OpenAI’s Rollercoaster Year: Triumphs and Turmoil in the AI Race
Staff Editor OpenAI Navigates Turbulent Year of Growth and Challenges
OpenAI, the artificial intelligence powerhouse, experienced a year of unprecedented growth and significant hurdles in 2024. The company reached a historic valuation and shifted towards a for-profit model, while simultaneously grappling with executive departures and legal challenges.
At the center of OpenAI’s tumultuous year was CEO Sam Altman, who briefly lost his leadership position in November 2023. The board’s decision to remove Altman, citing a lack of confidence, sent shockwaves through the tech industry. However, Altman was swiftly reinstated with a new board in place. Reflecting on the period, Altman described it as challenging but ultimately unifying for the company.
OpenAI faced fierce competition from unexpected quarters, including Elon Musk’s xAI. Musk, a former OpenAI co-founder who left the board in 2018, positioned xAI as a direct competitor, aiming to raise $6 billion. The rivalry intensified when Musk filed a lawsuit against OpenAI, alleging it had become a profit-driven entity contrary to its original mission. Although withdrawn in June, the lawsuit resurfaced later in the year.
Adding to OpenAI’s legal woes, the Securities and Exchange Commission (SEC) launched an investigation into whether the company misled investors, particularly focusing on Altman’s alleged lack of transparency.
The company also experienced a series of high-profile departures. Cofounder Ilya Sutskever left OpenAI, expressing regret over past actions. CTO Mira Murati and President Gregg Brockman took leaves of absence, while several other notable employees exited throughout the year.
Product-related controversies also emerged, with OpenAI removing a voice feature from ChatGPT after comparisons to actress Scarlett Johansson’s voice. Johansson expressed shock and sought legal action. Additionally, reports surfaced highlighting concerns about AI safety and restrictive NDAs, prompting OpenAI to reiterate its commitment to safety and transparency.
Despite these challenges, OpenAI secured significant strategic partnerships and funding. Apple announced the integration of ChatGPT into its software, marking a major collaboration. In a historic funding round, OpenAI raised $6.6 billion, reaching a staggering $157 billion valuation, with major investors including Thrive Capital, SoftBank, and Microsoft.
As the year drew to a close, OpenAI continued to face ongoing legal issues, including a lawsuit with The New York Times. Allegations surfaced that OpenAI had deleted data relevant to the lawsuit, which involved major newspapers. The legal battle continued to unfold with potentially far-reaching implications for the AI industry.
