'Close eye' will be kept on OpenAI's for-profit conversion, says attorney general

OpenAI has completed its transition to a for-profit company, after court battles and public criticism from one of its founders, Elon Musk.

The company's for-profit arm will become a public benefit corporation - a company type that must consider both the mission and shareholder interests. But the non-profit arm will retain control over it to make sure OpenAI sticks to its mission of developing artificial intelligence to the "benefit of all humanity".

The restructuring will make it easier for OpenAI to profit from its AI, which the company says will help it to realise its goal of developing artificial general intelligence (AGI). AGI would mean AI can perform any intellectual task that a human can.

It is often seen as the holy grail for AI companies. In a call on Tuesday, OpenAI's chief executive Sam Altman said "the most likely path" for the newly formed business is that it becomes publicly traded on the stock market, "given the capital needs that we'll have and sort of the size of the company".

The company also announced that Microsoft, a long-time backer of OpenAI, will now hold a roughly 27% stake in its new for-profit corporation, a slightly bigger share than OpenAI's own nonprofit. "We will be keeping a close eye on OpenAI to ensure ongoing adherence to its charitable mission and the protection of the safety of all Californians," said California Attorney General Rob Bonta.

Read more technology news:Over 1.2 million people a week talk to ChatGPT about suicideUncertainty for UK workers as Amazon to cut 14,000 jobs globallyNHS to offer same-day AI prostate cancer diagnosis OpenAI said it completed its restructuring "after nearly a year of engaging in constructive dialogue" with the offices in both states. "OpenAI has completed its recapitalization, simplifying its corporate structure," said a blog post Tuesday from Bret Taylor, the chair of OpenAI's board of directors.

"The nonprofit remains in control of the for-profit, and now has a direct path to major resources before AGI arrives." Read more:Musk v Altman: The battle to become king of AI When OpenAI initially suggested restructuring, Mr Musk asked a judge to block this from happening. He launched a legal case against the company in 2024, accusing it of a breach of contract.

Mr Musk accused the ChatGPT developer of transforming into "a closed-source de facto subsidiary of the largest technology company, Microsoft.