The dust has settled, and the drama at OpenAI with the ousting and the swift return of CEO Sam Altman is over. But was it really a drama? Or was it rather a farce?
The underlying reason for the company’s (short-lived) turmoil was foundational: should the power at OpenAI be more tilted toward the non-profit component of the company, in order to contain the risk of dangerous uses of its technologies that profit motives might promote? Or should instead the for-profit wing take the reins, given the need for huge investments and the unlimited opportunities for financial gains that those technologies promise?
This dilemma is real, however, only if one believes that there ever was an alternative — in other words, if the original objective of OpenAI to benefit all humanity was credible at all. The history of tech companies in the last few decades tells us otherwise.
The dominant narrative of tech companies has long been one of social service and of giving the world products that would improve everybody’s life. Conflicts of interests and objectives (producers vs. consumers, capital vs. labour, social welfare vs. private interest) were not part of the narrative in the digital economy. Companies were founded to make the world a better place.
Yet the academic and altruistic drive of Google’s founders gave way, just a few years, to an auction and ad-based model that produced enormous profits and wealth. Never mind the opacity in the collection and use of personal data; the allegations of sexual harassment and misconduct at the company swept under the carpet; the undisclosed deals with the Pentagon; the repeated violations of competition laws; and the abundance of YouTube videos on subversive conspiracy theories.
Facebook’s alleged goal was to connect people, have them make more friends, bring information all around the world, and realize the global village idealized by hippie Californians in the ’60s. Never mind the growth imperative and the maximization of traffic and engagement dictated by an ad-based business model that led to extreme polarization, the spread of fake news, and hate online and offline.
Make no mistake: There is nothing surprising in these contradictions. In a capitalistic, market economy, the objective and role of companies is the pursuit of profits. This is a powerful force that drives economic activity and ultimately creates growth and prosperity. In this pursuit, we should expect companies to look for legal shortcuts, reduce the power of workers, exploit or deceive consumers. This applies of course also to tech entrepreneurs, whom we indeed learned to call hustlers, who disrupt, move fast and break things, fake it till they make it.
A company that has developed some of the most powerful technologies in history, AI algorithms that come close to replicating human learning and reasoning, will try to extract private economic value from them. In fact, if we believe in the benefits of a market economy, of capitalism and freedom of enterprise, this is what we should hope for.
At the same time, we should expect a public sector (the government, the judiciary, etc.) to define rules that limit business practices that destroy social welfare instead of increasing it; and we should expect intellectuals, academics and news media to be skeptical and exert genuine critical thinking; to highlight the contradictions, not only legal but also ethical; to act, in other words, as balancing forces.
However, while tech entrepreneurs fulfil their functions brilliantly, governments as well as most opinion-makers have been largely deficient. Liberal and conservatives legislators alike have long granted the tech sector latitudes of action that other companies could not enjoy. Social media companies were exempted from any responsibility about the information that circulated on their platforms; tech giants have mostly been shielded from antitrust regulations, on account of their low prices and abundance of their products; and ride-share and delivery companies have been allowed to consider their gig workers as independent contractors, and as such, not entitled to the same treatments and guarantee of employees.
Regrettably, many of these policy choices had the backing of academic scholars (especially in economics departments and business schools). Brilliant academics got excited by the flexibility and the benefits of low costs in the digital economy, perhaps in good faith, in reliance with obsolete theories, or maybe hoping for lucrative speeches and first-class travel. Critics, including those within the tech industry, from Aaron Swartz to Meredith Whitaker, who were proposing an architecture for the World Wide Web that would make it accessible and safe, with diffused instead of concentrated power, have been marginalized.
So let’s not be easily fooled by the alleged prosocial intentions of OpenAI and similar companies, be them formally for- or non-profit. By tailoring their technologies to maximize their economic returns, they are just doing their job. If the consequences of these actions sound problematic or dangerous, then it’s time for policymakers, the press, intellectuals, and academics do their job too.
Nicola Lacetera is a professor of strategic management at the University of Toronto Mississauga and Rotman School of Management.
