Big Technology Podcast - Emergency Podcast: Sam Altman Fired At OpenAI

Episode Date: November 18, 2023

OpenAI fired CEO Sam Altman today, a stunning move that will reshape the AI wars and open new avenues for its competitors. Sharon Goldman, Senior AI writer at Venturebeat, joins us for an emergency podcast to discuss the news, and what comes next. --- You can subscribe to Big Technology Premium for 25% off at https://bit.ly/bigtechnology Enjoying Big Technology Podcast? Please rate us five stars ⭐⭐⭐⭐⭐ in your podcast app of choice. For weekly updates on the show, sign up for the pod newsletter on LinkedIn: https://www.linkedin.com/newsletters/6901970121829801984/ Questions? Feedback? Write to: [e-mail]

Sam Altman is out at OpenAI. It felt like a hallucination, and it still does, but he confirmed the news. He's gone. We're going to record an emergency podcast to break down the news and explain what it means, and we're going to do it right after this. Welcome to Big Technology Podcast Emergency Edition. Sam Altman has been fired by OpenAI Edition. Holy moly.

There's no way. No way we're waiting until Wednesday. day to cover the news on the podcast. So instead we're dropping an emergency episode here where we're going to talk about what happened, what it means, where Open AI goes from here, and who did it? Because the board has been involved in literally the most shocking firing in tech, I would have to say, in a decade or longer. And we don't know exactly why we did it, but we can talk a little bit about who did it. And that might give us some clues. We're joined today by the senior AI writer at Venture Beat, Sharon Goldman.

Sharon, welcome to the show. Alex, nice to see you. Friday afternoon. I know, serious. What a mic drop, literally. Absolutely, budding into evening, but we couldn't let it go any longer. You have been covering Open AI very closely. You just wrote about their board, which we're going to get into.

But first, can you just, like, tell us a little bit about the news? So Sam Altman is out as OpenAI CEO. The COO is stepping in. Mira is stepping in as the new interim CEO. They are looking for a new permanent CEO. Greg Brockman, who was the chairman of the board. He was the chairman of the board presidents of OpenAI, step down as chairman of the board. It was going to remain at OpenAI.

Try to contextualize. this for us. This is a massive shuffling, but how big is it? It's huge. Dev Day. OpenAI's Dev Day was just last week. Just earlier this week, there was news that OpenAI was looking for a big infusion of money from Microsoft. Microsoft CEO Satya Nadella was on stage with Sam Altman last week at Dev Day, touting their partnership to build AGI together. Just yesterday, I understand, And Sam Altman was on stage for the APAC conference. So it sounded like it came as a surprise to everybody, not just us, right? Absolutely.

We don't know what happened yet. It will probably break at some point this weekend. But we can speculate a little bit without being irresponsible. The business seemed like it was in good shape. You know, maybe there was like something that was going to. on, but this was clearly a conduct-related issue. Now, let me see if I can pull the exact language from the board, but basically they said that Sam had been inconsistent with his communication and they could no longer rely on or trust

him to do the job effectively. Some mealy-mouth PR language, what's your read on what actually happened? I feel like that it is mealy-mouth, but it's also not, you know, we wish Sam well and as he goes home to be with his family either. So, you know, it definitely, it dropped in the afternoon. There was some, there is some verbiage that indicates some kind of misconduct, whether that's financial or otherwise. I don't think anyone knows.

I read that there's some kind of all-hands meeting going on right now at OpenAI. Maybe that will offer some clues. But it sounds like everyone, no one really has a sure handle on what happened, whether it was financial. I'm wondering if it has something to do with Microsoft in some way. Then our editorial director at Venture Beat, Michael Nunez, was at Dev Day. He said there was a little bit of weirdness at the press briefing and during Dev Day, where it seemed like something was a little off.

So I don't know if it goes as far back as that or not. We do have some details coming out of that all-hands meeting. So first of all, Miram Radi, who is the opening, AI interim CEO was the C.O. By the way, well, we'll talk about her in a moment, very capable leader, told Stead's recording the information, told staff that its relationship with Microsoft was stable and that Satyindella and Kevin Scott, the CTO of Microsoft, had expressed the utmost confidence in Open AI following the news. So clearly they've been communicating that way. And Ilya Sitskiver, who's the chief AI researcher, told the staff the experience will make us

feel closer as they pick up the pieces from Altman's departure. So that's what they're saying inside the company. Where does the, you know, we, so as we try to figure out what happened, where does the loss of Sam Altman leave this company? I mean, it seems like they really were in the hits business as all this technology was starting to be commoditized. And while he wasn't playing like the chief product manager role, like he plays a big role in terms of what they develop, what they develop and how they decide to bet on those hits, right?

Absolutely. I mean, in some ways, you could say, you know, why care so much about Sam Altman? He wasn't, you know, the brains, the scientists behind the AI, behind the large language model. But he was the face of open AI. I mean, for the past year, he's been arguably the most forward-facing person in AI. He's built the company. He's been out there on a world tour touting GPT4 and beyond. And he's been there every step of the way.

So it's hard to imagine that this doesn't kind of rock the boat pretty significantly. You know, so, yeah, I'm interested to see what happens. But more than a cheerleader, right? He's actually like the, he's like, he's the, he came to this company as this, you know, formerly the CEO of Y Combinator. They built chat GPT and Dali on the transformer model, which was developed inside Google. What has made open AI what it is is a keen sense of how to take exactly. existing technology and turn it into products.

And who better to do that than someone that's run a startup incubator? You effectively need to be doing that to remain competitive. So are they going to be able to remain competitive in this fast moving field without him? I think so. I mean, I don't feel like Open AI was just Sam Altman. I mean, I think that, you know, Greg Brockman, I think Ilya, I think there's a lot of people in place. I'm sure that they're, that sense of mission.

and the product itself. I mean, if GPT-5 is already in the works, then, you know, I can't imagine that things would just completely go haywire. But I do think this rocks the boat and leaves an open space for competitors. We're talking Anthropic. We're talking Microsoft. We're talking Google and Amazon. That to me seems like the biggest implication, right?

Is that you're in a very fierce fight. You need the full team. You need the A team on the field. And part of the football analogy, but like, you know, Like you lose your quarterback, you're in trouble. I guess it depends who they chooses their next quarterback. So let's talk about the backup quarterback, not to kill this analogy any worse than we have. Miramir Marotti, the CEO, very impressive background with Tesla working on AI.

She's shepherded a lot of the chat GPT and dolly work. What more can you tell us about her? You know, she's also been out there as a strong face for Open A.I. And, you know, I can't imagine that she wouldn't be. I think I was just looking on Twitter and there was already some kind of like gaming out there of who was leading in the race for the role. And Mira Muradi was leading the PAC. But, you know, so I think she's definitely as a permanent CEO. What?

As permanent. That would make sense to me. Yeah. There was a fortune profile of her that said that she led the Dolly development, the ChatsyPT development. She was crucial in the partnership with Microsoft. She has all these beliefs about trying to achieve artificial general intelligence. So she might slot right in. I mean, I definitely feel like whoever is the next CEO would have to be someone who is as firmly devoted to that mission as Mira as Sam, because everything I've read, everything I've heard about the company.

what's right on their home page and website, what their board is all about that we've been talking about is that mission, that they're constantly mission critical, you know, AGI or bust. Okay. And there's even more news that's been breaking. This is coming from Axios. Microsoft was blindsided by OpenAI's ouster of CEO Sam Altman. Ina Freed says its biggest partner, one that has invested billions in the company learned a minute before the rest of the world. that Altman was out. So obviously, this is, you know, we've talked a lot about mission and about, say, I'm not taking equity.

And I think this is an important moment to just pause and talk about a theme we've discussed on this podcast a bunch, which is that like when someone tells you that they're interested in like the bettering the greater growth of the world, ask some questions. I mean, it's interesting that Altman who had this whole like, we're going to achieve AGI, we're going to repair the world. We're going to do universal basic income, et cetera, et cetera. did something, I mean, clearly he did something, either it was this weird power struggle that we're going to find out about, or, it seems, anyway, I won't put a probability on it,

but, or he did something so bad that the board decided to fire him and not tell Microsoft, you know. And the fact, I mean, that's just mind boggling. Microsoft, it's not even just that Microsoft is Open AI's biggest investor. It was just reported that Open AI was looking for more money, a big infusion of more money, all pointing to that mission of building AGI together. And then there's this complex relationship between Microsoft and OpenAI, the nonprofit side, the for-profit company, the two sides of Open AI, and the complex negotiations that must have been put in place to make that happen. And so the idea that Microsoft wouldn't be in the loop here is, is incredible. Astonishing.

Now, Open AI is kind of a weird company, right? It's got this like cap profit and status and a nonprofit origin. Yes. It was always a little bit of a strange setup. And it's like, you know, then they built these like extremely viable commercial products, but their goal was to reach artificial general intelligence. I mean, I'm sure there's some coherent thread through it all. just feels like, like, I don't know, a science project meant to go wrong, which it clearly has.

I feel like the, you know, that the idea behind it was to set up, from their standpoint, was to set up a way to be able to fund their mission while, you know, while still offering a commercial opportunity so that it could be a win-win. And in that way, kind of creating an entirely new governance way of governing a company. This is very unusual the setup that they have with Microsoft. It's really something very brand new. And this piece that I wrote that I mentioned, the lawyers I spoke to said that. They said it's very unusual kind of setup. They had not seen anything like that before. But Anthropic also has like an unusual setup as well in their goal.

towards AGI. So this, I thought that this was starting to be some kind of like a new trend, but perhaps in this case, it's, you know, who knows what's going to happen. You know, as you were talking to me, I was like, this sounds like very like F-TX-ish, not the Ponzi scheme, but this whole like we're going to set up a corporate structure to achieve our mission, which was kind of like the same thing as Sam Begman-Fried. And then reading your piece, it turns out there is a link. I mean, it's not the Ponzi scheme.

But there are board members who are close to this effective altruism movement that was, and I'm not saying this has anything to do with Sam's departure or anything like that. We just don't know. But it is interesting that the EA movement, right, this effective altruism, we're going to try to like maximize our expected value and do whatever we can, you know, to make more money so that we can end up, you know, saving more lives in the future. It's represented on the Open AI board. What can you tell us about that?

Well, that's what actually drew me to write that story in the beginning, is I had read a thread from Logan Kilpatrick, who's at Open AI, when some news was coming out about Microsoft possibly infusing more money into OpenAI. And, you know, I took, Kilpatrick sort of put a thread of right from the Open AI website. structure page, which talks about how the company is set up. And one of those areas said that discussed the nonprofit board alongside the for-profit entity. And one of the points on that structure page explains that a six-member nonprofit board of directors is the half-dozen group that will decide when OpenAI has, quote, unquote, attained AGI.

When I looked into the members of that board, there are three employee members, Sam Altman, now gone, Greg Brockman, president, now off the board, and Ilya, who is the chief scientist, and there are three other non-employee board members who seem very unrelated, but they all have some, have had some tie. If you Google their names, if you look them up online, there are ties to the effective altruism movement. When I reached out to Open AI, they got back to me with statements saying that none of the board members are effective altruists, and that the three non-employee board members do not align with effective altruism in that way. But it was kind of like shaded a little bit, like, yes, one is on a board, but it's only

because they're not so closely tied to the community. So there was a little hedging there, but there's no doubt that they do have some ties. And even OpenAI itself has long had some ties, you know, again, not saying that they are part of the movement, but they definitely have had some ties that I talk about in the article. Really rough moment for effective altruism. Maybe we can stop taking this stuff at face value. Okay, this is coming from hacker news. So just a comment. It's total speculation, but, you know, might not talk about it.

So someone says, put the pieces together. November 6, OpenAI Dev Day with new features of the build your own chat GPT and more. November 9th, Microsoft cuts employees off from chat GPT due to security concerns. November 15th, OpenAI announces no new chat GPT plus signups. November 17th, OpenAI fire Sam Altman. Put the threads together. one theory. The new release has a serious security issue. This is just speculation. Leaked a bunch of data and it wasn't disclosed, but Microsoft knew about it. This wouldn't be the first time.

In March, there was an incident where users were seeing the private chats of other users, further extending the theory, prioritizing, getting to market, overrode security privacy testing, and this most recent release caused something much, much larger. Sounds feasible to you? it doesn't align with what we just said about Microsoft just finding out knowing yeah exactly okay take that Microsoft not knowing out of the this is of course speculation take them out potentially something feasible sounds like it would explain why Greg Brockman would have resigned from the board they're that connection because I feel like that's still an open question but there's also this like you know this there's such a tolerance for bad data leaks

in Silicon Valley. Like, it had to be more than that, it seems like. I agree. I feel like it has definitely to be more than that. Okay. That can't be. And again, you know, when we think about how this happened so quickly that this is the afternoon on a Friday towards the end of the stock market opening, I feel like

it's more than that. The stock market, so I put this on Twitter that the Microsoft stock slipped about 1.5% immediately after the news dropped. Now, people told me, you know, know, not a large amount, it's just 1.5%. The company's going to be fine. Still a $2.73 trillion market cap. But that, you know, that decline accounts for just, you know, a cool few dozen billion dollars.

Right. Is that, so how should we read that? Is it a problem for Microsoft that he's gone? I do think it's a problem for Microsoft if he's gone for, you know, again, it raises questions. You know, again, Satya Nadella was with Sam Altman on stage at Dev day touting their relationship that they be building AGI together. The fact that if it becomes quite public that they didn't know until a minute before, that doesn't look good for Microsoft, does it? I feel like catching Microsoft flat-footed would seem very odd. So I definitely think in a

variety of ways it doesn't bode well for Microsoft just in this moment. Of course, I don't think it necessarily means anything huge in the long game, but who knows? I mean, I definitely just think this is a big mic drop and there'll be a lot of fallout over the weekend, right? Yeah, exactly. And it's not the mic drop you do after you have a proud moment. It's the mic drop where the mic slips out of your hands and you embarrassingly have to go pick it up. Sam Olman tweets, I loved my time at Open AI. It was transformative for me personally. And hopefully the world a little bit. Most of all, I loved working with such talented people will have more to say about what's next later. I mean, people are like, who cares about what's next? What about what happened?

But it will come out. There's no doubt that it will come out. And I thought that that tweet kind of was a little funny. Like if it was something absolutely horrifying, it seems like he wouldn't put out that tweet, but I don't know. Right. So, okay, final question for you, who wins and who loses from this? Well, I definitely think that Open AI loses, at least in the short term. I think there's going to, I don't think that we've seen this kind of upheaval from them. I feel like they've been such steady rocks all year long, especially in this incredible wave. Like, I feel like for us, what's still a small company, I think people forget, you know, that it's still a small company.

I think it still only has a few hundred employees. You know, they've obviously been shouldering quite a lot and, you know, both in terms of developing and building, but also criticism, lawsuits, you know, all sorts of things. You know, and you've never seen any kind of crack in that this year. I don't think. I feel like everyone's been very tight, together, kind of steady pace. that's been my observation. So I think that to me, that's partly why this comes as such a shock

because it feels so off for open AI. I think Microsoft, it remains to be seen. I wonder if they could be seen as a winner in some ways, depending on what the deal is that they have with OpenAI. It possibly could be an opening for competitors, as you say. But I do think that when we learn more, more about what really happened, the winners and losers will become more clear. Yeah.

We should definitely do some of the jokes. One was mine where I was like, man, if we find out there were people typing behind chat GPT this entire time, it's going to be crazy. That was the thing that he was concealing. There were a lot of people doing the joke that, you know, the first person to lose their job because of chat GPT was Sam Altman. Right. that chat GPT can replace CEOs and then finally like oh how ironic is it that you know someone was

inconsistent in their communication got fired I mean this might look terrible when we find out the cause and it turns out to be something totally awful but in the meantime in the meantime we can have a little laugh yeah Sharon Goldman thanks so much for joining there's been an emergency edition of big technology podcast more to come as we learn more but we wanted to get something on the feed can't thank you enough by the way tell people where to find your writing yes you can find my writing at venturebeat.com i'm sharon goldman i cover i have you have a newsletter or you have a twitter what's your i also have a substack i have a twitter at sharon dot goldman you can check me out there Sharon gold on twitter terrific

thank you sharon thank you everybody for listening emergency we did it quickly we'll be back on the on the feed for sure, but wanted to get you at least the very basic story, the implications. And if you're waking up to this news, well, holy moly, I mean, it's going to take a long time for it to settle it. That'll do it for us here. We'll see you next time on Big Technology Podcast.