OpenAI Cancels Conversion Plan, But Elon Musk's Lawsuit Continues

OpenAI will still run as a non-profit company (photo: dock. openai)

JAKARTA - OpenAI has changed its planned massive restructuring, with its parent nonprofit organization maintaining control. This move is likely to limit OpenAI CEO Sam Altman's power over the AI company that gave birth to ChatGPT.

The decision comes after a wave of criticism and legal challenges, including a lawsuit from Elon Musk, co-founder of OpenAI, who accused the company of deviated from its original goal of developing AI for humanitarian purposes.

In a statement on Monday, April 5, Altman confirmed that OpenAI will remain under nonprofit control, even though they still have a profit-oriented business.

In December 2024, OpenAI had submitted a plan to convert their for-profit unit into Public Benefit Corporation (PBC), a structure that allows a balance between shareholder profits and social missions. However, these changes will reduce non-profit control over the company.

Now, OpenAI ensures that non-profit parents remain in control of PBC, while becoming the main shareholder in the business unit. That way, the company can still raise more capital to maintain competitiveness in the AI development race.

The Dilemma Between AI's Profits And Missions

The move towards a fully profit-oriented company was originally designed to help OpenAI raise more funds. However, many parties are concerned about whether the company will continue to prioritize the public interest, and how the balance between AI development missions and boost profits will be maintained.

Bret Taylor, Chairman of the OpenAI Board, said the decision to maintain a nonprofit structure was taken after hearing input from community leaders and communicating with the California and Delaware Attorney General's Offices.

Altman said that this decision was a compromise that would still allow OpenAI to get enough funding from investors, including Microsoft. He also ensured that there were no changes in relations with existing investors.

However, there are still unanswered questions regarding the level of non-profit control that will have under this new structure.

Elon Musk Continues Lawsuit

This decision also emerged amid a legal conflict between OpenAI and Elon Musk. Musk previously sued OpenAI for trying to switch from non-profit to an entity that prioritizes profits.

Although OpenAI canceled its conversion plan, Musk's lawyers confirmed that the lawsuit would continue. He said that OpenAI's announcement still obscures important details, especially regarding reducing nonprofit ownership in Altman-led business units.

Musk also made an offer worth 97.4 billion US dollars to acquire OpenAI, but was rejected by Altman.

Meanwhile, OpenAI continues to look for ways to increase their investment. The company previously announced plans to raise funds of up to $40 billion, led by SoftBank with a valuation of up to 300 billion US dollars.

With all these developments, OpenAI is still in a dilemma between maintaining its mission as an AI organization for the public interest and the need to raise capital to develop further in global AI competitions.