Satya Nadella says the attempt to remove Sam Altman from OpenAI was ‘amateur city’
Microsoft chief explains his decision to back AI lab’s boss in 2023 coup attempt during testimony in Elon Musk’s lawsuit
Microsoft chief executive Satya Nadella said the OpenAI board’s abortive attempt to oust Sam Altman in 2023 was “amateur city” as he took the stand in the high-stakes legal battle between the AI lab and Elon Musk.
Nadella told the jury on Monday he never received “a specific answer” about why the board fired Altman, citing concerns about dishonesty, before reinstating him days later.
The episode has cast a shadow over Altman’s reputation — something Musk has exploited, branding him “Swindly Sam” as he pursued the case arguing OpenAI betrayed its charitable mission.
OpenAI’s board said at the time that Altman was removed because he was “not consistently candid”, something Nadella agreed would be grounds to fire a CEO.
But, questioned by Musk’s lawyers about why he supported Altman, Nadella said: “Whenever I asked specifically why Sam was fired, [the board] never gave me a specific answer.”
“It was amateur city as far as I’m concerned,” he said.
Microsoft’s CEO was testifying in a case Musk brought in which the $3tn software giant — OpenAI’s largest investor — is accused of “aiding and abetting” the AI lab and Altman in selling out its non-profit mission to become a for-profit business.
Victory for Musk, who made early financial contributions to OpenAI as a non-profit, could upend the $852bn start-up’s plans to go public this year.
Nadella’s testimony, and internal messages presented in court, also betray his concerns about the software group’s strategic position as OpenAI’s popularity grew.
Ahead of a $10bn investment in OpenAI, Nadella emailed Microsoft executives in 2022 “to figure out how to continue the partnership in a more aligned way”.
“I don’t want to be IBM and OpenAI to be Microsoft,” he wrote.
IBM struck a deal in the 1980s for a fledgling Microsoft to build an operating system for its personal computers that ultimately led the software group eclipsing the computer maker.
Asked what he meant by the email, Nadella said he wanted to avoid “slipping into a situation . . . where Microsoft [did not have] its own self-sufficiency”.
A few months later, Nadella emailed Microsoft’s chief financial officer Amy Hood to flesh out the concerns: “Right now we are a very thin layer on top of Nvidia and all the IP is with OpenAI . . . if we are going to spend this kind of money and not have control of destiny, it makes no sense.”
Microsoft has since struck several deals with OpenAI to restructure their relationship and tried to increase its independence in AI.
The Big Tech company now owns about 27 per cent of OpenAI, valued at just over $200bn.
According to disclosures in the trial, in 2016 Microsoft was offering OpenAI heavily discounted cloud computing access. By 2018, with OpenAI’s computing bills increasing, “we were not comfortable thinking of it as a marketing expense”, Nadella said.
“This was one you started to think ‘enough of the charity, on with the business’?” asked Steven Molo, an attorney for Musk. “Yeah,” Nadella responded.
Microsoft invested $1bn in 2019, $2bn in 2021 and a further $10bn in 2023, helping to support OpenAI’s transition since 2015 from a small research lab into one of the most valuable for-profit companies in the world.
“[The investment] has worked out very, very, very well for Microsoft hasn’t it?” Molo asked Nadella on Monday. Microsoft’s CEO replied: “Because we were the only ones who took the risk.”