Meta Opposes OpenAI’s Shift to Commercial Entity

Following Elon Musk’s lead, Meta has urged California’s Attorney General Rob Bonta to block OpenAI’s transformation into a commercial entity. This was reported by The Wall Street Journal, citing a letter.

Mark Zuckerberg’s firm argues that allowing the ChatGPT developer to restructure as a business entity would set a precedent enabling startups to exploit the benefits of non-profit status until they become profitable.

“OpenAI’s actions could have seismic consequences for Silicon Valley. If OpenAI’s new business model proves successful, non-profit investors will gain the same advantages as those investing in commercial companies in the usual way, while also benefiting from tax write-offs provided by the government,” Meta emphasized.

Earlier, Musk called on a federal court to halt OpenAI’s transition to a fully commercial business. Prior to this, he filed a lawsuit against Sam Altman’s startup, accusing it of breaching the company’s founding agreement by prioritizing commercial interests over public good.

On December 13, OpenAI responded to Musk’s accusations by publishing a series of emails and texts. According to the documents, the billionaire himself proposed in 2015 that OpenAI register as a non-profit with a commercial component.

Later, the company faced financial difficulties. In 2017, Musk suggested that OpenAI merge with another startup. Several executives agreed. At that time, the entrepreneur demanded a controlling stake—between 50% and 60%. He also proposed an organizational structure where he would “unequivocally have initial control over the company” and become CEO.

The management rejected the idea, after which Musk proposed merging OpenAI with Tesla. This initiative was also declined.

In 2018, he left OpenAI, after which the startup several times offered the entrepreneur a stake in the commercial part of the company. The billionaire always refused.

In October 2024, OpenAI raised $6.6 billion at a valuation of $157 billion. During negotiations with investors, the ChatGPT developer discouraged them from supporting competing firms like Anthropic or xAI.