Why Elon Musk took Sam Altman to court (and lost)

0:02Sky News, the full story first.

0:10They created the company behind ChatGPT. Now, Sam Altman and Elon Musk are accusing each other of greed, betrayal and abandoning humanity. And this is why.

0:27I'm Sam Coates from Sky News. And I'm Anne McElvoy from Politico. Downing Street drama, leadership battles and policy U-turns. We're on it before it breaks. We take you straight into the rooms where the real political conversations are happening. Smart Insight, clear analysis in your feeds by 7.45am. So you start your morning fully brief for the day ahead in British politics. Hit follow and listen to Politics at Sam & Anne's wherever you get your podcasts.

1:03Hi everyone, Neil here. Do hope you're well. Look, not long ago, most of us had never even heard of OpenAI. Now the company makes artificial intelligence platforms that are changing schools, offices, politics, journalism, search engines, perhaps eventually the economy itself. And at the centre of it all are two men, once allies, now enemies. Elon Musk. I don't trust them all, And I don't think we want to have the most powerful AI in the world controlled by someone who is not trustworthy. And Sam Altman. You know, I don't think about him that much. Well, this week, a jury in California sided with Altman after Musk accused the company of abandoning its original mission to build artificial intelligence safely, openly, and for the benefit of humanity.

1:47But as you're going to hear, this case isn't really just about bruised egos or Silicon Valley infighting. It's about something much bigger. who gets to control perhaps the most powerful technology humans will ever create. And that's where this whole core saga, which is akin to, if you're in the UK, Pat Butcher and Peggy Mitchell having a scrap in the Queen Vic pub. I sat down with the tech journalist, Will Guyot. Will, always lovely to see you. Let's start with the absolute basics in this quite complicated story. OpenAI, what is it? So OpenAI is a company that has been created to build products around artificial intelligence.

2:30Most of us will know about ChatGPT, which is its service that has essentially become the Hoover or the Google of the AI equivalent of those things. It's become ubiquitous over the last couple of years since it's launched. And a chatbot is essentially a replacement for the internet search engine. You can go and ask it questions and it will respond with answers of sorts. it became popular very quickly now that's the main thing that open ai do and they've got all sorts of other interesting things that we haven't even seen yet that are due to come they've done a huge deal with sir johnny ive the former design guru at apple that bought the imac and the iphone and everything to fruition and they're on the verge of launching various technology in that space so they're a company that's constantly in the news they're also a company at the moment that hasn't actually been available to buy shares in and there is sort of a massive growth of interest in this company and that's where this whole core saga which is akin to if you're in the UK Pat Butcher and Peggy Mitchell having a scrap in the in the Queen Vic pub.

3:35I have to admit I never thought I'd be hearing about Pat Butcher and Peggy Mitchell being used as a direct comparison between Sam Altman and Elon Musk so let's start with those two of course people will recognize the names titans of the tech world but who are they and how do they fit in to this argument so we go back 10 or so years to when open ai was being founded and depending on who you believe it was originally intended to be an entirely not-for-profit business it was intended to be created to the betterment and furtherment of society through artificial intelligence and elon musk sam altman and others got together to create this business.

4:16There was about four or five different partners in this organization. Now, Elon Musk and Sam Altman knew each other and had conversations about previous tech businesses and other companies that Sam Altman had been involved in. And he's been hugely successful in investing his money over the years. And Elon Musk is Elon Musk. I'm not sure what I need to tell people about Elon other than some people see him as the living equivalent of Robert Downey Jr.'s Tony Stark, Iron Man from Avengers. And those of us who follow him very closely can't work out how he's the world's richest person because a number of incredible missteps and misbehavior along the way.

4:59But he is an incredibly successful human being. I suppose the one thing that we can say is at the point at which OpenAI is being created and these two are working alongside each other. I mean, everyone knew who Elon Musk was. His start had already ascended. Sam Altman, not so much so at that point, at least outside of Silicon Valley. So I do wonder, where did it all start to go wrong between the two? It all fell apart over who was in control of it and who owned it. And over the years since, the tit for tat has increased. They're both definitely off each other's Christmas card lists. The anger over this came about when it was apparent that ChatGPT had skyrocketed OpenAI's estimation evaluation above and beyond anything else Elon Musk was capable of in the AI space.

5:46Let's not forget that Elon Musk bought X, formerly Twitter, and was going to build it into an AI business called XAI. So there's a rivalry here over this product, and that's where they fell out. Well, let's go to that court case, and it was a case brought by Elon Musk, but as always seems to happen, particularly when you've got two tech giants facing off against each other, there is countersuit. So explain exactly what both sides were accusing each other of. So Elon Musk, he bought the case. And this was all about whether OpenAI should remain a not-for-profit business. And this was Elon Musk's argument.

6:21It should stay not-for-profit. I was misled. He was suggesting all sorts of means like Sam Altman will be removed from the company or that the company would be forced to remain as a not-for-profit. He also threw in a suit involving Microsoft and suggesting Microsoft had conspiratorially behind the scenes done everything it could to help Sam Altman and obstruct Elon Musk and others from the so-called just development of OpenAI. And on the opposite side, OpenAI's response was, there's no legal basis to this. You should have done this years ago if you really thought there was a problem. And there's loads of contradictory evidence in what you've suggested.

7:02And And we found ourselves in a bizarre position where we thought after the judge had taken all the evidence for both sides, we were going to be in a long period of time when the judge was considering the whys and what for's of this case. And within several hours came out with an absolute really clear answer. You've gone over the time you should have had for this and I don't find them guilty. And Musk keeps framing this publicly as a technical decision by the judge. It was an absolute slap across the chops. Don't waste the court's time. if you really believe this you should have done it earlier and any of the information and the kind of points you've brought forward about your problems none of them stand now of course Elon Musk is going to say he will appeal but let's not forget there are all sorts of other examples where Elon Musk has quietly settled he did that recently when he tried to kind of heat up or cool down the price of x depending on what you were looking at he had to pay a large settlement for that we've had all sorts of legal cases where he's had to pay up for the mistreatment of twitter execs that he fired from the company all sorts of stuff that he hasn't won recently but he will tell his followers the millions and millions of people who follow him on x on other platforms that he is right and that something terribly unjust is happening to him well i can't believe i'm going to say this about a court case but can we just park the law just for a second and isn't there really at the heart of all of this a rather more fundamental philosophical question and it's this that if you're pursuing artificial general intelligence, you know, where AI has the ability to understand, to learn, to solve problems at a human-like level, if not better, I mean, you're going to need to put lots and lots of money into it.

8:40And if you need to put lots and lots and lots of money into it, you're probably not going to be able to do that if you're a not-for-profit. Yeah, exactly. And that is entirely the current route into artificial intelligence. There's a conversation we can have another day on the Western vision of AI and the Chinese vision of AI. The easiest 30 second version is the Western version is developed for a Ferrari. The Chinese version is tuned on a lawnmower engine. So it kind of gives you a very quick sense of the two different approaches. If you go for the maximum power generation, which the West are doing, you need to spend bucket loads of money.

9:16And there's been, aside from this court case, all sorts of bizarre decisions over the last couple of weeks. open AI scrapping its popular video generation app after several months, backing away from a billion dollar deal with Disney to use its characters in video generation, because this thing is costing them a lot of money. And they are literally at the moment, writing future checks that their body cannot currently cash. I think it was Barclays or HSBC that did some of the estimations recently, the committed numbers for compute power and server farms, and even the energy bill in 2030 something far exceeded what anybody thought their maximum profit generated by that point was based on the current size of the business so this is a monstrous massive house of cards and if we didn't learn anything from the dot-com bubble we are going to learn something from the ai bubble because there will be a crash that doesn't mean the end of ai it means i think that companies need to stop dreaming and over extending in order to try and be the leader Isn't it possible, though, to accuse both of these figures of blatant hypocrisy?

10:22I mean, Sam Altman, let's start with him. OpenAI was set up to be the more conscientious AI company. It was not-for-profit. Now they are chasing what I believe is a trillion-dollar valuation. On the other side of this, Elon Musk talking about it needing to be a not-for-profit, whilst himself desperately trying to keep control of a large share of the AI market by creating his own for-profit AI. There was the recent New Yorker piece about Sam Altman and his work with OpenAI. In the Roman Farrow piece, he said there's almost priced in now into these companies that the leader has to be deceptive and misleading.

11:02So we find ourselves in a situation where there's a race to bring this kind of technology to pass, but being in control of the people and having leaders with a strong moral compass doesn't seem to be at all compatible. But again, doesn't it also suggest that we should perhaps be looking to democratise artificial intelligence in a way that's not going on right now? That if we are to have AI controlled by a small handful of people, it would better not be this lot. This is another really interesting discussion. Nobody has yet come up with a really sensible way of how to democratise artificial intelligence.

11:37The European Union had what looked like the world's gold standard of rules coming into place to protect people, to protect companies, to protect data. Those have all been delayed, optimistically, completely removed, worst case, because of the pressure from lobbyists, from businesses in Europe that felt that they were going behind US companies. You find yourself in a situation where it feels a bit like a nuclear arms treaty, that there may be some public conversations about how we can work closely with China and other states, other countries, other businesses and other territories. but there is a race to get there first with this for all the reasons that you fear you know having this would give the west a lead over china having this first would give america military superiority over other organizations if they were able to have truly artificial general intelligence and it's also going to be worth a boatload of money to whoever gets their first two so that's why the brakes seem to have been taken off again and i'm not sure whether it's going to take something really big, a really big error that's going to cause humans to put this back in the bottle.

12:44I don't know when that will come. Okay, so explain why anyone should be bothered about this. My mum, sitting at home right now, making her dinner, listening to her boy on the podcast. Why should she care about this Altman versus Musk bun fight? The whole world of artificial intelligence that's behind the EastEnders-esque punch-up is something that's existentially transformative to the world. Everybody will be impacted here. And your mum's there and she's thinking about your future and your family's future. You and I as a generation might still get through relatively unscathed. We might have to pivot slightly in our work.

13:20But for our children and our grandchildren and for everybody else, the world will change hugely. Your mum, for example, might like to pick up the phone and speak to a human being in a customer service centre. Nearly all of those will disappear as a result of artificial intelligence in the next couple of years. it's going to impact everybody's lives in huge ways and people don't know it's not going to change mine but it already is without them realizing the kind of seismic shift that's happening with this stuff a lot of it at the moment is people like me saying there's going to be a seismic shift but the real changes are actually now shifting into society jobs are actually being lost in other countries graduates are not finding the opportunities there are in the workplace and you know there are other serious conversations just today it looks as though the NHS is suggesting it might not hire all the people the Conservatives said it needed, and it might lean on artificial intelligence, which is a very different way of dealing with healthcare in the UK.

14:13But Will, isn't there fundamentally a contradiction between capitalism and safety, particularly when it comes to artificial intelligence? I mean, genuinely, if we accept that profits have to be made to sustain this sort of growth, where does safety count in terms of their priorities? Yeah, this is the challenge. And I'm surprised we didn't get it in the court case. Sam Altman disappeared from the helm of OpenAI for 72 hours over a weekend. He was removed from the company. We don't still know why that is. But many of the rumours were that was because he took a fast and loose attitude to safety on the platform, how his products were being rolled out.

14:50And I think you've hit the nail on the head. Capitalism and safety do not necessarily go together. And this massive rush towards the next leap into artificial intelligence looks largely at the moment to be unfettered by any kind of monitoring or proper protection.

15:10And that's a lot for today. Do get in touch with your thoughts on today's episode. Perhaps you are scared of AI or perhaps you welcome the arrival of our robot overlords. Why? At sky.uk. We're back again tomorrow.

15:30I'm Sam Coates from Sky News. And I'm Anne McElvoy from Politico. Downing Street drama, leadership battles and policy U-turns. We're on it before it breaks. We take you straight into the rooms where the real political conversations are happening. Smart Insight, clear analysis in your feeds by 7.45am. So you start your morning fully brief for the day ahead in British politics. Hit follow and listen to Politics at Sam and Anne's wherever you get your podcasts. We'll be right back.