What can Beat Artificial Intelligence? Natural Stupidity

With due apologies to Amos Tversky

With due apologies to Amos Tversky

The events of the weekend of November 17 2023, will take time to be understood by history. The dramatic firing of OpenAI’s CEO Sam Altman and President Greg Brockman, followed by their hiring by Microsoft over the weekend and subsequent return to OpenAI has had many pundits declaring winners and losers. We believe we need to ask more fundamental questions about decision making at OpenAI and Microsoft that led to this sequence of events to understand what happened and its implications. First, we think this whiplash could have been avoided. Second, for all the talk of responsible AI, this episode makes it abundantly clear that the future of AI cannot be left to organizations with opaque and unusual governance structures. While OpenAI’s theory behind their structure was admirable, it has become clear that it did not work in practice. Indeed, it should have been obvious from the start.  

Structure induces behavior 

A quick glance at www.openai.com/our-structure  reveals that OpenAI has an unusual governance structure, with a non-profit controlling the profit-capped for-profit entity. OpenAI believed that no other structure could balance the asymmetric power that would accrue to a purely commercial entity if left unchecked. On their website, OpenAI makes it clear that the board members of the non-profit are expected to think about all of humanity rather than the commercial interests of OpenAI or its investors. When OpenAI was just a research and technology development organization with nebulous commercial prospects, this unusual structure was fine. However, with the phenomenal success of ChatGPT, the obvious commercial potential of the Gen AI technology, and Microsoft’s substantial investment, the idealistic and simplistic, but complex, structure of OpenAI had to change.