It has been an interesting few days in the world of AI. Ironically, it also highlighted that the most challenging predictions in the world are predicting human behavior. We are all governed by our emotions, preferences, and biases. And that drives our behavior. OpenAI chaos may be a result of that behavior. In this article, I want to share my viewpoint on what the last few days of OpenAI chaos mean. I have my own biases and have tried to ignore them as much as possible as I write this article. But be advised when reading that I am eventually human.

Central to my discussion is the fact that even though we love giving a human face to technology, like in this case, believing that Sam and OpenAI’s algorithms are the one and the same entity, they are not.

It seems like Ilya has done a u-turn and now wishes that Altman was back (after OpenAI appointed a new interim CEO?). But since he initially had concerns about the direction OpenAI seemed to be taking, one thing that seems apparent to me is the rift between the core technology (folks who actually built the product, like Ilya, one of the pioneers of advances in neural networks), and the socialization, commercialization, and partnerships people, like Sam.

Here is a big difference between Sam and Steve Jobs. Steve Jobs came with a vision. He knew what needed to be built. He directed the engineers to build it. He knew the technology and the product inside out. He drove design, engineering, development, and marketing. That, my friend, is the hallmark of a visionary.

Most of us will not achieve even a fraction of what Sam Altman has achieved, so I do not seek to undermine what he has built, But you have to dig a bit to understand that while Sam certainly was a founder, and at this point, had become the face of the company, Sam did not build the product. What the product does and needs to do is controlled by folks other than Sam. Some of his “explanations” show that he is not profoundly proficient even though he understands this technology. However, he understood the technology was groundbreaking and had the charisma to take it to the masses. So, the key thing to note here is that though Sam became associated with OpenAI, Open AI’s core algorithm and Sam are two entities.

Many who hold their breath to see where Sam moves should be more worried about what happens to the technology.

My suspicion is that early last week, there may have been some signs of a takeover, supported by Sam. I suspect that the technical side of the organization, the core technology folks (200+ folks who are not threatening to leave), did not want that commercialization. As a core tech guy, Ilya built the product and decided to boot Sam out (maybe impulsively?)

My suspicion is that the takeover attempt was from Microsoft. If not, poor folks at Microsoft did not deserve a $80b wipeout.

But let us now understand the current state options.

OpenAI decided to recruit an interim CEO even after the letter-signing campaign, and to me, it is a signal that Sam is not coming back soon.

Not sure who is making decisions at OpenAI, since Ilya has also signed the letter to get Sam back. But I think they know what OpenAI has, in terms of product, at this point. Let me put it forward crudely:- No entity, irrespective of whatever resources they throw, can build something that performs at the level of OpenAI’s product, or BARD and similar Generative AI products if they start from scratch now.

Sam understands that. That is what he meant when he said during his visit to India that it would be hopeless for any Indian company to try building a similar product.

Why has Microsoft offered roles to Sam and his buddy? Here is my take. Microsoft, after last week, still has the ambition to have control of OpenAI in the near future. They do not want Sam and his buddy to walk away and build other technology companies. Not because they will be able to build something similar. But because they are now widely seen as the face of the product.

So they have offered them roles, which are interim, in my opinion, while they mule over the next steps. Any wise guy would understand that even Microsoft cannot build a product that can match OpenAI. And there are now already so many products, leading ones, in the race.

The stakes are high for Microsoft. While BARD is Google’s own, OpenAI is not precisely a Microsoft product (for now). Losing its grip on OpenAI pushes Microsoft so far behind.

The other aspect of the struggle to build something remotely close to leading Generative AI solutions is that these solutions are not commercially strategic. How they are integrated into hundreds of thousands of solutions makes them strategic. That takes time. The penetration that OpenAI has seen in this area has been rapid. That is why I keep saying that the solutions built around the technology are differentiators, not the technology.

Since Sam has been the face of OpenAI, anyone with the ambition to take ownership of OpenAI in the near term would want to keep Sam close. But they need to move fast. The longer OpenAI keeps operating without Sam, the general masses that do not understand fully that Sam and the underlying product are not weaved together will understand that the product sustains just fine. That its innovative features do not exist because Sam exists.

There is so much usage of this product commercially that even partners, who are all complaining about the unstable scenario, will stick around if OpenAI remains afloat. Whoever is calling the shots currently within or for OpenAI understands that even losing 70% of the company staff is better than losing control of a potent product. They are willing to take a chance. They know that Sam and his buddy will never be able to build a similar product. To have a product like OpenAI, BARD, and similar ones, you need to own these products. Building one from scratch is futile.

The letter the threats, seem to be attempts in that direction. So far, the response, specifically after an interim CEO has been named, seems like a middle finger. I am insanely curious to know, however, who is driving all this after I saw that “Oops” tweet from Ilya.

Microsoft is walking on a tightrope. It can’t lose the OpenAI relationship. In this age of AI, that is all they have, actually. A competitor taking over OpenAI or OpenAI halting further commercialization, even temporarily, is not suitable for them. So right now, they are in the weird limbo state of having hands in both pots, hoping that soon they will be able to mix the content. Remember that the disintegration of OpenAI does not work for Microsoft as well. Stakes are high for them. Even if every member of the core technology team is hired by Microsoft and OpenAI ceases to exist, it will open an immediate room for competitors like BARD.

With an extensive tech background, the interim CEO probably understands the lever OpenAI holds. They will wait and watch to see who leaves and who doesn’t. If the company sustains, even at a bare minimum starting, for a while, he will be good.

For Microsoft, the best-case scenario is to get Sam back to OpenAI. Things will be challenging if the massive outflow of staff from OpenAI ends up at Microsoft AND OpenAI sustains. That will severely sour the relationship, and Microsoft will still be unable to build a similar product. The worst-case scenario for Microsoft is a takeover attempt by a competitor. The company leading the AI race (though the competitors were closing fast), may end up finding themselves as laggers.

By the end of this week, the smoke would have cleared enough. And the world of AI technology may have charted a different path. I guess we will find out?