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Comment by mattmaroon | Hacker News Reader

Seems pretty obvious everyone involved wants to cast off the not for profit structure and make a trillion dollars. Might as well get it over with.

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>the not for profit structure

Vast oversimplification.

It's difficult to get your arms around the absurdity that is the OpenAI corporate structure. A non-profit parent entity with a wholly owned for-profit subsidiary (actually, the non-profit wholly owns and controls a third "manager" entity which in turn is the controlling but not majority shareholder of the for-profit subsidiary) where the profit of the for-profit entity is "capped" and oh by the way, that for-profit subsidiary has a 49% shareholder who happens to be Microsoft. However, Microsoft, despite having 49% ownership of the for-profit subsidiary, gets 75% of their profit..........until their initial investment is recouped. Employees get Profit Participation Units (PPUs) which are NOT equity but which entitle employees to a percentage of profits, again up to the "cap". Then of course, when OpenAI achieves AGI, whatever the hell that is, then everything from that point forward reverts back to the non-profit entity and Microsoft, other investors, and employees get hosed.

They had already removed the cap:

https://www.economist.com/business/2023/11/21/inside-openais...

Holy shit. Thank you for your service.

I wish they would be at least forced to change their name. It’s like if Exxon called themselves The Free Renewable Energy Company. It’s misleading to consumers. In tech, we all know it’s BS, but the average consumer might not. It seems like an argument could be made that “OpenAI” in violation of FTC truth in advertising rules.

It could be a lot more closed than it is, from a general public perspective. i.e. the company having this cool AI and we not even getting the opportunity to use it at all.

They couldn't be, realistically, any more closed without being an essentially infinite money sink of the kind even nation states would struggle to fund long-term. It's the public using it that's helping offset costs and also giving them the usage data that they need to iterate on the design.

Umm why would they bother developing a product if they're not selling it to customers?

It could theoretically be a B2B product only (or something else limited) and not B2C.

Yeah but even then it would make it to consumers through their customers.

A bit like MS Copilot for Bing / Windows which is really just rebranded ChatGPT. For the O365 version they added a lot of stuff to interact with office but their online chatbot is just the same.

You can’t use OpenAI models without technically breaking OpenAI terms. That’s the best part.

The human brain is a model that competes with OpenAI, and every time you look at the output, you use OpenAI outputs to develop your brain.

Thus, every user interaction violates the rules as written, and is “illegal, harmful, or abusive.”

Malicious compliance is the move. Just don’t use it!

Also, OpenAI is now one of the most closed AI companies. No open source. No open weights. They don't even share how they're models are designed or the number of parameters. There's just nothing left from their original mission.

It’s very hard to separate profit maximization from investment/progress/impact maximization.

Handicapping the former inevitably handicaps the latter.

That might be ok in a backwater area where speed of progress wasn’t vital. But AI today is not that.

Maximizing resources is an important dimension of maximizing progress in any fast paced & expensive endeavor.

And resources, to be sustainably obtained, require offering comparable or better returns than your competitors.

Yes, profit incentive is generally a good thing.

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