OpenAI Controversy – Everything Changed Again (Update)

Silicon Valley has seen its fair share of leadership shakeups. But over the past few days, we have seen a whirlwind of drama unfold at OpenAI. Surprise firings, mass resignation threats, new hires, intense employee backlash, big tech power plays, rapid reversals, and unpredictable twists.

I’ve been following events closely and here are the key details and updates.

First, a quick recap.

Sam Altman Ousted

On the 17th of November 2023, OpenAI suddenly announced a major leadership transition in a blog post, stating that its CEO Sam Altman was out. And CTO Mira Murati would take over as interim CEO, effective immediately.

The board of directors of OpenAI, Inc., the 501(c)(3) that acts as the overall governing body for all OpenAI activities, today announced that Sam Altman will depart as CEO and leave the board of directors. Mira Murati, the company’s chief technology officer, will serve as interim CEO, effective immediately.

Altman himself confirmed his removal on Twitter shortly after.

This shocking move blindsided many. Greg Brockman, who served as OpenAI’s President, revealed that even they were given “moments notice” before the public announcement. As a part of this transition, Brockman will also be stepping down as chairman of the board and will remain in his role at the company, reporting to the CEO.

The fallout and attempts to bring Sam back

Looking at who was on OpenAI’s board provided some clues. Only two of the six board members were Sam and Greg. The remaining four board members – Ilya Sutskever, Adam D’Angelo, Tasha McCauley, and Helen Toner – would have needed to vote 4-2 to remove Sam as CEO.

In the following days, more details began to emerge shedding light on the conflict. According to sources familiar with the situation, tensions had been building between Altman and the board over the pace and scope of OpenAI’s commercial activities.

Specifically, Altman was pushing strongly to make more money available for research through means like monetizing APIs, selling access to powerful models, and spinning out startups. The board focused more on research and allegedly had concerns these moves were happening too quickly without proper safeguards.

Others indicated Microsoft, a major investor, also grew impatience with delays in deploying AI capabilities it helped fund. This added commercial pressure that some board members saw as problematic.

Altman, for his part, argued more resources were desperately needed for problems like safe and beneficial AGI. However, some on the board felt this risked prioritizing profit over safety if not carefully managed and communicated. Their perspectives appeared irreconcilable.

A Microsoft spokesperson stated that the company was “surprised” by Altman’s ouster and was “seeking” more information from the OpenAI board of directors. In other words, Microsoft had no prior warning of the changes, adding to suspicions the board blindsided even its closest partners. This gave the appearance the decision was made hastily and without properly considering ramifications.

Sam isn’t coming back as speculated

Key backers like Microsoft had reportedly pushed for his reinstatement.

Just when it seemed Sam would return to OpenAI, everything changed again on Sunday night. Articles reported that Sam Altman wouldn’t be coming back after all, and the board was sticking with their decision.

Instead, they had brought in Twitch co-founder Emmett Shear as the new CEO, replacing interim CEO Dario after just 48 hours in the role. The board wasn’t budging on Sam, despite massive support for him within the company.

Microsoft Makes Power Play and Hires Altman

Moments later, Microsoft CEO Satya Nadella announced that Sam Altman and Greg Brockman, together with colleagues, will be joining Microsoft to lead a new advanced AI research team.

Ilya Sutskever regrets his actions

Sutskever, in particular, seemed to reverse course. After reportedly voting to remove Altman, Sutskever tweeted that he “deeply regret[s] my participation in the board’s actions.”

He said he “never intended to harden OpenAI” and wants to “reunite the company.” Sam Altman responded positively on Twitter to Ilya’s statement as well.

It revelations like this that showed there may be more happening beneath the surface.

What Will Happen Next?

Where all these goes next is still unclear, but here are the likeliest scenarios:

Scenario 1: Faced with losing virtually the whole company, the board have a rethink and reinstates Sam as promised. OpenAI stays intact.

Scenario 2: The board holds strong and most OpenAI employees, defect to join Sam’s new Microsoft team. Without key people, OpenAI struggles or shuts down.

Scenario 3: A middle ground is found where Sam and Microsoft work closely with any remaining OpenAI team under new leadership. Both companies’ interests are served through the partnership arrangement.

My assessment is scenarios 1 or 2 are most probable based on the forces in play. The board’s handling of the situation has severely damaged trust within the company. It will take major concessions to avoid OpenAI essentially being rebuilt from scratch elsewhere.

No matter the outcome, these events will go down as an inflection point for OpenAI’s symbolic influence over AI development and ethics. Microsoft seizing the opportunity to wrest control of key OpenAI talent also represents a potential power shift.

About OpenAI

OpenAI was founded as a non-profit in 2015 with the core mission of ensuring that artificial general intelligence benefits all of humanity. In 2019, OpenAI restructured to ensure that the company could raise capital in pursuit of this mission, while preserving the nonprofit’s mission, governance, and oversight. The majority of the board is independent, and the independent directors do not hold equity in OpenAI. While the company has experienced dramatic growth, it remains the fundamental governance responsibility of the board to advance OpenAI’s mission and preserve the principles of its Charter.

Leave a Reply