Confused? You should be. I'm deliberately not looking at Techmeme so I don't have to update this post for the fifth time.
Twenty-four hours ago, this was a thoroughly different post. Heck, twelve hours ago, it was a different post.
One of the things I told myself when making this Substack was that I wouldn’t focus on current events. My focus is on the longer term: the three-to-five-year time frame, for publishers, communications professionals and others assorted nerds.
But the shenanigans at OpenAI over the weekend suckered me in, and now I have had to rewrite this post three times (and whatever I write will probably be wrong tomorrow). Still, the drama goes on.
The drama that’s been happening at OpenAI does matter and might be a turning point in how AI and large language models develop over the coming years. It has some implications for Google – which means it is relevant for publisher traffic – and Microsoft – which means it is significant for the business processes which keep everything flowing.
What’s happened at OpenAI?
If you’ve not been following the story, here’s a timeline created by Perplexity (about which I will have more to say in the future). But the basics are that OpenAI’s board dismissed Sam Altman, its founder and CEO, alleging he had been less than truthful with them. Half the company then decided they wanted to leave. Microsoft’s Satya Nadella then claimed Altman would be joining his company, only to walk that back later in the day. Now Altman is going back to OpenAI as CEO but not on the board and there will be an “independent investigation” into what went on, something that might not totally exonerate Altman.
Confused? You should be. Everyone else is. Partly this drama comes down to the unusual structure of OpenAI, which at its heart is a non-profit company that doesn’t really give two hoots about growth or profits or any of the things most companies do. Partly it’s down to Altman basically pushing ahead as if this wasn’t true, then realising too late that it was.
What’s the long-term impact on future AI development?
OpenAI has been at the forefront of developing the kind of conversations large language models which everyone now thinks of as “AI”. It’s fair to say that before the June 2020 launch of GPT-3, LLMs were mostly of interest to academic researchers rather than publishers.
And a huge number of tools have been built on top of OpenAI’s technology. By 2021 there were over 300 tools using GPT, and that number has almost certainly gone up an order of magnitude since. And of course, Microsoft is building OpenAI tech into everything across its whole stack, from developer tools to business apps to data analysis.
If there’s one company that you don’t want to start acting like a rogue chatbot having a hallucination, it’s OpenAI.
And yet, because of Microsoft’s investment in the company and commitment to AI, it probably matters a lot less than it would have if this schism had happened three or four years ago. The $13bn it has put in since 2019 for an estimated 49% stake of the company and the fact it is integrating OpenAI tech into everything it does mean it has a lot to lose (and Satya Nadella does not like losing.)
Because of this, I think the past few days won’t have much impact on the longer-term future of AI. In fact, it could end a good thing, as it means Microsoft has committed that it will step in should OpenAI start to slip.
The greatest challenge for Microsoft was that, although it had perpetual licenses to OpenAI’s models and code, it didn’t own the tech outright, and it didn’t have the people in house. And, when you’re betting your company’s future on a technology, you’re always in a better position if you own what you need (something that publishers should take note of).
Partners are great, but if you’re locked into a single partner, and they have what you require, you’re never going to be the driver of your fate. Now, though, if Altman and the gang join, Microsoft effectively owns all it needs to do whatever it wants. It has the team. It has the intellectual property. Everything runs, and will continue to run, on Azure, and it has the financial muscle to invest in the huge amount of hardware required to make it available to more businesses.
The big question for me is how all this impacts on Google over the next few years. If Altman and half of OpenAI ends up joining Microsoft, I think it weakens Google substantially: at that point, Microsoft owns everything it needs to power ahead with AI in all its products, and the more Microsoft integrates AI, the stronger a competitor it will be.
If, on the other hand, Altman goes back to OpenAI with more of a free hand to push the technology further and harder, Microsoft still benefits through its partnership, but to a lesser degree.
If I was running Google, I would be calling Aravind Srinivas and asking how much it would take to buy Perplexity. But that’s another story, maybe for next week.
