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  • OpenAI Says It Will Stay Under Nonprofit Control

    OpenAI Says It Will Stay Under Nonprofit Control


    Months after publicly stating its intention to shake up its corporate structure, OpenAI has reversed course and decided that its nonprofit arm will keep controlling its for-profit business.

    According to an OpenAI blog post published Monday, the company’s board of directors decided that OpenAI will continue to rely on the oversight and control of its nonprofit division moving forward.

    “OpenAI was founded as a nonprofit, and is today overseen and controlled by that nonprofit,” OpenAI board chairman Bret Taylor wrote in the blog post. “Going forward, it will continue to be overseen and controlled by that nonprofit.”

    The company’s for-profit LLC, which has lived under the nonprofit since 2019 and will continue doing so, will become a public benefit corporation (PBC). A PBC is a for-profit business that must consider the public good in addition to profit in its decisions. The nonprofit division of OpenAI will control and be the biggest shareholder in the PBC.

    “Our mission remains the same,” Taylor noted. OpenAI’s mission is “to ensure that artificial general intelligence benefits all of humanity.”

    Related: Everyone Wants to Buy Google’s Chrome Browser — Including OpenAI, According to a Top ChatGPT Executive

    In December, OpenAI publicly indicated in a blog post that it was thinking about making its for-profit section a PBC, but one that had complete control over OpenAI’s operations and business. The non-profit side would not oversee the for-profit, but would instead be in charge of charitable initiatives.

    Taylor wrote on Monday that OpenAI chose to reverse course and have the nonprofit retain control over the for-profit business after talking to civic leaders and with the offices of the Attorney General of Delaware and the Attorney General of California.

    More than 30 civic leaders, former OpenAI staffers, and Nobel laureates delivered letters to the offices of the attorneys general last month to ask that they stop OpenAI’s effort to break from its non-profit governance.

    OpenAI CEO Sam Altman. Photographer: Nathan Laine/Bloomberg via Getty Images

    OpenAI has recently been embroiled in a legal battle with Elon Musk, who helped co-found the company and left in early 2018 following a failed bid to take it over. Musk has since filed lawsuits against OpenAI and its CEO, Sam Altman, accusing them of breaking OpenAI’s founding agreement and working to maximize profits for Microsoft instead of humanity as a whole. Microsoft has invested close to $14 billion in OpenAI.

    Musk even led an unsolicited offer to buy OpenAI for $97.4 billion in February, which Altman quickly shot down on X. As of press time, Musk had yet to comment.

    Related: OpenAI Is Creating AI to Do ‘All the Things That Software Engineers Hate to Do’

    OpenAI started as a nonprofit in 2015 and transitioned to a “capped profit” company in 2019, meaning that the company’s profits were limited to a certain amount, with excess profits given to the nonprofit parent organization. The for-profit arm raised $1 billion from Microsoft in 2019, alongside a $100 million initial fundraising round.

    In November 2022, OpenAI launched its AI chatbot ChatGPT, which was used by 500 million global weekly users as of March, up from 400 million in February.

    OpenAI closed a $40 billion funding round in March, the biggest private tech deal ever, which valued the company at $300 billion.



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  • Starbucks Adding New Staff, Says Machines Alone Won’t Cut It

    Starbucks Adding New Staff, Says Machines Alone Won’t Cut It


    Starbucks has found that removing human labor in favor of machines doesn’t work for the company — so now the coffee chain is hiring old-fashioned human baristas at thousands of stores.

    Starbucks CEO Brian Niccol stated in a call with investors earlier this week that the company’s effort to reduce headcount over the past few years and replace humans with machines had backfired: Advanced machinery proved to be an inadequate substitute for human labor.

    “Over the last couple of years, we’ve actually been removing labor from the stores, I think with the hope that equipment could offset the removal of the labor,” Niccol said on the call, per The Guardian. “What we’re finding is that wasn’t an accurate assumption with what played out.”

    By the time Niccol joined Starbucks in September 2024, the company had been testing out human staff increases at just a handful of locations. Niccol broadened the effort this year to include 3,000 locations of the coffee chain’s 40,000 stores globally.

    Related: ‘We’re Not Effective’: Starbucks CEO Tells Corporate Employees to ‘Own Whether or Not This Place Grows’

    Niccol stated that new technology alone doesn’t cut it. Starbucks needed to adequately staff stores and allow employees access to new equipment to deliver a better customer experience.

    “Equipment doesn’t solve the customer experience that we need to provide, but rather staffing the stores and deploying with this technology behind it does,” Niccol said on the call.

    Niccol noted that increasing staff would entail higher costs but asserted that “some growth” for the company would accompany the move.

    Starbucks CEO Brian Niccol. Photo by Kevin Sullivan/Digital First Media/Orange County Register via Getty Images

    The move to hire new baristas is part of Niccol’s plan to turn Starbucks around after five consecutive quarters of declining sales. Starbucks reported on Tuesday that same-store sales dropped 1% in the first quarter of 2025, falling short of Wall Street expectations.

    Related: It’s Pay-to-Stay at Starbucks As the Coffeehouse Reverses Its Open Door Policy

    Niccol reassured investors on the call that though the financial results proved “disappointing,” Starbucks was “really showing a lot of signs of progress” internally. For example, the average time to deliver in-store orders had declined by an average of two minutes during the quarter, he said.

    Niccol’s plan to turn around Starbucks includes limiting the number of items customers can order through mobile, adding ceramic mugs for in-store orders, cutting 30% of the menu, writing customers’ names down with Sharpies on their cups, and asking baristas to make orders in under four minutes. Starting May 12, Starbucks will also require baristas to dress uniformly in a solid black top and khaki, black, or blue denim bottoms.

    Starbucks operates 16,941 stores in the U.S. and has 211,000 U.S. employees. The company’s stock was down about 11% year-to-date at the time of writing.



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