Brian Merchant: OpenAI's board had safety concerns. Big Tech obliterated them in 48 hours

Brian Merchant, Los Angeles Times on

Published in Business News

It's not every day that the most talked-about company in the world sets itself on fire. Yet that seems to be what happened last Friday, when OpenAI's board announced that it had terminated its chief executive, Sam Altman, because he had not been "consistently candid in his communications with the board." In corporate-speak, those are fighting words about as barbed as they come: They insinuated that Altman had been lying.

The sacking set in motion a dizzying sequence of events that kept the tech industry glued to its social feeds all weekend: First, it wiped $48 billion off the valuation of Microsoft, OpenAI's biggest partner. Speculation about malfeasance swirled, but employees, Silicon Valley stalwarts and investors rallied around Altman, and the next day talks were being held to bring him back. Instead of some fiery scandal, reporting indicated that this was at core a dispute over whether Altman was building and selling AI responsibly. By Monday, talks had failed, a majority of OpenAI employees were threatening to resign, and Altman announced he was joining Microsoft.

All the while, something else went up in flames: the fiction that anything other than the profit motive is going to govern how AI gets developed and deployed. Concerns about "AI safety" are going to be steamrolled by the tech giants itching to tap in to a new revenue stream every time.

It's hard to overstate how wild this whole saga is. In a year when artificial intelligence has towered over the business world, OpenAI, with its ubiquitous ChatGPT and Dall-E products, has been the center of the universe. And Altman was its world-beating spokesman. In fact, he's been the most prominent spokesperson for AI, period.

For a high-flying company's own board to dump a CEO of such stature on a random Friday, with no warning or previous sign that anything serious was amiss — Altman had just taken center stage to announce the launch of OpenAI's app store in a much-watched conference — is almost unheard of. (Many have compared the events to Apple's famous 1985 canning of Steve Jobs, but even that was after the Lisa and the Macintosh failed to live up to sales expectations, not, like, during the peak success of the Apple II.)

So what on earth is going on?


Well, the first thing that's important to know is that OpenAI's board is, by design, differently constituted than that of most corporations — it's a nonprofit organization structured to safeguard the development of AI as opposed to maximizing profitability. Most boards are tasked with ensuring their CEOs are best serving the financial interests of the company; OpenAI's board is tasked with ensuring their CEO is not being reckless with the development of artificial intelligence and is acting in the best interests of "humanity." This nonprofit board controls the for-profit company OpenAI.

Got it?

As Jeremy Khan put it at Fortune, "OpenAI's structure was designed to enable OpenAI to raise the tens or even hundreds of billions of dollars it would need to succeed in its mission of building artificial general intelligence (AGI) ... while at the same time preventing capitalist forces, and in particular a single tech giant, from controlling AGI." And yet, Khan notes, as soon as Altman inked a $1-billion deal with Microsoft in 2019, "the structure was basically a time bomb." The ticking got louder when Microsoft sunk $10 billion more into OpenAI this past January.

We still don't know what exactly the board meant by saying Altman wasn't "consistently candid in his communications." But the reporting has focused on the growing schism between the science arm of the company, led by co-founder, chief scientist and board member Ilya Sutskever, and the commercial arm, led by Altman.


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