Stability AI, an open source-generative AI company that provides simple AI tools for cutting-edge research, language, coding video, and design, seems to be facing an uncertain future. The company’s CEO, Emad Mostaque, resigned on March 24, citing concerns about the concentration of power in AI. He stated that he would be pursuing his interests in “decentralized AI” from now on.
Photo: David Paul Morris/ Bloomberg via Getty Images
Despite some critics seeing this move as an attempt to save his image from some of the company’s problems, Mostaque reiterated in a Twitter post that his shares of Stability have a majority vote and give him full board control. He seemed to be bothered about individuals holding this kind of power, or having a few companies dominate the industry.
Forbes has previously reported that Stability AI was on shaky ground after some of its top developers quit. Three of the five researchers behind Stable Diffusion have lately dropped out.
Stability AI has been successful in popularizing the stable diffusion method of AI, but it has faced lawsuits over the data that Stable Diffusion is allegedly trained on. Getty Images has filed a lawsuit in the UK, and the case is heading to trial soon. This could be a significant moment for the legislative framework surrounding generative AI products.
In response to concerns about the concentration of power, the company announced that Mostaque had also resigned from its board of directors. While there is no immediate replacement for his position, the company has appointed COO Shan Shan Wong and CTO Christian Laforte as interim co-CEOs while it seeks a replacement.
This occurred less than a week after the United Nations General Assembly passed a resolution endorsed by Washington to regulate artificial intelligence. Over 120 member states unanimously supported the plan, and China also expressed strong support. While such UN resolutions lack enforcement, it is anticipated that the provisions will serve as the foundation for global regulations to maintain a safe, trustworthy, and self-sustainable IA sector.
Jim O’Shaughnessy, the chairman of the board, expressed gratitude towards Mostaque for his exemplary leadership and unwavering dedication to Stability AI and the advancement of the open source movement.
Efforts to reach Mostaque for comment were unsuccessful at the time of reporting.
The repercussions of recent developments have left investors particularly affected. Stability AI has encountered challenges in monetizing its text-to-image generator effectively, and its initial pledges to develop AI models for nation-states have not materialized. Consequently, the company has pivoted towards an alternative revenue stream: the resale of its computational resources.
This strategic shift was communicated to investors as a managed services offering, with projections from the October financial report indicating anticipated revenues of $139 million in 2024, constituting approximately 98 percent of its total revenue.
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