Following Tesla CEO Elon Musk, Facebook parent Meta CEO Mark Zuckerberg also expressed opposition to ChatGPT developer OpenAI’s transition to a for-profit corporation.
According to the Wall Street Journal (WSJ) on the 15th (local time), Zuckerberg recently sent a letter to California’s attorney general asking him to prevent OpenAI from converting to a for-profit corporation.
In his letter, Zuckerberg said allowing OpenAI to transition into a for-profit company would set a dangerous precedent that would allow startups to enjoy the benefits of nonprofits until they are ready to make a profit.
Specifically, “OpenAI’s transformation into a for-profit corporation can have a tremendous impact on Silicon Valley,” Zuckerberg said. “If OpenAI’s new business model is valid, non-profit corporate investors can earn the same profits as for-profit corporate investors and receive tax credits granted by the government.”
This is the first time Zuckerberg has expressed his opinion on OpenAI’s transition to a for-profit corporation.
Earlier last month, Musk also filed a legal lawsuit to prevent OpenAI from turning into a for-profit corporation.
At the time, Musk accused OpenAI CEO Sam Altman of violating his promise to operate as a non-profit organization by creating a for-profit department and conspiring with Microsoft (MS), his largest investment company, to lead AI development.
WSJ analyzed that Zuckerberg’s legal action reflects concerns about the emergence of a competitor called OpenAI amid intensifying AI competition among big tech companies.
“Meta is one of OpenAI’s biggest competitors and has invested billions of dollars to develop its own AI technology that matches or exceeds ChatGPT,” the WSJ said. “OpenAI also works closely with Microsoft and Apple.”
Founded in 2015, OpenAI is currently managed by the board of directors of a non-profit corporation. These boards aim to make AI safe and helpful to mankind.
OpenAI, which started as a non-profit organization, created a for-profit corporation in 2019 with the aim of receiving billions of dollars in investment from MS and others.
At the time, OpenAI said its business purpose was to “develop AI technology that contributes the most to humanity as a whole, not to generate revenue.”
The board of directors of a non-profit corporation without a stake has a governance structure that is in charge of overall management and supervision of profit-seeking companies.
However, after launching “Chat GPT” in 2022, the demand for Generative AI surged and the situation began to change.
Under Altman’s leadership, OpenAI began rolling out new products for consumers and corporate customers, employing sales, strategy, and financial staff.
Since then, Altman has suffered internal conflicts over aggressive business expansion and profit-related transparency, and was eventually dismissed as CEO in November last year due to a board decision, but returned after five days due to pressure from OpenAI employees to leave the group and investor pressure.
Since then, Altman has been pushing to convert OpenAI into a general for-profit company, and is reportedly in initial discussions with California authorities to do so.
JULIE KIM
US ASIA JOURNAL
