12:51 am - March 7, 2025
Elon Musk, the billionaire entrepreneur and CEO of xAI, has made a bold move by leading a consortium to offer $97.4 billion to acquire OpenAI, the nonprofit entity that controls the artificial intelligence startup behind groundbreaking generative AI technology. This bid, revealed on Monday, has the potential to escalate long-standing tensions between Musk and OpenAI CEO Sam Altman, who have been at odds over the direction and future of the company. The two visionaries, who co-founded OpenAI in 2015, have diverged in their priorities, with Musk advocating for a return to OpenAI’s original nonprofit, open-source roots, while Altman has been driving the company toward a for-profit model to secure the capital needed for its ambitious AI projects.
The tension between Musk and Altman is not new, but it has intensified in recent months. Musk has been vocal in his criticism of OpenAI’s decision to transition into a for-profit entity, a move he claims strays from the company’s original mission to develop AI for the benefit of humanity. In a lawsuit filed earlier this year, Musk alleged that OpenAI’s shift toward profitability contradicts the nonprofit ethos under which the company was founded. He has been particularly critical of the $500 billion Stargate project, a high-profile initiative announced at the White House after Donald Trump’s return to office. Musk questioned the feasibility of the project, suggesting that the investors involved lacked the necessary funding to see it through. His press release accompanying the bid underscored his vision for OpenAI’s future: “It’s time for OpenAI to return to the open-source, safety-focused force for good it once was.”
Altman, who has been instrumental in steering OpenAI’s recent success, was quick to respond to Musk’s offer. In a tweet on his X account, he dismissed the bid with a mix of humor and defiance: “No thank you but we will buy Twitter for $9.74 billion if you want.” This playful jab highlights the competitive and often personal nature of the rivalry between the two tech leaders. Altman’s response also reflects his confidence in OpenAI’s trajectory and his determination to push forward with the company’s transition to a for-profit model, which he believes is essential for securing the capital needed to develop cutting-edge AI technologies.
Musk’s bid is being backed by his own AI company, xAI, which he founded in 2023 after leaving OpenAI before it gained significant traction. If the deal goes through, The Wall Street Journal has reported that xAI could merge with OpenAI, creating a powerhouse in the AI industry. However, the proposal faces significant hurdles, including the need to raise enormous funds to finance the acquisition. OpenAI’s latest valuation stands at $157 billion, as of its October funding round, making it one of the most valuable private companies in the world. In January, Reuters reported that SoftBank Group was in talks to lead a new funding round of up to $40 billion, which would further cement OpenAI’s position as a leader in the AI sector. Musk and his consortium would need to secure substantial backing to meet the $97.4 billion offer, a challenge that could prove daunting even for one of the world’s wealthiest individuals.
Despite the financial and logistical challenges, Musk’s move is a strategic play to regain control of a company he helped create but left before it achieved its current prominence. His vision for OpenAI’s future is rooted in its origins as a nonprofit focused on developing AI responsibly and for the greater good. He has expressed concern that the company’s current path prioritizes profit over safety and ethical considerations, a sentiment echoed by some in the AI community. However, Altman and OpenAI’s backers argue that transitioning to a for-profit model is necessary to attract the investment required to keep pace with advancements in AI technology and compete with other industry players.
The outcome of this high-stakes battle for control of OpenAI remains uncertain, but its implications for the future of artificial intelligence are profound. On one side, Musk’s bid represents a call to return to OpenAI’s nonprofit roots, emphasizing transparency, safety, and ethical AI development. On the other, Altman’s leadership has positioned OpenAI as a for-profit innovator capable of liquidity and growth in a rapidly evolving industry. As the drama unfolds, one thing is clear: the future of OpenAI—and potentially the AI industry at large—hangs in the balance. This clash of visions between two of tech’s most influential figures will undoubtedly shape the trajectory of generative AI and the companies that drive it forward.