Musk vs. Altman Goes to Trial, and AI Still Can’t Find the Profit Button

Elon Musk and Sam Altman are about to have a very public, very expensive legal fight. This week, a court will decide whether OpenAI can proceed with its for-profit transformation ahead of its IPO. Musk, who co-founded the company and then left in a huff, is asking for $134 billion in damages, the removal of Altman and president Greg Brockman, and a forced return to non-profit status.

His argument? He claims he was tricked into funding OpenAI under the guise of a charitable mission, only to watch it turn into a money-making machine. Whether or not you buy that, the outcome could reshape the entire AI landscape. If the court rules against OpenAI, it could throw the company’s IPO plans into chaos and send shockwaves through the industry. If Musk loses, well, he’ll probably just tweet about it for a few weeks and move on.

Meanwhile, the AI industry is grappling with a much more mundane but equally existential problem: how to actually make money. Will Douglas Heaven nails it with a South Park analogy—Phase 1: Build the tech. Phase 2: ? Phase 3: Profit. Right now, everyone is stuck on Phase 2. Companies have poured billions into models and infrastructure, but the business models remain fuzzy. Is it enterprise subscriptions? API usage fees? Selling shovels to gold miners? Nobody has a clear answer yet, and that’s a problem when investors start asking for returns.

On a darker note, the era of weaponized deepfakes has arrived. Eileen Guo reports that cheap, accessible models are now producing realistic fake images and videos used for sexual exploitation, political propaganda, and incitement to violence. Women and marginalized groups are bearing the brunt, but the broader impact is a slow erosion of trust and critical thinking. Experts are alarmed, and they should be. We’ve been warned about this for years, and now it’s happening.

A few other things caught my eye today. OpenAI ended its exclusive partnership with Microsoft, opening the door to rivals like Amazon. Microsoft will still license the tech, but the exclusivity is gone. OpenAI is also reportedly missing key growth targets ahead of its IPO, which doesn’t inspire confidence. Google signed a classified AI deal with the Pentagon, allowing AI use for “any lawful government purpose.” Over 600 Google workers had called for a block on the deal, but the company went ahead anyway. AI firms are now training military versions of their models on classified data, which is exactly as unsettling as it sounds.

That’s the state of play. Courtrooms, boardrooms, and battlefields—AI is everywhere, and nobody really knows what comes next.