3 ms·

Someone else would have probably signed a similar deal, without OpenAI giving Microsoft the incredible leverage of owning all the IP, and being able to offer yo

by vkou 3y ago

Someone else would have probably signed a similar deal, without OpenAI giving Microsoft the incredible leverage of owning all the IP, and being able to offer your entire staff a 20% pay raise to jump ship. If Sam was responsible for that, he smuggled one hell of a trojan horse into OpenAI, and should have been fired a long time ago.

vendiddy 3y ago
Which company could that have been and how would that have turned out any differently? It seems like OpenAI needed deep pockets and access to computing power to survive. That limits the potential companies they could have cut deals with.
- red-iron-pine 3y ago
  Aye, wasn't MS's main offer Azure credits? The compute resources that are required are massive, and if not MS then you're getting into bed with some other Big Corp, i.e. Amazon, Oracle, IBM, Google, etc.
jacquesm 3y ago
You deal with the devil at your peril. But this is still an own goal by the OpenAI board, before last Friday there were no circumstances that would have pitted the board against Microsoft and now there potentially are. Bad move.
mannerheim 3y ago
> If Sam was responsible for that, he smuggled one hell of a trojan horse into OpenAI, and should have been fired a long time ago. What's the likelihood that he signed onto a $10 billion investment deal from Microsoft without approval from the board?
- jacquesm 3y ago
  Zero. And if it was done without board approval then that would have been the moment to can him.
- robocat 3y ago
  Sam might not have been candid with the board about the implications of the deal.
  - jacquesm 3y ago
    Then the board failed in their duty of oversight. Because they could have found this out regardless of Sam being candid or not, implications are the consequences of that which is written on the papers and those papers were presumably available for inspection by the board. Unless Altman changed the paperwork but that would be an entirely different level and based on the statements by the new CEO none of that was the case. It seemed to be mostly a reason made up by the board to make the firing look good.
  - mannerheim 3y ago
    Are you saying he asked them to approve a contract that the board never saw the terms of, and they agreed?
nprateem 3y ago
This is a lot of jumping up and down over nothing. Think about it when the deal was on the table: 1) Take the money. If OpenAI fail, MS get the code. OK, who cares, OpenAI have gone bust. 2) Don't take the money, don't become successful unless they can find another partner with such a good fit (deep pockets and resources). It made sense to allow MS to have the code if OpenAI failed since they'd have had nothing to lose apart from whatever residual value they could sell their IP for (which they already were effectively doing for $10B, so fair enough). If this was a sticking point to secure a $10B investment, it made sense. OTOH if they granted the IP to MS not contingent on OpenAI failing, then that would have been sheer incompetence.
- notahacker 3y ago
  Option 3: negotiate a deal with a corporate partner with terms that mean it's more lucrative for them to help you succeed rather than take steps to ensure you fail at the first sign of trouble seems like a better choice. Clearly the possibility of OpenAI failing is not independent from the behaviour of its corporate partner. And I'm not sure Microsoft's negotiation is quite bad faith enough or their interest in OpenAI low enough to have made the entire deal contingent on the "if/when we decide to move aggressively against your company so it collapses we get exclusive free in perpetuity access to everything you ever did and no more caps to the profits from them" clause. If it's in there, it's in there because they signed a bad deal rather than because it was the only possibility.
  - jacquesm 3y ago
    Who will do that after MS already has been given all but the keys to the kingdom, and with all of the results of your efforts almost automatically flowing to your competitor by way of the deal that precedes yours?
    - notahacker 3y ago
      Its the original deal I'm saying shouldnt have been considered on "keys to the kingdom... if we should happen to unfortunately die" terms (I think my edit to make that clearer came after your post)

by vkou 3y ago

vendiddy 3y ago

Which company could that have been and how would that have turned out any differently? It seems like OpenAI needed deep pockets and access to computing power to survive. That limits the potential companies they could have cut deals with.

red-iron-pine 3y ago
Aye, wasn't MS's main offer Azure credits? The compute resources that are required are massive, and if not MS then you're getting into bed with some other Big Corp, i.e. Amazon, Oracle, IBM, Google, etc.

jacquesm 3y ago

You deal with the devil at your peril. But this is still an own goal by the OpenAI board, before last Friday there were no circumstances that would have pitted the board against Microsoft and now there potentially are. Bad move.

mannerheim 3y ago

> If Sam was responsible for that, he smuggled one hell of a trojan horse into OpenAI, and should have been fired a long time ago. What's the likelihood that he signed onto a $10 billion investment deal from Microsoft without approval from the board?

jacquesm 3y ago
Zero. And if it was done without board approval then that would have been the moment to can him.
robocat 3y ago
Sam might not have been candid with the board about the implications of the deal.
- jacquesm 3y ago
  Then the board failed in their duty of oversight. Because they could have found this out regardless of Sam being candid or not, implications are the consequences of that which is written on the papers and those papers were presumably available for inspection by the board. Unless Altman changed the paperwork but that would be an entirely different level and based on the statements by the new CEO none of that was the case. It seemed to be mostly a reason made up by the board to make the firing look good.
- mannerheim 3y ago
  Are you saying he asked them to approve a contract that the board never saw the terms of, and they agreed?

nprateem 3y ago

This is a lot of jumping up and down over nothing. Think about it when the deal was on the table: 1) Take the money. If OpenAI fail, MS get the code. OK, who cares, OpenAI have gone bust. 2) Don't take the money, don't become successful unless they can find another partner with such a good fit (deep pockets and resources). It made sense to allow MS to have the code if OpenAI failed since they'd have had nothing to lose apart from whatever residual value they could sell their IP for (which they already were effectively doing for $10B, so fair enough). If this was a sticking point to secure a $10B investment, it made sense. OTOH if they granted the IP to MS not contingent on OpenAI failing, then that would have been sheer incompetence.

notahacker 3y ago
Option 3: negotiate a deal with a corporate partner with terms that mean it's more lucrative for them to help you succeed rather than take steps to ensure you fail at the first sign of trouble seems like a better choice. Clearly the possibility of OpenAI failing is not independent from the behaviour of its corporate partner. And I'm not sure Microsoft's negotiation is quite bad faith enough or their interest in OpenAI low enough to have made the entire deal contingent on the "if/when we decide to move aggressively against your company so it collapses we get exclusive free in perpetuity access to everything you ever did and no more caps to the profits from them" clause. If it's in there, it's in there because they signed a bad deal rather than because it was the only possibility.
- jacquesm 3y ago
  Who will do that after MS already has been given all but the keys to the kingdom, and with all of the results of your efforts almost automatically flowing to your competitor by way of the deal that precedes yours?
  - notahacker 3y ago
    Its the original deal I'm saying shouldnt have been considered on "keys to the kingdom... if we should happen to unfortunately die" terms (I think my edit to make that clearer came after your post)