One possibility is that OpenAI could become a competitor to Sam Altman – the CEO they just fired, because Altman may decide to suck talent away from OpenAI when he comes to the new company.
According to CNN, OpenAI’s supervisors are concerned that the company is creating advanced artificial intelligence (AI) technology, with the destructive power equivalent to a nuclear bomb, and “a corporate caretaker.” ” – former Chief Executive Officer (CEO) Sam Altman – made decisions so quickly that they risked causing a global disaster.
Therefore, the Board of Directors decided to fire Altman. At first glance, this sounds like a reasonable solution.
But the manner in which Altman was fired — suddenly, without notice, and without warning to some of OpenAI’s largest partners and stakeholders — defies logic. And this risks causing more damage than the scenario where the Board of Directors does not decide to fire Altman.
A company’s Board of Directors has the highest duty to its shareholders. OpenAI’s most important shareholder is Microsoft – the company that gave Altman and OpenAI $13 billion to help Bing, MS Office, MS Windows and Azure products surpass rival Google, and stay ahead of Amazon and IBM. and other big technology companies also want AI.
However, Microsoft was not informed of Altman’s firing until “right before” the public announcement, according to Kara Swisher, a CNN contributor. As a result of the OpenAI Board of Directors’ decision, Microsoft’s stock has declined.
OpenAI employees themselves were not informed in advance about the layoff decision.
The same thing happened with Greg Brockman, the company’s co-founder and former Chairman. Brockman said in a post on social network X that he learned that Altman was fired just minutes before it actually happened.
Brockman, a staunch supporter of Altman and his leadership of the company, resigned last Friday. Others loyal to Altman are also “looking for the exit.”
Suddenly, OpenAI fell into crisis. Reports suggest that Altman and other OpenAI loyalists are about to start their own business, which threatens to destroy everything the company has worked so hard to achieve over the years.
So, just one day after making the decision to fire, the Board of Directors is said to have moved to try to bring Altman back. It was a shocking turn of events for a company considered by many to be the most promising manufacturer of the most exciting new technology.
The “strange” structure of OpenAI’s Board of Directors causes many complications.
The company is a non-profit organization. But Altman, Brockman and Chief Scientist Ilya Sutskever in 2019 founded OpenAI LP – a for-profit entity that exists within a corporate structure.
That for-profit company took OpenAI from worthless to a $90 billion valuation in just a few years, and Altman is considered the “mastermind” of this plan, key to the company’s success.
As a rule of thumb, a company with big backers like Microsoft and venture capital firm Thrive Capital is supposed to grow its business and make money. Investors want to make sure they make a lot of money and “they are not known as a very patient group.”
This may have led Altman to push OpenAI LP to innovate faster and develop products to market sooner. In the Silicon Valley tradition of “moving fast and breaking things,” products that come to market early don’t always work well from the start.
The Verge news site reported on November 20 that Microsoft Corporation is recruiting former OpenAI CEO Sam Altman and the company’s co-founder Greg Brockman.
Maybe it would still be okay if the product was just a dating app or a social media platform.
However, the case of OpenAI is a completely different story, when the product is a technology capable of imitating human speech and behavior in an amazingly similar way, to the point of being able to fool people into believing it. that the fake conversations and images created are real.
And that’s what scares the company’s Board of Directors – which is still largely controlled by its nonprofit “wing.”
Kara Swisher reports that OpenAI’s recent Developer Conference served as a highlight: Altman announced OpenAI will provide tools so anyone can create their own version of ChatGPT.
For Sutskever and the Board of Directors, it was a step too far.
“The company is playing with fire”
In Altman’s own words, the company is playing with fire.
When Altman founded OpenAI LP four years ago, the new company noted in its charter that it remained “concerned” about AI’s potential to “cause rapid change” for humanity.
That can happen accidentally, when technology performs malicious tasks due to bad code, or because humans intentionally sabotage AI systems for malicious purposes. So the company is committed to prioritizing safety, even if that means a decline in profits for stakeholders.
Altman also called on regulators to set limits on AI to prevent people like him from causing serious damage to society.
“Must be [AI] will be like the printed newspaper that once ‘diffused’ knowledge, promoting learning everywhere, empowering ordinary everyday individuals, bringing prosperity, above all great freedom than?” – he said in a Senate Subcommittee hearing in May.
“Or will it be like the atomic bomb – a major technological breakthrough, but the (serious and terrible) consequences continue to haunt us to this day?”
AI advocates believe that new technology has the potential to revolutionize every industry and make humanity better in the process. It has the potential to improve education, finance, agriculture and healthcare.
But it also has the potential to take away people’s jobs: 14 million jobs could disappear in the next five years – according to a warning at the World Economic Forum in April this year.
AI is also “exceptionally good” at spreading harmful misinformation. And some people, including Elon Musk – a former OpenAI founder, fear this technology will surpass humanity in intelligence and could wipe out life on the planet.
How to handle a crisis
Given those threats, it is not surprising that the Board of Directors is concerned that Altman is moving at too fast a pace. They may feel the need to replace him with someone “more careful with potentially dangerous technology.”
But OpenAI does not operate in a “vacuum.” It has stakeholders, some of whom have billions of dollars poured into the company.
Inviting Microsoft into the decision, keeping employees informed, working with Altman on “a reasonable exit plan…” — all of those things would have been solutions typically recommended by the Board at large. OpenAI’s models are used, and it should all lead to better results.
Microsoft believes it has invested wisely in new technology that holds promise for the future. So, Altman’s firing must have been a shock to Microsoft CEO Satya Nadella and his team when they learned about the incident.
The OpenAI Board of Directors has angered a powerful ally and could be forever changed by the way it handled the “overthrowing” of Altman.
The company will likely become a competitor to Altman, who could eventually siphon talent away from OpenAI at the new company.
In the latest development, The Verge news site said on November 20 that Microsoft Corporation is recruiting Sam Altman and Greg Brockman. It is unclear what other scenarios this will lead to in the technology world.
But regardless, OpenAI is probably in a worse position than it was last Friday, when the company fired Altman. And ironically, it’s a problem the company could have avoided if it had behaved calmer and made decisions more slowly.