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Elon Musk vs OpenAI: The story so far

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CEO of Tesla and SpaceX, Elon Musk, has filed a lawsuit against OpenAI alleging a breach of the original contractual agreements. Musk asserted that OpenAI, initially conceived as a nonprofit dedicated to advancing artificial intelligence (AI) for the better advancement of humanity, has veered off course by prioritising profits.

The legal action, officially lodged in a San Francisco court on Thursday, outlines Musk’s claims that OpenAI, once lauded as the most valuable AI startup globally, has transitioned into a for-profit model following collaboration with Microsoft, which infused approximately $13 billion into the company.

Musk contends that under its new board, OpenAI has effectively become a subsidiary of Microsoft, concentrating on refining Artificial General Intelligence (AGI) for maximising profits.

The lawsuit underscores a significant shift in OpenAI’s priorities, prompting concerns about the organisation’s commitment to its original mission. Musk donated over $44 million to OpenAI between 2016 and September 2020 and maintains that has been a vocal supporter of the nonprofit’s objectives. However, faced with OpenAI’s transformation into a for-profit entity, Musk has declined an offer for a stake in its commercial arm.

Musk’s allegations center on OpenAI’s GPT-4, which he claims qualifies as AGI, potentially surpassing human intelligence. The lawsuit also accuses OpenAI and Microsoft of improperly licensing GPT-4 despite previous agreements that the AGI capabilities would be dedicated to humanity.

In response to Musk’s claims, OpenAI issued a statement addressing the concerns raised. The organisation disclosed that the development of AGI required more resources than initially anticipated and highlighted Musk’s recommendation for an initial $1 billion funding commitment to OpenAI.

“Even raising several hundred million won’t be enough. This needs billions per year immediately or forget it,” said an email from Elon Musk.

The lawsuit can have an impact on the development of AGI by OpenAI.

In the statement, OpenAI acknowledged receiving less than $45 million from Musk and over $90 million from other donors.

The statement revealed that Musk discussed transitioning to a for-profit structure in 2017, driven by the realization that substantial capital was required for AGI development. However, disagreements over terms arose, with Musk proposing a merger with Tesla, a proposal deemed incompatible with OpenAI’s mission.

“However, building out a product from scratch would steal focus from AI research, it would take a long time and it’s unclear if a company could “catch up” to Google scale, and the investors might exert too much pressure in the wrong directions. The most promising option I can think of, as I mentioned earlier, would be for OpenAI to attach to Tesla as its cash cow. I believe attachments to other large suspects (e.g. Apple? Amazon?) would fail due to an incompatible company DNA,” wrote Musk in an email.

Elon Musk eventually parted ways with OpenAI in 2018, expressing scepticism about the organisation’s chances of success. OpenAI continued working and eventually secured a hefty investment from Microsoft.

Expressing disappointment over the legal dispute, OpenAI noted that Musk, whom they deeply admired, inspired them to set higher goals. However, he later initiated a competing project, Grok, and filed a lawsuit when progress was made without his involvement.

As the legal proceedings unfold, the tech industry will be keenly watching the clash between the two most influential figures. The lawsuit will also impact OpenAI’s development of AGI at a time when Meta is already pursuing further research in this field.

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Kumar Hemant

Kumar Hemant

Deputy Editor at Candid.Technology. Hemant writes at the intersection of tech and culture and has a keen interest in science, social issues and international relations. You can contact him here: