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Elon Musk’s X and xAI have launched a legal battle against Apple and OpenAI, alleging the tech giants are conspiring to establish an AI monopoly. The lawsuit, filed in a Texas federal court, asserts that Apple’s integration of ChatGPT into iPhones, facilitated through an exclusive partnership with OpenAI, is a calculated strategy by ‘two monopolists joining forces to ensure their continued dominance.’
The suit claims that this partnership effectively blocks competing AI assistants, such as xAI’s Grok, by embedding ChatGPT deeply within Apple’s ecosystem. This allegedly deprives consumers of genuine choice, directly contradicting OpenAI’s own stated principle that ‘Real choice drives competition and benefits everyone. Users should be able to pick their AI assistant.’
Data is at the core of the dispute. The lawsuit argues that generative AI’s learning process, driven by user interactions, creates a valuable feedback loop. Exclusive access to potentially billions of prompts from iPhone users enables OpenAI to build an insurmountable ‘moat’ around its market leadership, effectively starving competitors of the vital data needed for model improvement. The filing alleges that OpenAI offers its technology to Apple at no direct cost, viewing the invaluable data access as ‘of equal or greater value than monetary payments.’
The legal challenge further suggests Apple’s participation is a preemptive defense against the growing influence of ‘super apps,’ comprehensive platforms like X that consolidate social media, messaging, payments, and other services. These super apps diminish the importance of smartphones, posing a threat to Apple’s hardware revenue.
Furthermore, X and xAI accuse Apple of leveraging its control over the App Store to favor specific AI applications. They allege that X and xAI’s highly-ranked apps are deliberately suppressed and excluded from prominent placement lists, while ChatGPT receives preferential treatment. Delayed approvals for Grok app updates are also presented as evidence of anti-competitive practices.
X and xAI contend that the alleged conduct harms innovation, reduces consumer choice, and potentially increases prices. The lawsuit seeks to dismantle the Apple-OpenAI partnership and seeks compensation for billions of dollars in alleged lost value and sales.