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In a legal escalation of his feud with Apple and OpenAI, Elon Musk has filed a lawsuit accusing the companies of colluding to protect and extend their monopolies in AI chatbots. Filed Monday on behalf of Musk’s companies X and xAI, the lawsuit says Apple and OpenAI struck an “illegal deal” that would block competitors like Grok from competing with ChatGPT. It follows weeks of public complaints by Musk about Apple’s support of OpenAI while banning Grok from the App Store’s “Must Have” list.

The suit, filed in the U.S. District Court for the Northern District of California, goes well beyond gripes about App Store rankings, alleging Apple and OpenAI entered into an exclusive arrangement to distribute ChatGPT through iOS features and messaging while “foreclosing rivals” from reaching Apple users. It says the two companies are violating antitrust and unfair competition laws, and threatens to upend Musk’s plans to build a so-called “everything app” on Twitter, which he purchased in 2022.

Apple integrated ChatGPT into iOS in early May as the default chatbot in Siri, Apple’s Writing Tools, and other parts of the operating system, giving OpenAI exclusive access to the potentially billions of prompts from Apple users. The filing argues that data is critical for chatbot developers to train and improve their models, but without access to Apple’s user base, rivals like Grok cannot compete. It estimates that OpenAI currently controls at least 80 percent of the chatbot market, and Apple’s integration of ChatGPT “would give OpenAI a market stranglehold for years to come.”

“The defendants’ anticompetitive conduct has handed a substantial portion of the market to ChatGPT instead,” the lawsuit states. “Generative AI chatbots would vigorously compete with one another in a fair market.”

The complaint also argues that Apple is acting out of fear that an attractive rival super app would make iPhones less essential to consumers, pointing to WeChat in China as an example. It cites an Apple executive as saying the firm worried advancements in AI could “destroy Apple’s smartphone business.” Musk’s filing accuses Apple of “colluding” with OpenAI to protect its “de facto iPhone monopoly” by hobbling competitors and giving OpenAI an unbeatable lead in generative AI.

Details on Exclusive ChatGPT Deal, xAI Attempts to Reach Agreement

X points to a prior search engine arrangement between Apple and Google as a direct parallel, which U.S. regulators have argued helped entrench Google’s monopoly. Musk alleges Apple shot down numerous requests by xAI to integrate Grok with iOS, and even refused to feature Grok in the App Store in recent months or allow its new “Imagine” feature to be used. Beyond that, the filing also accuses Apple of manipulating App Store rankings and holding back Grok updates to stifle competition.

Musk’s lawsuit argues that if Apple and OpenAI continue to favor ChatGPT, competitors like Grok stand little chance of making up ground. X claims that Apple Siri is already a chatbot on its own, with the virtual assistant handling 1.5 billion requests per day from users around the world in 2024 alone—a volume greater than the total prompts used to train all generative AI chatbots that year. If Apple opens up all those prompts exclusively to OpenAI, the company could gain control of up to 55 percent of all possible chatbot interactions, the filing argues.

This could be bad news for Apple customers, Musk’s filing says, which could see reduced options and less capable chatbots, while paying monopoly prices for iPhones. The lawsuit also suggests that OpenAI could use its market dominance to jack up prices for subscriptions, which Musk’s companies say OpenAI plans to double over the next four years. “OpenAI would be unable to charge such an increase, much less double the price, unless it had marketwide pricing power,” the lawsuit alleges.

Musk further suggests Apple and OpenAI’s actions will deter investment in competitive chatbots, with investors providing less support to underdogs that face Apple’s might. Developers could be lured away to Big Tech firms that already have access to ChatGPT, including at OpenAI, X’s filing argues.

Financial Terms of Deal Suggest Goal Was Blocking Competition

The filing also questions why two such high-profile companies would make such a risky deal, suggesting its value to both companies is the broader block on competitors, rather than direct financial revenue. The deal, X says, is exclusive through 2028. Musk’s filing says OpenAI gave ChatGPT to Apple for free, “effectively paying Apple tens of millions of dollars” for the privilege of being the exclusive chatbot. Apple does not anticipate seeing any profit from the deal in the near term, but both Apple and OpenAI executives have emphasized the importance of keeping competitors at bay.

“The defendants made the deal exclusive, not because Apple and OpenAI care about lost profits, but because Apple and OpenAI’s primary interest was blocking competition,” the lawsuit states.

In a statement to Ars Technica, an OpenAI spokesperson described Musk’s lawsuit as “part of Elon’s ongoing pattern of harassment and distraction.” Apple declined to comment.

If a court rules in Musk’s favor, Apple could be forced to either integrate multiple chatbots with iOS or give xAI equal access to iOS integrations, though it’s unclear whether Apple could even technically give Grok access to some features it offers ChatGPT. The suit is seeking billions in damages as well as a permanent injunction barring Apple’s exclusive integration of ChatGPT. For Musk, the legal fight could determine the very future of AI competition and chatbots like Grok, which now power Musk’s vision of a centralized everything app on Twitter.