Musk sues Apple and OpenAI for favoring AI on iPhones and limiting competition

Elon Musk sued Apple Inc. and OpenAI, accusing them of unfairly favoring an artificial intelligence app on iPhones and hindering competition from other chatbot developers.

Musk’s X and xAI filed the lawsuit Monday in federal court in Fort Worth, Texas, arguing that Apple’s decision to integrate OpenAI into the iPhone’s operating system harms competition and deprives consumers of options.

The billionaire founder of xAI Holdings, which now brings together the Grok AI team and the X social network, said Apple makes it impossible for someone other than OpenAI to reach the top spots on the App Store lists, a global showcase highly coveted by app developers.

Apple and OpenAI’s exclusive agreement has made ChatGPT the only generative AI chatbot integrated into the iPhone, X’s lawyers said in the lawsuit, and has hoarded the markets to maintain their monopolies and prevent innovators such as X and xAI from competing.

The case poses a high-risk court standoff between the richest person on the planet and one of the world’s most valuable companies.

This is the story of two monopolists who join forces to ensure their continued dominance in a rapidly devolving world driven by the most powerful technology ever created by humanity: artificial intelligence, the demand says.

The plaintiffs claim that Apple owns 65% of the smartphone market in the United States, while OpenAI controls at least 80% of the generative AI chatbot market through ChatGPT.

In a message on X, Altman called Musk’s accusation “notable” and said he manipulated X to benefit himself and his companies.

Musk replied, calling him a liar.

Both were founders of OpenAI before Musk’s departure in 2018, and now have a conflicting relationship. Musk founded XAI in 2023 to compete with OpenAI and other major AI companies.