In the battle for the high-octane artificial intelligence-driven sweepstakes, it is the good old upright spine that has won the day.
Sam Altman, the 39-year-old Stanford University dropout who is one of the key drivers of the AI boom, has rebuffed Elon Musk’s offer to buy ChatGPT-maker OpenAI at a highly undervalued price.
Let that sink in — the world’s richest man who with US President Donald Trump’s patronage has been wielding unprecedented influence on the functioning of a democratically elected government as a private individual has finally met his match in his former compatriot.
A group of investors led by Musk has offered to buy OpenAI for $97.4 billion, which is substantially below the company’s most recent valuation of $157 billion. OpenAI CEO Altman has shot down the proposal and made an equally sardonic offer — buy Twitter (now X) at a price that is less than one-fourth the amount at which Musk had acquired the microblogging site.
The Wall Street Journal had earlier reported news of the offer.
“No thank you but we will buy Twitter for $9.74 billion if you want,” Altman posted on X, which Musk bought for $44 billion in 2022. Musk replied to Altman with a single word: “Swindler.” In a reply to a different user, Musk called Altman “Scam Altman”.
Musk, who is a top adviser to Trump, has been in a public relations battle with Altman for years. They were two of the many co-founders of OpenAI in 2015, establishing the company as a nonprofit focused on AI research. Musk left OpenAI in 2018.
The consortium of investors eyeing OpenAI includes Musk, his startup xAI and investors in his other businesses — Baron Capital Group, Valor, Atreides, Vy Capital, Joe Lonsdale’s 8VC and Ari Emanuel.
Marc Toberoff, a lawyer representing the investors, said: “If Sam Altman and the present OpenAI Inc board of directors are intent on becoming a fully for-profit corporation, it is vital that the charity be fairly compensated for what its leadership is taking away from it: control over the most transformative technology of our time. It’s time for OpenAI to return to the open-source, safety-focused force for good it once was. We will make sure that happens.”
Musk’s latest legal assault comes at a time when OpenAI has been working to restructure itself away from its original non-profit status. The offer to buy OpenAI could complicate that effort.
After launching ChatGPT in 2022, OpenAI has emerged as a giant in the generative AI space, attracting a wave of investments in its many tools. SoftBank is reportedly close to finalising a $40 billion investment in OpenAI at a $260 billion valuation. At the moment, Microsoft with its close to $14 billion investment is one of the biggest business partners of OpenAI.
OpenAI recently partnered with SoftBank and Oracle to announce Project Stargate, which has impressed Trump. The joint venture aims to build Cloud computing data centres in the US and intends to invest $500 billion over the next four years.
It’s difficult to determine how serious Musk’s bid is or his long-term motive. He and Altman have been feuding over the direction that OpenAI has taken since its founding in 2015.
Musk first sued OpenAI in June last year but he dropped the lawsuit after the company published a blog post that included several of Musk’s emails from OpenAI’s early days. The emails show Musk recognising the need for the company to make money to fund the computing resources needed to power its AI ambitions. He then filed another lawsuit in August, accusing OpenAI of racing to develop powerful “artificial general intelligence” technology to “maximise profits”.
