After being ousted from the company he co-founded, then hired by Microsoft, and now back as the chief of OpenAI, Sam Altman finds himself in another tight spot. The ongoing clash with Elon Musk took a new twist when Musk and a group of investors announced a $97 billion bid to acquire OpenAI.
In response, Altman fired off a tweet: “No thank you, but we will buy Twitter for $9.74 billion if you want.” This isn’t the first legal spat between Musk and OpenAI. Last year, he accused OpenAI’s CEO, Greg Brockman, of breaching their founding agreement. OpenAI started as a non-profit but shifted to a for-profit model to fund its computing needs.
OpenAI scored a huge boost when Microsoft backed it with $10 billion, providing access to their cloud for running large language models like ChatGPT. Recently, the Trump administration introduced Project Stargate, backed by companies including Oracle, which aims to funnel $500 billion into AI infrastructure for OpenAI over the next four years.
In a blog post, Altman emphasized his commitment to Microsoft, stating they plan to maintain their partnership long-term. However, OpenAI’s lead in the language model space is now threatened by the launch of China’s DeepSeek AI model, which offers a much lower price point.
While legislators are concerned about user data being potentially shared with China, DeepSeek’s models are open source, allowing them to run on various public cloud platforms. Costs for running these models depend on the required graphics processing unit. The cheapest route is through APIs with DeepSeek’s cloud version of its model.
OpenAI charges $2.50 per million input tokens for GPT-4o, while the API connection to DeepSeek costs just $0.14 per million tokens if the AI can use cached information, and $0.55 for non-cached inputs. The emergence of a more affordable alternative has rattled some investors. Nvidia’s stock took a hit following DeepSeek’s announcement, and Musk’s bid for OpenAI might be a strategic move amidst market confusion, showcasing that AI can be done differently.
Musk’s own x.AI venture recently wrapped up a $6 billion Series C funding round, yet he’s now aiming to acquire OpenAI. If he succeeds, Musk could become a key player in the U.S. AI landscape and the Stargate initiative.