X and xAI Sue Apple and OpenAI Over Alleged AI Monopoly
Created on August 26|Last edited on August 26
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Elon Musk’s X and its AI arm, xAI, have filed a lawsuit in a Texas federal court against Apple and OpenAI, accusing the two companies of forming an AI monopoly. The complaint centers on Apple’s exclusive integration of OpenAI’s ChatGPT into its operating systems, giving it direct access to core iPhone features. X and xAI argue that this effectively shuts out competing assistants like their own chatbot, Grok, from meaningful competition.
Exclusive Access and the Data Advantage
The lawsuit emphasizes that generative AI thrives on user input data, which helps refine and improve models. By making ChatGPT the only assistant with deep system integration across hundreds of millions of Apple devices, the partnership creates a feedback loop of unprecedented scale. X and xAI argue that this gives OpenAI an unassailable advantage, depriving rivals of the opportunity to collect comparable data and improve their products. The complaint even cites internal documents where OpenAI previously stressed that giving users a real choice of assistants was essential for fair competition.
Why Apple Would Partner with OpenAI
According to the complaint, Apple’s motivations go beyond AI. The lawsuit suggests Apple sees the partnership as a defensive move against the rise of “super apps.” These all-in-one platforms, popular in Asia and now being developed by companies like X, combine social media, payments, messaging, and AI services. If super apps become dominant, users could rely less on expensive iPhones, instead accessing all functionality through a single app on cheaper devices. The filing claims Apple views this as an existential threat to its hardware business, citing an Apple manager who likened super apps to “barbarians at the gate.”
App Store Allegations
Beyond integration, X and xAI accuse Apple of leveraging its control of the App Store to disadvantage competitors. According to the lawsuit, Grok and other AI apps from X are systematically excluded from Apple’s “Must-Have Apps” list while ChatGPT enjoys prime visibility. Delayed approvals for Grok updates are also mentioned as tactics that allegedly hinder competition. The companies argue that Apple’s gatekeeping effectively prevents rival assistants from reaching users on fair terms.
Implications for Consumers and the Industry
X and xAI contend that Apple and OpenAI’s arrangement harms the broader market. They claim it limits consumer choice, slows innovation, and ultimately raises costs for users. By building what they describe as a data “moat” around OpenAI, the lawsuit argues that the partnership locks in OpenAI’s dominance and prevents challengers from catching up. The plaintiffs are seeking to dismantle the agreement and recover billions in damages for lost opportunities and suppressed growth.
Broader Context
This legal battle comes as regulators around the world are already scrutinizing Big Tech’s role in AI, data access, and platform control. If the lawsuit gains traction, it could become a landmark case defining how competition law applies to the rapidly growing AI industry, especially at the intersection of software monopolies and hardware ecosystems.
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