As OpenAI prepares to undergo a restructuring that would make it a for-profit public benefit corporation, it faces two big hurdle: a legal battle with billionaire Elon Musk and opposition from fierce rival Meta.
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Welcome back to The Prompt,
“You can’t sue your way to AGI.” That’s OpenAI’s response to Elon Musk, who has filed a lawsuit against the AI juggernaut over its plan to restructure itself to become a for-profit public benefit corporation. Emails and text messages between Musk and OpenAI cofounders show that the billionaire himself proposed that OpenAI have a for-profit component back in 2017, with himself as CEO and majority stakeholder. Musk, an OpenAI cofounder, left in 2018 and years later started a rival AI startup xAI, last valued at $50 billion.
“We have great respect for Elon’s accomplishments and gratitude for his early contributions to OpenAl, but he should be competing in the marketplace rather than the courtroom,” OpenAI said in a blog post.
Musk isn’t the only one opposing OpenAI’s transition. Meta, another fierce OpenAI competitor, has asked California’s attorney general to stop OpenAI from becoming a for-profit, adding that it could allow other startups to enjoy the benefits of a non-profit status until ready to become profitable, the Wall Street Journal reported.
Now let’s get into the headlines.
P.S. Quick housekeeping note: this will be the last edition of The Prompt of 2024. We’ll be back on January 8. Happy holidays!
BIG PLAYS
Former OpenAI researcher Suchir Balaji was found dead in his apartment in San Francisco late last month, San Jose Mercury News first reported. Local police and the Office of Chief Medical Examiner told Forbes Balaji died due to suicide. One of the first OpenAI whistleblowers, Balaji spoke out against OpenAI’s web scraping practices in October, alleging that the AI behemoth had violated copyright law by training ChatGPT and other AI products on copyrighted works scraped from the internet.
Google plans to bring artificial intelligence to your smart glasses. The tech giant demoed prototype glasses embedded with the next-generation of Google’s flagship AI model, Gemini 2.0, which allows users to identify objects they’re looking at and ask questions about them. It also announced upgrades to its AI agentic platform, Project Astra, improving its speed and natural language processing.
PEAK PERFORMANCE
At UnitedHealthcare, whose CEO Brain Thompson was killed in early December, AI has been utilized to approve or deny claims. The health insurance powerhouse has one of the highest claims denial rates in the country. Now a group of entrepreneurs are using AI to “level the playing field” and fight those denials by helping patients file appeals.
ETHICS + LAW
In the aftermath of the shooting of UnitedHealthcare’s CEO, fake accounts on Facebook and X are calling for violence against other healthcare executives. An analysis by cybersecurity firm Cyabra found about 11% of posts that included the words “kill” and “healthcare CEOs” were written or amplified by fake profiles.
AI DEAL OF THE WEEK
Data analytics and AI unicorn Databricks is finalizing a $10 billion funding round, the Wall Street Journal reported. The round, one of the largest investment rounds in Silicon Valley history, would value the company $62 billion. Thrive Capital is leading the round with participation from Andreessen Horowitz, DST Global and others.
Also notable: Perplexity and Databrick cofounder Andy Konwinski, former NEA Partner Pete Sonsini and Berkley PhD Andrew Krioukov have joined forces to start a new venture firm, Laude Ventures with $150 million fund to back startups working in and beyond AI, Forbes reported.
DEEP DIVE
Last month, a detective in a small town outside of Lancaster, Pennsylvania, invited dozens of high school girls and their parents to the police station to undertake a difficult task: one by one, the girls were asked to confirm that they were depicted in hundreds of AI-generated deepfake pornographic images seized by law enforcement.
In a series of back-to-back private meetings, Detective Laurel Bair of the Susquehanna Regional Police Department slid each image out from under the folder’s cover, so only the girl’s face was shown, unless the families specifically requested to see the entire uncensored image.
“It made me a lot more upset after I saw the pictures because it made them so much more real for me,” one Lancaster victim, now 16, told Forbes. “They’re very graphic and they’re very realistic,” the mother said. “There’s no way someone who didn’t know her wouldn’t think: ‘that’s her naked,’ and that’s the scary part.” There were more than 30 images of her daughter.
The photos were part of a cache of images allegedly taken from 60 girls’ public social media accounts by two teenage boys, who then created 347 AI-generated deepfake pornographic images and videos, according to the Lancaster County District Attorney’s Office. The two boys have now been criminally charged with 59 counts of “sexual abuse of children,” and 59 counts of “possession of child pornography,” among other charges, including “possession of obscene materials depicting a minor.”
Forty-eight of the 60 victims were their classmates at Lancaster Country Day School, a small private school approximately 80 miles west of Philadelphia. The school is so small that nearly half of the high school’s female students were victimized in the images and videos. The scale of the underage victims makes this the largest-known instance of deepfake pornography made of minors in the United States.
Read the full story on Forbes.
AI INDEX
SoftBank CEO Masayoshi Son and President-elect Donald Trump made a bold promise on Monday, committing to spend $100 billion, but details on how he plans to finance that pledge remain unclear–especially given that its market cap is less than that amount.
$100 billion
Japanese investment firm SoftBank pledged to invest in US projects over the next four years, CEO Masayoshi Son and President-elect Donald Trump announced on Monday.
100,000
New American jobs the company plans to create across artificial intelligence and other technological fields.
$97 billion
SoftBank’s market cap as of market close on Monday.
MODEL BEHAVIOR
Apple is facing criticism after its AI inaccurately summarized a BBC article, falsely claiming that Luigi Mangione, the prime suspect in the murder of UnitedHealthcare’s CEO, shot himself, the BBC reported. Apple Intelligence’s AI-based summaries have had other problems in recent times — it grouped three headlines by the New York Times and incorrectly claimed that Israeli Prime Minister Benjamin Netanyahu had been arrested.
