Elon Musk May Withdraw OpenAI Offer Under Specific Conditions

The ongoing dispute over artificial intelligence dominance continues as OpenAI's CEO, Sam Altman, has firmly stated that the organization is not for sale. Following a substantial acquisition proposal from tech billionaire Elon Musk, valued at $97.4 billion, Musk is now signaling a potential retreat from his offer--but with a significant condition attached.

Recent reports indicate that Musk is prepared to withdraw his bid, contingent upon OpenAI maintaining its existing operational structure. This information emerged from a letter sent by Musk's legal team to a U.S. court, as reported by Reuters.

Despite Musk's intentions, his proposal has yet to reach OpenAI's board of directors. According to Marc Toberoff, Musk's attorney, an email detailing the offer was sent to OpenAI's legal representatives, who have not commented on the matter as of now.

In a rather dismissive response on social media platform X (formerly Twitter), Altman referred to Musk's offer as ridiculous, suggesting that they would instead consider purchasing Twitter for $9.74 billion if Musk was interested. Altman reiterated that OpenAI is not for sale and characterized Musk's overtures as attempts to interfere.

OpenAI has formed a joint venture known as 'The Stargate Project,' collaborating with notable entities such as SoftBank, Oracle, and an Emirati sovereign fund. Part of a broader $500 billion initiative announced by former President Donald Trump, this project aims to enhance AI technology in the U.S. with an immediate influx of $100 billion. Musk has publicly criticized this initiative, arguing that the necessary funding is not available and labeling Stargate as a 'fake' endeavor, while also disparaging Altman.

The conflict between Musk and Altman has been further complicated by Musk's previous legal actions against OpenAI, aimed at halting the commercialization of AI developments. Musk co-founded OpenAI with Altman in 2015, contributing $50 million initially, but departed in 2018, citing plans to develop a competing AGI within Tesla.

Now operating his own AI company, xAI, Musk has raised concerns about OpenAI's competitive practices, claiming that a profit-driven segment of the originally non-profit organization has been released. He has also criticized the current proprietary nature of the software code, which he argues has become a trade secret, leading him to file a lawsuit approximately a year ago.

Despite Musk's assertion that he aims to realign OpenAI with its non-profit roots to serve humanity, there are skeptics who question his motives, particularly given his own competing interests in the AI space. Tech investor Christie Pitts expressed caution regarding Musk's intentions, noting the potential conflict of interest.

In October 2024, OpenAI was valued at $157 billion during a funding round, significantly higher than Musk's initial offer, which raises doubts about whether his bid would be taken seriously. Reports suggest that OpenAI's current valuation in ongoing negotiations is around $300 billion, with stakeholders ready to match or exceed any competing offers.