OpenAI Pauses For-Profit Plans Following Backlash: Industry Reactions

The non-profit organization that established OpenAI will maintain its operations as they have been. In December 2024, plans were announced to transition to a for-profit model, driven by the need for substantial funding to advance the development of costly artificial general intelligence (AGI).

However, rather than fully converting to a for-profit structure, OpenAI’s for-profit entity will evolve into a Public Benefit Corporation (PBC). This type of organization must answer to both its shareholders and its mission-driven objectives.

The existing non-profit OpenAI will continue to have oversight of the PBC and will also become one of its largest shareholders. The decision to adopt this new structure came after discussions with community leaders and constructive dialogues with Attorneys General from Delaware and California.

OpenAI was founded in 2015 as a non-profit and has faced significant criticism over its plans to shift toward a for-profit model. Notable critics include co-founder Elon Musk, who has litigated against OpenAI, claiming that the organization is straying from its foundational mission to develop AI technology for the benefit of humanity.

Voices of opposition also come from former employees, various non-profit organizations, Nobel laureates, and legal scholars. It remains uncertain what implications will arise from OpenAI’s decision to abandon its initial for-profit plans.

Despite the significant changes, the organization insists that it is committed to preserving its core mission while seeking the financial resources necessary for continued innovation in AI.

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