Majority of OpenAI employees threaten to quit as backlash against ouster of CEO continues

An unprecedented weekend of chaos atChatGPT maker OpenAIcontinued into Monday as the majority of the company's remaining employees say they're willing to quit unless the board resigns.

More than 500 employeeswho work at the Silicon Valley company, including chief technology officer Mira Murati and chief operating officer Brad Lightcap,have signed a letter demanding the company's board be reconstituted.

"Your actions have made it obvious that you are incapable of overseeing OpenAI," the employees who represent the majority of the company's 700-odd employees said in their letter. "We are unable to work for or with people that lack competence, judgment and care for our mission and employees."

The move comes after a small group of board members ousted CEO Sam Altmanfollowinga review that found he was "not consistently candid in his communications" with the board of directors, which caused them to loseconfidence in his ability to lead the company.

Ousted CEO hired by Microsoft

The move sent shockwaves across the technology industry, but Altman did not stay unemployed for very long.

On Monday morning, Microsoft announced it had hired Altman and another former OpenAI executive Greg Brockman to head up its own AI division.

Microsoft is the main financial backer of OpenAI, and the shakeup at the company came without the knowledge of Microsoft's chairman andCEO,Satya Nadella.

Nadella wrote on X, formerly known as Twitter, that he was committed to his company's partnership with OpenAI and that helooked "forward to getting to know" OpenAI's new chief executive, former Twitch leader Emmett Shear, and the rest of the management team.

"We're extremely excited to share the news that Sam Altman and Greg Brockman, together with colleagues, will be joining Microsoft to lead a new advanced AI research team," Nadella said.

In a reply on X, Altman said "the mission continues," while OpenAI co-founder and former president Brockman posted, "We are going to build something new & it will be incredible."

Altman helped catapult ChatGPT to global fame and in the past year has become Silicon Valley's sought-after voice on the promise and potential dangers of artificial intelligence.

While the drama is far from over, technology analysts already say the uncertainty has sent shockwavesthrough the technology sector.

"I don't think I've ever seen anything as eventful in my more than decade covering enterprise software aswhat we saw over this past weekend," saidRishi Jaluriaa managing director with RBC, who covers the sector, in an interview with CBC News.

Jaluriasaid the backlash against the move has been so acute that he would not be surprised to see Altman come back to the company in some form, but even that is no sure thing.

"I'd have to question at this point whether Sam and Greg want to, given everything," he said.

'A complete shock'

Even the reasons for the discord are shrouded in mystery. Unlike other companies in the AI space that are piling in to the hype, OpenAI was unique in that it was operating without an overt profit incentive.

That was a major advantage for the company in terms of recruitment, saysGillian Hadfield, a professor at the University of Toronto and theSchwartz Reisman Chair in Technology and Society. The company's mission statementof AI being "something that should be built for humanity and not for corporate profits that was actually the founding vision as part of what attracted a lot of people to working with OpenAI."

She says the likeliest source of tension would be a push and pull among members of the company who are eager to commercialize their innovation, and those wishing to adhere to the original vision.

"A nonprofit board is actually not interested in profits," she said. "They want to see a successful company, of course, but that makes me wonder [if] they were seeing conflict here between the mission of the board, which is not solely maximizing shareholder value."

WATCH | Altman's firing shocked Silicon Valley:

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After the board of pivotal artificial intelligence company OpenAI stunned Silicon Valley by firing its CEO Sam Altman, hundreds of employees threatened to leave en masse unless the board quits. Now, investors say they'll sue unless Altman is brought back to lead the company that developed ChatGPT.

Amr Awadallah, the CEO ofVectaraa technology company based in Palo Alto, Calif.,that works with OpenAI, says he was "flabbergasted" by the news of Altman's ouster.

"The company is on a trajectory that has never been witnessed in the history of Silicon Valley in terms of growth and accomplishments and innovation," he said. "A complete shock."

While he also says he has no inside knowledge of what happens, he agrees with the theory that it was likely tension between the non-profit side of things and the division trying to make a profit, which is a subsidiary of the parent company.

"It seems like Sam had made some decisions that he did not run by the board first to get their approval and that created a schism where they thought [he was]not enabling the board to do their job properly now towardthe mission of what OpenAI has agreed on.

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New CEO to hire investigator

Whatever the cause, instead of working toward its vision of a humanity aided by AI, the company is spending most of its time right now in damage control.

In an X post Monday, Shear, OpenAI's newly minted CEO, said he would hire an independent investigator to look into what led up to Altman's ouster and write a report within 30 days.

"It's clear that the process and communications around Sam's removal has been handled very badly, which has seriously damaged our trust," wrote Shear, who co-founded Twitch, an Amazon-owned livestreaming service popular with video gamers.

He said he also plans in the next month to "reform the management and leadership team in light of recent departures into an effective force" and speak with employees, investors and customers.

Akey driver of Friday's shakeup, OpenAI's co-founder, Russian-born Israeli-Canadian computer scientistIlya Sutskever, posted regrets aboutthe situation to X on Monday: "I deeply regret my participation in the board's actions. I never intended to harm OpenAI. I love everything we've built together and I will do everything I can to reunite the company."

Regardless of what happens, RBC's Jaluria says the saga is looking like a coup for Microsoft.

"This was a masterstroke by Satya in bringing them in house because either way it goes either it'sSam and Greg working for Microsoft inkind of a startup environment or they're back at OpenAI Microsoft has more of a say," he said.

"Either way, Microsoft wins."