Background

This development comes as several top AI companies have simultaneously signed classified AI deals with the Pentagon, including Google, Microsoft, Amazon, and Meta. Anthropic, however, was excluded from the Pentagon program due to issues with its “Mythos” AI model.

Significance

The safety testing agreements mark a transition from voluntary industry commitments to a more formal regulatory framework. The US government is attempting to balance AI innovation with safety oversight — supporting technological advancement while strengthening controls on model outputs.

Key implications:

• This represents a shift from “voluntary pledges” to “mandatory testing”
• Government involvement in AI safety assessment could become a regulatory template
• Participating companies will undergo independent government safety reviews before model releases

The US Department of Commerce’s Center for AI Standards and Innovation (CAISI) announced that Google, Microsoft, and xAI have agreed to voluntarily submit their AI models for pre-release safety testing and capability evaluations.

The new agreements expand on similar pacts reached with OpenAI and Anthropic during the Biden Administration. CAISI has now conducted 40 evaluations of AI tools, including testing of certain “state-of-the-art models that remain unreleased.” The center did not specify which models were blocked from public release.

Expanding Oversight

“These expanded industry collaborations help us scale our work in the public interest at a critical moment,” CAISI director Chris Fall said.

The cooperation marks a subtle shift in the Trump administration’s AI policy. Despite President Trump signing executive orders last year centered on “removing red tape” around AI development, the White House appears to be adjusting its stance as AI expands into military applications and Anthropic claims its Mythos model is “too powerful for public release.”

Companies Under Scrutiny

Notably, xAI’s Grok chatbot has faced widespread public scrutiny over image processing controversies, including incidents where the tool undressed people in images. Google’s Gemini model is now being used by US defense and military agencies. Microsoft’s CoPilot remains a leading enterprise AI product.

Senior Trump administration officials also met with Anthropic CEO Dario Amodei last month, even as the company is embroiled in a lawsuit with the US Department of Defense over its refusal to lower safety guardrails for government use of its models.

Representatives of Google, Microsoft, and SpaceX (which now controls xAI) did not respond to requests for comment.

According to the Wall Street Journal, this agreement represents the latest step in the US government’s efforts to strengthen AI safety regulation. The White House is considering establishing an AI model review mechanism that would require major AI companies to submit test versions of new models before public launch, allowing the government to evaluate potential safety risks.

The core provisions of the agreement include: tech companies must provide access to designated government agencies when model training is nearing completion; the government will conduct capability assessments and safety testing, with particular focus on whether models could potentially be used to create biological weapons, conduct cyberattacks, or other malicious purposes.

Industry analysts point out that this approach could become a benchmark for AI regulation in the United States. If more companies join, it would substantially change how AI models are developed and released. However, it also raises questions about whether government review could stifle innovation.

The European Union and the United Kingdom are also considering similar AI safety regulatory frameworks. Global coordination on AI regulation may be accelerating.

Background of the Case

At the heart of the lawsuit is the question of whether OpenAI’s transition from a non-profit organization to a for-profit entity was legal. Musk, a co-founder of OpenAI, left the company in 2018. OpenAI subsequently established a for-profit arm in 2019 and further restructured as a for-profit company in 2023. Musk alleges this transition violated OpenAI’s original non-profit mission and is seeking a ruling that the company’s actions were unlawful.

Trial Focus: The Distillation Controversy

During cross-examination, Musk acknowledged that xAI had used OpenAI models for distillation training. Distillation is a process in which a larger, more powerful model generates synthetic data used to train another model. The practice has become increasingly controversial in the tech world and is viewed by many as a problematic method of acquiring competitive technology.

OpenAI’s legal team pursued an aggressive line of questioning, sharply probing Musk’s motivations for filing the lawsuit. Despite the pressure, Musk reportedly maintained a composed demeanor throughout the proceedings.

Musk’s Wealth Manager Takes the Stand

Following Musk’s testimony, his wealth manager Jared Birchall was called as the next witness. Birchall oversees Musk’s vast portfolio, and his testimony may provide key details about Musk’s investment decisions related to OpenAI and the funding operations of xAI.

Far-Reaching Implications

Legal analysts note that the outcome of this case could have profound implications for the entire AI industry. The core question before the court: What are the boundaries for AI laboratories when it comes to raising capital, structuring governance, and attracting investors?

If the court rules that OpenAI’s transition was illegal, it could trigger a chain reaction affecting the governance structures of multiple AI companies, including Anthropic and Google DeepMind. Conversely, an OpenAI victory would provide clearer legal precedent for the commercialization of AI laboratories.

Industry Attention

This case is being described as one of the most significant legal proceedings in AI industry history. Regardless of the outcome, it will set important precedents for future AI company governance models and the transition between non-profit and for-profit structures. The trial is ongoing and is expected to continue for several more weeks.

Source: The Verge, Reuters

Elon Musk’s second day on the stand in his lawsuit against OpenAI involved hours of occasionally testifying cross-examination. The case centers on whether OpenAI’s transition from a nonprofit to a for-profit entity was proper.

The lawsuit Musk filed challenging the structure of OpenAI alleges that Sam Altman and the other co-founders tricked him into backing a nonprofit, then launched the frontier lab’s for-profit arm and let it come to dominate the organization.

After an occasionally testy Musk testified for hours, it appears the case may come down to how much of a distinction jurors and Judge Yvonne Gonzalez Rogers make between investors in OpenAI having their potential profit capped or not.

In Musk’s telling, when he co-founded the lab with Altman, Ilya Sutskever, Greg Brockman, and others, he trusted them to build AI for humanity, but over time became suspicious of their motives, and finally concluded that they were “looting the nonprofit.”

OpenAI’s lawyer William Savitt sought to complicate that story during cross-examination, trying to show that Musk had supported a variety of efforts to transition OpenAI toward for-profit status so it could raise the funds necessary to compete with rival AI labs.

Musk testified that he had discussed converting the company to a for-profit as early as 2016, and that in 2017, he had explored creating a for-profit arm of OpenAI where he would hold the majority of the equity and control the company. When those plans fell through, he left the board.

Savitt tried to establish that Musk had been consulted by Altman and Shivon Zilis — his longtime adviser who is also the mother of four of his children — about subsequent efforts to raise money, and did not object.

That cross-examination extended to Tesla’s AI ambitions. Notably, Musk was asked about Tesla’s efforts to develop competing AI technologies and found himself on the wrong side of one of his own posts on X. Savitt brought up emails where Musk had backed efforts by Tesla and his brain interface company, Neuralink, to poach employees from OpenAI while he was still on that company’s board.

The most consequential thread of the day, though, may have been about harm prevention. Part of Musk’s case rests on the idea that OpenAI’s transition into a traditional corporation is dangerous to society because it reduces the company’s focus on safety. Judge Gonzalez Rogers halted that line of questioning, but in remarks to the lawyers after testimony concluded made clear it would resume, with limits.

Musk returns Thursday for another round of adversarial questioning. Also expected to testify are his family office manager, Jared Birchall; AI safety expert Stuart Russell; and OpenAI president Greg Brockman.

Source: TechCrunch

April 30, 2026 | Sources: TechCrunch, BBC News

Courtroom Admission of Model Distillation

During Thursday’s testimony in a California federal court, Elon Musk was asked whether xAI had used distillation techniques on OpenAI’s publicly-accessible models to train Grok. Musk partially admitted to the practice, characterizing it as common among AI companies.

When pressed on whether that meant “yes,” Musk replied: “Partly.”

What Is Model Distillation?

Model distillation refers to the technique of systematically querying publicly-available AI chatbots and APIs, extracting their outputs, and using them to train new models. This enables other software companies to create AI systems nearly as capable as frontier models at a fraction of the cost.

Until now, the conversation around distillation had focused primarily on Chinese firms using the technique to create open-weight models that rival U.S. offerings. However, it has been widely assumed in the tech industry that American labs also employ these techniques against each other to avoid falling behind.

Now, for the first time, this has been confirmed at the highest level.

The Irony

Musk’s admission carries particular irony given that he is the one suing OpenAI, CEO Sam Altman, and Greg Brockman, alleging they breached the original nonprofit mission of OpenAI by converting it to a for-profit entity.

Distillation threatens the competitive advantage that AI giants have built through massive investments in computing infrastructure. This admission takes on added significance considering the reported bending and alleged breaking of copyright rules by frontier labs in their own quest for training data.

xAI’s Industry Positioning

Later in his testimony, Musk was questioned about a claim he made last summer that xAI would soon be far ahead of every company except Google. In response, he reassessed the landscape of leading AI providers, ranking Anthropic at the top, followed by OpenAI, Google, and Chinese open-source models. He characterized xAI as a much smaller company with only a few hundred employees.

Industry Impact

OpenAI, Anthropic, and Google have reportedly launched an initiative through the Frontier Model Forum to share information about combating distillation attempts, particularly from China. To counter these efforts, frontier labs are working to prevent users from making suspicious mass queries.

OpenAI did not respond to a request for comment on Musk’s admission at press time.

Source: TechCrunch, BBC News

April 30, 2026 — Elon Musk’s social media platform X announced on Thursday that it has begun a phased rollout of a completely rebuilt AI-powered advertising platform. This marks a significant effort by X to win back advertiser trust through technological innovation after years of declining ad revenue.

AI Reshaping Ad Delivery

According to X, the new advertising platform features more modern “retrieval and ranking systems” powered by AI technology. These improvements are designed to help marketers create targeted campaigns with greater control and precision. AI will be used to enhance ad performance, offering more relevant ad placements and more accurate audience targeting.

Monique Pintarelli, head of global advertising at xAI, said in a statement posted on X: “Very few companies would have the ambition and technical courage to completely rebuild their entire advertising platform in such a short timeframe. This is classic X and xAI — bold, fast, and focused on building something substantially better for advertisers. We are designing this new ad stack to enable more rapid and seamless integration of ongoing innovation.”

Ad Revenue Showing Signs of Recovery

In the first few years following Musk’s acquisition of Twitter (now X), the company’s advertising business suffered significant setbacks as many brands pulled their spending over content moderation concerns. X subsequently shifted its focus to other monetization channels, including AI and subscriptions.

However, eMarketer forecasts indicate that X’s ad business has been turning around recently, with estimated ad revenue of $2.26 billion in 2025, rising to $2.46 billion in 2026. While still only about half the size of Twitter’s 2021 ad business, the trajectory is heading in the right direction.

Industry Trends

AI adoption in advertising is becoming an industry-wide consensus. This week’s tech earnings season revealed that companies like Google and Meta are all benefiting from an AI-driven “digital ad boom.” The New York Times reported this week that AI systems have automated various aspects of marketing — from ad creation to targeting to measurement — while also lowering the barrier for smaller businesses to access advanced advertising tools.

Rebuilding the ad platform became a priority after X merged with xAI last year, with AI integration viewed as a key growth driver.

Source: TechCrunch