February 20, 2024

Sam Altman returns to OpenAI, Apple adopts RCS and Binance CEO pleads guilty to charges

Hey folks, welcome to Week in Review (WiR), TechCrunch’s regular recap of the past few days in tech. The headlines were dominated — even overwhelmed — by the drama unfolding at AI startup OpenAI, but a lot more happened in the half-week leading up to Thanksgiving. So much for a sleepy pre-holiday!

In this edition of WiR, in addition to the OpenAI saga, we cover Apple finally bringing RCS to iPhones, a former Silicon Valley VC darling being convicted of investor fraud, Cruise co-founder Kyle Vogt resigning, and Amazon sells cars online. Also on the agenda are Elon Musk’s lawsuit over claims of hateful ads on Twitter, Google’s secret deal with Spotify, Binance’s CEO pleading guilty to federal charges, and Signal detailing the costs of keeping people online from its private messaging service.

It’s a lot to accomplish, so we won’t procrastinate. But first, a reminder to sign up here to receive WiR in your inbox every Saturday if you haven’t already.

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Sam Altman returns to OpenAI: After a rollercoaster of a weekend and change, Sam Altman, who was CEO of OpenAI as of Friday morning, is CEO again. The board of directors that fired him ultimately came to the realization that firing him might not have been the best course of action – after enormous pressure from OpenAI’s backers, venture capital firms, close partner Microsoft and one of their own. Check out our timeline of events for an overview of how it all went down.

Apple (finally) embraces RCS: Apple plans to add support for the RCS standard on iOS next year, the iPhone maker said last Thursday in a reversal that would solve the widespread problem of SMS compatibility between iPhones and Android smartphones. But as Manish reports, the company has failed to eliminate fears of the ‘green bubble’; messages from Android phones still appear as green bubbles on iOS.

Conviction for fraud: Mike Rothenberg, an ex-VC known for organizing lavish parties, was convicted last Friday in late October on 21 counts of defrauding investors. The verdict, handed down by a Northern California jury, marks a decade-long journey for Rothenberg, who burst onto the Bay Area scene in 2013 at age 27 with a $5 million fund and enough charm to convince TechCrunch that his one-man business was a success. special enough to deserve coverage.

Vogt leaves Cruise: Kyle Vogt, the serial entrepreneur who co-founded and led Cruise from a garage startup through its acquisition and ownership by General Motors, resigned this past week, as did Cruise director and co-founder Dan Kan. The uproar comes less than a month after the California Department of Motor Vehicles suspended Cruise’s licenses to operate self-driving vehicles on public roads following an accident in which a pedestrian was run over and dragged 20 feet by the AV.

Lawsuit over X advertisements: Media Matters published an article last Thursday with screenshots showing ads from IBM, Apple, Oracle and others alongside hateful content on Elon Musk’s X, formerly Twitter. Musk has filed a lawsuit alleging defamation by the news organization. But the lawsuit appears to confirm what the lawsuit says is defamatory, Devin reports.

Google’s secret Spotify deal: A Google executive said during testimony in the Epic vs. Google trial that a deal with Spotify will allow the audio company to avoid Play Store fees, as first reported by The Verge. Don Harrison, head of Google’s partnership, said Spotify pays no fees when it processes its own payments and a paltry 4% fee when Google processes them — and that both companies have committed to putting $50 million each into a “success fund.” fuses.

Binance CEO faces federal charges: Changpeng Zhao, aka “CZ,” the founder and CEO of Binance, is stepping down and has pleaded guilty to a number of charges brought through the Department of Justice and other US agencies. The world’s largest cryptocurrency exchange, Binance, has agreed to pay about $4.3 billion to resolve the DOJ’s investigations, the agency said in a news release late Tuesday.

The price of privacy: End-to-end encrypted messaging app Signal has provided an interesting breakdown of the costs required to develop and maintain its pro-privacy systems that protect user data from tracking by default. The blog post, written by Signal president Meredith Whittaker and developer Joshua Lund, reveals that the company currently spends about $14 million per year on infrastructure to run the private messaging service and another $19 million per year on employee costs. That’s a total of $33 million to keep the lights on.

Audio

With Thanksgiving happening this week, you may be in need of podcasts to drown out the sound of family arguments and sportsball games. (I know I am.) Luckily, TechCrunch has plenty to choose from.

Equity has published two – count them, two – episodes this week. The first recap captures OpenAI’s wild weekend, from Sam Altman’s firing to its final activity (as of November 20). The second – with former Equity presenter Matthew Lynley, Alex and yours truly – looks at what the latest OpenAI twists can mean for startup founders.

In the meantime, Found it had Studs co-founders and close friends Lisa Bubbers and Anna Harman talk about their ear-piercing company, which aims to help Gen Zers and millennials create their “dream havens” with piercing studios opening across the country.

TechCrunch+

TC+ subscribers get access to in-depth commentary, analysis, and surveys — all of which you’ll know if you’re already a subscriber. If you’re not, please consider signing up. Here are a few highlights from this week:

Note what happened to OpenAI’s board: Dominic-Madori takes a critical look at the unusual structure of OpenAI’s board, which was technically part of a non-profit organization with control over OpenAI’s for-profit division. In her words: “If this corporate structure is hurting you, you are not alone.”

Who would have thought that the mighty people would win the AI ​​battle? One way to think about the OpenAI furor of the past few days is that a nonprofit board with a specific mission felt like one of the company’s leaders wasn’t working toward those goals. So they canned it. Another way to think about it, Alex colorfully writes, is that “a bunch of yahoos who had no idea what they were doing made a power play against the real value engine of their company, and got fired in response.”

OpenAI and the dangers of vendor lock-in: The companies that opted for a flexible approach instead of depending on one AI model supplier should be feeling pretty good after all the OpenAI drama, Ron writes. If there’s one objective lesson to be learned from all this, he says, it’s that it’s never a good idea to deal with a single supplier.

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