Wednesday, July 24, 2024

How OpenAI fired Sam Altman while blindsiding Satya Nadella

Fresh details have emerged in Sam Altman’s ousting from OpenAI, with a new report claiming that the company’s old board deliberately excluded Microsoft after initially voting to expel Altman as CEO.

The New Yorker reported that Microsoft executives, including Chairman and CEO Satya Nadella, were blindsided by the decision to oust Altman.

Several people in Microsoft found the OpenAI board’s decision “mind-bogglingly stupid” and felt it could destroy the ChatGPT developer.

“When Nadella recovered from his shock over Altman’s firing, he called an OpenAI board member, Adam D’Angelo, and pressed him for details,” the report mentioned.

D’Angelo told him Altman hadn’t been “consistently candid in his communications with the board”.

“Nadella hung up in frustration. Microsoft owned nearly half of OpenAI’s for-profit arm — surely he should have been consulted on such a decision,” the report mentioned.

On the video call with Nadella, Microsoft executives began outlining possible responses to Altman’s ouster.

“Plan A was to attempt to stabilise the situation by supporting Murati, and then working with her to see if the startup’s board might reverse its decision, or at least explain its rash move,” the report mentioned.

Plan B was to use Microsoft’s considerable leverage to help get Altman reappointed as CEO, and to reconfigure OpenAI’s governance by replacing board members.

Plan C was to hire Altman and his most talented co-workers, essentially rebuilding OpenAI within Microsoft.

Nadella did hire Altman for a short period to help the company pursue its advanced AI dreams with a new vertical.

However, Altman finally returned to OpenAI as CEO after an intense drama, with Microsoft getting a non-voting observer seat on the company’s board.

OpenAI’s new board consists of chair Bret Taylor, Larry Summers, and Adam D’Angelo, the only remaining holdout from the previous board.

Microsoft is a major investor in OpenAI, with a 49 per cent stake in the for-profit entity.

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