In the latest escalation of Elon Musk’s war with Apple and OpenAI, the billionaire filed a lawsuit on Monday claiming the companies made a deal to fortify their monopolies in the rapidly expanding AI chatbot market. The suit, which was filed just weeks after Musk berated Apple over its constant promotions for OpenAI’s ChatGPT and lack of equivalent placement for his own chatbot Grok, also accuses the two firms of breaching antitrust and unfair competition laws to hobble his broader vision of an “everything app.”

Filed on behalf of Musk’s X and xAI companies, the complaint goes far beyond gripes over App Store rankings. It instead centers on an alleged exclusive agreement giving OpenAI’s ChatGPT deep access to iPhone features unavailable to competitors and effectively locking out others from Apple’s 2 billion device users. X says the deal would violate antitrust and unfair competition laws and inflict irreparable damage on Musk’s long-promised super app, the foundation of which is Twitter and other software built atop the company he acquired in 2022.

Apple and OpenAI are alleged to have cut a deal giving ChatGPT deep access to iPhone features

The complaint filed in the Northern District of California argues Apple has integrated ChatGPT into iOS as the default chatbot across Siri, its Writing Tools, and other features, and that it will provide OpenAI with access to billions of user prompts. This data is necessary to train and improve chatbot models, X alleges, and without access to that pool of information, rivals cannot hope to scale Grok. OpenAI already controls at least 80 percent of the chatbot market, the filing states, and Apple’s actions risk entrenching it as the 800-pound gorilla in the nascent space for years to come.

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

X also claims Apple has a broader motive of fearing a successful rival super app could one day make iPhones less indispensable, as WeChat has in China, replacing standalone smartphones for many functions. The complaint includes a citation from Apple executive Eddy Cue allegedly saying advances in AI could “destroy Apple’s smartphone business.” Musk’s lawsuit contends that rather than pursue building a better user experience, Apple is trying to preserve the iPhone’s stranglehold over consumers, while also providing OpenAI a critical advantage and data trove to become unbeatable in generative AI.

Exclusive Access and Growing Market Power

In the filing, X compared the Apple-OpenAI deal to the tech giant’s previous agreement with Google to make it the default search engine. A deal that U.S. regulators have alleged entrenched Google’s monopoly. Musk’s team alleges Apple rejected repeated overtures from xAI to make Grok work with iOS and even declined requests to feature Grok in the App Store, including for a joint launch of the product and its new “Imagine” feature. Beyond that, the filing argues Apple manipulated App Store rankings and delayed Grok updates to hurt the chatbot’s ability to compete.

For Musk and X, the key to this battle is not just Grok’s ability to compete, but the very future of AI-driven social and productivity platforms. The filing points to a single day in 2024 where Siri processed 1.5 billion user requests across the globe, more than the total prompts received by all generative AI chatbots that year. If OpenAI alone is receiving those prompts and thus billions more in data to train models, it effectively controls up to 55 percent of all potential chatbot interactions, X alleges.

The filing paints a grave future for consumers who will have to contend with far fewer and less capable options, while paying Apple’s monopoly prices for iPhones. For OpenAI, meanwhile, the lawsuit suggests the data it amasses from Apple users will give it a dominant market position to raise subscription prices at will. The company is currently on track to double its “plus” subscription over the next four years, the filing notes. “That plan would be unfeasible unless OpenAI has power over marketwide prices,” it states.

Musk also argues the deal could stifle broader investment. Apple’s decision to “press its thumb firmly on the scale” in favor of ChatGPT will “convince potential investors that funding chatbot companies is a fruitless, if not foolish, endeavor,” the filing states. In turn, venture capitalists will be much more hesitant to fund future Grok rivals, leaving them without resources to scale and underdog developers starved for cash to simply be bought out by Big Tech.

The filing also questions the financial logic of the Apple-OpenAI deal, suggesting it would only make sense if the goal was to block rivals. According to X, OpenAI gave Apple ChatGPT for free to cover the costs of the deal, and in return, Apple effectively pays OpenAI to build its data pool, getting no near-term profit for its efforts. For both, the best outcome is ensuring OpenAI is the dominant chatbot on the iPhone, a move that will broadly block rivals and entrench their own power.