Microsoft-backed OpenAI: CEO Altman out, lands at Microsoft AI unit

‘The board no longer has confidence in his ability to continue leading OpenAI,’ according to a statement from OpenAI

Sam Altman has left the CEO role at OpenAI, the organisation known for its ChatGPT generative artificial intelligence product and work with Microsoft on GenAI.

In a statement published Friday on San Francisco-based OpenAI's website, the organisation said that Altman "was not consistently candid in his communications with the board, hindering its ability to exercise its responsibilities."

"The board no longer has confidence in his ability to continue leading OpenAI," according to the statement, which named chief technology officer Mira Murati interim CEO effective immediately.

Altman out at OpenAI

In a statement to CRN, a Microsoft spokesperson reiterated the vendor's commitment to OpenAI.

"We have a long-term partnership with OpenAI and Microsoft remains committed to Mira and their team as we bring this next era of AI to our customers," according to the statement.

In a LinkedIn post on Monday morning, Microsoft CEO Satiya Nadella welcomed the management reshuffle and announced that Altman and Brockman will be joining the software giant to lead a new "AI research unit."

Microsoft, OpenAI relationship

Microsoft has reportedly invested $13bn in OpenAI and has an exclusive license on the organisation's GPT-4 large language model (LLM) that generates answers in response to user queries.

Microsoft and OpenAI have partnered "to develop the underlying AI" in Microsoft's Copilot GenAI tools.

!Washington-based Microsoft is also "developing and providing the supercomputing infrastructure that OpenAI services run on," according to the tech giant.

During Microsoft's annual Ignite conference last week, Microsoft CEO Satya Nadella praised the OpenAI partnership.

"It starts with our deep, deep partnership with OpenAI," Nadella said.

"They're just doing stunning breakthrough work to advance the state of AI models. And we are thrilled to be all-in on this partnership together."

Nadella even pledged that "as OpenAI innovates, we will deliver all of that innovation as part of Azure AI."

He announced a preview for OpenAI's GPT-4 Turbo on Azure OpenAI Service, with token pricing at parity with OpenAI.

Nadella made a surprise appearance at OpenAI's DevDay conference earlier this month, sharing the stage with Altman and telling him "we love you guys" and that the partnership has "been fantastic for us," according to Business Insider.

Along with Altman's departure and Murati's promotion, Greg Brockman will leave his role as chairman of the board but will remain at OpenAI, reporting to Murati.

Altman left his role as president of startup accelerator Y Combinator in 2019 to focus on OpenAI, according to The New Economy.

He became its president in 2014 and joined YC in 2011 as a part-time partner. He previously founded location-based social network Loopt in 2005. It sold to prepaid card issuer Green Dot in 2012 for $43.4m.

In September, The Wall Street Journal reported that OpenAI was talking to investors about a share sale that would value it at between $80bn to $90bn - triple its level earlier this year. Microsoft owns 49 per cent of OpenAI, which expected at the time to hit $1bn in revenue this year.

On Monday, 13 November, Altman told the Financial Times he planned to secure more financial backing from Microsoft as it worked toward artificial general intelligence (AGI).

Murati, the interim CEO, joined OpenAI in 2018 as vice president of applied AI and partnerships, according to an archive of her LinkedIn account. She took on the CTO role in May 2022.

Her resume includes about two years with Leap Motion, leaving the company in 2018 with the title of vice president of product and engineering. She spent three years with Tesla, leaving in 2016 with the title of senior product manager for Model X.