Why Elon Musk and Sam Altman are angry with each other: from creating OpenAI to fighting over control of AI

Elon Musk’s recent bid to acquire OpenAI for $97.4 billion has rekindled one of the most significant disputes in the technology industry. This move not only reflects Musk’s ambition to regain control of a company he co-founded, but it also highlights the ideological differences between him and Sam Altman, the current CEO of OpenAI.

Over the years, their relationship has shifted from collaboration to enmity, with cross-accusations and differing visions regarding the development of artificial intelligence. In this article, we explore the origin of OpenAI, Musk’s departure from the company, the evolution of his relationship with Altman, and the reasons behind his billion-dollar offer.

The Birth of OpenAI: An Alliance with Grand Ambitions

In December 2015, Elon Musk and Sam Altman, along with other investors and technology experts such as Peter Thiel, Jessica Livingston, and Reid Hoffman, founded OpenAI with the objective of developing advanced AI to benefit all of humanity. The initiative began as a non-profit organization with a clear promise: to create open-source artificial intelligence and ensure that its advancements would not be controlled by large corporations.

The founders announced an initial investment of $1.100 billion, although subsequent reports revealed that the actual amount contributed was approximately $143 million. Elon Musk contributed less than $49.5 million, a significantly lower figure than initially promised. Además, Jessica Livingston, Peter Thiel, Reid Hoffman, and companies like Amazon Web Services, Infosys, and YC Research, acted as donors.

However, OpenAI’s vision changed over time. In 2019, the organization adopted a «capped-profit» model to attract investments and ensure its technological development, which caused frictions between Musk and the management team.

Elon Musk Leaves OpenAI Due to «Conflict of Interest»

In 2018, Elon Musk left OpenAI’s board of directors. Officially, he claimed his departure was due to a potential conflict of interest with Tesla, as the automotive company was also developing artificial intelligence technology for its autonomous vehicles.

However, a subsequent investigation by the outlet Semafor, claims that Musk attempted to take control of OpenAI before his departure and, faced with the refusal of the rest of the management team, decided to step back and ceased funding the organization. Since then, he has been a constant critic of OpenAI’s evolution, especially after its alliance with Microsoft, which in 2023 invested $10 billion in the company.

Philosophical differences between Musk and Altman became increasingly apparent. While Musk advocated for open-source AI with strict oversight, Altman favored a model of accelerated development with a business structure that allowed for large-scale investments.

Elon Musk Creates xAI to Develop a «More Transparent» AI

In July 2023, Elon Musk founded xAI with the aim of developing a general artificial intelligence (AGI) focused on truth and safety, setting itself apart from companies like OpenAI and Google DeepMind.

Since its launch, xAI has been working on AI models like Grok, a chatbot integrated into the X platform (formerly Twitter), which seeks to compete with ChatGPT, although it is still in an early stage of development and has not achieved the same impact as OpenAI in the market. Musk has insisted that xAI will develop a more transparent AI less influenced by corporate interests.

Elon Musk Sues Sam Altman for Breach of Contract

The rivalry between Altman and Musk escalated in February 2024, when the latter filed a lawsuit against OpenAI and Sam Altman in the Superior Court of San Francisco, accusing them of prioritizing commercial interests over AI safety. In the document, the mogul accused the company of breach of contract, alleging they had violated the foundational agreement stipulating that OpenAI’s AI research should focus on developing technology for the benefit of humanity and not for profit. According to Musk, OpenAI’s alliance with Microsoft had distorted its original goal of achieving a public and open-source general AI, transforming it into a closed-source entity aimed at maximizing profits.

OpenAI denied the accusations, calling them «incoherent» and «frivolous,» affirming that Musk understood from the beginning that its mission did not necessarily involve the release of an open-source AI. The company defended its partnership with Microsoft and its evolution to a «capped-profit» structure as necessary strategies to attract investment and talent, ensuring that these decisions aligned with its mission of developing AI that is safe and beneficial for humanity.

Musk Accuses Altman of Fraud over Project Stargate

Last January, Donald Trump announced the creation of the Stargate Project, which will involve building a network of advanced supercomputers designed to train and run AGI models on a large scale. For this, an investment of $550 billion is expected from SoftBank, OpenAI, Oracle, and MGX.

Elon Musk described the plan as “a monumental scam to raise funds”. Through X, the mogul stated that OpenAI has become “an extension of Microsoft disguised as an independent organization” and that Altman is using exaggerated promises to attract investors. Musk claims that the projected cost is excessive and that OpenAI, instead of developing open and transparent AI, is consolidating a technology monopoly with the support of major corporations.

Musk Offers $107.140 Billion for OpenAI

The latest chapter in the confrontation between Altman and Musk unfolded yesterday, when the owner of X, along with a consortium of investors, submitted an unsolicited offer of $107.140 billion to acquire the foundation that controls OpenAI. This proposal, announced by The Wall Street Journal, was seen as a hostile takeover bid, as there were no prior negotiations with the OpenAI board. Through his social network, Musk argued that it was time for OpenAI to “once again become a force for good, focused on safety and open-source, as it once was.”

“This is the moment for OpenAI to once again be a force for good, focused on safety and open-source, as it once was,” stated Musk in the statement provided by his attorney. “We will ensure this happens,” he insisted.

However, the offer has not been seen as a genuine proposal from Musk, but rather as a provocation, since the estimated real value of OpenAI exceeds $330 billion, a figure that more than triples what the South African offered.

Sam Altman Rejects the Offer Sarcastically

Sam Altman’s reaction to Musk’s offer was immediate and decisive. Not only did he reject the proposal, but he responded sarcastically via the X platform, writing: “No, thanks, but we could buy Twitter for $9.74 billion if you want”.

Altman’s comment was a reference to Musk’s purchase of Twitter in 2022, for a total of $44.4 billion, a move that has been widely criticized for its chaotic management of the social network.

With this rejection, OpenAI made it clear that it has no intention of relinquishing control of the company, maintaining its current alliance with Microsoft and other investors.

Of course, the last word was from Elon Musk, who responded to Altman’s comment with a single word: “Swindler”. And then he replied to another post with a play on words, altering the name of the owner of OpenAI: “Scam Altman” (“Scam” Altman, instead of Sam Altman).

A rivalry that defines the future of AI

The battle between Elon Musk and Sam Altman goes beyond a simple business dispute. It represents two opposing visions for the future of artificial intelligence:

• Musk advocates for open-source AI, with more regulated and controlled development.
• Altman, on the other hand, bets on accelerated evolution, backed by large investments and a more pragmatic approach.

The $97.4 billion offer has been a media blow, but it will hardly change OpenAI’s course. Meanwhile, the rivalry between Musk and Altman will continue to mark AI development in the coming years.

Photo: Grok.