Microsoft is on the verge of finalizing a monumental $40 billion investment in OpenAI, valuing the artificial intelligence pioneer at a staggering $260 billion. Meanwhile, Elon Musk's attempt to seize control of OpenAI's nonprofit arm for $97.4 billion has been thwarted. The OpenAI board has unanimously rejected Musk's proposition, which they determined does not align with the company's mission.
Elon Musk, once a friend and colleague of OpenAI's CEO Sam Altman since the organization's inception in 2015, has turned into a formidable adversary. His relationship with OpenAI soured as the company emerged as a leader in generative AI, gaining global attention with its ChatGPT chatbot. OpenAI's attorney, William Savitt, communicated the board's decision to Musk's lawyer, Marc Toberoff, stating that Musk's "much-publicized 'bid' is in fact not a bid at all."
The proposal was directed at OpenAI's nonprofit arm, responsible for overseeing ChatGPT's development, rather than the entire entity. Despite Musk's offer being substantial, the board found it did not serve the best interest of their charter. Unlike traditional companies, OpenAI's board holds no fiduciary duty to investors but remains devoted to its original charter, which emphasizes the broader good of humanity through advanced AI.
OpenAI is currently navigating a transition toward a for-profit structure, a move that has sparked legal action from Musk. He accuses OpenAI of breaching contract terms and seeks to impede its restructuring efforts. In response to Musk's offer, CEO Sam Altman humorously suggested an alternative by saying, "no thank you but we will buy twitter for $9.74 billion if you want."
Musk, meanwhile, is rallying support for his rival AI venture xAI, raising billions to challenge OpenAI's market dominance. The tension between Musk and OpenAI underscores the broader debate over AI development priorities.
"It's time for OpenAI to return to the open-source, safety-focused force for good it once was." – Marc Toberoff
Amid this backdrop, OpenAI Chairman Bret Taylor emphasizes the nonprofit's commitment to its mission.
"Any potential reorganization of OpenAI will strengthen our nonprofit and its mission to ensure AGI benefits all of humanity." – OpenAI Chairman Bret Taylor