OpenAI will operate as a ‘non-profit’ organization, CEO says

 

OpenAI will operate as a ‘non-profit’ organization, CEO says

Sam Altman, CEO of American artificial intelligence company OpenAI, has denied that the company is turning into a profitable venture, saying that it will continue to operate as a non-profit organization.

According to the French news agency AFP, OpenAI, which runs platforms such as ChatGPT, was being pressured by some investors to turn its services into a profitable operation.

Advocates of safe use of AI had expressed concern about linking a powerful platform to profit that works for the benefit of society rather than shareholders.

Altman wrote in an email to staff, which is also available on the company's website, that "OpenAI is not and never will be a normal company."

According to him, “We have decided to make OpenAI a non-profit after consulting with civic leaders and the California and Delaware attorney general’s offices.”

OpenAI was founded in 2015 as a non-profit organization, but later allowed it to become a limited for-profit organization to attract investors, which led to the emergence of Microsoft, the largest cloud computing platform, as a major backer.

The series almost ended in 2023 when the company’s board unexpectedly fired Altman, which led to a staff revolt and his reinstatement, but the people who decided to fire him left.

After it later suffered from instability, investors demanded that it be converted into a for-profit organization.

According to the plan unveiled last year, OpenAI was to become a for-profit organization, which increased investors’ confidence that the company would invite investors to meet its needs.

However, it was necessary to obtain approval from the state governments of California and Delaware for the change in status, as the company is headquartered and registered in those states.

The plan was heavily criticized by advocates of safe use of AI and co-founder Elon Musk. He left the company in 2018, but he also sued the company over the proposed project, calling the project a violation of his core philosophy.

According to the new plan, OpenAI will now be able to make a profit, but this method will be overseen by a non-profit board.

Altman added that “we believe this new method will help us move forward quickly and safely and bring AI to everyone.”

Major investors in OpenAI may have different views on the matter.

Japan’s SoftBank had made a condition in changing its $30 billion investment in OpenAI.

According to the bank, if OpenEye does not emerge as a profitable entity by the end of this year, the investment amount could be reduced to $20 billion.