The board of directors of OpenAI has formally turned down Elon Musk’s almost $100 billion bid for the company that creates ChatGPT, the most well-known artificial intelligence (AI) technology in the world.
However, according to analysts, Musk may not consider the unsolicited proposal a failure.
This is because CEO Sam Altman’s intentions to turn OpenAI from a non-profit-controlled organization to a for-profit business may still be complicated by the offer.
According to Johnnie Penn, an associate teaching professor at the University of Cambridge, Musk is “basically trying to stymie OpenAI’s growth trajectory,” Penn told the BBC.
Profit & non-profit
Last week, Musk and a consortium of investors including Hollywood superagent Ari Emanuel tabled a $97.4bn (£78.4bn) offer for all of OpenAI’s assets.
It was a huge sum – but less than the $157bn the firm was valued at in a funding round just four months ago, and much lower than the $300bn that some think it is worth now.
Complicating all of this is OpenAI’s unusual structure which involves a partnership between non-profit and for-profit arms.
Mr Altman is understood to want to change that, stripping it of its non-profit board.
That involves costs which Mr Musk is seemingly trying to inflate.
“What Musk is trying to do here is raise the perceived value of the non-profit arm of OpenAI, so that OpenAI has to pay more to get out of the obligations it has to its own non-profit,” said Dr Penn.
It’s unclear how much its non-profit assets are worth. Lutz Finger, a senior lecturer at Cornell University and the creator and CEO of the AI business R2Decide, said Musk was floating a price with his bid.
“By Musk putting a price tag on the non-profit part, he makes the split way more expensive for Altman to do,” Mr. Finger told the BBC. “It’s very simple.”
‘Missed the AI train’
Mr. Musk used his desire to restore OpenAI, which he co-founded, to its non-profit origins and its initial goal of creating AI for the good of humanity as justification for his actions.
Others, however, contend that he has slightly less admirable intentions connected to his own artificial intelligence business xAI and chatbot Grok, which have drawn little public interest.
Musk has kind of fallen behind the AI curve. He has made multiple attempts to catch up, but he is currently behind,” Mr. Finger stated.
Mr. Finger claims that Mr. Musk is currently attempting to outshine his most formidable rival.
ICYMT: Government to reassign Samuel Adom Botchway after CLOGSAG protest
Last week, Mr. Musk responded by labeling his former partner a “swindler” after Mr. Altman made fun of his offer on X, thus exacerbating their already strained relationship.
Then, in a Bloomberg interview, Mr. Altman retaliated, claiming that Mr. Musk is not “a happy person” and that his choices are made from a “position of insecurity”.
The tit-for-tat is also taking place in court, as US district judge Yvonne Gonzalez Rogers is deliberating over Mr. Musk’s motion for an injunction to prevent OpenAI from proceeding with its proposal to convert.
Without her help, he says, he will suffer irreversible harm.
ICYMT
“It is conceivable that Mr. Musk is telling the truth. We’ll discover. Gonzalez Rogers stated at a Musk v. Altman hearing earlier this month in Oakland, California, “He’ll take the stand.”
Mr. Musk’s latest offer, according to OpenAI’s attorneys, goes against his past assertions that OpenAI’s assets cannot be taken away for “private gain.”
“[O]ut of court, those constraints evidently do not apply, so long as Musk and his allies are the buyers,” according to their reply brief.
Making a deal never seemed to be his intention, according to several observers.
“I think he’s just trying to create noise and news and consternation,” says Karl Freund, Cambrian-AI’s chief analyst and creator.
But that tactic might harm Mr. Musk’s reputation for years to come in addition to creating issues for his former adversary.
“He’s quite intelligent. He builds amazing businesses that do amazing feats. However, many are beginning to doubt his intentions because of his personal agenda,” Mr. Freund stated.
SOURCE:BBC
