Stability AI founder's jokes about Satya Nadella's influence have a dark truth to them

• Stability AI's Emad Mostaque stepped down as CEO to "pursue decentralized AI."
• The founder of the Stability Diffusion maker seemed to joke on X that he was set to join Microsoft.

They say an element of truth lies behind every joke — and Emad Mostaque's recent wisecrack about Satya Nadella inadvertently underlines a reality of the AI sector.

The Stability AI founder made light of his departure last week as CEO by kidding that he'd succumbed to the power of Microsoft.

He posted a photo on X on Tuesday in what appeared to be a video call with Satya Nadella. He wrote: "He is above, below and around us. In Satya we trust (because at this rate we'll kinda have to)".

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pic.twitter.com/bAoPCMil3w

— Emad acc/acc (@EMostaque) March 26, 2024

Mostaque later said that he was "just messing" and that he's doing his "own thing(s)" after leaving the creator of text-to-image generator Stable Diffusion, which he previously said was to "pursue decentralized AI."

But Mostaque's quip that Nadella has AI firms surrounded has some truth to it.

After all Microsoft recently hired Mustafa Suleyman and some of the Inflection AI team, which some regard as a strategic consolidation of top AI talent.

Mostaque's comments that Nadella is "above, below and around us" is a play on the Microsoft CEO's remarks about OpenAI in a November interview, which recently resurfaced in Elon Musk's lawsuit against Sam Altman and the ChatGPT maker.

The comments took on new meaning last week as Nadella appointed Suleyman as the CEO of Microsoft AI.

Mostaque, the British-Bangladeshi founder of the $1 billion startup, also praised Nadella as an "amazing leader" and said he was the greatest of all time (GOAT) by posting a goat emoji.

He added: "Microsoft is also one of the leading open source companies globally & there are great teams in Microsoft Research like the wizard & phi teams pumping out great models."

'Quiet takeover'

Microsoft is playing a key role in shaping the future of the industry through its partnerships with OpenAI and French firm Mistral AI as Big Tech players vie for dominance in the AI race.

The transfer of expertise to Microsoft through Nadella's hiring of Inflection's key personnel could be described as a "quiet takeover" and shows that AI power is consolidating.

Microsoft appears to have laid out a new blueprint for Big Tech to avoid the scrutiny of antitrust regulators.

Or as Gavin Baker, managing partner of investment firm Atreides Management, put it on X: "If the Microsoft/Inflection deal stands, then this is the roadmap for every large tech company to make acquisitions."

Microsoft didn't immediately respond to a request for comment from Business Insider.