Medium Capitalism

OpenAI and their best-known creation ChatGPT have become so ubiquitous, so at the core of this new digital and economic paradigm, that it can be jarring to remember that they aren't just some public good like an internet protocol but are, in fact, a company.

That means shareholders. That means economic incentives. That means business decisions, not just tech decisions. OpenAI made a bunch of business decisions for ChatGPT this week.

The first is a privacy-focused update. ChatGPT users can now turn off chat history. Think incognito browsing for a comparison. When chat history is turned off, OpenAI won't use those chats to train their models, and all chats are permanently deleted after 30 days.

The second business decision is, well, ChatGPT business. It's a forthcoming subscription services "for professionals who need more control over their data as well as enterprises seeking to manage their end users." By default these customers' data won't be used to train their models.

Yesterday they also released brand guidelines which are meant to crack down on how many projects slap "GPT" on the back of a word and call it a day.

Now, going back to this idea of economic incentives, OpenAI's are designed at least to be a little different than others. The company started in 2015 as a nonprofit, but in 2019 created a for-profit vehicle as well. In a recent interview with Lex Fridman, OpenAI CEO Sam Altman said

"We had tried and failed enough to raise the money as a nonprofit. We didn’t see a path forward there. So we needed some of the benefits of capitalism, but not too much. I remember at the time, someone said, you know, as a nonprofit, not enough will happen. As a for profit, too much will happen. So we need this sort of strange intermediate."

Part of that "strange intermediate" was capping returns at 100x for early investors (the cap has gotten lower for later investors). On the one hand, 100x doesn't seem like too bad a return. On the other hand, AGI (assuming, you know, we live) probably returns a hell of a lot more than 100x.

Which is why so many other companies are racing at it with far less caution and consideration (and frankly, far more money). In that environment, even with the lead OpenAI has, can this vision of Medium Capitalism win?

What Else to Pay Attention To

• In text-to-video land, Runway released its Gen-1 iOS app

• Outlets are reporting that Apple is building an AI powered health app

• AI discovered a planet?

• This is pretty awesome 👇

What We Talked About Today

Grimes is going in on the AI music collab idea man. It's all happening.gif

Thanks for reading! If you want more AI Breakdown:

The AI Breakdown podcast - https://pod.link/1680633614

The AI Breakdown YouTube - https://www.youtube.com/@theaibreakdown

Signing off from the future’s past - NLW