Musk Accuses Apple and OpenAI of AI Market Collusion

Billionaire entrepreneur Elon Musk’s artificial intelligence (AI) startup, xAI, has filed a lawsuit in U.S. federal court in Texas against Apple Inc. and OpenAI, alleging that the two companies have colluded to stifle competition in the AI market. The legal action, brought by xAI and X Corp., accuses Apple and OpenAI of maintaining monopolies and preventing smaller AI firms from competing fairly [1].

According to the lawsuit, Apple and OpenAI have “locked up markets to maintain their monopolies and prevent innovators like X and xAI from competing.” The legal filing claims that Apple's partnership with OpenAI, which integrates the ChatGPT AI platform into Apple devices such as iPhones, iPads, and Macs, has given the ChatGPT chatbot an unfair advantage over xAI’s Grok and other AI applications [1]. The lawsuit further argues that Apple’s exclusive arrangement with OpenAI disincentivizes it from promoting xAI’s AI tools in its App Store [2].

The lawsuit seeks billions of dollars in damages and a court order to halt what xAI calls “illegal tactics” aimed at suppressing competition. The filing marks the latest escalation in Musk’s ongoing legal battles, having previously threatened to sue Apple for allegedly preventing Grok from reaching No. 1 in the App Store. At the time of the lawsuit’s filing, Grok was ranked No. 5, while ChatGPT held the No. 2 position [2].

Musk’s legal complaint also highlights the broader implications of the Apple-OpenAI partnership. The integration of ChatGPT into Apple’s ecosystem is described as a strategic move that not only elevates OpenAI’s visibility but also provides the company with valuable user data. This data advantage, xAI argues, is not available to its own Grok chatbot or to other AI competitors like DeepSeek and Perplexity. The lawsuit suggests that Apple’s AI shortcomings have led it to rely on ChatGPT as a primary answer engine, thereby indirectly supporting its market dominance [3].

The legal action is part of a broader pattern of antitrust scrutiny directed at Apple, following its long-standing App Store practices. One notable example is the ongoing case involving Epic Games, in which a judge has ruled that Apple must allow more flexible payment options for app developers. The xAI lawsuit appears to follow a similar line of argument, asserting that Apple is leveraging its control over the App Store to favor certain AI services over others.

In response to the lawsuit, OpenAI stated that the filing is “consistent with Mr. Musk’s ongoing pattern of harassment,” while Apple has not yet commented publicly. This legal dispute adds to Musk’s ongoing tensions with OpenAI, including a separate lawsuit in California where he seeks to halt OpenAI’s transition from a nonprofit to a for-profit organization [1].

Source:

[1] Reuters (https://www.reuters.com/legal/litigation/elon-musks-xai-sues-apple-openai-over-ai-competition-app-store-rankings-2025-08-25/)

[2] Sherwood News (https://sherwood.news/tech/xai-sues-apple-openai-elon-musk-chatgpt)

[3] WFMJ (https://www.wfmj.com/story/53029469/elon-musk-accuses-of-apple-and-openai-of-stifling-ai-competition-in-antitrust-lawsuit)