© Reuters. FILE PHOTO Microsoft CEO Satya Nadella speaks at a Microsoft event in San Francisco, California, March 27, 2014. Nadella introduced Microsoft Office for iPad and Enterprise Mobility Suite, a set of cloud services. REUTERS/Robert Galbraith/File Photo
By Jeffrey Dustin
DAVOS, Switzerland (Reuters) – Microsoft Chief Executive Satya Nadella said on Tuesday he had no problem with the governance structure of his partner OpenAI, two months after the startup's nonprofit board temporarily ousted to its CEO without taking into account the interests of investors.
The surprise firing in November of OpenAI CEO Sam Altman over an alleged communication failure triggered a crisis at the startup behind ChatGPT, with employees threatening to quit en masse and go to work for Microsoft (NASDAQ:), which backs OpenAI with billions of dollars.
“I feel comfortable. I have no problem with any structure,” Nadella said at a Bloomberg News event on the sidelines of the World Economic Forum's annual meeting in Davos.
OpenAI's board of directors, charged with protecting the nonprofit startup's mission of developing powerful artificial intelligence that benefits humanity, ultimately reinstated Altman days later and is now in the process of completing his membership.
“I expect we'll make a lot of progress on that in the coming months,” Altman, CEO of OpenAI, said at a later Bloomberg event in Davos. “And after that, the new board will examine the governance structure.”
“We'll look at it from all angles,” he said.
Microsoft has now secured a non-voting observer position on the OpenAI board.
Competition authorities in Europe, Britain and, reportedly, the United States have begun to closely examine the Microsoft-OpenAI relationship. Their deal guarantees the Windows maker large portions of the startup's profits depending on certain conditions, said a person briefed on the terms.
According to Nadella, the fact that Microsoft does not fully own OpenAI distinguished their deal in a pro-competitive manner.
“Associations are, in fact, a way to have competition,” he said.
Microsoft's investments in computing power and its years-long bet on OpenAI before its ChatGPT fame, Nadella said, were a “very risky bet” and “it wasn't all conventional wisdom.”
