Hey everybody. Welcome back to the Elon Musk Podcast. This is a show where we discuss the critical crossroads that shape SpaceX, Tesla X, The Boring Company, and Neurolink. I'm your host, Will Walden. So what exactly is Elon Musk accusing Microsoft and Open AI of doing to the AI market? And how does his concerns tie into the origins of Open AI and its business? Also, there's internal disputes going on, and they're being revealed through a trove of early emails.
Now, in a move from Musk and his new legal claims, they broaden his ongoing lawsuit against open AI but also named Microsoft, marking a dramatic escalation in his efforts to challenge the dominance of these two tech giants in the burgeoning AI sector. Now, Musk's expanded lawsuit filed in Oakland, CA builds on his original complaint from August and now includes allegations that Microsoft and Open AI conspired to monopolize the market for generative AI
technologies. The amended legal filing accuses the companies of engaging in anti competitive practices designed to shut out potential rivals and secure their dominant position in the AI space. This lawsuit aims to nullify the licensing agreement between Open AI and Microsoft, demanding the forfeiture of profits Musk claims were obtained through
illicit means. The lawsuit comes after Musk public criticisms of Open AIA company he Co founded in 2015 but later distance himself from as its focus shifted. Now originally founded as a nonprofit aiming at ensuring AI benefits to the public, Open AI is transformation into a profit driven entity with heavy investment for Microsoft is a central issue in Musk's legal arguments.
Never before has a corporation gone from tax exempt charity to $157 billion for profit market, paralyzing Gorgon and in just eight years, the lawsuit claims. This stark language underscores Musk's disapproval of opening eyes direction in his tight financial ties with Microsoft. Now, Microsoft has opted not to comment on the ongoing legal case, but Open AI issued a brief statement dismissing the new claims as even more baseless and overreaching than the previous ones.
Meanwhile, Musk's lawyer framed the lawsuit as an attempt to shed light on allegedly unethical business practices. They said Microsoft's anti competitive practices have escalated, adding that sunlight is the best disinfectant now. Elon Musk's relationship with Open AI has been fraught with tension, stemming from his departure in the company's pivot
towards a profit driven model. Emails unearthed in the legal proceedings reveal internal discord not only about the direction of Open AI, but also regarding Musk's role. These in exchanges show that Musk initially envisioned a leading role for himself, despite his public statement suggesting he disliked the responsibilities of being ACEO.
Now, in one e-mail, Open AI is former chief scientist expressed concerns about Musk's intentions, arguing that Musk's desire for control could create risks. They said the current structure provides you with a path where you end up with unilateral absolute control over the AGI. He highlighted Musk's inconsistent statements about wanting to lead the company, despite his apparent reluctance
to take on ACEO role. They feared that Musk might prioritize control over the broader mission of preventing the misuse of advanced AI. Now, their concerns about the potential for an AGI dictatorship weren't solely directed at Musk. He also pointed to the risk of Google's DeepMind achieving a dominant position in AGI development, citing Demis Hassabis, Deepmind's Co founder, as a key figure in what Musk described as One Mind to Rule
the World philosophy. This rivalry between DeepMind was a motivating factor behind the founding of Open AI, as Musk and his collaborators sought to create a counterbalance to Google's growing influence in AI research. Now, internal communications revealed that Musk's vision for Open AI extended beyond nonprofit aspirations.
As early as 2017, he and other Co founders, including Andre Carpathy, considered integrating open AIS resources with Tesla's, potentially using Tesla as a cash cow to fund AI research. Kaparthy or Carpathy, noted that the transportation sector's vast revenue potential could help scale open AIS projects now. The idea of merging the two companies never materialized, though, in part because of the practical difficulties of leveraging Tesla's resources in this way.
Now, by 2018, the friction between Musk and Open AIS leadership had become more pronounced. Emails indicate that Musk was growing increasingly disillusioned with the company's trajectory, particularly as it moved away from its nonprofit origins. Sam Altman, who took on a prominent leadership role at Open AI, faced scrutiny from both Musk and other Co founders.
Sutzkiver and Greg Brockman question Altman's motivations and his desire for the CEO title, noting inconsistencies in his reasoning, they said we haven't been able to fully trust your judgments throughout this process. Pointing to Altman's shifting rationale and underlying intentions. Now, the infighting and strategic disagreements culminated in Musk's departure from Open AI. It chose to exit rather than continue to push for changes within the organization.
And following his departure, Musk pursued his own AI initiatives, culminating in the launch of X AI Company, focused on developing advanced AI technologies with a robust infrastructure that includes a 100,000 GPU strong data center. X AI represents Musk's direct challenge to the current leaders in the AI field, including Open AI and Google's DeepMind.
Now, this lawsuit alleges that Open a Eyes transition to a for profit entity was driven by a desire to secure substantial funding, ultimately leading to a significant investment from Microsoft in 2019. Now, this deal, initially valued at $1 billion, laid the foundation for a close partnership that continues to evolve with Microsoft integrating Open A Eyes technology into its products, including the Copilot feature in its software offerings.
Now, Musk's lawsuit contends that his partnership resembles a merger and should have been subject to regulatory scrutiny due to its anti competitive nature. Now, emails disclosed as part of the lawsuit provide a glimpse into the financial negotiations and strategic decisions made by Open A IS leadership. In 2016, Microsoft offered Open AI $60 million in Azure compute credits, which came with the expectation that the companies would promote each other's
services. Musk, however, recalled it the idea of what he called corporate back scratching, describing the proposal as making him nauseous. This early discomfort foreshadowed Musk's later dissatisfaction with a deepening ties between Open AI and Microsoft. Now, one surprising detail revealed in the court documents was Open AI's early consideration of acquiring another company, Cerebrus, a chip maker specializing in AI
hardware. They suggested that the acquisition could be facilitated through Tesla leveraging its resources to support Open AI ambition. The plan ultimately fell through, though, but it illustrates the extent to which Musk and Open AI leadership were willing to explore unconventional strategies to cure an edge in the AI race. Now, despite the legal battle in Musk's vocal criticisms, Open AI has continued to thrive, largely
thanks to Microsoft's backing. The software giant's investment has propelled Open AI into a leading position partnership in the AI industry, with its models, including ChatGPT, widely adopted across various sectors. Now, Microsoft's ongoing financial support signals its belief in the potential of AI to transform its core business as it continues to integrate Open AI technologies into all of its products. Now, interestingly, Intel had a chance to invest in Open AI early but declined the
opportunity. In 2017, Intel was offered a 15% stake in Open AI for a billion dollars, an investment the company passed on, citing doubts about AI's immediate return on investment. Now, in hindsight, it appears to have been a complete costly misstep as the value of Open AI has soared following its partnership with Microsoft.
Now, the expanded lawsuit highlights relationships and power struggles that have shaped the whole industry and if Musk's claim, if they're proven true, could have far reaching consequences for other major tech companies and the partnerships and competitive strategies in this field. Now the court battle promises to keep exposing internal documents and private communications, shedding light on the behind the scenes maneuvers of some of the most influential figures in
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