OpenAI discontinues partnership with Scale AI as a data provider post-Meta acquisition.

OpenAI terminates collaboration with Scale AI in response to Meta deal

OpenAI has decided to end its partnership with Scale AI and sever ties with the data provider following Meta’s agreement with the startup. Sarah Friar, OpenAI’s CFO, had previously indicated that the collaboration with Scale AI would continue, but the organization has now shifted its stance.

The discontinuation of the collaboration began before Meta’s recent announcement that it would invest a substantial amount in Scale AI and appoint CEO Alexandr Wang. OpenAI had already been exploring alternative data providers to acquire more specialized data for the development of advanced AI models.

Implications for Scale AI’s core data labeling business have emerged as a result of OpenAI’s decision to terminate the partnership. Rumors circulating about Meta’s deal with Wang led to increased interest from AI model providers in finding new “neutral” partners.

Scale AI’s executives sought to dispel concerns about preferential treatment for Meta following the deal. They assured that confidential information from other clients would not be shared with Meta, and Wang would not be involved in day-to-day operations. Nonetheless, major clients of Scale AI are already shifting away from the data provider, suggesting that significant changes may be necessary for the startup to remain competitive.

In response to these developments, Scale AI’s interim CEO Jason Droege announced plans to focus on expanding its applications business, which entails developing bespoke AI applications for governmental bodies and businesses.