The recent OpenAI saga, by which Microsoft exerted its quiet but firm dominance over the “capped profit” entity, provides a robust demonstration of what we’ve been analyzing for the last half-decade. To wit: those with the cash make the principles. And at once, they’re engaged in a race to the underside, releasing systems before they’re ready in an try to retain their dominant position.
Concentrated power isn’t just an issue for markets. Counting on just a few unaccountable corporate actors for core infrastructure is an issue for democracy, culture, and individual and collective agency. Without significant intervention, the AI market will only find yourself rewarding and entrenching the exact same corporations that reaped the profits of the invasive surveillance business model that has powered the industrial web, often on the expense of the general public.
The Cambridge Analytica scandal was just one amongst many who exposed this seedy reality. Such concentration also creates single points of failure, which raises real security threats. And Securities and Exchange Commission chair Gary Gensler has warned that having a small variety of AI models and actors at the muse of the AI ecosystem poses systemic risks to the financial order, by which the results of a single failure may very well be distributed far more widely.
The assertion that AI is contingent on—and exacerbates—concentration of power within the tech industry has often been met with pushback. Investors who’ve hurried from Web3 to the metaverse to AI are keen to comprehend returns in an ecosystem where a frenzied press cycle drives valuations toward profitable IPOs and acquisitions, even when the guarantees of the technology in query aren’t ever realized.
However the attempted ouster—and subsequent reintegration—of OpenAI cofounders Sam Altman and Greg Brockman doesn’t just bring the power and influence of Microsoft into sharp focus; it also proves our case that these industrial arrangements give Big Tech profound control over the trajectory of AI. The story is fairly easy: after apparently being blindsided by the board’s decision, Microsoft moved to guard its investment and its road map to profit. The corporate quickly exerted its weight, rallying behind Altman and promising to “acquihire” those that desired to defect.
Microsoft now has a seat on OpenAI’s board, albeit a nonvoting one. However the true leverage that Big Tech holds within the AI landscape is the mixture of its computing power, data, and vast market reach. To be able to pursue its bigger-is-better approach to AI development, OpenAI made a deal. It exclusively licenses its GPT-4 system and all other OpenAI models to Microsoft in exchange for access to Microsoft’s computing infrastructure.
For corporations hoping to construct base models, there’s little alternative to working with either Microsoft, Google, or Amazon. And people at the middle of AI are well aware of this, as illustrated by Sam Altman’s furtive search for Saudi and Emirati sovereign investment in a hardware enterprise he hoped would rival Nvidia. That company holds a near monopoly on state-of-the-art chips for AI training and is one other key choke point along the AI supply chain. US regulators have since unwound an initial investment by Saudi Arabia into an Altman-backed company, RainAI, reinforcing the issue OpenAI faces in navigating the even more concentrated chipmaking market.
