I've turned down the page size so everyone can see the threads, but you'll have to click through the More links at the bottom of the page to read all the comments, or like this:

https://news.ycombinator.com/item?id=38344196&p=2

https://news.ycombinator.com/item?id=38344196&p=3

https://news.ycombinator.com/item?id=38344196&p=4

etc...

"Microsoft Buys Skype for $8.5 Billion" -https://www.wired.com/2011/05/microsoft-buys-skype-2/

To then write down their assets?

"How Skype lost its crown to Zoom" - https://www.wired.co.uk/article/skype-coronavirus-pandemic Or when they did this ?

Or how in 2014...

"Microsoft buying Nokia's phone business in a $7.2 billion bid for its mobile future" - https://www.theverge.com/2013/9/2/4688530/microsoft-buys-nok...

Then in 2016 sold it for 360 million?

"Nokia returns to the phone market as Microsoft sells brand" - https://www.theguardian.com/technology/2016/may/18/nokia-ret...

"Microsoft to acquire GitHub for $7.5 billion" - https://news.microsoft.com/2018/06/04/microsoft-to-acquire-g...

only to enable GitHub to do greater things, without disrupting user experience?

"Four years after being acquired by Microsoft, GitHub keeps doing its thing" - https://techcrunch.com/2022/10/26/four-years-after-being-acq...

or when they acquired LinkedIn before that?

"Microsoft buys LinkedIn" - https://news.microsoft.com/announcement/microsoft-buys-linke...

which turned out to be fine too?

How about Minecraft? Activision?

It's easy to cherry-pick examples from an era where Microsoft wasn't the most successful. The current leadership seems competent and the stock growth of the company reflects that.

"... In the two years since the acquisition announcement, GitHub has reported a 41% increase in status page incidents. Furthermore, there has been a 97% increase in incident minutes, compared to the two years prior to the announcement..."

GitHub is stronger now then it ever has been.

Maybe they got funding for a proper incident team? Or changed the metrics of a incdient is, maybe the SLAs changed to mirror MS SLAs?

Also Betteridge's law.

Linkedin has not improved its problems with spam or content quality since Microsoft took over.

Not unreliable enough to be a problem though, and Actions seems to be a decent experience for plenty of people.

The simple fact with GitHub is that it is _the_ primary place to go looking for, or post your, open source code, and it is the go-to platform for the majority of companies looking for a solution to source code hosting.

Your comment about LinkedIn is true, but where is the nearest competition in its' space?

Excuse you? Greater where? Github was an amazing revolution, unique of its kind. Microsoft didn't kill it but didn't make it even 1% better for the users, just turned it into a cash cow. Linkedin is currently a PoS.

I think it can be argued that giving free private repos to user is a 1% increase. Or what about private vulnerability reporting for open source projects. And so on. Github has gotten a lot of new free functionality since Microsoft bought it. It sounds like you just have not been paying attention.

Edit: Nevermind, I see you refer to Microsoft as M$. That really says it all.

The fact that this is even news speaks of the absolute shit job they've done with acquisitions in the past.

Looking at the global track records of what happens after acquisitions, these don't seem too bad

Meanwhile Microsoft wins if OpenAI stays dominant and wins even bigger if Sam and Greg prevail. Some day soon they may teach this story at Harvard Business School.

I sense a lot of respect and appreciation for his role, but unfortunately I just don’t know many details and I’m curious about the highlights.

might be missing some more but Satya is like a S tier CEO, compared to Sundar who doesn't seem very good at his role.

This is a win from Microsoft's perspective. They don't have to have the best group messenger around, but having a significant office product being dominated by another company would be a massive risk to Microsoft, and Teams has prevented that.

It seems to me roughly all of the value of OpenAI’s products is in the model itself and presumably the supporting infrastructure, neither of which seem like they’re going to MSFT (yet?).

It's seems like a cult right now, tbh.

Whether they actually move to MS or not remains to be seen, but it is definitely a strong indicator that they're not "aligned" with OpenAI anymore.

https://twitter.com/karaswisher/status/1726598360277356775?s...

If he manages to get a significant amount of the OpenAI engineers to jump ship maybe, but even for those who are largely motivated by money, how is MS going to offer the same opportunity as when they joined for equity with OpenAI? Are they going to pay then >$1M salaries?

Recruiting. At the end of the day, that's the most important job a CEO has. If they can recruit the best AI people, they're the most formidable AI team.

> Are they going to pay then >$1M salaries?

I would wager very heavily that they are. My guess is Satya more or less promised Sam that he'd match comp for anybody who wants to leave OpenAI.

Even if he does nothing, he keeps the team together and that is worth quite a bit.

My guess is that a lot of the people that will follow Sam and Gregg are that kind of cult-follower.

My uneducated guess is that OpenAI really screwed up the PR part and the current Microsoft’s claims are more on the overall damage control / fire suppression side.

This sounds like hyperbole, but isn't that what China is doing?

What exactly can a foundation in charge of OpenAI do to prevent this unethical use of the technology? If OpenAI refuses to use it to some unethical goal, what prevents other, for profit enterprises, from doing the same? How can private actors stop this without government regulation?

Sounds like Truman's apocryphal "the Russian's will never have the bomb". Well, they did, just 4 years later.

A non-profit is not by any means guaranteed to avoid the dangers of AI. But at a minimum it will avoid the greed-driven myopia that seems to be the default when companies are beholden to Wall Street shareholders.

in America, nonprofits are just how rich people run around trying to get tax avoidance, plaudettes and now wealth transfers.

I doubt OpenAI is different not that Altman is anything but a figurehead.

but nonprofits in America is how the government has chosen to derelict it's duties.

I'm no embarrased billionaire, but there is a place for both.

For Sam , he got more than what he was asking and a better prospect to become CEO of Microsoft when Satya leaves. Satya lead cloud division, which was the industry growth market at that time before becoming CEO and now sam is leading AI division , the next growth market.

Ilya still lost in all of this , he managed to get back the keys of a city from sam , who now got this keys to the whole country . Eventually sam will pull everyone out of the city in to rest of his country. Microsoft just needs a few openai employees to join them . They just need data and GPU , openai has reached its limits for getting more data and was begging for more private data while Microsoft holds worlds data, they will just give a few offers to business or free Microsoft products in return of using their data or use their own. I think it’s the end for openAI.

The argument would go something like this:

MS were contractually obliged to assist OpenAI in their mission. OpenAI fired Altman for what they say is hindering their mission. If MS now hires Altman and gives him the tools he needs, MS is positioning itself as an opponent to OpenAI and its mission.

They were positioned that way by the OpenAI board, which has effectively committed corporate suicide and won’t be around much longer.

the bottleneck right now is mostly compute I think, and openai does not have the resources or expertise to allieviate that bottleneck on a timescale that can save them.

Into the shackles of ever-controlling mega-corp?

Microsoft will not have actually paid $10B as a single commitment, in fact the financials of OpenAI appear to be alarming from the recent web chatter. OpenAI are possibly close to collapse financially as well as organizationally.

Whatever Satya does will be aimed at isolating Microsoft and its roadmap from that, his job is actually also on the line for this debacle.

The OpenAI board have ruined their credibility and organization.

1. When they invested in Open AI it had a more mature board (in particular Reid Hoffman) and afterwards they lost a few members without replacing them. That was probably something Microsoft could have influenced without making themselves part of the problem.

2. They received a call one minute before the decision was made public. That shouldn't happen to a partner that owns 49% of the company you just fired a CEO from.

Sources:

1 - https://loeber.substack.com/p/a-timeline-of-the-openai-board

2 - https://www.axios.com/2023/11/17/microsoft-openai-sam-altman...

Nadella was rightly furious about this, the tail wagged the dog there. And this isn't over yet: you can expect a lot of change on the OpenAI side.

We don't know that yet.

There was a lot of discussion on HN the past few days regarding the importance (or lack thereof) of a CEO to an organization. It may be the case that most executives are interchangeable and attributing success to them is not merited, but in the case of the aforementioned, I think it is merited.

Yes directly, the $10B investment in the company itself may be a write off. But it's not just about that.

For business and for the consumer. They can retire Bing search at this point, making it Microsoft Copilot for Web or something.

Nah it would make it too understandable. It's Microsoft, they'll just rename Bing to Cortana Series X 365. And they'll keep Cortana alive but as a totally different product.

Yeah, it's not like Microsoft has one of the most renowned industry research groups or something like that: https://en.wikipedia.org/wiki/Microsoft_Research

How so? I don't get the hype.

OpenAI trained truly ground breaking models that were miles ahead of anything the world had seen before. Everything else was really just a side show. Their marketing efforts were, at best, average. They called their flagship product "ChatGPT", a term that might resonate with AI scientists but appears as a random string of letters to the average person. They had no mobile app for a long time. Their web app had some major bugs.

Maybe Sam Altman deserves credit for attracting talent and capital, I don't know. But it seems to me that OpenAI's success by far and large hinges on their game-changing models. And by extension, the bulk of the credit goes to their AI research/tech teams.

Like some googlers have mentioned - aside from GPU requirements, there isn't much else of a moat since a lot of ML ideas are presented and debated relatively freely at NEURIPS, ICML and other places.

Google has been hyping gemini since the spring (and not delivering it)

Amazon's Titan Model is not quite there yet.

Or at least the most hyped AI team in the world. The level of cult of personality around OpenAI is reaching pretty nauseating levels.

This massively increases the odds we’ll see AI regulated. That isn’t what Altman et al intended with their national press tour—the goal was to talk up the tech. But it should be good in the long run.

I also assume there will be litigation about what Sam et al can bring with them, and what they cannot.

There was an article that came out over the weekend that stated that only a small part of that $10B investment was in cash, the vast majority is cloud GPU credits, and that it has a long time horizon with only a relatively small fraction having been consumed to date. So, if MSFT were to develop their own GPT4 model in house over the next year or so they could in theory back out of their investment with most of it intact.

In all this drama, the deep work interruption of the nerds is the net loss (and effectively slight deceleration) for the future.

Credit to Nadella for making a big cultural shift over the past several years.

Now they get 40 percent of open ai talent and 50 percent of the for profit openai subsidiary.

Pretty sure when the market opens you'll see confirmation that they came out on top.

It's a win for everyone honestly. Anthropic split all over again but this time the progressives got pushed out vs the conservatives leaving voluntarily.

They couldn't keep nice under the tent. Now two tents.

Little diff because this time an investor with special privaleges made a new special tent quick to bag talent.

Easy decision for msft. No talent to competitors. Small talent pool. The other big boys were already all over that. Salty bosses at other outfits. No poach for them. Satya too clever and brought the checkbook plus already courted the cutest girls earlier for a different dance. Hell he was assisting in the negotiation when the old dance got all rough and the jets started throwing hooks about safety and scale and bla bla we all know the story.

Satya hunts with an elephant gun with one of those laser sites and the auto trigger that fires automatically when the cross hair goes over the target. Rip sundar. 2 rounds for satya. One more and I feel bad for Google... Naw... Couldn't feel bad for Google. Punchable outfit. They do punchable things. We all know it... I'm just saying it.

You are imagining I fall in a crowd you've observed. Maintaining statute of the art ofc is a constant battle.

Google could be top dog in 2 weeks. Never insinuated otherwise. (though I predict otherwise, if we're gonna speculate)

Its not even relevant because each big firm is specializing to a degree. Anthropic is going for context window and safety... Bard is all about Google priorities... Ect

They won’t necessarily be able to attract similar technical talent because they no longer have the open non profit mission not the lottery ticket startup PPO shares.

Working on AI at Microsoft was always an option even before they were hired, not sure if they tip the scale?

Slashdot literally used to call them M$

The core thing he is 100% focused on is not having a massive stock drop Monday morning. That’s it that’s his reason to exist all weekend long.

After that. He has time to figure it out.

So basically they get to control ChatGPT 2.0 and get a 10 billion tax credit for it.

Honestly the board at least owes Satya a drink.

The money was promised in tranches, and probably much of it in the form of spare Azure capacity. Microsoft did not hand OpenAI a $10B check.

Satya gives away something he had excess of, and gets 75% of the profits that result from its use, and half of the resulting company. Gives him an excuse to hoard Nvidia GPUs.

If it goes to the moon he’s way up. If it dies he’s down only a fraction of the $10B. If it meanders along his costs are somewhat offset, and presumably he can exit at some point.

Not sure why you didn’t research before saying that! It was $10B committed and not a cash handover of that amount. Also, majority of that’s Azure credits

Hiring Altman makes sure that MSFT is still relevant to the whole Altman/OpenAI deal, not just a part of it. Hiring Altman thus decreases such possibility to write-off its investment.

That's a slightly flamboyant reading.. but I agree with the gist.

A slim chance of total right off doctor off.. that was always the case. This decision does not affect it much. The place in the risk model, where most of the action happens... Is less dramatic effects on more likely bans of the probability curve.

Msft cannot be kicked off the team. They still have all of the rights to their openai investment no matter who the CEO is.

Meanwhile, is clearly competing, participating, and doing business with openai. The hierarchy of paradigms, is flexible... Competing appears to have won.

I agree that direct financial returns, are the lesser part of the investment case for msft.. and the other participants. That's pretty much standard in consortium-like ventures.

At the base level, openai's IP is still largely science, unpatentable know how and key people. Msft have some access to (I assume) of openAI' defendable IP via their participation in the consortium, or 49% ownership of the for-profit entity. Meanwhile, openai is not so far ahead that pacing them from a dead start is impossible.

I also agree, that this represents a decision to launch ahead aggressively in the generative AI space.

In the latter 2000s, Google have the competence, technology, resources and momentum to smash anyone else on anything worldwideWeb.

They won all the "races." Google have never been good at turning wins into businesses, but they did acquire the wins handily. Microsoft wants to be that for the 2020s.

Able to replicate everything, for the new paradigm OpenAI's achievments probably represents.

The AI spreadsheet. The LLM email client. GPT search. Autobot jira. Literally and proverbially.

At least in theory... Microsoft is or will be in a position to start executing on all of these.

Sama, if he's actually motivated to do this.. it's pretty much the ideal person on planet earth for that task.

I'm sure takes a lot to motivate him. Otoh, CEO of Microsoft is it realistic prize if he wins this game. The man is basically Microsoft the person. I mean that as a compliment.. sort of.

One way or another, I expect that implementing OpenAI-ish models in applications is about commence.

Companies have been pleading chatbot customer support for years. They may get it soon, but so will the customers. That makes for a whole new thing in the place where customer support used to exist. At least, that is the bull case.

That said, I have said a lot. All speculative. I'll probabilistic, even where my speculations are correct. These are not really predictions. I'm chewing the cud.

By all accounts, OpenAI is not a going concern without Azure. I could see Tesla acquiring the bankrupt shell for the publicity, but the worker bees seem to be more keen on their current leader (as of last week) than their prior leader. OpenAI ends with a single owner.

Normally I am the cynic but this time I’m seeing a potential win-win here. Altman uses his talent to recruit and drive forward a brilliant product focused AI. OpenAI gets to refocus on deep research and safety.

Put aside cynicism and consider Nadella is looking to create the best of all worlds for all parties. This might just be it.

All of the product focused engineering peeps have a great place to flock to. Those who believe in the original charter of OpenAI can get back to work on the things that brought them to the company in the first place.

Big props to Nadella. He also heads off a bloodbath in the market tomorrow. So big props to Altman too for his loyalty. By backing MS instead of starting something brand new he is showing massive support for Nadella.

For all we know, OpenAI may actually achieve AGI, and Microsoft will still want a front row seat in case that happens.

Exhibit A: this weekend, lol.

Not doing that would be participating in illegal wage suppression. I'm not sure how following the law means OpenAI and MSFT can't continue a business relationship.

For one, I'm not sure Sam Altman will tolerate MS bureaucracy for very long.

But secondly, the new MS-AI entity can't presumably just take from OpenAI what they did there, they need to make it again.

This takes a lot of resources (that MS has) but also a lot of time to provide feedback to the models; also, copyright issues regarding source materials are more sensitive today, and people are more attuned to them: Microsoft will have a harder time playing fast and lose with that today, than OpenAI 8 years ago.

Or, Sam at MS becomes OpenAI biggest customer? But in that case, what are all those researchers and top scientists that followed him there, going to do?

Interesting times in any case.

Part of me thinks that Nadella, having already demonstrated his mastery over all his competitor CEOs with one deft move after another over the past few years, took this on because he needed a new challenge.

I'd wager Altman will either get sidelined and pushed out, or become Nadella's successor, over the course of the next decade or so.

It's an interesting time!

What I meant is, most likely assuming that you are using pytorch / jax you could code down the model pretty fast. Just compare it to llama, sure it is far behind, but the llama model is under 1000 lines of code and pretty good.

There is tons of work, for the training, infra, preparing the data and so on. That would result guess in millions lines of code. But the core ideas and the model are likely thin I would argue. So that is my point.

MSR leadership is probably a little shaken at the moment.

And if you separate out the products from OpenAI, that leaves the question of how an organization with extremely high compute and human capital costs can sustain itself.

Can OpenAI find more billionaire benefactors to support it so that it can return to its old operating model?

I personally expect the chat.openai.com site to just become a redirect to copilot.microsoft.com.

I get that funny money startup equity evaporates all the time, but usually the board doesn’t deliberately send the equity to zero. Paying someone in an asset you’re intentionally going to intentionally devalue seems like fraud in spirit if not in law.

But I think it is probably sufficient to point to the language in the contracts granting illiquid equity instruments that explicitly say that the grantee should not have any expectation of a return.

But I think this is an actual problem with the legal structure of how our industry is financed! But it's not clear to me what a good solution would even be. Without the ability to compensate people with lottery tickets, it would just be even more irrational for anyone to work anywhere besides the big public companies with liquid stock. And that would be a real shame.

I say this as someone with 20 years of Mozilla employment, the first couple in the non profit Mozilla Foundation and then about 18 years in the taxable subsidiary. The sub is technically taxable, so "for profit" but it was never created to make people rich, but rather to allow Mozilla to reap some profits and grow it size and influence, which it did, reaching about 30% browser market share.

The structures were similar but likely different in material ways, as there was zero equity at MoCo, nevertheless, if you go to work for an arm of a non-profit, expecting to get rich, you're probably not reading the fine print carefully enough.

I think this is where this all went off the rails. It's very clear that a huge percentage of the staff (I think the last numbers I saw was that over 85% of the staff had signed the letter urging the board to resign) were hired with incredibly big compensation packages, predicated on the giant equity valuation. It is not surprising that those people did not turn out to be there due to being big believers in the mission of the non-profit, or that they expected those compensation packages to be real.

Microsoft has access to almost everything OpenAI does. And now Altman and Brockman will have that access too.

Meanwhile, I imagine their tenure at MSFT will be short-lived, because hot-shot startup folks don’t really want to work there.

They can stabilize, use OpenAI’s data and models for free, use Microsoft’s GPUs at cost, and start a new company shortly, of which Microsoft will own some large share.

Altman doesn’t need Microsoft’s money - but Microsoft has direct access to OpenAI, which is currently priceless.

https://www.forbes.com/sites/louiscolumbus/2019/01/06/micros...

Believing that OpenAI is MSFT's sole move in the AI space would be a serious error.

https://news.ycombinator.com/item?id=38318205

https://news.ycombinator.com/item?id=38337522

https://news.ycombinator.com/item?id=38342882

MSFT's control isn't as "hard" as you portray it to be. At the senior leadership level they're pretty happy to allow divisions quite a lot of autonomy. Sure there are broad directives like if you support multiple platforms/OSes then the best user experience should be on "our" platform. But that still leaves a lot of room for maneuverability.

Soft control via human resources and company culture is a whole other beast though. There are a lot of people with 20+ years of experience at Microsoft who are happy to jump on job openings for middle-management roles in the "sexy" divisions of the company - the ones which are making headlines and creating new markets. And each one that slides on in brings a lot of the lifelong Microsoft mindset with them.

So yeah working within MS will be a very different experience for Altman, but not necessarily because of an iron grip from above.

Then the acquisition happened at a time when Microsoft presented a lot of opportunities to ship Skype "in the box" to pretty much all of MS' customers. Windows 8, Xbox One and Windows Phone (8) all landed at more or less the same time. Everybody's eyes became too big for their stomachs, and we tried to build brand new native experiences for all of these platforms (and the web) all at once. This hampered our ability to pivot and deal with the existential risks I mentioned earlier, and we had the rug pulled out from under us.

So yes I think the acquisition hurt us, but I also never once heard a viable alternative business strategy that we might have pivoted to if the acquisition hadn't happened.

As I understand Github is also run very independently from Microsoft in general.

Github operates independently of Microsoft. (To Microsoft's detriment... they offer Azure Devops which is their enterprisey copy of Github, with entirely different UX and probably different codebase.) They shove the copilot AI now everywhere but it still seems to operate fairly differently.

They didn't really fold LinkedIn in into anything (there are some weird LinkedIn integrations in Teams but that's it)

Google seems to me much worse in this aspect, all Google aquisitions usually become Googley.

Skype sort of became Teams thought, that's true.

GitHub Actions is basically Azure Pipelines repackaged with a different UI, so I don't think they mind much.

AI peeps are not cheap

OAI comp was high based on equity and its crazy valuations

I think "predictable" is more apt.

I think the predictable thing would have been a new company with new investment from Microsoft. But this is better; it a bit like magical thinking that MS would want to just throw more money after a new venture and essentially write off the old one. This solution accomplished similar things, but gives more to Microsoft in the trade by bringing that "new company" fully in house.