Elon Musk is waging a legal war on Apple and OpenAI. On Monday, his companies filed a lawsuit that claims the two companies have conspired to “entrench monopolies” in the rapidly growing AI chatbot market. The suit escalates a dispute that has raged for weeks over App Store rankings and exclusive access to iPhone features.

Filed on behalf of Musk’s X and xAI companies, the lawsuit goes beyond gripes about App Store rankings. It charges that Apple and OpenAI have entered into an exclusive deal giving ChatGPT preferential access to iPhone features, while blocking competitors from reaching Apple’s users. Musk alleges the deal violates antitrust and unfair competition laws and will prevent him from realizing a long-stated vision to build an “everything app” on the foundation of the Twitter social network, which he purchased in 2022.

In its complaint, X argues that Apple gave ChatGPT “unprecedented access to iPhone features,” including as the default chatbot within Siri, Apple’s Writing Tools, and more. The integration also provides OpenAI with exclusive access to billions of user prompts, data that X says is crucial to training and improving chatbot models. ChatGPT rival Grok, the lawsuit claims, cannot scale without access to Apple’s user base. OpenAI currently has at least 80 percent of the chatbot market, according to X, and its exclusive integration with Apple will cement that lead indefinitely.

“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.”

In what X characterizes as a conflict of interest, Apple is motivated by a fear that a successful rival super app will one day make iPhones less necessary, Musk’s filing argues. The company is particularly wary of an app that can supplant standalone smartphone functions the way WeChat has in China. One Apple executive, Eddy Cue, was “concerned that advances in AI could ‘destroy Apple’s smartphone business,’” according to the complaint. Musk’s filing contends that the deal is intended to preserve the iPhone monopoly while giving OpenAI an unbeatable head start in generative AI.

Exclusive Access, Growing Market Power

In the complaint, X likens the deal to the existing arrangement between Apple and Google to make the latter the default search engine on iOS devices. U.S. regulators have long argued the deal cemented Google’s monopoly in search. Musk says Apple refused repeated attempts by xAI to integrate Grok with iOS, and blocked its efforts to even get Grok listed in the App Store, in particular around the rollout of a new “Imagine” feature.

Beyond that, the complaint alleges Apple manipulated App Store rankings to give ChatGPT an advantage and delayed approval of Grok updates. At stake, Musk argues, is not only Grok’s ability to compete but the very future of AI-driven social and productivity platforms. The lawsuit notes that Siri already fields 1.5 billion user requests per day globally as of 2024, an order of magnitude greater than all the other generative AI chatbots that year. If those prompts go to OpenAI alone, it will end up controlling up to 55 percent of all potential chatbot interactions, according to X.

The filing paints the picture of a deal with far-reaching consequences for consumers. Apple customers, it argues, may end up with fewer choices and less capable AI chatbots, while paying monopoly prices for iPhones. Meanwhile, OpenAI could also use its dominant position to raise prices, having plans to double its “plus” subscription over the next four years. “That plan would be unfeasible unless OpenAI has power over marketwide prices,” the lawsuit alleges.

Musk also underscores the chilling effect on potential investment. If Apple continues to “press its thumb firmly on the scale in favor of ChatGPT, such that ChatGPT appears to investors to be a preferred or guaranteed winner,” other investors may see little value in supporting alternative approaches, X argues, leaving them starved for resources. The filing further warns that Big Tech companies could snap up developers from underfunded startups.

The suit also questions the financial incentives that Apple and OpenAI have to enter the exclusive deal. According to X, OpenAI gave ChatGPT away to Apple for free, essentially paying Apple for the privilege, while Apple, in turn, will not make a near-term profit on the integration. The filing suggests both companies view the exclusive access as more valuable than direct revenue, since it broadly blocks competitors and entrenches their control.

“By making the deal exclusive, Apple sacrificed the profits it would have earned by integrating multiple chatbots,” the complaint states. “The true motive was Apple and OpenAI’s shared goal of blocking competition.”

The stakes are particularly high for Musk. He warns in the filing that if left unchecked, Grok may never be able to compete on a level playing field, becoming less attractive to both users and investors. “Because Grok’s functionality is a key feature of the X app, the X app is more attractive the better Grok performs,” the filing states. “Defendants’ conduct makes Grok less able to compete with ChatGPT, leading to fewer customers, less revenue, and ultimately a depressed enterprise value for X.”

X is seeking billions in damages as well as a permanent injunction blocking Apple’s integration of ChatGPT. OpenAI, in a statement to Ars Technica, called the filing part of Musk’s “ongoing pattern of harassment” that “says more about him than it does about Apple or OpenAI.” Apple did not respond to a request for comment.

A court ruling on Musk’s legal challenge could determine not only the fate of Grok but also the future of AI innovation.