OpenAI broke its silence on California’s most controversial AI bill on Tuesday, officially expressing opposition in a letter to California state Senator Scott Wiener and Governor Gavin Newsom. The AI giant argued SB 1047 would stifle innovation and push talent out of California — a position Wiener quickly replied “makes no sense.”
“The AI revolution is only just beginning, and California’s unique status as the global leader in AI is fueling the state’s economic dynamism,” said OpenAI’s Chief Strategy Officer Jason Kwon in the letter obtained by TechCrunch. “SB 1047 would threaten that growth, slow the pace of innovation, and lead California’s world-class engineers and entrepreneurs to leave the state in search of greater opportunity elsewhere. Given those risks, we must protect America’s AI edge with a set of federal policies — rather than state ones — that can provide clarity and certainty for AI labs and developers while also preserving public safety.”
The company joins broad local pushback against SB 1047 on Tuesday, adding its take to those of trade groups representing Google and Meta, investment firm Andreessen Horowitz, prominent AI researchers and California Representatives Nancy Pelosi and Zoe Lofgren.
An OpenAI spokesperson says the company has been in discussions with Senator Wiener’s office about the bill for months. However, Senator Wiener says the AI lab’s argument that SB 1047 would push AI companies out of California is “tired.”
He pointed out in a press release on Wednesday that OpenAI doesn’t actually “criticize a single provision of the bill.” He says the company’s claim that companies will leave California because of SB 1047 “makes no sense given that SB 1047 is not limited to companies headquartered in California.” As we’ve previously reported, SB 1047 affects all AI model developers that do business in California and meet certain size thresholds.
In other words, whether an AI company was based in San Jose or San Antonio, if they let Californians use their products, they would be subject to these restrictions. (An example of an effective law with this type of scope is Illinois’ Biometric Information Privacy Act.)
That said, Bloomberg reports that OpenAI has put conversations about expanding its San Francisco offices on hold amid concerns about California’s regulatory landscape. OpenAI has had an office in San Francisco’s Mission district for years, and recently moved into a new office in the city’s Mission Bay region, previously occupied by Uber.
OpenAI declined to comment further on those real estate discussions.
“Instead of criticizing what the bill actually does, OpenAI argues this issue should be left to Congress,” said Wiener in the statement. “As I’ve stated repeatedly, I agree that ideally Congress would handle this. However, Congress has not done so, and we are skeptical Congress will do so.” Tech companies have taken similar stances regarding privacy laws in the past, calling for federal regulation knowing it will be slow to come, and California ended up stepping up there as well.
OpenAI has endorsed several federal bills regulating AI models, one of which authorizes the United States AI Safety Institute as a federal body that sets standards and guidelines for AI models. From a high level, that’s fairly similar to what SB 1047’s Board of Frontier Models is supposed to do.
California lawmakers significantly amended SB 1047 to give Governor Newsom a less controversial AI bill to sign, but they’ve failed to convince Silicon Valley’s most important AI lab the bill is worth passing. SB 1047 is now headed for a final vote in California’s Assembly, and could land on Governor Newsom’s desk by the end of the month. The California governor has not indicated his feelings on SB 1047, but he’d likely face a broad industry backlash if he signs it.
