Connect with us

Published

on

He was a tech whizz before he left primary school, dropped out of one of America’s top universities, and appeared to be spearheading a revolution that could change our lives forever.

Sam Altman would have been unknown to most outside tech circles before the launch of his firm’s breakthrough chatbot ChatGPT, but he has recently much of his time rubbing shoulders with world leaders and some of America’s most recognisable executives.

But in a surprise announcement on Friday, OpenAI – the firm behind ChatGPT – revealed Altman had been ousted as its chief executive after the board said it no longer had confidence in him.

Here, Sky News looks at the 38-year-old’s rise to fame – before his sudden axing.

Earlier life

Altman grew up in the US state of Missouri where, as an eight-year-old, he was gifted his first computer and quickly learnt not just how to use it, but to program for it.

Altman attended John Burroughs School in St Louis, and told The New Yorker in a 2016 interview that having his computer helped him come to terms with his sexuality and come out to his parents when he was a teenager.

More on Artificial Intelligence

“Growing up gay in the Midwest in the 2000s was not the most awesome thing,” he recalled. “And finding AOL chatrooms was transformative. Secrets are bad when you are 11 or 12.”

With school in the rear-view mirror, it was time for university – Stanford, no less. Altman made his way to that famous California institution to study computer science, but dropped out after just two years, following in the footsteps of previous dropouts-turned-tech superstars Bill Gates and Mark Zuckerberg, who both abandoned their Harvard degrees before becoming two of history’s most influential CEOs.

Abandoning a precious spot at one of America’s top universities seemed such a rite of passage for the country’s leading tech entrepreneurs that it played right into the success story of the now disgraced Elizabeth Holmes, whose departure from Stanford to gatecrash Silicon Valley led to a wave of media attention not dissimilar to that currently given to Altman.

His first post-university venture was a smartphone app called Loopt, which let users selectively share their real-time location with other people. Some $30m (£24m) was raised to launch the company, aided by funding from a start-up accelerator firm called Y Combinator, which lists the likes of Airbnb and Twitch among the internet companies it has helped establish.

Altman became president of Y Combinator itself in 2014, after the sale of Loopt for $44m (£35m) in 2012. He also founded his own venture capital fund called Hydrazine Capital, attracting enough investment to be named on the Forbes 30 Under 30 list for venture capital. As if he wasn’t busy enough, Altman also ran Reddit for a grand total of eight days amid a leadership shake-up in 2014, describing his tenure as “sort of fun”.

The rise of OpenAI

While his time at the top of Reddit only lasted eight days, his oversight of OpenAI has lasted eight years. He was “doing pretty well” with it, he said in a February tweet (certainly compared to Loopt, which, he now says, “sucked”).

He launched the company with a certain Elon Musk (who only ran SpaceX and Tesla at the time) in 2015, the two men providing funding alongside the likes of Amazon and Microsoft, totalling $1bn (£800m).

It was run as a non-profit with the noble goal of developing AI while making sure it doesn’t wipe out humanity.

So far, mission accomplished – but if Altman’s to be believed, the risk since has become very real indeed.

Under his tenure, OpenAI ceased to be a non-profit and grew to an estimated value of up to $29bn (£23bn), all thanks to the remarkable success of its generative AI tools – ChatGPT for text and DALL-E for images.

Microsoft boss Satya Nadella described Altman as an “unbelievable entrepreneur” who bets big and bets right, which OpenAI’s success makes hard to argue with.

ChatGPT amassed tens of millions of users within weeks of launching in late 2022, wowing experts and casual observers alike with its ability to pass the world’s toughest exams, get through job applications, compose anything from political speeches to children’s homework, and write its own computer code.

Suddenly the concept of a large language model (meaning it is trained on huge amounts of text data so that it can understand our requests and respond accordingly) became something of a mainstream buzz term, its popularity seeing Microsoft invest extra cash into OpenAI and bring the tech to its Bing search engine and Office apps.

Google also got in on the act with its Bard chatbot, some of China’s biggest tech companies entered the race, while Musk – who left OpenAI in 2018 due to a conflict of interest with Tesla’s work on self-driving AI – has said he wants to launch his own one too.

All the while, OpenAI’s technology is also improving – an upgrade dubbed GPT-4 within months of ChatGPT’s release showing just how quickly these models can develop.

Read more:
We asked a chatbot to help write an article

Please use Chrome browser for a more accessible video player

Will this chatbot replace humans?

‘My worst fears’

For all the wonder such systems have provided, it’s matched – if not surpassed – by the concerns. Whether it be spreading disinformation or making jobs redundant, governments are scrambling to formulate an effective way of regulating a technology that seems destined to change the world forever.

Perhaps with an eye on how some of his Silicon Valley contemporaries have failed to act on the dangers of their creations before it’s too late, Altman appears keen to be a willing participant in just how it should be done.

“My worst fears are that we, the industry, cause significant harm to the world,” Altman told the US Senate, his assessment that government regulation would be “critical to mitigate the risks” undoubtedly music to the ears of politicians who never seem overly impressed by figures from the tech world.

Read more:
Who is the ‘godfather of AI’?

Please use Chrome browser for a more accessible video player

AI speech used to open Congress hearing

In the space of a few short weeks, Altman met the US vice president, Kamala Harris, France’s Emmanuel Macron, European Commission president Ursula von der Leyen and the British prime minister, Rishi Sunak – all politicians who share the same hopes and fears about the potential benefits and dangers of AI.

With the EU seemingly none too impressed by Elon Musk’s running of Twitter, TikTok managing to achieve the mostly impossible task of uniting Democrats and Republicans against a common enemy, and Mark Zuckerberg having struggled to repair his reputation after the Cambridge Analytica scandal, the upstart Altman could be positioning himself to become a more durable tech star than some of his forebears.

Prime Minister Rishi Sunak met the CEOs of OpenAI, Google DeepMind, and Anthropic
Image:
Sam Altman meets with PM Rishi Sunak in May 2023

But just in case it does all go wrong, he’s previously admitted to being a prepper – someone who stockpiles everything from guns to medicine should the worst should befall us.

Announcing Altman’s departure as OpenAI chief executive on, the company said a review found he had not been “consistently candid in his communications with the board”.

He posted on social media following the announcement, writing: “I loved my time at OpenAI.

“It was transformative for me personally, and hopefully the world a little bit.

“Most of all, I loved working with such talented people. (I) will have more to say about what’s next later.”

Continue Reading

Business

Chair candidates battle to check in at Premier Inn-owner Whitbread

Published

on

By

Chair candidates battle to check in at Premier Inn-owner Whitbread

Two chairs of FTSE-100 companies are vying to succeed Adam Crozier at the top of Whitbread, the London-listed group behind the Premier Inn hotel chain.

Sky News has learnt that Christine Hodgson, who chairs water company Severn Trent, and Andrew Martin, chair of the testing and inspection group Intertek, are the leading contenders for the Whitbread job.

Mr Crozier, who has chaired the leisure group since 2018, is expected to step down later this year.

The search, which has been taking place for several months, is expected to conclude in the coming weeks, according to one City source.

Ms Hodgson has some experience of the leisure industry, having served on the board of Ladbrokes Coral Group until 2017, while Mr Martin was a senior executive at the contract caterer Compass Group and finance chief at the travel agent First Choice Holidays.

Under Mr Crozier’s stewardship, Whitbread has been radically reshaped, selling its Costa Coffee subsidiary to The Coca-Cola Company in 2019 for nearly £4bn.

The company has also seen off an activist campaign spearheaded by Elliott Advisers, while Mr Crozier orchestrated the appointment of Dominic Paul, its chief executive, following Alison Brittain’s retirement.

More from Money

It said last year that it sees potential to grow the network from 86,000 UK bedrooms to 125,000 over the next decade or so.

Mr Crozier is one of Britain’s most seasoned boardroom figures, and now chairs BT Group and Kantar, the market research and data business backed by Bain Capital and WPP Group.

He previously ran the Football Association, ITV and – in between – Royal Mail Group.

On Friday, shares in Whitbread closed at £25.41, giving the company a market capitalisation of about £4.5bn.

Whitbread declined to comment this weekend.

Continue Reading

Business

Bank chiefs to Reeves: Ditch ring-fencing to boost UK economy

Published

on

By

Bank chiefs to Reeves: Ditch ring-fencing to boost UK economy

The bosses of four of Britain’s biggest banks are secretly urging the chancellor to ditch the most significant regulatory change imposed after the 2008 financial crisis, warning her its continued imposition is inhibiting UK economic growth.

Sky News has obtained an explosive letter sent this week by the chief executives of HSBC Holdings, Lloyds Banking Group, NatWest Group and Santander UK in which they argue that bank ring-fencing “is not only a drag on banks’ ability to support business and the economy, but is now redundant”.

The CEOs’ letter represents an unprecedented intervention by most of the UK’s major lenders to abolish a reform which cost them billions of pounds to implement and which was designed to make the banking system safer by separating groups’ high street retail operations from their riskier wholesale and investment banking activities.

Their request to Rachel Reeves, the chancellor, to abandon ring-fencing 15 years after it was conceived will be seen as a direct challenge to the government to take drastic action to support the economy during a period when it is forcing economic regulators to scrap red tape.

It will, however, ignite controversy among those who believe that ditching the UK’s most radical post-crisis reform risks exacerbating the consequences of any future banking industry meltdown.

In their letter to the chancellor, the quartet of bank chiefs told Ms Reeves that: “With global economic headwinds, it is crucial that, in support of its Industrial Strategy, the government’s Financial Services Growth and Competitiveness Strategy removes unnecessary constraints on the ability of UK banks to support businesses across the economy and sends the clearest possible signal to investors in the UK of your commitment to reform.

“While we welcomed the recent technical adjustments to the ring-fencing regime, we believe it is now imperative to go further.

More on Electoral Dysfunction

“Removing the ring-fencing regime is, we believe, among the most significant steps the government could take to ensure the prudential framework maximises the banking sector’s ability to support UK businesses and promote economic growth.”

Work on the letter is said to have been led by HSBC, whose new chief executive, Georges Elhedery, is among the signatories.

His counterparts at Lloyds, Charlie Nunn; NatWest’s Paul Thwaite; and Mike Regnier, who runs Santander UK, also signed it.

While Mr Thwaite in particular has been public in questioning the continued need for ring-fencing, the letter – sent on Tuesday – is the first time that such a collective argument has been put so forcefully.

The only notable absentee from the signatories is CS Venkatakrishnan, the Barclays chief executive, although he has publicly said in the past that ring-fencing is not a major financial headache for his bank.

Other industry executives have expressed scepticism about that stance given that ring-fencing’s origination was largely viewed as being an attempt to solve the conundrum posed by Barclays’ vast investment banking operations.

The introduction of ring-fencing forced UK-based lenders with a deposit base of at least £25bn to segregate their retail and investment banking arms, supposedly making them easier to manage in the event that one part of the business faced insolvency.

Banks spent billions of pounds designing and setting up their ring-fenced entities, with separate boards of directors appointed to each division.

More recently, the Treasury has moved to increase the deposit threshold from £25bn to £35bn, amid pressure from a number of faster-growing banks.

Sam Woods, the current chief executive of the main banking regulator, the Prudential Regulation Authority, was involved in formulating proposals published by the Sir John Vickers-led Independent Commission on Banking in 2011.

Legislation to establish ring-fencing was passed in the Financial Services Reform (Banking) Act 2013, and the regime came into effect in 2019.

In addition to ring-fencing, banks were forced to substantially increase the amount and quality of capital they held as a risk buffer, while they were also instructed to create so-called ‘living wills’ in the event that they ran into financial trouble.

The chancellor has repeatedly spoken of the need to regulate for growth rather than risk – a phrase the four banks hope will now persuade her to abandon ring-fencing.

Britain is the only major economy to have adopted such an approach to regulating its banking industry – a fact which the four bank chiefs say is now undermining UK competitiveness.

“Ring-fencing imposes significant and often overlooked costs on businesses, including SMEs, by exposing them to banking constraints not experienced by their international competitors, making it harder for them to scale and compete,” the letter said.

“Lending decisions and pricing are distorted as the considerable liquidity trapped inside the ring-fence can only be used for limited purposes.

“Corporate customers whose financial needs become more complex as they grow larger, more sophisticated, or engage in international trade, are adversely affected given the limits on services ring-fenced banks can provide.

“Removing ring-fencing would eliminate these cliff-edge effects and allow firms to obtain the full suite of products and services from a single bank, reducing administrative costs”.

In recent months, doubts have resurfaced about the commitment of Spanish banking giant Santander to its UK operations amid complaints about the costs of regulation and supervision.

The UK’s fifth-largest high street lender held tentative conversations about a sale to either Barclays or NatWest, although they did not progress to a formal stage.

HSBC, meanwhile, is particularly restless about the impact of ring-fencing on its business, given its sprawling international footprint.

“There has been a material decline in UK wholesale banking since ring-fencing was introduced, to the detriment of British businesses and the perception of the UK as an internationally orientated economy with a global financial centre,” the letter said.

“The regime causes capital inefficiencies and traps liquidity, preventing it from being deployed efficiently across Group entities.”

The four bosses called on Ms Reeves to use this summer’s Mansion House dinner – the City’s annual set-piece event – to deliver “a clear statement of intent…to abolish ring-fencing during this Parliament”.

Doing so, they argued, would “demonstrate the government’s determination to do what it takes to promote growth and send the strongest possible signal to investors of your commitment to the City and to strengthen the UK’s position as a leading international financial centre”.

Continue Reading

Business

Post Office to unveil £1.75bn banking deal with big British lenders

Published

on

By

Post Office to unveil £1.75bn banking deal with big British lenders

The Post Office will next week unveil a £1.75bn deal with dozens of banks which will allow their customers to continue using Britain’s biggest retail network.

Sky News has learnt the next Post Office banking framework will be launched next Wednesday, with an agreement that will deliver an additional £500m to the government-owned company.

Banking industry sources said on Friday the deal would be worth roughly £350m annually to the Post Office – an uplift from the existing £250m-a-year deal, which expires at the end of the year.

Money latest: ’14 million Britons on course for parking fine this year’

The sources added that in return for the additional payments, the Post Office would make a range of commitments to improving the service it provides to banks’ customers who use its branches.

Banks which participate in the arrangements include Barclays, HSBC, Lloyds Banking Group, NatWest Group and Santander UK.

Under the Banking Framework Agreement, the 30 banks and mutuals’ customers can access the Post Office’s 11,500 branches for a range of services, including depositing and withdrawing cash.

More on Post Office Scandal

The service is particularly valuable to those who still rely on physical cash after a decade in which well over 6,000 bank branches have been closed across Britain.

In 2023, more than £10bn worth of cash was withdrawn over the counter and £29bn in cash was deposited over the counter, the Post Office said last year.

Read more from Sky News:
Water regulation slammed by spending watchdog
Rate cut speculation lights up as economic outlook darkens

A new, longer-term deal with the banks comes at a critical time for the Post Office, which is trying to secure government funding to bolster the pay of thousands of sub-postmasters.

Reliant on an annual government subsidy, the reputation of the network’s previous management team was left in tatters by the Horizon IT scandal and the wrongful conviction of hundreds of sub-postmasters.

A Post Office spokesperson declined to comment ahead of next week’s announcement.

Continue Reading

Trending