Elon Musk's xAI Sues Apple And OpenAI Over Alleged Collusion

Many people assumed Elon Musk was bluffing when he said he planned to sue Apple for purposefully preventing Grok from reaching the top spot in the App Store. Now, two weeks later, Musk has actually followed through. Earlier today, the Musk-owned X Corp. and xAI filed a lawsuit against both Apple and OpenAI. The suit alleges that Apple is engaging in monopolistic behavior and is conspiring with OpenAI to prevent rival AI apps from competing on a level playing field.

The suit claims that Apple, upon realizing the serious threat AI poses to its core business, is resorting to illegal tactics so that it can remain relevant. "In a desperate bid to protect its smartphone monopoly," the suit says, "Apple has joined forces with the company that most benefits from inhibiting competition and innovation in AI: OpenAI, a monopolist in the market for generative AI chatbots."

As we covered previously, Musk's allegations seem a bit flimsy given that other AI apps have performed exceptionally well on the App Store in recent months. For instance, the DeepSeek AI app was the #1 app on the App Store earlier this year. Further, Perplexity AI also managed to become the most popular app on the App Store in India a few months ago.

The crux of X's lawsuit is that Apple last year integrated ChatGPT into iOS. Consequently, if iPhone users want to use a generative AI chatbot on their device, "they have no choice but to use ChatGPT, even if they would prefer to use more innovative and imaginative products like xAI's Grok," the suit alleges.

X's argument here is a stretch, to say the least. There is no shortage of generative AI chatbots on the App Store, and Grok itself is quite popular. Apple's agreement with OpenAI has more to do with bolstering Siri than it does with precluding competition from rivals. If anything, Apple's implementation is so underwhelming that you could argue it drives users to seek out standalone generative AI chatbots — the same ones Musk claims are being thwarted.

"Generative AI chatbots improve their models based on a continuous feedback loop," the suit reads in part. "More users beget more prompts, and more prompts offer more opportunities to train the model, whose better features then attract even more users. As a result of Apple and OpenAI's exclusive arrangement, ChatGPT is the only generative AI chatbot that benefits from billions of user prompts originating from hundreds of millions of iPhones."

As a result, the suit alleges that it's difficult for ChatGPT competitors to fairly compete. This particular argument is especially bizarre given that Grok is heavily integrated into X and also Tesla vehicles.  Apple has yet to respond to the lawsuit, but in a previous statement, the company called Musk's previous claims of monopolistic behavior baseless. "The App Store is designed to be fair and free of bias," Apple said a few weeks ago. "We feature thousands of apps through charts, algorithmic recommendations, and curated lists selected by experts using objective criteria."