If needed, refer these moderation strike announcements for more background: MSE post and open letter.
As one can see from above references, the relations between volunteer content curators and the company owning the site haven't been smooth. And this looks natural to me given the difference in their interests. Company interest is traffic and money. Curators interest is accurately rating site content (to prevent reader picturing them sinless angels, some openly admit doing this for selfish reasons of using the very content they curate).
So far it was possible to keep the relations despite tensions between curators and company because both sides made compromises (especially when pressed strong enough). I would even go as far as to say that in the root this relation was supposed to be symbiotic: quality of the content maintained by curators helped company get traffic and money while company money could be invested into improvements making it easier to maintain content.
Now, it looks like ChatGPT (and other similar tools) introduced a new dimension where their perceived interests became antagonistic so that wins for either of the sides would be interpreted as losses for the other. ChatGPT essentially took part of the questions that were historically asked at the site and began providing answers for these in smoother and more convenient way.
This tool is expected to provide satisfactory answers for duplicates - questions that were already answered elsewhere. From this point of view, it takes away traffic that shouldn't be there on the site to start with: instead of posting, askers would better search and find existing duplicates of the question they wanted to ask, along with the answer they are looking for. Considering that, from the perspective of content curators, ChatGPT can be helpful in that manner.
For curators, questions "intercepted" by ChatGPT mean just less load on maintaining and duplicating these questions if they were posted to the site and more time to spend on improving content quality and answering non-duplicate questions.
For the company though, ChatGPT presented a difficult challenge due to its negative impact on site traffic (which decreased 14% in March according to similarweb). It looks plausible that the tool may eventually get to the point of identifying most existing duplicates and presenting their answers with sufficient accuracy and this may drastically decrease amount of questions asked (N.B. ChatGPT is not yet providing 100% reliable answers).
As far as I can tell, company perceives this as a very serious danger to their business. And their actions related to this seem to indicate that they have chosen a way to address it that makes content curation impossible ("effectively permitting nearly all AI-generated answers to be freely posted" according to referred open letter).
My understanding of the company's plan based on above is, they are going to totally change how site works inside - specifically, remake it into a "ChatGPT frontend".
I think this is supposed to work as follows: imagine someone unaware of ChatGPT has a question. They get to the site historically known as the place to ask (that's Stack Overflow brand) and post their question expecting some expert to answer. At this point some user looking for rep points passes the question to ChatGPT and translates its response into the answer box.
Long term, above approach may be a dead end because it is so inferior to using ChatGPT directly. But short term, company probably believes that it will help recover traffic and this is maybe why they act the way they do and why their actions may look reasonable to them. It's hard to tell when critical mass of those attracted by the trick will realise that there is much more convenient way than roundtrip through the site and all this "artificial" traffic disappears.
From perspective of curators, company approach may look deeply (maybe even deadly) troublesome. The main problem is not really that it looks like a dead end - after all company already tried risky experiments that ended in tears and was able to recover (Documentation comes to mind as an example).
Worst thing about this approach is that - unlike previous dead projects - it appears to be very difficult (if possible at all) to recover after it's gone - because in the course of it most if not all users who maintained content quality will likely leave (quite possibly along with those who provided high quality human made answers, but I digress).
Really, while it looks doable (although not easy) to rate and curate answers provided by humans - doing this on AI generated content is totally different.
I don't think that those who maintaned human made content quality will have scale, motivation and abilities to suddenly turn into unpaid slaves used to rate automated tool output - especially given that as I wrote above most of this output will likely go to duplicate questions that should be closed, not answered.
OK so here we are...
If things work the way curators want, then company may expect fairly large decline in the traffic (one can argue that in theory this traffic shouldn't be there in the first place, or the decrease would not be as significant, but it's hard to convince company).
If things work the way company tries to approach their challenge then curators will probably have to stop what they were doing all these years and maybe even leave the site because there is no way to tell when this ends.
Given all of the above, I can not figure if there is a way to keep relationship between content curators and the company - ideally mutually acceptable, or at least with tolerable compromises for involved sides. Thoughts?