Microsoft Doesn’t Really Need OpenAI, it Wants AGI

Satya Nadella, chairman and CEO at Microsoft, was quick to onboard Altman at Microsoft after his negotiations with the OpenAI board of directors went stale. Altman will be joined by Greg Brockman and a few other researchers from OpenAI, notably Jakub Pachocki, the person leading GPT-4.

Absorbing Altman and his team into Microsoft could possibly be the biggest bet Nadella has made in this nearly decade-long stint as the CEO of Microsoft, bigger than its billions of dollars of investment in OpenAI.

However, by the time I conclude this article, Altman might have returned to OpenAI, rendering the arguments I presented potentially irrelevant. Reports suggest, despite announcements, Altman to Microsoft is not a done deal. Satya Nadella, in a recent interview with Bloomberg, stated that he will continue to support him and his team irrespective of where Altman is.

But it would make more sense for Microsoft to have Sam Altman and the team at Microsoft rather than OpenAI. The startup’s faith currently remains undecided, even though they have a new CEO in Emmett Shear. Nadella, on the other hand, would want to get as much as OpenAI folks to join this new AI group led by Altman at Microsoft.

The end game

OpenAI, which started off in 2015 as a non-profit, is focussed on achieving Artificial General Intelligence (AGI). As stated in one of their blogs, their mission has been “to build artificial general intelligence (AGI) that is safe and benefits all of humanity.”

However, interestingly, according to OpenAI, Microsoft will not have exclusive rights to use OpenAI’s post-AGI model. Due to their USD 13 billion dollar investment in the company, currently, Microsoft has exclusive rights to use its models like GPT-4 and GPT-4 turbo.

( Source: OpenAI blog)

Once AGI emerges, whether in the form of GPT-5, GPT-6, or an entirely new model, Microsoft will not possess exclusive rights to utilise that technology. Given Microsoft’s corporate nature driven by financial interests, it would want exclusive access to the technology and seek opportunities for monetisation regardless of its origin.

“Reality is that an in-house lab led by Sam and Greg might be better for Microsoft than the existing arrangement given the AGI clause,” Gavin Baker, managing partner & CIO at Atreides Management, said in an X post.

Even if Microsoft successfully acquires this cutting-edge technology from OpenAI, the blog goes on to clarify that in a for-profit structure, there would be equity caps. These limits are designed to prioritise a balance between commercial objectives and considerations of safety and sustainability, rather than solely pursuing profit maximisation.

Achieve AGI at Microsoft

Nevertheless, if Altman and his top team collaborate at Microsoft within a carefully selected group, there’s a potential scenario where Altman could achieve AGI at Microsoft rather than at OpenAI.

This scenario would grant Microsoft exclusive access to this technology, providing it with the opportunity to maximise its monetisation—an unsettling but plausible prospect.

This could be another reason Nadella was quick to get Altman and Brockman on board at Microsoft as soon as negotiations with the OpenAI board of directors faltered. After all, it was Altman who started the generative AI explosion by releasing ChatGPT to the world nearly a year ago.

Come achieve AGI at Microsoft might possibly be the exact words Nadella expressed when he tabled the offer to Altman. So far, besides Altman, Brockman, and Pachocki, Aleksander Madry, and Szymon Sidor, all previously working for OpenAI, have agreed to join Altman’s new AI group.

So, to sum it up, MSFT now has:
• OpenAI’s CEO
• OpenAI’s President
• The guy who lead GPT-4
• The guy who made GPT-4 work
• The guy who polished models for release

— Mark Tenenholtz (@marktenenholtz) November 20, 2023

Appearing optimistic, Brockman also announced on X ( previously Twitter) that they are going to build something new and it will be incredible.

So far, not much is known about this newly formed group, which Altman will lead, besides that it will be a new advanced research team (possibly mission AGI). But it would be interesting to see how much of their work aligns with OpenAI’s.

Microsoft does not really need OpenAI

‘OpenAI is nothing without its people,’ almost all OpenAI employees tweeted yesterday in a synchronised manner resembling a coordinated X campaign, expressing solidarity with those who departed from the company. Moreover, nearly all of them have also threatened to resign.

Given the turmoil, many other companies working in AI are reportedly trying to poach OpenAI employees. Salesforce CEO Marc Benioff also posted on X, “Salesforce will match any OpenAI researcher who has tendered their resignation full cash & equity OTE to immediately join our Salesforce Einstein Trusted AI research team.”

“That talent is the crown jewel of the organisation,” Tammy Madsen, professor of management in the Leavey School of Business at Santa Clara University told TechCrunch.

Given that Atlman is already on board, Microsoft would want to get more talents onboard from OpenAI and continue their pursuit of AGI at Microsoft. Brockman also declared on X that more will follow suit.

This remains a likely scenario, however, these are uncertain times, and we will have to see how the whole situation pans out. But, Nadella, so far, has said that Microsoft remains committed to its partnership with OpenAI.

“We look forward to getting to know Emmett Shear and OpenAI’s new leadership team and working with them,” he posted on X.

Currently, Microsoft is banking heavily on OpenAI’s models such as GPT-4 and will continue to need them until Altman’s AI group comes up with newer and better models. Moreover, the intricate nature of the clauses of the deal between Microsoft and OpenAI is not public yet.

Interestingly, Altman’s new AI team could be working on exactly the same thing OpenAI is, and a future scenario, where Altman’s team has achieved AGI, then Microsoft, could not possibly need OpenAI anymore.

Furthermore, the duration of Microsoft’s ongoing financial support for OpenAI and potential shifts in strategy amid significant reshuffling pose intriguing uncertainties.

The dynamics could again shift significantly, especially if the board at OpenAI resigns and Altman is reinstated as the CEO, altering the entire landscape of these arguments.

The post Microsoft Doesn’t Really Need OpenAI, it Wants AGI appeared first on Analytics India Magazine.

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