Microsoft CEO Nadella Says OpenAI Governance Needs To Change (cnbc.com) 28
In an interview with CNBC's Jon Fortt today, Microsoft CEO Satya Nadella said that the governance structure of OpenAI needs to change after the AI company's sudden firing of CEO Sam Altman. "At this point, I think it's very clear that something has to change around the governance," Nadella said. He added that Microsoft would have "a good dialogue with their board on that."
Unlike traditional private company boards, OpenAI's board consists mostly of outsiders and isn't tasked with maximizing shareholder value. "[N]one of them hold equity in OpenAI," notes The Verge. "Instead, their stated mission is to ensure the creation of 'broadly beneficial' artificial general intelligence, or AGI." From the report: In his first press interview since Altman's ouster, Nadella dismissed concerns of long-term damage at OpenAI and said that the critical artificial intelligence research continues as does the partnership with Microsoft. But his comments didn't clear up confusion surrounding where Altman and fellow OpenAI co-founder Greg Brockman, who was the company's chairman, will ultimately end up. Early Monday morning Nadella said that Altman, Brockman and their colleagues would join Microsoft as part of a new AI research group. That post followed news that ex-Twitch CEO Emmett Shear had been named OpenAI interim head as Altman looked to depart. Over the course of Monday, it became less evident that Altman and Brockman would actually be joining Microsoft.
Hundreds of OpenAI employees signed a letter to the company's board demanding that they resign or else the staffers may choose to leave and join their former boss at Microsoft. Nadella said it's the choice of OpenAI employees whether they stay in their current roles or move to Microsoft, adding that his company has what it needs to keep innovating on its own. "I'm open to both options," he said. Nadella told Fortt that Microsoft respects OpenAI's nonprofit roots and shares its belief that AI needs to be developed and rolled out in a safe manner. "We want to make sure that we're dealing with not only the benefits of technology, but the unintended consequences of the technology from day one, as opposed to waiting for things to happen," Nadella said. Stay tuned: Legendary tech journalist Kara Swisher is releasing a 30 minute interview with Nadella in which he says, among other things, that he felt he should have been informed earlier as a partner of OpenAI and that will change in the future. "Also lots of deets about new hire [Sam Altman], safety in AGI and even India's loss to Australia in that cricket match," says Swisher in a post on X.
Further reading: Some investors in OpenAI are considering suing the board. "Sources said investors are working with legal advisors to study their options," reports Reuters. "Investors worry that they could lose hundreds of millions of dollars they invested in OpenAI, a crown jewel in some of their portfolios, with the potential collapse of the hottest startup in the rapidly growing generative AI sector."
Unlike traditional private company boards, OpenAI's board consists mostly of outsiders and isn't tasked with maximizing shareholder value. "[N]one of them hold equity in OpenAI," notes The Verge. "Instead, their stated mission is to ensure the creation of 'broadly beneficial' artificial general intelligence, or AGI." From the report: In his first press interview since Altman's ouster, Nadella dismissed concerns of long-term damage at OpenAI and said that the critical artificial intelligence research continues as does the partnership with Microsoft. But his comments didn't clear up confusion surrounding where Altman and fellow OpenAI co-founder Greg Brockman, who was the company's chairman, will ultimately end up. Early Monday morning Nadella said that Altman, Brockman and their colleagues would join Microsoft as part of a new AI research group. That post followed news that ex-Twitch CEO Emmett Shear had been named OpenAI interim head as Altman looked to depart. Over the course of Monday, it became less evident that Altman and Brockman would actually be joining Microsoft.
Hundreds of OpenAI employees signed a letter to the company's board demanding that they resign or else the staffers may choose to leave and join their former boss at Microsoft. Nadella said it's the choice of OpenAI employees whether they stay in their current roles or move to Microsoft, adding that his company has what it needs to keep innovating on its own. "I'm open to both options," he said. Nadella told Fortt that Microsoft respects OpenAI's nonprofit roots and shares its belief that AI needs to be developed and rolled out in a safe manner. "We want to make sure that we're dealing with not only the benefits of technology, but the unintended consequences of the technology from day one, as opposed to waiting for things to happen," Nadella said. Stay tuned: Legendary tech journalist Kara Swisher is releasing a 30 minute interview with Nadella in which he says, among other things, that he felt he should have been informed earlier as a partner of OpenAI and that will change in the future. "Also lots of deets about new hire [Sam Altman], safety in AGI and even India's loss to Australia in that cricket match," says Swisher in a post on X.
Further reading: Some investors in OpenAI are considering suing the board. "Sources said investors are working with legal advisors to study their options," reports Reuters. "Investors worry that they could lose hundreds of millions of dollars they invested in OpenAI, a crown jewel in some of their portfolios, with the potential collapse of the hottest startup in the rapidly growing generative AI sector."
Of course it does (Score:4, Insightful)
That might be the easiest and cheapest corporate takeover MS has ever undertaken. No boardroom fights, or messy stock purchases, nor did they have to plant a saboteur (looking at you Elop).
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Its almost brilliant. OAI had an astonishingly powerful, but not particularly patentable (Transformer NNs where not invented at OAI) piece of IP and possibly the most sought after R&D team in silicon valley. Now that team is pretty much fleeing to MS, and theres going to be a very good chance that at the end of all th
Re:Of course it does (Score:4, Interesting)
Chances are microsoft won't need a grip on openai, because without the research team, it's a dead end company. If microsoft can just grab the entire team as is and transplant them into some (de facto) newly created vision that will do things in the same way openai did, they win everything that is valuable and get to axe all the cruft all at once.
If microsoft plays its cards right here, this is truly among the most epic corporate intrigue executions of all times, if not the most epic.
A plan by superhuman intelligence? (Score:4, Funny)
Its almost brilliant.
Its almost like a strategy was designed by a superhuman intelligence? :-)
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Almost like maikurosofuto has been ruled by a degenerative AI for the past 40 years.
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I think too many investors were hoping to get fabulously rich off of a "non profit". They should have left it alone instead of trying to force it into becoming a money maker. Stradding the line beween a non-profit half and a profit half is the problem, which guarantees that the board (non-profit) disagrees with the investors (profit).
Solution should have been all along to split OpenAI into two. The board was right to fire a CEO trying to do too much corporate profit making, and the employees who wanted t
Re: Of course it does (Score:1)
Pub Benefit Corps are a legit way to go (Score:3)
I think too many investors were hoping to get fabulously rich off of a "non profit".
It was not investors.
Open AI was no longer a non-profit: "We designed OpenAI’s structure—a partnership between our original Nonprofit and a new capped profit arm—as a chassis for OpenAI’s mission: to build artificial general intelligence (AGI) that is safe and benefits all of humanity"
https://openai.com/our-structu... [openai.com]
They created a hybrid organization. They entered a monetization phase. It was THEIR choice. This is actually not uncommon, see public benefit corporation. A simp
Public benefits corp a legitimate way to go (Score:2)
I think too many investors were hoping to get fabulously rich off of a "non profit".
It was not investors.
Open AI was no longer a non-profit: "We designed OpenAI’s structure—a partnership between our original Nonprofit and a new capped profit arm—as a chassis for OpenAI’s mission: to build artificial general intelligence (AGI) that is safe and benefits all of humanity"
https://openai.com/our-structu... [openai.com]
They created a hybrid organization. They entered a monetization phase. It was THEIR choice. This is actually not uncommon, see public benefit corporation. A simp
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I would not call it a hybrid exactly. They created a for profit company (capped profit actually) that was majority owned and controlled by a non-profit company. This seems to me like an inherently unstable arrangement, since the incentives and motives of the non-profit board were not well aligned with the minority owners of the for profit company. When the value of the for profit company soared, the instability increased and the whole thing collapsed.
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It was a not for profit. It's definition of success was delivering an AGI safely to everyone, not making money. The company making money was supposed to be a way to support delivering that goal but came to dominate it and get in the way. The board likely tried to get back to achieving success at the foundations aims rather than the companies aims, as was supposed to be their job.
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nor did they have to plant a saboteur
Are you sure? Yes, there is Hanlon's Razon. However, i question whether the board could possibly have made this much of a mess by accident. Perhaps there was a saboteur...
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Surely Sam Altman is the saboteur (of the Foundation's goals of open AGI for everyone). He's trying to drive profit, which means that he wants to limit access to the AI to those that pay for it. That's was a fundamental conflict of interest.
It's like that movie..... (Score:1)
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MS is synonymous of "hostile takeover"
Who is surprised by this (Score:3)
How dare a non-profit observe their stated goals and mission in the face of people with lots of money considering themselves integral to Real Business, huh.
Can't wait until people look back and be like "wow how did we miss all the red flags about that guy".
Non-profit versus for profit (Score:3)
It almost goes without saying, but seeing that the CEO of a very large company seems to be missing the point, here it is:
Non-profits benefit society as a whole.
Ripping that out to benefit a couple of money-hungry "investors" just drags down whatever the non-profit is for.
In my humble opinion, non-profit of AI needs to be enshrined into law worldwide. Anecdotally, the internet is a great help to all people, precisely because it is made for all people, and the underpinnings of it is free. Of course you can build for profit things with it, but the building blocks is available to everyone that is willing to expend some effort in learning how it works.
AI should be the same way, not held hostage by a privileged few who make terrible decisions to line their pockets. See slave trade as only one example of many.
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> Non-profits benefit society as a whole.
There is no such requirement of a non-profit. One of the many forms of a non-profit might benefit society, but there are many that do not.
> non-profit of AI needs to be enshrined into law worldwide
I see you don't understand how law works...
What (Score:2, Insightful)
Stay tuned: Legendary tech journalist Kara Swisher
Is Kara Swisher now treated as "a brand" to be used to generate clicks?
Nadella lies through his teeth (Score:2)
EEE (Score:3)
OpenAI governance needs to change... to the point where Microsoft can own them easily
Beginning of the end of the AI hype cycle (Score:2)
> "Investors worry that they could lose hundreds of millions of dollars they invested in OpenAI, a crown jewel in some of their portfolios, with the potential collapse of the hottest startup in the rapidly growing generative AI sector"
It's clear to every AI investor now that they're stupid if they depend on a cult of personality to keep their hundreds of millions of dollars safe. They're not going to invest in these ridiculous bullshit SV hype trains (anymore) without guarantees. What this basically mean
Of course he's pissed off (Score:2)
MS dumped how many billions into a company
that now utterly lacks leadership?
Cool investment, bro.