OpenAI Rebooted: What's Next for the Company?

1. KSKara Swisher0:00

   Sam Altman is back as the CEO of OpenAI following that whirlwind of chaos last week, which I think we did a very good job covering it. Um, OpenAI's board is getting a major rehaul with nearly all of its members replaced. Not all of them though. The initial board includes Bret Taylor as chairman, former Treasury Secretary Larry Summers. Where did he come from? And Adam D'Angelo, the only current board member remaining. I understand he was quite stubborn about that. Uh, Sam appears to be ready to head back to work, posting on X, "With the new board and with Satya's support, I'm looking forward to returning to OpenAI and building on our strong partnership with Microsoft." It was interesting that was his first tweet. Um, w- how do you look at it? Back, looking back at it, who's the winners, losers, et cetera? I hate to use that reductive a term but it really, there really, a lot was happening here.

2. SGScott Galloway0:44

   I think in the fullness of time, the, the thing that happened here, or what I've been thinking a lot about is that if you think about the initial mission of OpenAI, I don't even think it was supposed to be a company. I think they initially saw it as a research institute or a think tank that would help, that would study and analyze and make recommendations around the possibilities and more importantly the dangers of AI. And then they discovered, "We're really good at this," and then all of a sudden it, it was a company that became worth $90 billion. So if you look at the shareholder side of this and the products and the value, the economic value they create, call that capital, and then you look at the structure, and a big component of the structure and a big part of their mission was to think about humanity or AI in the context of humanity. So at a very reductive analysis, you have capital versus humanity, and I would argue that capital literally, literally smothered humanity in its sleep. Whether you think it was a good decision or a bad decision, but when there was $90 billion in an amazing product and the leader in the most exciting new technology emerged, all that fun, nice stuff, important stuff about humanity and the fears of AI, that shit got smothered in its sleep.

3. KSKara Swisher1:57

   I'm not sure it got smothered, Scott. I think it got, "Let's put this over in..." Yeah, I get it, I get it, I get it. It's like, "Let's put this over here on the shelf."

4. SGScott Galloway2:05

   It'll just be very interesting to see how this moment ages because if... Uh, and, and it all comes back to the same thing for me, and that is for-profit companies are so amazing at generating profits, they shouldn't be trusted to anything else. They shouldn't be trusted to do anything else.

5. KSKara Swisher2:26

   Mm-hmm. Fair.

6. SGScott Galloway2:27

   What are they called? Social purpose, um, companies. No, private benefit, social benefit companies. ESG investing. I think it's the ultimate Sheryl Sandbergian move where we're gonna pretend that capitalism and the market can work things out on their own, that when people buy Patagonia or they buy dolphin-friendly tuna or they learn about transparency or some fake organization says that Southwest Airlines is an ESG (laughs) investment, it dilutes the need for democratic institutions to regulate these organizations.

7. KSKara Swisher3:00

   I, I, you picked one company-

8. SGScott Galloway3:01

   And this whole-

9. KSKara Swisher3:02

   ... who I do think really does walk that talk.

10. SGScott Galloway3:03

    ... ridiculously convoluted Byzantine-

11. KSKara Swisher3:04

    It's Pat, Pat-Patagonia. I think, and I think, and I think that-

12. SGScott Galloway3:07

    Walks the walk. Patagonia.

13. KSKara Swisher3:08

    ... people who buy there buy there because of that.

14. SGScott Galloway3:09

    Agree. They, they walk the walk.

15. KSKara Swisher3:10

    I think that's a success-

16. SGScott Galloway3:11

    Agreed.

17. KSKara Swisher3:11

    ... successful version of that. But go ahead.

18. SGScott Galloway3:13

    And so does Ben & Jerry's. I would argue that constitutes less than 0.1% of the market.

19. KSKara Swisher3:18

    Yes, I would agree.

20. SGScott Galloway3:19

    The, the majority of research shows around ESG or social-minded companies, they're tiebreakers, that consumers aren't willing to pay for them but they will, if they're the exact same product at the exact same price, they'll go with the one that's more, that doesn't, you know, that lets dolphins out of its nets or whatever. But this is... And I, I, I think it's time we come to grips with the fact that a lot of this, you know, social benefit organization or ESG jazz hands is just that. To that point, there should be an FDA that says when your mom rewrites an opinion on a failed drug and then takes it public with a SPAC and you sell all of your shit to run, to, to get a billion dollars, maybe there should be more government oversight. I, look, I, I worry that, I worry that at the end of the day, we need to, democratic institutions need to regulate these companies, and that all these Byzantine structures and virtue signaling are nothing but a Sandbergian move to serve as a, a ma- a weapon of mass distraction from the fact that for-profit companies are this amazing part of capitalism, they grow, they innovate, they're full co- body contact.

21. KSKara Swisher4:26

    So let's get the government in there, in other words.

22. SGScott Galloway4:28

    And then let's tax them at a fair rate and not let them take their IP offshore so they can avoid taxes and then let's use those taxes to hire outstanding people who try to prevent a tragedy to the commons and regulate these companies.

23. KSKara Swisher4:41

    Yep, I agree. Let me ask you a different question, though, is, is board structure. O- obviously Microsoft is getting a board seat. Uh, Satya Nadella posted about board changes, uh, noting, "We believe this is the first essential step to the path to more stable, well-informed, and effective governance." He kind of, that was the shot across the bow, uh, for him in like, "We're gonna be watching." Like, we, we get, I- I think a lot of people were surprised they didn't have a seat, uh, at all or have even an absor- observer status. I think that was a, he really pulled a, pulled the iron out of the fire as they say here for, of his investment in terms of getting this back in Sam's hands. But he definitely, if that had not turned out that way, it would've been very bad for Microsoft, as you saw on Friday after he was fired, th- that they did not have their hands around this in the way they needed to. Um, you know, it'll be interesting to see if they get a board seat. The other women that were floated at one point was Lorraine Powell Jobs, Marissa Mayer, Condoleezza Rice, all these, some of these were rejected 'cause they were too close to Sam. Um, it'll be interesting to see who they bring to the board. I sent, I put a list up to, uh, many, many people. Um, there's lots of, you know, I'd put Fei-Fei Li on the board. Why not? Like, she's neither a doomer nor a, nor a, uh, techno-optimist. You know, someone like that who has sort of a middle ground. Sort of like the Supreme Court, you want something that's a little more... I don't know. Who, is anyone you would think should be on the board? Larry Summers, I don't know where he popped out of but sure. So who would you bring on the board? Give me some names. I've given you many.

24. SGScott Galloway6:08

    I, I haven't thought about... There's a lot of talented-... people. I would wanna bring, I would absolutely wanna bring someone who really understands AI and disinformation. I think those are the biggest threats. Also, Kara, uh, uh, and you've said this, you said something that was really, that's really resonated with me, and that is the people that design these technologies don't put in place the protections because they've never been victims themselves. And again, we're setting up another technology that's being designed by rich white guys who don't understand what it's like to be the subject of revenge porn or to have your family attacked or feel physically, physically threatened.

25. KSKara Swisher6:49

    I think it's interesting. I think that they, you know, someone they should have on the board? A media person to under... You know, like I, I, Barry Diller's too old, but hi- the lawsuits around copyright, they just need a media. They need a media-

26. SGScott Galloway7:00

    Barry Diller would be great on the board. Uh, uh, I'd love to see a, you know, a, a... I'd love to see a guy like Jonathan Haidt on the board. I think he just has such a clear blue flame-

27. KSKara Swisher7:09

    They need tech people though, too.

28. SGScott Galloway7:10

    Yeah, fair enough.

29. KSKara Swisher7:11

    They need people who understand the technology.

30. SGScott Galloway7:12

    Um-

Episode duration: 9:39