billions in damages.”
The lawsuit also uses past statements from Apple execs against them, arguing that Apple has fallen behind in the AI race. It explains that Apple’s Senior Vice President for Services, Eddy Cue, has said AI might destroy Apple’s smartphone business, similarly to the impact of Apple’s iPhone on Nokia’s handsets.
Where Will the Lawsuit Go?
However, some critics have already responded to the lawsuit with some skepticism: ChatGPT has a much larger base of installed users in comparison to many competitors, including Grok.
Plus, Grok itself was at the number one spot in the App Store relatively recently — an indication that Apple hasn’t been unduely favoring ChatGPT for the position.
Apple has faced claims of anticompetitive practices related to its App Store in the past, so this new lawsuit isn’t without precedent. One thing’s for sure: It’s earning plenty of media attention for all the businesses involved. All news might just be good news, depending on the size of one’s install base.
