&gt; I remain, confused.I think everyone is confused.

Not sure about the IP, but the team can get whatever they have access in the past. It certainly speed up the restart process

Not only that, Microsoft in practice is OpenAI&#x27;s customer. So somehow OpenAI will be working for them.

Care to elaborate? Microsoft funding OpenAI doesn’t grant them right to just grab intellectual properties.

Does the Microsoft deal let Microsoft continue training from e.g. the GPT-4 weights?I guess at least it gives them access to the OpenAI models to use internally, which they kinda need as their ways of working (Greg especially) will be highly dependent on having them now.

Your comment got me thinking, it&#x27;s not just all the current access to all the data, weights, and infrastructure they had at OpenAI, it&#x27;s also everything that will come out of OpenAI in the future.Remember, Microsoft has an exclusive license to all models that come out of OpenAI until they reach the pre-agreed income threshold, which given the current trajectory of OpenAI, will not happen anytime soon.

By joining Microsoft, they retain access to all the data, weights, and infrastructure they had at OpenAI. They don&#x27;t have to start from scratch and ramp up. They can start up right where they left off.

He wasn&#x27;t the guy who built it, he was the guy who got things funded. Let&#x27;s see how many of the core OpenAI people join. I.e. the ones that weren&#x27;t (just) there for the money &#x2F; post ChatGPT.

And then they get to say one of the most depressing sentences in an engineer&#x27;s lexicon: &quot;It&#x27;s almost like we&#x27;re a startup within a big company!&quot;

Imagine thinking that top AI researchers are going to start choosing to work for MSFT after years of them being second class citizens there.Like if they don’t like OpenAI they can go to 10 other places that pay more and treat researchers better than MSFT

And for the OpenAI employees, they can just switch the badge in a blink second, it almost feel like a no-brainer to many.I think Sam just took the easier route to rebuild OpenAI within MSFT.Now the trouble comes to the SV VCs they now will be furious.

The business person is a SV darling. And previously the President of YCombinator.

Every once in a while, and I actually do not care much about soccer, I read comment sections in a German newspaper about soccer (please don&#x27;t ask why, I have actually no clue myseld). And there, you basically have the same discussion: that player &#x2F; trainer is great &#x2F; sucks &#x2F; rightfully &#x2F; wrongfully lost his job, that club will never ever win again without person A...It is quite intrigueing to see tge same fan &#x2F; cheerleading going on when it comes to comapnies and managers. But then everything is entertainment by now...

I am confused why everyone is freaking out about some business person being let go from a tech shop.

What Sam is going to bring to MS? Recruits? MS already has all the money and infra they need.

Sam joining MS was actually one of the theories I read in the initial, or one of the first, threads about his ouster. 10 billion dollar seems like a pretty steep recruiting cost, but MS knows what they are doing, right? Right?

This isn&#x27;t even remotely confusing now.This move makes it exactly clear what was going on. Microsoft is doing to AI what they tried to do to Internet browsers back in the day. I wonder if they&#x27;d have been successful if they&#x27;d managed to buy the board of Netscape.I suspect it&#x27;s rather possible that there will be an ungodly-massive lawsuit in the offing.

All the claims about how OpenAI&#x27;s board desperately wanted Altman back were based on leaks from &quot;people close to Altman&quot; which the press uncritically lapped up.If it wasn&#x27;t clear before, it should be clear in hindsight that the board&#x27;s desire to welcome Altman back was, at best, overstated.The leaks were probably an attempt to pressure the board or, failing that, undermine OpenAI.

The whole situation likely arose due to Microsoft attempting to cross the boundaries set by OpenAI.

Listen.I was confused when the whole thing was going down.I was more confused when the whole &quot;board wants to backtrack and maybe resign&quot; thing was going down.I got even more confused when Emmett Shear was announced as the CEO....but never in a hundred years would I have imagined &quot;haha just join Microsoft&quot; as an actual alternative.I remain, confused.

Maybe they want it that way and want to move on from all the LLM hype that was distracting them from their main charter of pushing the boundaries of AI research? If yes, then they succeeded handsomely

Ilya and co are going to get orphaned, there’s no point to the talent they have if they intend to slow things down so it’s not like they’ll remain competitive. The capacity that MSFT was going to sell to OpenAI will go to the internal team.

How do you conduct research with sales people? even if they manage to bring in researchers from OpenAI, the only gain here is microsoft getting some of the researchers behind the products and&#x2F;or product developers.

Maybe I&#x27;m reading too much into it, but for me it is us framed as if they won&#x27;t be working on GPT-based products, but on research.The whole thing reads like this to me: &quot;In hindsight, we should&#x27;ve done more due diligence before developing a hard dependency on an organization and its product. We are aware that this was a mistake. To combat this, we will do damage control and continue to work with OpenAI, while developing our in-house solution and ditching this hard dependency. Sam &amp; Co. will reproduce this and it will be fully under our control. So rest assured dear investors.&quot;

I wonder if they&#x27;ll get bored working on Copilot in PowerPoint

This is kind of true, I think programming even codellama or gpt3.5 is more than enough and gpt-4 is very nice but what is missing is good developer experience, and copy-pasting to the chat window is not that.

If I recall correctly, Mira Murati was actually the person responsible for productizing GPT into a Chatbot. Prior to that, OpenAI&#x27;s plan was just to build models and sell API access until they reach AGI.I know there&#x27;s a lot of talk about Ilya, but if Sam poaches Mira (which seems likely at this point), I think OpenAI will struggle to build things people actually want, and will go back to being an R&amp;D lab.

Just curious what do you think is bad about the user side experience of chatgpt? It seems pretty slick to me and I use it most days.

Sam and Greg were responsible for everything including building the company, deciding on strategy, raising funding, hiring most of the team, coordinating the research, building the partnership with Microsoft and acquiring the huge array of enterprise customers.To act like they were just responsible for the &quot;UI parts&quot; is ridiculous.

Except they only had AI model velocity and not product velocity. The user-side implementation of chatGPT is actually quite below what would be expected based on their AI superiority. So the parts that Sam &amp; Greg should be responsible for are actually not great.

This actually seems like a decent compromise.  Sam and Greg can retain velocity on the product side without having to spin up a whole new operation in direct competition with their old levers of power, and Ilya + co can remain in possession of the keys to the kingdom.

Agreed. Sam isn’t some AI visionary, he’s a startup guy. Unless he’s leading a team that’s going to spin out a new company, I don’t get it.

What value does Sam bring now? They have all the money they could want. All the connections they’d need.Weird situation for him.

Wonder how long this will last. This team doesn&#x27;t seem like a good fit for big corp Microsoft.Good get by MS though!

If your goal is to produce a lot of value and you don’t care about others capturing it, then it may actually be a good way to go, especially with the non-profit setup.

OpenAI is destined to learn the story of Xerox PARC the hard way. I commend them.

But Satya is making a few 100 mil a year, tops. Sam could easily make himself a billionaire with one raise. And who wants to control all of Microsoft, that&#x27;s a whole lot of headaches

Lol, maybe. Ballmer was a friend of Gates, was 44 years old and had worked at Microsoft for 20 years (2000-1980) already when he became CEO. Nadella was also forty-something and had worked at Microsoft for 22 years (2014-1992) when he got the job.

Maybe Sam thinks OpenAI will be so important he has a shot at CEO of Microsoft in a couple years?

So Sam &amp; Greg can stay focus on their work rather than getting distracted by all the lawsuits. It isn’t a bad thing. Just not sure how they can get they want under the corporate culture?

In California the anti-compete clauses are not enforceable, afaik

non-competes are extremely hard to enforce in California. Sam would literally have to download Open AI trade secrets into a USB drive to get in trouble.

Do anti-compete clauses work when you’ve been ousted? Greg resigned, actually, but Sam was ejected.

&gt; It sounds very out of line of what you&#x27;d expect.Except if Sam and Greg have some anti-compete clauses. If they join MS, they have a nice 10 billion USD leverage against any lawsuites.

It certainly sounds out of line with all the reporting that Altman was talking about starting a new company and could trivially fundraise for it. Was that just as much kayfabe as the idea of bringing him back?

I&#x27;ll bet Microsoft offered him a very sweet deal, which for Sam means lots of autonomy.Microsoft is happy. They get to wrap this movie before the markets open.Edit: I also agree with bayindirh below. These things can both be true.

Nope. They&#x27;re following the path to power, money, and maybe continued fame. That&#x27;s all.

There&#x27;s an infinite difference between turning your startup into a giant corporation and getting a job at one.

What? If anything a startup founder (in general) wants to become a gigantic corporation. The bigger the better.

&gt; He was the kind of guy on the way to become worth $100 billion and more, with enough luck,Was he though? If I understand correctly he didn’t have any equity in the for profit org. Of OpenAI.IIRC he also publicly said that he doesn’t “need” more than a few hundred million (and who knows, not inconceivable that he might actually feel that).

Presumably they’ll both get their C-level positions out of the gate (for that AI entity MS is setting up specially for this) so not just “mere” employees.But, yeah, kind of confusing, especially for Altman.He was the kind of guy on the way to become worth $100 billion and more, with enough luck, meaning to be the next Musk or Zuckerberg of AI, but if he chooses to remain inside a behemoth like MS the “most” that he can aspire to is a few hundred millions, maybe a billion or two at the most, but nothing more than that.

I bet MS probably bankrolls a subsidiary or lightweight spinoff for AGI if they are under MS, they can keep the original research and code.

Hilarious. The look on Ilyas face when these two show up at the office for their &quot;sync&quot;, or perhaps he&#x27;s ordered to travel to a location of the owner&#x2F;client&#x27;s choosing.

OpenAI can also jump ship and get a nice deal with amazon or google. In fact, right now they are ripe for the taking.

They&#x27;re likely going to be the ones who manage the OpenAI relationship...what better way to fuck the people who fucked them than by becoming the ones who literally control the resources that they need?

Technical debt.Azure was already second nature for OpenAI and so there is very little friction in moving their work and infrastructure. The relationships are already there and the personnel will likely follow easily as well.They are also likely enticed by the possibility of being heads of special projects and AI at the second largest tech company, meaning deep pockets, easy marketing and freedom to roam.Oh, and those GPUs.

They need computers. I&#x27;d assume this came with a substantial budget promise.

They will probably run a subsidiary under the MS umbrella and profit hugely in the next few years. Also, MS could easily dump OAI in the next few months to year.

Sam had no stake in OpenAI. So, any potential deca billion value is hypothetical. He would have to do a U-turn and fight with the board to get his cut. Now he&#x27;ll get his cut from MS. This AI division will have some further restructuring.Edit: Sam is CEO of the new AI division.

This is Microsoft starting a copy machine to replace OpenAI with in-house tech in medium to long term.Apparently Microsoft already had plans to spend $50 billion on cloud hardware.Now they are getting software talent and insider knowledge to replace OpenAI software with in-house tech built by Sam, Greg and others that will join.Satya just pulled a kill move on OpenAI.

It&#x27;s a no lose situation for Microsoft.Either there in house team wins out and Microsoft wins.Or OpenAI wins out and Microsoft wins with there exclusive deal and 75% of OpenAI profits.Better to have two horses in the race in something so important, makes it much harder than one of the other companies will be the one to come out top.

Seems like a good compromise?OpenAI continues to develop core AI offered over API. Microsoft builds the developer ecosystem around it -- that&#x27;s Sam&#x27;s expertise anyway. Microsoft has made a bunch of investment in the developer ecosystem in GitHub and that fits the theme. Assuming Sam sticks around.Also, the way the tweet is worded (looking forward to working with OpenAI), seems like its a truce negotiated by Satya?

&gt; So Microsoft decided to compete with OpenAIThey already do, though, has everyone forgot they got a Microsoft Research division?

They could get a infra deal with AWS, Google, NVidia or AMD even :-).Or they write the AI that runs on your M3That said the Microsoft offer came quickly than Amazon can deliver a 3090 to your house so…

Their alternative is to start a new AI company.At this point in time a new AI company would be bottle-necked by lack of NVIDIA GPUs. They are sold out for the medium term future.So if Sam and Greg were to start a new AI company, even with billions of initial capital (very likely given their street cred) they would spend at a minimum several months just acquiring the hardware needed to compete with OpenAI.With Microsoft they have the hardware from day one and unlimited capital.At the same time their competitor, OpenAI, gets most of the money from Microsoft (a deal negotiated by Sam, BTW).So Microsoft decided to compete with OpenAI.This is the worst possible outcome for OpenAI: they loose talent, pretty much loose their main source of cash (not today but medium to long term) and get cash rich and GPU-rich competitor who&#x27;s now their main customer.

Plus continued access to OpenAI technology.

Satya probably offered the one resource they couldn’t buy at the scale&#x2F;speed they need: OpenAI models &amp; future work. Altman wouldn&#x27;t have had (legal) access to these anywhere else, and Microsoft wouldn&#x27;t have had Sam Altman controlling OpenAI tech in any other arrangement. This arrangement may be the best for all involved: Microsoft gets it&#x27;s LLM geegaws based on OpenAI tech, Altman gets to build GPT marketplaces and engage whatever growth-hacking schemes he can dream of that may have been found distasteful by colleagues at OpenAI, and OpenAI can focus on the core mission and fulfilling contractual obligations to MicrosoftI foresee this new group building on top of (rather than completing with) OpenAI tech in the near-to-mid term, maybe competing in the long term of they manage to gather adequate talent, but it&#x27;s going to be going against the cultural corporate headwinds.I wonder if Microsoft will tolerate the hardware side-gig and if this internal-startup will succeed or if it will end up being a managed exit to paper over OpenAIs abrupt transition (by public company standards). I guess we&#x27;ll know in a year if he&#x27;ll transition to an advisory position

Satya probably offered the one resource they couldn’t buy at the scale&#x2F;speed they need: GPUs. Both time on Azure’s cloud, as well as promise of some of the first Azure Maia 100 and Cobalt 100 chips.

No. They need a lot of money and computation resources to work on. In order to continue their work, they either A). raise a massive fund B). be employed by a big corp. There&#x27;s no surprise they chose the latter. After all, MS has a research department on this domain.

It depends on what they are allowed to do as employees, which is probably in the process of being figured out right now.

The only meaningful thing here that makes sense to me is that the “secret sauce” that openAI has is exclusively licensed to Microsoft.Which means, starting a competing startup means they can’t use it.Which makes their (potential) competing startup indistinguishable from the (many) other startups in this space competing with OpenAI.Does Sam really want to be a no-name research head of some obscure Microsoft research division?I don’t think so.Can’t really see any other reason for this that makes sense.

LolDesperate... Right...The guy met with the Arabs a few weeks back about billions in financing for a new venture. The guys desperate like I&#x27;m Donald duck.

Sounds desperate to me, a bit like that &#x27;I&#x27;m in the office&#x27; photo-op. A bit like having access to the models or whatever is sustaining him somehow lol

&gt;I think Sam&#x27;s goal is to create AGISupposedly his goal was the same as OpenAi --&gt; AGI that benefits society instead of shareholders.Seems like a hard mission to accomplish within Microsoft.

Like Cyberdyne Systems was just a means of getting there.

I think Sam&#x27;s goal is to create AGI, same as most of the other founders of OpenAI. If he just wanted money and power, he probably would have continued with YC or some other startup instead of joining the nonprofit and unproven OpenAI at the time.His opinion on the ideal path differs from Ilya&#x27;s, but I&#x27;m guessing his goal remains the same. AGI is the most important thing to work on, and startups and corporations are just a means of getting there.

It&#x27;s gonna be a special unit. He&#x27;s not gonna be an employee.Once you lead at that level... It&#x27;s max autonomy going forward. Source: Elon. Guy hates a board with power as much as Zuckerberg. Employee? Ha
.. Out of the question.

Curious to see how long Sam lasts as an employee.

I guess they were fired exactly for this reason: more money, less research and being actually &quot;open&quot;. A &quot;non-profit&quot; called &quot;Open&quot;AI hiding GPT-4 behind a paywall with no source code with just a few hints in the papers, surreal.

Or just accept that their image is overinflated just because they happened to be in the right place at the right time. Ofcourse they had a hand on building that successful team but do not underestimate the fact that, that successful team was build with the promise of nonprofit, AI for the benefit of all And few of them would have joined Microsoft out of principle.

Isn&#x27;t the exit exactly what you&#x27;d expect from startup founders?

Never gonna happen.Satya runs the biggest race track.Altman trains pure breds trying to win the Kentucky derby repeatedly.Totally diff games. Both big bosses. Not equivalent and never will be. Totally diff career tracks.

Guess who&#x27;ll be running Microsoft after Satya, and what Microsoft&#x27;s core offering &#x2F; cash cow will be.

They won&#x27;t have to worry about raising capital or getting access to GPUs, and they&#x27;ve likely been promised a high degree of autonomy, almost certainly reporting directly to Nadella.

Satya is saying they&#x27;ll be an independent &quot;startup&quot; within Microsoft <a href="https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=38344811">https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=38344811</a>

They must be getting a king&#x27;s ransom. Turns out sama didn&#x27;t need equity, he got paid by getting fired.

I think the employees part is probably wrong here. Can’t imagine they’ll need to act like ones even if they are on paper

In the end it&#x27;s just labels. What matters is what kind of funds will they be given, what they can work on, what sort of control they have over it.

From the sounds of it they&#x27;re starting a new company within MSFT.

A little bit, but I highly doubt it&#x27;ll last long. I predict most of them will end up in a startup sooner rather than later.

We don&#x27;t know the structure of their new unit, do we? Sometimes &quot;startup in a big corp&quot; may really bring the best of both worlds (although in reality, 90% of such initiatives bring the worst of the two worlds).For many years, Microsoft Research had a reputation for giving researchers the most freedom. Probably even that&#x27;s the reason why it hasn&#x27;t been as successful as other bigcorp research labs.

Anyone else find it strange that startup founders of the magnitude of Sam &amp; Greg would join a gigantic corporation as employees?It sounds very out of line of what you&#x27;d expect.

Good work for Microsoft, moving swiftly to take advantage!

&quot;OpenAI, the next huge tech company to rival Google&quot; is a huge loser of this whole process, probably dead.&quot;OpenAI, the non-profit who only has a for-profit subsidiary to get enough resources to fund its mission to develop AGI&quot; is probably a winner, and gets to live instead of slowly die.

It’s really safe to say the big loser is OpenAI. Microsoft is effectively getting the team under their own overnight

Greg Brockman has already announced some of the others on the leadership team -- <a href="https:&#x2F;&#x2F;twitter.com&#x2F;gdb&#x2F;status&#x2F;1726530200484372688" rel="nofollow noreferrer">https:&#x2F;&#x2F;twitter.com&#x2F;gdb&#x2F;status&#x2F;1726530200484372688</a>

OMG, it is 12am in SF. I need to sleep.But what a play, MSFT the winner here.They now owns the actual OpenAIEdit: PM-&gt;am

The next QBR with MS is going to be interesting.

From OpenAI founders to Microsoft employees

This was most unexpected. Hopefully it&#x27;s a compromise reached mutually. Now OpenAI can fulfill what their mission is and these guys can work on AI products at MS.Again. Very unexpected.

It&#x27;s confusing because no one beyond the direct negotiating parties knows exactly why any of this is happening in the first place. The media scoops about commercialization disputes don&#x27;t seem that important to warrant such a dramatic showdown

I thought for sure the only two outcomes were that Altman raises money for a new startup or he comes back to OpenAI with a new governance structure (which is still a wild and crazy outcome, but crazier things have happened). Now that this happened though, I feel stupid for not considering this as a possible outcome at all.The whole timeline of events over the last two events still leaves me scratching my head though.

I don&#x27;t know, way before all of this drama started, the rumors were that he was barely contributing any original or significant ideas to research and the grounbreaking ideas had come from lower level researchers.

&gt;Did Microsoft just effectively acquire 100% of OpenAINo, Ilya alone is like 75% of the brains and I&#x27;m fairly certain he&#x27;s not going anywhere.

Except OpenAI didn&#x27;t write the attention paper.. Google did. So Google is the Xerox

Did Microsoft just effectively acquire 100% of OpenAI without actually needing to cross the 49% regulatory hurdle? Depending on who follows them to MSFT, that might actually be the outcome here. And OpenAI is suddenly Xerox Parc.

More like this is a PR stunt and Sam will launch a startup once the furore dies down

Haven&#x27;t worked at Microsoft, but usually, when folks up high have their balls at stake, resources and budgets magically start getting approved faster than the Concorde.

Sam and Greg obviously haven’t heard that Microsoft Research doesn’t get any GPU access (:

From the start I assumed that Sam was the (street) smarter guy here, and that only confirms itMeanwhile Google remains oblivious

It will be an applied research group obviously to develop products based on AI

BigCos generally have a hard time keeping their autonomous groups actually isolated from bureaucracy. Lab126 has been thoroughly corporatized, and Area 120 got outright reabsorbed.

My guess:This is no research group, this is OpenAI 2.0, Sam&#x2F;Greg will have enormous autonomy. It will be foolish to think Satya just recruited them to tangle them in MSFT bureaucracy

He did lead together with greg at openai. Not as researchers. For that they hired the initial research team.

Others from OpenAI team, maybe can lead the AI research, but how does Sam can lead a research group?IMO, to lead a research group you need some decent research skills, Sam is good at business

&gt; When a company is acquired those are typically the reasons to do so other than pure revenue acquisitionLarge companies are primarily purchased for their moats

Satya winsSam winsIlya and the board continue to look like fools

Pirate more like.  He&#x27;s not just poaching &quot;talent&quot; he has likely stolen IP and will hope to destroy OpenAI in court costs.  Microsoft is a terrible company and I hope this backfires on them.

Satya really goated here.He takes advantage of this situation and make OpenAI&#x27;s assets in his control more than ever.He is the genius, scary even.

I think people underestimate how much of a company’s value is in their key leadership, select talent, and technology. When a company is acquired those are typically the reasons to do so other than pure revenue acquisition. Microsoft already has their technology, now has the key leadership, and will soon have the select talent.Satya wins, OpenAI is walking dead.

Why jockey for a board seat when you can harbor the org

Nadella was heavily involved in the talks to get Altman et al. back in OpenAI. This must have been brought up, so I’m guessing the OpenAI board made their decision knowing this would be the outcome?

I suspected this. OpenAI was always going towards Microsoft and Sam was leading that charge. Who else but them to bankroll his next vision.Great pickup by MSFT. The exodus is only beginning and MSFT will not have to buy OpenAI for the billions in valuation it was getting. East win.

Ugh. I’m not keen on AGI being an eventual Microsoft product, or after this circus, even the hangers on at Open AI. Hope it’s still decades off and this all is a silly side show footnote.

MS&#x2F;G&#x2F;A didn’t put this into voice assistants not because they don’t have it, but because it doesn’t scale to fit the commercials at the moment. Google invented transformers and Deepmind had GPT scale LLM’s at least a year before CGPT came out.Altman just rushed everyone’s hand by publishing it into the world at cost

I find your theory more plausible. Microsoft, Google and Amazon were lagging in AI. You can simply look at their voice assistants for an example. That&#x27;s why they started investing billions in OpenAI and other think tanks in this space. Now capital turns things around to be as they should (from their perspective) and reacquires control.Anthropic is probably next in line.

This might turn out to be a lot more stable structure long term: the commercialization of AI under Microsoft&#x27;s brand, with Microsoft&#x27;s resources, and the deep research into advanced AI under OpenAI. This could shield the research division of OpenAI from undue pressure from the product side, in a way that it probably couldn&#x27;t when everything was under one roof.

Just FYI...Microsoft was already set to spent 27 billion usd on research for 2023. They dedicate huge standout double digit percentages of budget to research every year. Their in house AI research division was already huge.They didn&#x27;t become a major AI player overnight... They already were long ago.OpenAI is small, in raw numbers of AI researchers, compared to the big players in the space. That&#x27;s a major reason why it&#x27;s so compelling that they have been able to consistently set the bar for state of the art.They were a dream team... But small. Msft is adding AAA+ talent to their existing A+ deck. Also they won&#x27;t have to rewrite the code base. Can hit the ground running.Lastly, there is no evidence that openai has the greatly quoted and so hard to define &#x27;agi&#x27;. That&#x27;s Twitter hearsay and highly unlikely... If folkes can even agree what that is. By the overwhelming percentage of definitions... Even gpt-5 is unlikely to meet that bar. Highly speculative. Twitter is a cesspool of conspiracy theory... Don&#x27;t believe everything you read.

Incredible how much has changed in one weekend… or not?Confused what this really means. So Microsoft still has access to OpenAI’s pre-AGI tech that Sam and Greg can leverage for their more product-focused visions.More than that, it looks like Microsoft has become a major AI player (internal research) overnight up with the likes of Meta, Google, and OpenAI. Incredible.

Hopefully this motivates a lot of people who don&#x27;t want Microsoft to be the AI company. Slowing down research would mean Microsoft wins everything.MS now has both the accelerationists and the deccelerationists. They can keep accelerating themselves when pushing for regulatory capture through their deccelerationist branch to slow down any competition.

Satya Nadela confirms that sama and team, presumably anyone who walked from OpenAI will be funded as part of a new advanced research team at Microsoft

imo Satya is a different ball game compared to Ballmer. I wouldn&#x27;t put a lot of emphasis on msft&#x27;s track record pre-Satya personally.

Not unexpected, MS is betting everything on AI. On the other hand, MS is a corporation in which lions are lead by donkeys. We had windows phones that was excellent and in the right place and then couple of product managers fucked it up. We have windows that is becoming even better underneath and then you have people that thought Cortana and Bing search in the bar were good ideas.So Ilya can be safe that whatever potential nuclear capabilities they give sama, the Microsoft quagmire will not let them fully develop.

Welcome to the TikTok generation. The current video was just about to end and now we are at the climax of the next video.

Do you think Microsoft gets access to it?

5 months ago they said they hadn&#x27;t started training: <a href="https:&#x2F;&#x2F;techcrunch.com&#x2F;2023&#x2F;06&#x2F;07&#x2F;openai-gpt5-sam-altman&#x2F;" rel="nofollow noreferrer">https:&#x2F;&#x2F;techcrunch.com&#x2F;2023&#x2F;06&#x2F;07&#x2F;openai-gpt5-sam-altman&#x2F;</a> and had no intention to do so within the next 6 months: <a href="https:&#x2F;&#x2F;the-decoder.com&#x2F;gpt-5-is-nowhere-close-says-openai-chief-sam-altman&#x2F;" rel="nofollow noreferrer">https:&#x2F;&#x2F;the-decoder.com&#x2F;gpt-5-is-nowhere-close-says-openai-c...</a>They just started development in the last week or so: <a href="https:&#x2F;&#x2F;decrypt.co&#x2F;206044&#x2F;gpt-5-openai-development-roadmap-gpt-4" rel="nofollow noreferrer">https:&#x2F;&#x2F;decrypt.co&#x2F;206044&#x2F;gpt-5-openai-development-roadmap-g...</a>

GPT-5 is almost certainly already done. But considering they sat on 4 for 8 months with Altman as head, who knows if it&#x27;ll see the light of day.

Presumably Sam and Greg now get to pick up where they left off and keep productizing GPT-4 since Microsoft has the IP and is hosting their own GPT-4 models on Azure, right?The more interesting thing is whether or not they&#x27;ll be able to build and release something equivalent to GPT-5, using Microsoft&#x27;s immense resources, before OpenAI is able to.

You could both say that this gives Sam less power over OpenAI, and more.

Yeah, this is a huge validation of what Ilya and the Board did. If Sam and Greg had started another company with similar aims, even if it wasn&#x27;t non-profit, they would probably keep arguing that what they were doing was only to get enough resources to be able to solve the problem of AGI with a broad benefit to humanity, and it probably would have turned into a big ideological schism between Sam&#x27;s side insisting that a profit-seeking company was okay to pursue the goal, and OpenAI insisting on pursuing the goal and not getting distracted by greed.Sam and Greg joining up with Microsoft settles that debate cleanly, they clearly aren&#x27;t serious about developing AGI without a profit motive or military control determining the development process if they&#x27;re docking with Microsoft. I don&#x27;t think Ilya and the Board would have had any doubts about Sam if they fired him, but if they did this would remove them.

This confirms that Sam and Greg don&#x27;t belong as heads of a non-profit who&#x27;s sole objective is to develop AGI for the benefit of all of humanity. Because if your Plan B is to join Microsoft, whose mission is to make profit for shareholders, then your heart wasn&#x27;t really in it, as that won&#x27;t achieve your original goal.

I really don’t think that’s in the Microsoft DNA to do

How will equity and compensation workAI peeps are not cheap

Yeah... Not really how a mega-corp like MSFT does things. They LOVE to have control.

Highly unlikely. Instead they&#x27;ll be working on internal Windows AI tools for chatbots and random AI features in Windows. We all lose in this situation.

Satya will probably allow them to run a startup under the MS umbrella without interference and with full MS backing.

&gt; if hot shot startup folks don&#x27;t want to work there, why would they even go thereMSFT may have offered them a lucrative offer to join (for the time being) in order to alleviate the potential stock dump.

Microsoft have access to the gold mine and with a bit of time Altman can get enough gold to open a jewelry business

It is the only way they can continue the work they have already contributed at OpenAI. Otherwise, it would mean they spend months or up to a year training their own model which in this arms race isn&#x27;t feasible with viable competitors like Anthropic closing the gap quickly. This was the only way forward. I&#x27;m sure Sam Altman + Greg were offered an incredibly lucrative deal and autonomy.

if hot shot startup folks don&#x27;t want to work there, why would they even go there? If you&#x27;re flat broke, you need a job; they&#x27;re not flat broke, they don&#x27;t need a job. The deal at MS is worth it, or it&#x27;s not, it&#x27;s not something they need to decide over the course of a weekend... unless it&#x27;s what they were already not being candid about.

It makes perfect sense for Satya, Sam, and Greg, but I doubt many of us thought deeply enough to have predicted it in advance.

I&#x27;ve read a decent amount of predictions about this and had not actually seen this one or considered it until I read about it happening.I think the predictable thing would have been a new company with new investment from Microsoft. But this is better; it a bit like magical thinking that MS would want to just throw more money after a new venture and essentially write off the old one. This solution accomplished similar things, but gives more to Microsoft in the trade by bringing that &quot;new company&quot; fully in house.

&quot;brilliant&quot;I think &quot;predictable&quot; is more apt.

I said this elsewhere, but think the timeline is longer than that. Either Sam and Satya will butt heads and Altman will be sidelined, or it will be a good partnership, and he&#x27;ll be on the shortlist as a successor when Nadella&#x27;s run naturally comes to a close. But that second path is longer than a couple years.

Lets assume the whole structure works, 1-2 years later, Sam becomes the apparent CEO candidate after Satya.

&gt; Microsoft has access to almost everything OpenAI does. And now Altman and Brockman will have that access too.Microsoft still has to deal with OpenAI as an entity to keep the existing set up intact. The new team has to kinda start from zero. Right?

That was my first thought too: Didn&#x27;t occur to me as a solution, and it seems to square the circle brilliantly. It struck me that this is why people who are CEOs of mammoth companies have the jobs they have, and not me :)

This is sorta brilliant.Microsoft has access to almost everything OpenAI does. And now Altman and Brockman will have that access too.Meanwhile, I imagine their tenure at MSFT will be short-lived, because hot-shot startup folks don’t really want to work there.They can stabilize, use OpenAI’s data and models for free, use Microsoft’s GPUs at cost, and start a new company shortly, of which Microsoft will own some large share.Altman doesn’t need Microsoft’s money - but Microsoft has direct access to OpenAI, which is currently priceless.

Over time, the new team at Microsoft will slowly drain the OpenAI talent as MS will provider fewer and fewer resources to OAI and prioritize their own team they have full ownership owner. OAI will die a slow death due to the talent and resource drain.
In a year or two, Sam and Greg will end up with the same people at MS that are now still at OAI. Okay, perhaps minus Sutskever.

So Microsoft gets co-founders and employees too. This is a great win for them!!

What motivates Sam to join Microsoft? Could it be the proximity of achieving AGI and his desire to remain competitive without starting from scratch?

At the end of the day, it is MSFT that emerged as a winner.

Because OpenAI has first mover advantage, an actual product, the household &quot;ChatGPT&quot; name and starting anything from 0 would mean you start with a 3-0 disadvantage. Even if you threw a few billion dollars at it and attracted all of the top minds for at least a year - probably longer - you will be seen as the &quot;ChatGPT alternative&quot;. How long before you can capture the momentum they have now with OpenAI? It&#x27;s also a legal minefield, even when the majority of employees of OpenAI migrate, there will be all kinds of no-competes and conflicts of interest.Strategically, this is probably a better move. Microsoft doesn&#x27;t see their investment implode and they probably have some sort of plan to inject or absorb Sam and&#x2F;or Microsoft back into OpenAI to prevent this in the future. Perhaps replacing the board of directors to prevent further infighting.

Being able to raise money doesn&#x27;t necessarily translate into success. Perhaps his new crew won&#x27;t be able to replicate the secret sauce. Or Satya just gave terms favourable enough to convince him at least for now to avoid giving off the impression that Microsoft&#x27;s investment in OpenAI is incinerated.

What&#x27;s the lead time on a gross of H100s these days?

Weird. Why did not he start a new company?

Yep, it&#x27;s now time for MS to throw in the laywers.

yeah most likely they have like 6 billion left in the bank accounts which they&#x27;ll redirect to the new AI lab

Make the model open source and lets see what MS can do with army of lawyers

10 billion was potential investment. They transfer that in tranches, so lot of it is still in MS bank. They already have access to GPT3&#x2F;4&#x2F;turbo + Dalle 2&#x2F;3. Plus with its hordes of lawyers, it will be an uphill battle for OpenAI to make MS lose.

I&#x27;m not sure I follow this chain of arguments, which I hear often. So, a technology becomes possible, that has the potential to massively disrupt social order - while being insanely profitable to those who employ it. The knowledge is already out there in scientific journals, or if it&#x27;s not, it can be grokked via corporate espionage or paying huge salaries to the employees of OpenAI or whoever else has it.What exactly can a foundation in charge of OpenAI do to prevent this unethical use of the technology? If OpenAI refuses to use it to some unethical goal, what prevents other, for profit enterprises, from doing the same? How can private actors stop this without government regulation?Sounds like Truman&#x27;s apocryphal &quot;the Russian&#x27;s will never have the bomb&quot;. Well, they did, just 4 years later.

And this kind of thinking seems to be the exact reason he was pushed away. “The future” as envisioned by a megacorp might not be that great.

Don&#x27;t forget, MS has a board as well. One Satya reports to the same way Sam reported to the OpanAI one. Potantially loosong 10 billion is nothing the board will just shrug off.

He doesn’t have to write down the investment that came in the form of azure credits. He just doesn’t have to deliver.The core thing he is 100% focused on is not having a massive stock drop Monday morning. That’s it that’s his reason to exist all weekend long.After that. He has time to figure it out.

24k gold shackles for a year or two and then onto the next thing.

That surely is no problem from the pov of said mega-corp.

&gt; Maybe, recruit the most formidable AI team in the world, removed from the shackles of an awkward non-profit owning a for-profit company?Into the shackles of ever-controlling mega-corp?

Not only Github copilot but the general copilot integrations announced at Ignite for Microsoft 365 and other apps means a much deeper full on assistant integration for whole ecosystem.

Yeah, Copilot has become a very nice branding.For business and for the consumer. They can retire Bing search at this point, making it Microsoft Copilot for Web or something.

Microsoft got Copilot. They were first to establish the brand. OpenAI technologies let them do it. I don&#x27;t know how much Copilot brand cost, but right now when you&#x27;re thinking about AI-assisted programming, Copilot is the first thing comes in mind. So probably they got something in return.

<a href="https:&#x2F;&#x2F;imgur.com&#x2F;a&#x2F;ZjehzHY" rel="nofollow noreferrer">https:&#x2F;&#x2F;imgur.com&#x2F;a&#x2F;ZjehzHY</a>

Microsoft is now the for-profit arm of OpenAI.

&gt; can capture a bigger slice of THE FUTURE
History says that the future is actually written by the nerds and not the drumbeaters (ah read CXOs).In all this drama, the deep work interruption of the nerds is the net loss (and effectively slight deceleration) for the future.

As much as I dislike Microsoft: they played this exactly right. No boardseat: no culpability or conflict of interest, catch the falling pieces and reposition themselves stronger. What makes you say they didn&#x27;t anticipate the problem? If they had anticipated it I don&#x27;t see what else they could have done without making themselves part of the problem.

This whole weekend will probably be a case study in both Corporate Governance (Microsoft may look bad here for not anticipating the problem) and Negotiation (a masterclass by Satya: gave Ilya what he wanted and got most of OpenAI&#x27;s commercial potential anyway).

Perhaps. Could be tied up in court for 2-3 years before we find out.

&gt; MS is positioning itself as an opponent to OpenAIThey were positioned that way by the OpenAI board, which has effectively committed corporate suicide and won’t be around much longer.

Microsoft does not prevent OpenAI from achieving their mission. OpenAI does not bind Microsoft to behave one way or another.

Since the board was never clear what Altman did, you could make flip the parties and your breach of contract argument holds about as much water. Plus MS can resort to the playground &quot;they started it&quot; argument.

Isn&#x27;t Microsoft in breach of contract here? Not by the word (parties hadn&#x27;t forseen such event, and so there won&#x27;t be anything about this explicity in the contract). But one could argue that MS isn&#x27;t acting in good faith and acting counter to the purpose of the agreement with OpenAI.The argument would go something like this:MS were contractually obliged to assist OpenAI in their mission. OpenAI fired Altman for what they say is hindering their mission. If MS now hires Altman and gives him the tools he needs, MS is positioning itself as an opponent to OpenAI and its mission.

Maybe the next move is an open offer to any OpenAI employees to join Sam’s team at their current compensation or better.. call it the ‘treacherous 500’ or something.

Satya was not responsible for those 2 purchases

Pre Satya history is irrelevant to the current MSFT

True, but that was when ballmer was at the helm

Remember when they did this?&quot;Microsoft to acquire GitHub for $7.5 billion&quot; - <a href="https:&#x2F;&#x2F;news.microsoft.com&#x2F;2018&#x2F;06&#x2F;04&#x2F;microsoft-to-acquire-github-for-7-5-billion&#x2F;" rel="nofollow noreferrer">https:&#x2F;&#x2F;news.microsoft.com&#x2F;2018&#x2F;06&#x2F;04&#x2F;microsoft-to-acquire-g...</a>only to enable GitHub to do greater things, without disrupting user experience?&quot;Four years after being acquired by Microsoft, GitHub keeps doing its thing&quot; - <a href="https:&#x2F;&#x2F;techcrunch.com&#x2F;2022&#x2F;10&#x2F;26&#x2F;four-years-after-being-acquired-by-microsoft-github-keeps-doing-its-thing&#x2F;" rel="nofollow noreferrer">https:&#x2F;&#x2F;techcrunch.com&#x2F;2022&#x2F;10&#x2F;26&#x2F;four-years-after-being-acq...</a>or when they acquired LinkedIn before that?&quot;Microsoft buys LinkedIn&quot; - <a href="https:&#x2F;&#x2F;news.microsoft.com&#x2F;announcement&#x2F;microsoft-buys-linkedin&#x2F;" rel="nofollow noreferrer">https:&#x2F;&#x2F;news.microsoft.com&#x2F;announcement&#x2F;microsoft-buys-linke...</a>which turned out to be fine too?How about Minecraft? Activision?It&#x27;s easy to cherry-pick examples from an era where Microsoft wasn&#x27;t the most successful. The current leadership seems competent and the stock growth of the company reflects that.

They didn&#x27;t buy OpenAI, they got the best part of their team to develop new products for MS.

The Skype purchase was good for itself. It lead to Teams, which is dominating.

Except the founders weren&#x27;t included in the Skype deal. Microsoft has OpenAI&#x27;s two founders and they&#x27;re highly motivated to show that OpenAI is nothing without them which in time it may soon be. I openly await when Sam and Greg ship a product in say two years time.Meanwhile Microsoft wins if OpenAI stays dominant and wins even bigger if Sam and Greg prevail. Some day soon they may teach this story at Harvard Business School.

Don&#x27;t forget Microsoft buying aQuantive for $6 billion in 2007 and then taking a $6.2 billion dollar writedown 5 years later.

Not every swing is going to be a home run. Billion dollar investments sound like a lot but not for companies of this size. They are small to medium sized bets.

Remember when they did this?&quot;Microsoft Buys Skype for $8.5 Billion&quot; -<a href="https:&#x2F;&#x2F;www.wired.com&#x2F;2011&#x2F;05&#x2F;microsoft-buys-skype-2&#x2F;" rel="nofollow noreferrer">https:&#x2F;&#x2F;www.wired.com&#x2F;2011&#x2F;05&#x2F;microsoft-buys-skype-2&#x2F;</a>To then write down their assets?&quot;How Skype lost its crown to Zoom&quot; - <a href="https:&#x2F;&#x2F;www.wired.co.uk&#x2F;article&#x2F;skype-coronavirus-pandemic" rel="nofollow noreferrer">https:&#x2F;&#x2F;www.wired.co.uk&#x2F;article&#x2F;skype-coronavirus-pandemic</a>
Or when they did this ?Or how in 2014...&quot;Microsoft buying Nokia&#x27;s phone business in a $7.2 billion bid for its mobile future&quot; - <a href="https:&#x2F;&#x2F;www.theverge.com&#x2F;2013&#x2F;9&#x2F;2&#x2F;4688530&#x2F;microsoft-buys-nokias-devices-and-services-unit-unites-windows-phone" rel="nofollow noreferrer">https:&#x2F;&#x2F;www.theverge.com&#x2F;2013&#x2F;9&#x2F;2&#x2F;4688530&#x2F;microsoft-buys-nok...</a>Then in 2016 sold it for 360 million?&quot;Nokia returns to the phone market as Microsoft sells brand&quot; - <a href="https:&#x2F;&#x2F;www.theguardian.com&#x2F;technology&#x2F;2016&#x2F;may&#x2F;18&#x2F;nokia-returns-phone-market-microsoft-sells-brand-hmd-foxconn" rel="nofollow noreferrer">https:&#x2F;&#x2F;www.theguardian.com&#x2F;technology&#x2F;2016&#x2F;may&#x2F;18&#x2F;nokia-ret...</a>

Have to give it to Satya. There&#x27;s a thin possibility that Microsoft would have to write-off its whole $10B (or more?) investment in OpenAI, but that isn&#x27;t Satya&#x27;s focus. The focus is on what he can do next. Maybe, recruit the most formidable AI team in the world, removed from the shackles of an awkward non-profit owning a for-profit company? Give enough (cash) incentives and most of OpenAI employees would have no qualms about following Sam and Greg. It will take time for sure, but Microsoft can now capture even a bigger slice of THE FUTURE than it was possible with OpenAI investment.

Sam Altman, Greg Brockman and others to join Microsoft