Welcome to tech Stuff, a production from iHeartRadio. Hey there, and welcome to tech Stuff. I'm your host, Jonathan Strickland. I'm an executive producer with iHeart Podcasts and How the Tech Are Yet Now. Normally I say tech news items for Tuesdays and Thursdays, But over this past weekend a pretty big sequence of events happened and it really merits a deeper discussion. I'm sure most of you have at least heard something about this story. The short version is Sam Altman, the CEO of open Ai, received his walking papers from the company's board of directors. Then the board kind of flipped out and begged him to come back to the company, and he ultimately decided now I'm good, y'all can do this on your own. And last I heard, he has now joined Microsoft's Advanced AI department. Which is a heck of a weekend. So today I thought we would talk a bit about Altman, We talk a bit about open Ai, We chat about what went down behind closed doors this past Friday, why the board of directors fired Altman, why they then switched gears so quickly, and what it all means going forward. Now. I did an episode titled the Story of Open AI at the beginning of this year, which published in January. I am going to retread a lot of that same ground here in a slightly different context, because it's necessary to really unravel what was going on over the last weekend. So first up, who is Sam Altman. Well, he grew up in Saint Louis, Missouri, and as a kid he became really interested in programming. According to The New Yorker, he was programming as early as age eight, and that he went so far to take a part a Macintosh computer in order to learn how it worked. He also challenged social restrictions and taboos. When a Christian group announced a boycott for an assembly that was supposed to be focused on sexuality, Altman came out to his community as gay, and he challenged them to adopt an open attitude toward different ideas. And he was just a teenager at the time, so very much someone who is curious, motivated, and by most accounts I've read, fearless. Altman attended Stanford, but he was only there for two years. He studied computer science while he was there. In fact, he studied artificial intelligence by some of the leading thinkers in the discipline at Stanford, but he dropped out of college in order to work on an app and a business idea. So in many ways, it was the stereotypical founder story of Silicon Valley. Right. You go to Stanford, and when you're there, you're really there to make connections. You don't bother completing your studies, You drop out of school, you make a company, and then you get rich. It's kind of like, you know, the whole idea of step one, go to Stanford, step two, drop out, step three profit. I guess you could argue that if you can make a successful tech business, there's no real point to completing your studies. I mean, if your studies are all about learning the technology and it turns out you already have a good mastery of that and you can make a profitable business, why would you continue to spend money going to school, unless, of course, maybe you would grow more as a person and develop a deeper appreciation and understanding of things that could perhaps help you when you make decisions in the future. But don't listen to me. I graduated with a degree in the humanities, so I have these wacky ideas about how the experience of college is about more than just learning a subject. But that's beside the point. Let's get back to Sam Altman. So the app he was working on with a few friends was called Looped loopt, and it was meant to let users to share their location data with selected other users, So you can make friends with people on the app, and then you could share your precise location with that person, kind of a shorthand way of saying here I am. And it could facilitate stuff like real world meetups. Like imagine that you're heading to a concert venue and it's a big venue. There's a lot of different interests and stuff. You get there, you're going to meet up with your friends. You use this app to say this is specifically where I am, so that you can find each other. That's kind of a use case. The Looped team applied to the Why Combinator accelerator company to become part of their program. So let's talk about Why Combinator for a moment. It is, as I said, a startup accelerator organization. So Why Combinator its purpose is to provide early funding in promising startup ideas in order for them to start to get off the ground. So it's an early investment part of a startup so that they can at least get a chance to mature into an actual business. Now, in return for this early investment, why Combinator takes a small percentage of ownership in the startup. So let's say that why Combinator provides you know, a fairly modest sum in the early days, Like it was a lot of money, don't get me wrong, Like maybe like one hundred thousand dollars or maybe one hundred and twenty thousand dollars. That's a lot of money, but it's a tiny amount when you think about what a company needs to actually run. So this is really just to get a startup to go from idea to something slightly more you know, coherent. But in return, why Combinator gets like, you know, seven percent ownership of that startup. Now, let's say that startup is something like Dropbox, and then years down the road it's worth you know, more than ten billion dollars. Well, that becomes a heck of a return on investment. Right, you can have a huge profit as this startup accelerator, even if just a few of the startups really hit it big. Ideally, you want them all to hit big and then you get huge payouts down the line, and you become an important part of the whole tech startup ecosystem, which is exactly what why Combinator said up to do now why Combinator launched in two thousand and five, that was the same year that Looped would become part of its inaugural class of startups. Essentially, now, not all startups make it. Obviously, Looped at least appeared to do well initially, at least on paper. Altman and his colleagues secured a couple of major rounds of investment funding, Series A and Series B. The company's valuation hit more than one hundred and seventy million dollars. But they were running into a tiny little problem. They had developed this app, and they couldn't convince people to use it. They were all thinking that, you know, Looped was going to be this really useful and popular tool. Everyone was going to download it. But turns out the general public didn't seem to agree with that, and so in twenty twelve, Looped that team accepted an offer from the company green Dot, and they sold Looped for around forty three million dollars. That's also a lot of money, but it did not cover the amount of money that venture capitalists had invested into looped, so it was a negative return for investors. You know, sometimes you bet on the ponies and you lose. But Altman walked away with around five million bucks, so it was a pretty decent return for him, even though the app that he had worked on for several years never really gained traction. Now, in the wake of this disappointment, Altman founded a venture capital company of his own, and it was called Hydrazine Capital. So he sunk most of his personal wealth that he had earned from this sale into this new venture capital company, and he also raised millions more from other investors. He focused on investing in companies that were in the y Combinator program, and he was largely successful in this. He was picking some really good startups, and he was backing ones that would become a big deal in the tech space a few years down the road, and so he was seeing big returns on those investments. Within just a few years, his venture capital firm increased in value by an order of magnitude. But Altman wasn't super happy doing this work. He didn't find it rewarding on a personal level. Financially sure, but on a personal level, he didn't really like the work, so he then extricated himself from the venture capital company to try and do something else. Now, around this same time, the folks who were behind why Combinator were looking to hand off the whole accelerator program to someone else to lead it, and that someone else ended up being Sam Altman. The guy had gone through the process with looped and now he would be running it, and he reportedly agreed without hesitation. He was eager to do this job. It was something that he didn't even necessarily know he wanted to do, but once he was offered it, he was really enthusiastic about doing it. So he really ramped up y Combinator, and Altman began recruiting, you know, startups that were focused on science and technology, so we're talking about bleeding edge stuff like quantum computing or nuclear power or AI that kind of stuff. Around this time, he started to be part of a group that included Elon Musk, and this group ostensibly wanted to develop artificial intelligence in a responsible, accountable way while being extra careful not to do anything foolish to make safe artificial intelligence. You know, they didn't want to go down the wrong path and do something like accidentally unleash Skynet and terminators all over the place, so this group would become open ai. Now, the original open ai was a non profit organization, and the whole idea was to help in this effort to foster the development of artificial intelligence in a responsible and safe way. It wasn't some for profit company pushing a generative AI chatbot at that time, and it was not yet a partner to massive companies like Microsoft. So Altman was running y Combinator, and he also began to work with the open ai folks and tried to recruit various leaders in artificial intelligence to join open ai. In twenty fifteen, Sam Altman published a two part blog post about machine intelligence and quote why you should fear it end quote, And it starts off with the comfort sentence and I quote development of superhuman machine intelligence SMI is probably the greatest threat to the continued existence of humanity end quote. Now Altman allows that other massive threats, like say, an asteroid hitting the Earth, are possibly more likely to happen than super human intelligent machines run amok, but he also points out that a lot of the other threats that we think of, like super volcanoes and climate crisis might end up having a massive impact on the human population, but probably wouldn't just totally wipe out humans in totality. But superhuman machine intelligence, he argued, did have that potential, and that this is why he thought of it as being the most important or perhaps most dangerous threat. Almand goes on in those blog posts to point out that SMI doesn't have to be malevolent to be a threat. Just setting an SMI to complete a task like trying to manage resources could end up causing massive human harm. The SMI might determine that the biggest cause of resource depletion is the human race, So presto, you get rid of the people, and now you don't have to worry about these resources running out anymore. Now that's an oversimplification, but you get the idea. Altman's point is if you don't develop artificial intelligence in a way that is safe, you can get terrible consequences, whether that was your goal or otherwise. And of course there are malicious ways to use AI. Right You could develop AI in an effort to try and come up with new biological weapons. For example, that's often a scenario that's cited by concerned critics of artificial intelligence. That's certainly something that could potentially happen. So again Altman saying, well, you need to have the right team responsible to develop AI in a way that is most likely to benefit people and to protect people from malicious or badly designed AI. So Altman makes an argument that machine intelligence could hit an inflection point once recursive self improvement becomes a real possibility. That means, if we get to the point where we can create machines that are smart enough to reprogram themselves, and to reprogram themselves in a way that is better than what humans could do, so to program these machines at a higher than human level of capability, a superhuman capability, if you will, then machines suddenly engage in self improvement and can do so at increasingly shorter intervals. They get better at doing the thing that they're doing, so they get better at improving themselves, and they improve themselves over and over, and this becomes a version of the singularity, which is a moment where change is so sudden and it's happening all the time that effectively it becomes impossible to even describe the present, everything will change and continue to change at a rate that's beyond our ability to describe. Altman says, we might be creeping toward that now, and maybe we're creeping toward it at a rate that's just impossible for us to notice because it's so gradual. That makes it really tricky, because it could be that it goes from it's happening so slowly that we can't notice it, to it's happening so quickly that we are unable to describe it, and that there's no point in the middle where we can say, wait a second. So in part two of his blog posts, Altman makes a clear argument. He says, quote, the US government and all other governments should regulate the development of SMI. In an ideal world, regulation would slow down the bad guys and speed up the good guys. It seems like what happens with the first SMI to be developed will be very important end quote. Essentially, what Altman is arguing here is that if ethical researchers develop a superhuman machine intelligence first, they can employ that SMI to prevent the development or deployment of malevolent or poorly built SMIs. So we unleash our good guy Superman against their bad guy General Zod or you know whatever whichever superhero supervillain pairing you happen to like. Interestingly, this is going to come back again when we talk about Altman and his appearances around the world while talking about the potential for AI regulations. Before we dive any further into this, let's take a quick break to thank our sponsors and we'll be right back. So Altman went so far in his blog posts to say that he thinks, generally speaking, that tech is often overregulated, but on the flip side, he doesn't want to live in a world that has no regulation at all. In some cases, you can see regulation as a necessary evil that maybe it does slow down innovation or it has unintended consequences, but in the absence of regulation you can have some really poorly thought out deployments that can cause a lot of harm. From twenty fifteen to twenty eighteen, Open Ai operated as a nonprofit organization. The organization championed the open part of its name, claiming that it would freely share research and its patents with AI researchers all around the world, all in an effort to ensure safety in AI development. Greg Brockman, one of the co founders, identified a short list of top AI researchers, and the organization as a whole began to recruit several of them to join open ai as the first employees of the organization. The talent helped attract more talent. Some folks said they actually joined open ai because it was where you could work on really exciting research with the most brilliant and talented people in the discipline, even though it would mean you wouldn't be making as much money there as you could somewhere else. Even high paid individuals at companies like Google found themselves switching jobs for the chance to work on something that they saw as important and challenging and potentially critical to the survival of humanity. One of those people who would also be listed as a co founder of open ai was Ilia Sutzkiver, who would become chief Scientist at open ai and would join the board of directors. Musk reportedly played a critical role in recruiting Sutzkiver over to open Ai. Like it went back and forth between open Ai and Google, which really wanted to hold on to him, and reportedly the Musk was a big reason why Sutskever eventually moved over to open ai, and also Ilia Sutzkever is one of the people who would ultimately be part of the decision making group that fired Sam Altman this past weekend. Anyway, we're up to twenty eighteen, and behind the scenes there was drama a bruin, and much of it was in the cauldron known as Elon Musk. Not a big surprise there, right, because Elon Musk is kind of a magnet for drama in the tech sphere and the business sector. So Musk was on the board of directors for open Ai, but in twenty eighteen he left open ai entirely, and the official story was that Musk chose to step down because of a potential conflict of interest because there he was on the board of directors for an organization working on artificial intelligence, but he also was CEO of Tesla, a car company that was pushing hard to develop and deploy autonomous driving capabilities to the market, and autonomous driving is of course a subset of artificial intelligence, so stepping down was the responsible thing to do because of this potential conflict of interest between the two companies. There was, however, more to his decision than just that. So, according to Business Insider, Musk was not happy with open Ay's progress. He compared it negatively to Google. He was saying Google is spending huge amounts of money and is getting ahead in artificial intelligence research, and he argued Musk argued that Google, and he specifically targeted Larry Page in this criticism, was not paying any attention to safety, that safety was not a factor when it came to Google's approach to artificial intelligence, and so that was one of the things he said that it was critical of open ai, saying you're not doing enough, and he was kind of pointing at Sam Altman as the reason for them, that Altman's leadership was the reason why open ai was lagging behind. So Musk then reportedly went to other co founders of open ai, including Sam Altman, and essentially he said, I want to run open ai, and he was told in no uncertain terms that this would not happen, and so, again, according to Business Insider, Musk decided to take his ball and leave. His ball also included a sizable investment or donation to open ai, so when he left, he left with a whole bunch of money that otherwise was going to go to the organization and didn't. Musk would later say he disagreed with the direction of open ai and that the company wasn't nearly as open as its name would suggest. That last criticism happened after open Ai would create a for profit company in twenty nineteen. Musk actually leveled the lack of openness at open Ai that critique. Around twenty twenty, Musk also was founding his own ai research organization and would occasionally throw shade at open Ai and Sam Altman. And I am not an Elon Musk fan. Most of y'all know this. I'm not a huge fan of Elon Musk. However, at least some of the criticisms he had toward open Ai I actually agree with, or at least I think they were true, like the fact that open ai was becoming less open. I think that criticism has merit. Meanwhile, open Ai was in a pretty tough position because, as it turns out, artificial intelligence research is expensive, so you need access to a whole lot of compute power and that's not cheap, and then you also need to have the money to attract the best talent, especially if your goal is to be the first to develop superhuman machine intelligence that is ethically sound. Like, if that's your goal and you need to outpace everybody else who's also working on developing superhuman machine intelligence, you got to spend the big bucks to get the top of the class to come over to your organization. And a nonprofit organization is just not the fastest way to gather huge amounts of money needed to fund research and operations. It would be way easier if you could get investors to pour money in, but investors want a return. Meanwhile, a nonprofit is a place where you donate money. You're not expecting return on your donation. It's no an investment. This is what led to the decision to create a for profit arm of open ai, which in turn would generate money that could be theoretically at least used by the nonprofit part of open ai to further the original organization's goals and mission. So the result was open Ai LP, which open Ai called a capped profit company. So what the heck is a capped profit company? That's actually a really good question, because I've found two somewhat conflicting answers from various sources. Like they lay it out in two different ways that are similar but distinct. So I'm going to give you both of the ways that it has been explained in various sources, because I'm gonna be honest with y'all. I'm not a business person. Despite the fact that I have hosted a business podcast of the Best, I'm not really a business person, so I can't pretend like I have a firm grip on this. And also, open ai was kind of charting new territory while they were announcing this. But here are the two ways that it is frequently described. So version number one means that open ai would accept investments from venture capitalists and that would pay out returns on those investments from profits, but only up to a certain amount. So in open AI's case, the early backers, the people who first poured money in to open ai, would have a cap of one hundred times their initial investment. So let's take a very simple scenario. Let's say that some kids in your neighborhood want to start a lemonade stand and you invest one dollar into their lemonade stand. Now, let's say the kids running the stand turn out to be business geniuses and your dollar investment helps lead that stand into making tens of thousands of dollars in profits, Like, even after the expenses, these kids are raking in tens of thousands of dollars. However, when you invested, you did so knowing there was a one hundred time cap on returns, So that means the most you're ever going to get from the stand is one hundred dollars. It's a one hundred times return on your investment. Meanwhile, those snot nosed kids who never could have made the stand without your dollar are pocketing thousands of bucks and they're franchising across the town, those rotten kids. Anyway, that's one version of how the capped profit structure work. It works, investors can make a return, but only up to a certain amount, the early backers being one hundred times whatever they put in, and that means if they put in ten million dollars, they could potentially make as much as a billion dollars in returns if open ai profited that much. So you know it does add up. However, there is a second explanation for capped profit that, like I said, is slightly different. So in this version, investors would pour money into open ai and open ai would hold back on distributing any returns on profits until those profits reached at least one hundred times the investments that had been made. So using our limonade stand example, you've donated one dollar to the limonade stand business, you would not see a return on that investment until the liminade stand made at least one hundred dollars in profit. At that point you could start to receive returns. And a few explanations kind of combine the first version I mentioned in this version, and frankly, just to be transparent, this kind of confuses me. So for example, Time at time dot Com uses the second explanation right that you don't get any returns until the profits reach one hundred times whatever your investment level was, but then includes the phrase quote anything above that being the one hundred times profit would be donated back to the nonprofit. So if that's the case, it means you wouldn't get a return until the profits hit that one hundred times your investment, and then anything over one hundred times your investment would be going toward the investment into the nonprofit or a donation into the nonprofit, which means I guess you would be limited to one hundred times. I don't know, like maybe it's a combination of these two, but it's just been poorly reported in various places. It just it seems a little confusing to me, and it also seems like it'd be confusing from an investor standpoint of whether or not it would even make sense to pour money into this. I think a lot of reporting around the cap profit nature is just incomplete, and that's the problem that there were just there's just a lack of good explanations of this. And also, I mean, I'm dense, so that's the other part of the problem. But anyway, however you frame the context of a capped profit company, the structure would give open ai the chance to court investors and to hold a whole bunch of money that they could then pour into research and recruiting. A one hundred times factor is pretty darn big, And arguably you could say this was necessary because while open ai had this noble mission, the truth is you still had massive companies like Amazon and Google and Meta. These companies have really deep pockets and a desire to invest in AI research, and if you didn't do something, there was just no way, no matter how noble the cause you were going to keep up with these companies. So that was kind of the decision making factors that drove open eye to launch this for profit arm of the organization, and that didn't make everybody happy. In fact, it was controversial, to put it lightly, There were critics who were asking if it would even be possible for open ai to continue to pursue its mission of ethical AI development while also operating a commercial business that was profiting off of artificial intelligence development. That these two things could not be in alignment and would mean that ultimately open ai would not be able to achieve its mission. Complicating matters was that open ai began to back away from that whole open part of the philosophy, which again Elon Musk would criticize. In twenty twenty. Open a Eye sighted a concern that malicious developers might take the information the research being shared from open ai and use that information to develop nasty and harmful applications, or at least poorly designed ones. So now they're saying, you know, our knowledge is dangerous. So I know, we said we were going to share it so that we could benefit humanity, but now we're scared that if we share it people will misuse it, so we're not going to do that anymore. So again, like Musk was saying, it was no longer being as open as the name had implied. So yeah, his criticisms had weight. Open ai really was moving away from an unassailable nonprofit status and also was getting less open in the process. Sure, the folks that open ai had explanations for why they were doing this, but it didn't change the fact that the open Ai of twenty nineteen was fundamentally different than the organization that had started in twenty fifteen. All Right, we're going to take another break. When we come back, we'll talk more about what happened in the following years that then led to the situation that we saw unfold this past weekend. But first, let's thank our sponsors. Okay, So we left off in around twenty nineteen. We're gonna skip ahead a few years. So the battle for AI talent was a constant one in the tech space, but the world at large remained pretty much oblivious to open ai and the folks who were involved in that company. Open ai just wasn't a name that your average person was aware of. But that would change in November twenty twenty two. That's when OpenAI introduced the chatbot called chat GPT. This chat bot drew on a large language model, the GPT model, which had gone through a couple of iterations, and it would use that language model to generate responses to queries and input. The responses often seemed like a human being had actually written it. It didn't come across as your typical AI generated text. It seemed more natural than that. It also seemed like it was a really smart person who wrote the response, someone who appeared to be an authority on whatever the subject was. Like any subject you could think of, you could put into this thing, and chat gpt would generate a response that seemed to be pretty definitive. And there were limitations on chat GPT's expertise. The open Ai announced that chat gpt really only had access to information leading up to September twenty twenty one, and if you asked it to explain anything that happened after September twenty twenty one, you'd be out of luck because chat GPT wouldn't have access to that information. But right out of the gate, chat gpt seemed incredible. Now over the following weeks after its introduction, we would start to see various critics and skeptics raise concerns about generative AI in general, really and chat GPT in particular. Now, some of these conversations had already started because there were already text to image generative AI tools out there that had prompted some concern. Chat GPT created new discussions about how generative AI could make misinformation. They could engage in plagiarism, it could slander someone, or it could just produce the wrong response due to something that the AI field calls hallucinations. Sometimes they call it confabulations instead. So this is when an AI model fabricates an answer for whatever reason. Like one reason that AI might just make something up is that it doesn't have access to relevant information that relates to the query. So instead the chatbot produces an answer that, from a linguistic perspective, is statistically relevant. In other words, it's creating sentences that are linguistically correct but factually incorrect because it doesn't know the difference, and it's just trying to provide a response to the question that was asked of it. Now, this meant that sometimes you could ask chat GBT to solve a problem for you, and the response you would get would sound authoritative and sound like it's correct, but in fact it was entirely wrong. And following these criticisms came concerns from lawmakers who began to ask the very same questions that open AI was intended to address when folks first got together back in twenty fifteen to create it in the first place. Now, as we all know, the law trails behind technological development, sometimes by years. It takes time to make laws, and then it takes time to approve them and to pass them into law. If you rush, you're likely to make problems worse, or at the very least, you're likely to complicate matters so that it becomes very difficult to comply with the laws you've written. So Altman, who had already made his philosophy around regulation known in that blog post from twenty fifteen, began to meet with various officials all around the world. Now, the idea was that sam Altman would help legislators understand the potential risks of artificial intelligence and presumably create the most responsible approach to regulations to ensure safety. But skeptics were worried that what sam Altman was actually doing was just stacking the deck to favor Open a Eye over other AI companies. You see, Altman had long held this position that it's really important for an ethical group of researchers to beat everybody else to the punch to develop that superhuman machine intelligence in order to prevent catastrophe. That if you don't do that, you're essentially sealing your own doom. And of course Altman viewed open AI as that ethical group. It is the group that's dedicated to creating ethical, safe AI, and Altmann felt that regulations could help mitigate the risk of bad actors or inept creators from making dangerous machine intelligence. And so these skeptics were arguing Altman's position was that regulations should really hold back everybody else and then favor open AI and allow it to move forward towards this goal of creating benign, protective machine intelligence. So in other words, yeah, the AI field needs rights, but more importantly, those regulations need to stop every one other than open AI. That was how the skeptics saw Sam Altman's position as he met with all these different leaders, and in fact we saw proposals for putting AI research on hold for half a year. In fact, Elon Musk argued for this. Now, the skeptics came out again and said, well, I see the need to kind of pump the brakes so that we make sure that all this work in AI isn't going to cause enormous harm in the future. But of course Musk is arguing for this because he wants to create his own AI research division. And if you force the industry as a whole to hold off for six months on moving forward, it would give Musk the opportunity to start to build out the foundations for his own AI division while not losing more ground to competitors like open Ai. It's a cutthroat world out in that AI field, y'all. Now. In January of this year, in twenty twenty three, news broke that Microsoft was investing around ten billion with a B dollars in open Ai. Microsoft had already invested billions in open Ai over the previous years, in twenty nineteen and twenty twenty one, specifically, so this was seen as Microsoft's effort to catch up to rivals like Google and Amazon, which had already been spending their own billions in AI research. The relationship between Microsoft and open Ai would manifest in lots of different ways, including in Microsoft incorporating chat GPT into its search feature in bing. For a long time, Microsoft has been pushing being an edge toward becoming more important in the market, but as come up time and again up against the brick wall that is Google. In August, open Ai announced in an enterprise version of chat gpt, and then in September, open Ai allowed the chatbot to access information on the Internet for the first time. So now that restriction where it could only access information up to September twenty twenty one, had been lifted. Now it could access real time information around the world. On the political side, lawmakers around the world, particularly in the United States and in the European Union, began to grow more concerned about AI and its possible uses and the risks associated with it. So more pressure was building on the artificial intelligence discipline in general and open ai in particular, because open ai was seen as sort of the leading authority in artificial intelligence. Chad GPT had really captured a lot of interest around the world, and at the same time you had some people within open ai who were really clinging onto the ideals of the original nonprofit organization and who had growing concerns about where open ai was headed because of the for profit arm of the company. So similar to Elon Musk, there were people, high level people in open ai who were starting to feel uncomfortable with where the organization was going. Now, just a couple of weeks ago, open ai held its first developer conference. Sam Altman took the stage on November sixth, so not long ago, and he took the stage as CEO of open Ai, and he listened off some pretty incredible statistics like the fact that open ai can count more than ninety percent of Fortune five hundred companies as customers. That's incredible. It shows how influential open ai is in this field. Open AI's partnership with Microsoft also played a huge part in Sam Altman's presentation. But again, behind the scenes, things were far from honky dory. You had open Ai doing gangbusters on a business level, but again some of the scientists who were part of the board of directors were growing increasingly concerned that the company was guilty of the very behaviors that open Ai was meant to head off. That open ai was developing and deploying tools without putting in appropriate safeguards or considering the consequences of unleashing these tools that open ai had become more about monetizing technologies and innovation and less about ethical development of artificial intelligence. There were also some personal tensions that were growing between Altman and other members of the board, such as Ilia Sutzkever. So, according to Time, Altman reduced Ilia's role in the company, while Ilia worried that Altman was launching side projects that would benefit from open AI's work but also not be accountable to open ai. So, in other words, ILIO was worried about this sort of conflict of interest that Altman was going to end up pursuing some developments of artificial intelligence that were not governed by the board of open ai and thus not constrained by these ethical concerns. So this really boiled over. During the developer conference, Altman made several announcements that Ilya reportedly objected to, including the unveiling of a customizable version of chat GPT that, in theory, could run autonomously once it was told what tasks it was supposed to handle. So the critics on the board outnumbered Altman's supporters. You had essentially two camps. You had the people who thought Altman was in the right, including Altman and Brockman, and then you had other members who were more concerned. And last Friday, that's when the board decided it was time to fire Sam Altman. They saw Altman as being too reckless, not nearly cautious enough, and despite open AI's market performance, which was incredible, they felt the company was moving in the wrong direction and that it needed new leadership as a result, so they decided they had to fire Sam Altman as CEO. Now. Reportedly, Altman learned of this fate in a Zoom meeting. Ilia was the one who told him that he had to go to the Zoom meeting, and it happened shortly before the board announced their decision Publicly. Greg Brockman, co founder president of open Ai, he was not told of this meeting, and in fact, he found out about Sam Altman getting fired just shortly before open Ai released the news to the public. Similarly, Satya Nadella, the CEO of Microsoft, also found out essentially when the news got released to the public, and this set off a metaphorical explosion in the tech world. First, open AI's board didn't exactly have a real good transition plan in place, to handle this, nor did it seem to really comprehend the extent of the fallout this decision would have, particularly in the way they did it, where they did not consult with Microsoft, a partner that was going to invest ten billion dollars into the company, or talk it over with the other executives before making the decision. So even the folks who agreed that Altman was perhaps not being cautious enough felt that the board's move was poorly thought out and even more poorly executed. It's really hard to argue against that. Like, even if you feel that Sam Altman was absolutely leading open Ai in the wrong way the wrong direction, you can also say that the way the board handled this ultimately was disastrous. So Greg Brockman announced that he was leaving open Ai once the news went public that Sam Altman had been fired, So open Ai would see both its CEO and its president leave the company in one day. Some members of the board, like Ilia, expressed regret for having supported the measure to fire Altman, like they said later like I kind of wish we hadn't done that. Iliosutskiv would go on to sign an open letter saying as much, and even threatened to leave Open a Eye along with more than five hundred other staff members over this decision. Just a big old whoopsie, right, so the board found itself in extremely hot water. They had done the classy thing of waiting until a Friday to announce a massive decision. My guess is this was probably in an effort to take at least some of the sting out of the news cycle, the idea of being like, well, if it's on a Friday afternoon, no one's going to pay attention because we're going into the weekend. By the time it comes around to Monday, things are going to cool off a bit. Plus here in the United States, we're going into a holiday week with Thanksgiving, so there won't be a whole lot of opportunity to bring a whole lot of attention to this, and we'll be able to get away relatively unscathed. That is not how it turned out, however. Instead, the news media went bonkers with this decision, and how could you not chat GPT and open AI. They had been the center of so many headlines throughout the whole year. Of course, this was going to get a lot of attention, and so while they were hoping that they could get away with this without it being too painful. Immediately, investors started to freak out about this change. A bunch of them essentially indicated that they would pull out of open ai and they would back whatever Altman chose to do next. So if Altman launched his own competing artificial intelligence company, they were going to back Altman, not open Ai. There were hints that Microsoft could potentially even do the same, and that's ten billion dollars plus. You had the general staff who felt that this was the wrong move, and they felt that this was a terrible mistake, and they were threatening a mass walkout of the company. It was pretty much the worst reaction you could expect from a big announcement. So it did not take very long for news to break that the board was trying hard to take back what it had done and to try and convince Altman and Brockman to return to the company, but by then the damage had been done. Altman was not interested in coming back. Specifically, he said unless the board stepped down, he would not come back, and that would become a real sticking point. Mira Murrati, the chief technology officer for open Ai, would serve as interim CEO for about two whole days. Murati reportedly was the person who actually reached out to Altman to try and convince him to come back to open AIE. But while Altman did return to open AI's headquarters to negotiate, and he said it was the first and only time he would ever have a guest badge to open AIE, those negotiations didn't really go very far, so the board decided on a new interim CEO, perhaps because of a perception that Murrati was maybe a bit too pro Altman and they needed to get someone who would be more in their pocket. They chose the former CEO of Twitch, Emmitt Sheer, who doesn't have any experience with artificial intelligence. By this time, the board directors consisted of just four people, people who have been pressured to step down but refused to do so. Thus Altman did not come back to the company. Altman and Brockman, meanwhile, weren't exactly on the job market for very long, because Microsoft swiftly hired both of them to head up a new advanced AI research team within Microsoft. Nadella also said Microsoft remains committed to supporting open AI, hinting that those ten billion dollars, most of which has not made its way to open Ai yet. Open Ai has received just a fraction of that ten billion dollars, but the hint is that that money will continue to go to OpenAI, that Microsoft is not backing out of that agreement, but Altman is going to end up working directly with Microsoft and will have the title of CEO for whatever this Advanced AI part of Microsoft ends up being called. A few other prominent executives and scientists from open Ai are apparently moving over to Microsoft as well, so there are already other defections from open Ai to Microsoft. Meanwhile, back at open Ai, a lot of folks who work within the company have been posting their support for Altman on platforms like x so there's a concern that there's going to be a mass walkout and resignation following this move. Certainly other companies like Microsoft, Google, Amazon, and Meta would be eager to get hold of some of that talent, and it's entirely possible that the board of open Ai, in a move made out of concern for the company's safety and humanity safety, may have actually doomed the organization entirely. I'm not sure hiring a former CEO of Twitch is going to be enough to prevent disaster. Now, all that being said, open ai is in an incredible position. A recent evaluation placed the company at around eighty six billion dollars. Microsoft says it is committed to this ongoing relationship with open Ai. Chad GPT is still an incredibly important tool in the tech space, particularly with the introduction of the enterprise product of chat GPT. So could open ai just be too big to fail? Maybe? I think this monumental misstep will test that hypothesis. I do not know how it's all going to shake out. From a business perspective, I would say open ai is in a really strong position. But then if the organization suddenly sees a mass defection from its researchers and staff, that could very well change. So we'll have to see. And of course, now we're on a holiday week, so it might be another week but before we start getting answers. But yeah, that's kind of an update on what went down this past weekend and why it happened, Like all those different factors that built up to this big explosion of activity. Now you have a bit more background as to what was going on. As to whose side I'm on, I don't know. I do think that Altman's leadership was not always the best as far as trying to achieve the goal of ethical AI. I do not think that it was almost like engaging in a necessary evil kind of thing. But I'm not sure that the evil is really necessary. But what do I know. I know that AI is very hard and very expensive, and I don't know how you get the money to do it the right way and still beat out all the companies that don't have those restrictions on them. So I don't know. I just know that it's a mess. But now it's a mess we can put behind us until we see what happens next. I hope you are all well, and I'll talk to you again really soon. Tech Stuff is an iHeartRadio production. For more podcasts from iHeartRadio, visit the iHeartRadio app, Apple Podcasts, or wherever you listen to your favorite shows.