Meta Asks California AG to Block OpenAI’s For-Profit Shift  

• Meta backs Musk’s lawsuit against OpenAI’s for-profit conversion.  
• Meta warns of a “seismic effect” in Silicon Valley from OpenAI’s shift.  
• OpenAI counters Musk’s claims, asserting the for-profit model is aligned with its goals.  

Meta has formally requested that California Attorney General Rob Bonta intervene and block OpenAI’s move to restructure into a for-profit company. The social media giant has voiced significant concerns over the implications this shift could have on Silicon Valley and the broader tech industry. 

Meta, in its letter, expressed that allowing OpenAI to change its status would set a dangerous precedent, potentially allowing other startups to similarly shift from non-profit to for-profit status at will.

Meta, a major player in artificial intelligence, aligns itself with Elon Musk in opposing OpenAI’s transition. The company argues that such a ruling would create an unfair advantage, as non-profit investors would reap the same financial benefits as traditional for-profit investors, while still receiving tax breaks. 

Meta stresses that this could have long-lasting negative effects on Silicon Valley, calling the potential consequences a “seismic effect.”

In its letter, Meta backs Musk’s ongoing lawsuit, which seeks to prevent OpenAI from making the conversion. Musk, who co-founded OpenAI alongside current CEO Sam Altman, has argued that the company has strayed from its original non-profit mission. 

Musk had filed several lawsuits, claiming that OpenAI’s partnership with Microsoft and its move to a for-profit model contradicts the goals he set when he initially invested in the company.

Additionally, OpenAI has tried to defend its decision, claiming that it will still maintain a non-profit arm despite its restructuring. The company has reassured its investors that the new for-profit model will help drive the firm’s mission while also providing value to its stakeholders.

Meta’s intervention is significant, as the company has historically been a rival to Musk’s ventures. However, with the rise of AI, both companies share similar interests in shaping the future of the industry. Meta’s decision to back Musk against OpenAI’s conversion indicates a shared concern over how such a move could affect the broader landscape of AI development.