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>I kind of thought that was the point of the current structure. Yes, it is but if we only stopped the analysis right there, we could take pleasure in the fact
by jasode 2y ago
>I kind of thought that was the point of the current structure.
Yes, it is but if we only stopped the analysis right there, we could take pleasure in the fact that Sam Altman checkmated himself in his own blog post. "Dude, the non-profit is _supposed_ to control the profit company because that's how you formed the companies in the first place! Duh!!!"
To go beyond that analysis, we have to at least entertain (not "agree" but just _entertain_ for analysis) ... what Sam is saying:
- the original non-profit and profit structure was a mistake that was based on what they thought they knew at the time. (They thought they could be a "research" firm.)
- having a non-profit control the profit becomes a moot point if the for-profit company becomes irrelevant in the marketplace.
Here is a key paragraph:
>The hundreds of billions of dollars that major companies are now investing into AI development show what it will really take for OpenAI to continue pursuing the mission. We once again need to raise more capital than we’d imagined. Investors want to back us but, at this scale of capital, need conventional equity and less structural bespokeness.
In other words, let's suppose the old Friendster social network was structured as "non-profit-board-controlling-a-for-profit-Friendster" like OpenAI. The ideals of the "non-profit being in control" is a moot point when a competitor like Facebook makes non-profit-Friendster irrelevant.
Or put another way, pick any hard problem today (self-driving, energy discovery, etc) that requires billions of investment and hypothetically create a new company to compete in that space. Would creating that company as a non-profit-controlling-the-profit-company confer any market advantage or would it be a handicap? It looks like it's a handicap.
OpenAI is finding it hard to compete for investors' billions in the face of Tesla's billions spent on 50000 GPU supercluster, Google billions spent on Gemini, Anthropic billions spent on Claude, Alibaba's billions, etc. OpenAI doesn't have an unassailable lead with ChatGPT.
The issue is Sam Altman & OpenAI look bad because he and the investors want to use the existing "OpenAI" brand name in a restructured simpler for-profit company. But to outsiders, it looks like a scam or bait-and-switch. Maybe they could have done an alternative creative procedure such as spin up a totally new for-profit company called ClosedAI to take OpenAI's employees and then pay a perpetual ip license to OpenAI. That way, CloseAI is free of encumbrances from OpenAI's messy structure. But then again, Elon Musk would still probably file another lawsuit calling those license transfers as "bad faith business dealings".
- parpfish 2y agoI could see an argument for your example that putting the non profit in control of a social media company could help the long term financial success of the platform because you’re not chasing short term revenue that annoys users (more intrusive ads, hacking engagement with a stream of shallow click bait, etc). So it’d be a question of whether you could survive long enough to outlast competitors getting a big short term boost. I’m not sure what the equivalent would be for llm products.
- bradleyjg 2y agothe original non-profit and profit structure was a mistake that was based on what they thought they knew at the time. (They thought they could be a "research" firm.) There’s no slavery here. If Sam decided it was a mistake to dedicate his time to a non-profit, he’s perfectly free to quit and start an entirely new organization that comports with his current vision. That would be the honorable thing to do.
- jasode 2y ago>If Sam decided it was a mistake to dedicate his time to a non-profit, he’s perfectly free to quit [...] To be clear, I don't think Sam can do anything and come out looking "good" from a public relations standpoint. That said, Sam probably thinks he's justified because he was one of the original founders and co-chair of OpenAI -- so he feels he should have a say in pivoting it to something else. He said he got all the other donors on board ... except for Elon. That leaves us with the messy situation today... Elon is the one filing the lawsuit and Sam is writing a PR blog post that's received as corporate doublespeak.
- bradleyjg 2y agohe was one of the original founders and co-chair of OpenAI -- so he feels he should have a say in pivoting it to something else No. Non-profit is a deal between those founders and society. That he was an original founder is irrelevant. I don’t care about Elon, it’s the pivoting that’s inherently dishonorable.