Categories
AI technology

Sam Altman (OpenAI) kan niet in de schaduw staan van Elon Musk

Juist omdat het de laatste weken zo vaak ging over Sam Altman van OpenAI en Elon Musk van Donald Trump, was ik bezig aan een nieuwsbrief met totaal andere onderwerpen. Maar toen gebeurde er in een paar dagen zoveel bijzonders dat ik toch moet concluderen dat Elon Musk wordt onderschat en Sam Altman wordt overschat.

Temidden van al het mediageweld over de haantjes van de techwereld zouden we bijna vergeten dat twee mensen die ook regelmatig aan bod komen in deze nieuwsbrief, George Hinton en Demis Hassabis, beiden een Nobelprijs hebben gewonnen. Toch, ook hier, nu eerst de focus op Musk en Altman.

Musk en Altman tegenpolen

Het vreemde is dat elke vermelding van Musk scherpe reacties oproept, waarbij de helft het principieel met me oneens is omdat Musk een reactionaire racist zou zijn, terwijl de andere helft de prestaties van zijn bedrijven juist ondergewaardeerd vindt: of je haat de persoon, of je houdt van diens prestaties. Wat je ook van de persoon vindt; afgelopen week werd opnieuw duidelijk dat Elon Musk als innovator op eenzame hoogte staat. 

OpenAI wordt door de meeste mensen, die ik gemakshalve omschrijf als leken, gezien als een uniek innovatief bedrijf geleid door een mysterieus genie in de persoon van Sam Altman. Maar juist vorige week bleek dat OpenAI is gebouwd op een wankel fundament, omdat niet alleen financieel de positie zo zwak is dat er over een paar maanden opnieuw miljarden moeten worden opgehaald op de kapitaalmarkt, maar de omzet en eventuele toekomstige winst van OpenAI vooral verdwijnt in de zakken van een vrolijk toekijkend Microsoft.

Musk en Altman zijn tegenpolen. Altman doet er alles aan om serieus te worden genomen door het establishment; vraag zijn eigen ChatGPT maar iets over Altman en je wordt overspoeld met een bloemlezing die nauwelijks op feiten is gebaseerd. Volgens ChatGPT loopt Altman nog net niet over water, maar het scheelt niet veel en dat het nog niet lukt, ligt vooral aan het water.

Musk doet er de laatste tijd alles aan om zichzelf belachelijk te maken; van het willekeurig weggeven van een miljoen dollar per dag aan iemand die zijn petitie ondertekent en het spuien van onzinnige samenzweringstheorieën, tot zogenaamd autonome robots die cocktails inschenken. Zie wat Marques Brownlee van de Tesla-robots observeerde en op gortdroge manier afbrandde.

Het is de reden dat ik vorige week bewust niets meldde over de robots, omdat duidelijk was deze suffe gimmick diende om meer publiciteit voor Tesla te krijgen. Allemaal gekkigheid van Musk die afleidt van daadwerkelijk bijzondere prestaties van zijn bedrijven. En die prestaties zijn er genoeg.

Een gigantisch apparaat, gevangen tussen twee Mikado-stokjes.  
Bron: BBC

Herbruikbaar Starship 

Want wat bijna ondersneeuwt is dat, hoewel er nu andere spelers in de ruimtevaart zijn zoals Blue Origin en Rocket Lab, niets in de buurt komt van wat SpaceX bereikt heeft op het gebied van herbruikbare ruimtevaarttechnologie. De BBC legt in deze video uit waarom het hergebruik van de Starship-raket zo belangrijk is.

De kern is dat hergebruik de kosten van ruimtevaart sterk reduceert, maar juist het ontwikkelen van herbruikbare raketten is bijzonder complex. Daarom is het geen andere partij nog gelukt. Op beelden lijkt de SpaceX Starship niet zo imposant, maar de raket woog bij landing 3.5 miljoen kilo, acht keer zoveel als een volle Boeing 747. De Starship is op zes meter na ook even hoog als zo’n 747 lang is. Kortom, er werd bij de allereerste poging een enorm gevaarte gevangen tussen twee Mikado-stokjes.

Het is daarom logisch dat SpaceX vrijdag een contract van acht lanceringen ter waarde van $733 miljoen kreeg toegekend door de Amerikaanse Space Force, als onderdeel van een programma dat bedoeld is om concurrentie tussen lanceeraanbieders te bevorderen.

Super datacenter in negentien dagen

Dan een ander megasucces voor Musk dat onderbelicht bleef. Als er iemand verstand heeft van AI en datacenters is het Jensen Huang, CEO van Nvidia, dat dinsdag $3.4 biljoen waard werd. Het is na Apple ’s ($3.57 biljoen) werelds meest waardevolle onderneming en, ik blijf het herhalen, het is een kwestie van maanden, niet jaren, tot Nvidia ’s werelds meest waardevolle bedrijf wordt. Afgelopen week zei Huang dit over wat het team van Musk in negentien dagen voor elkaar kreeg:

“En allereerst, erkenning van prestaties waar dat verdiend is. Vanaf het moment van concept tot een datacenter dat klaar is voor NVIDIA om onze apparatuur daar te hebben, tot het moment dat we het aanzetten, alles hadden aangesloten en het zijn eerste training deed. Dus dat eerste deel, alleen al het bouwen van een enorme fabriek, vloeistofgekoeld, van stroom voorzien, in de korte tijd dat het gedaan is, ik bedoel, dat is als bovenmenselijk. 

Ja, en voor zover ik weet, is er maar één persoon in de wereld die dat zou kunnen doen. Elon is uniek in zijn begrip van techniek, constructie en grote systemen, en het mobiliseren van middelen. Het is ongelofelijk. Natuurlijk is zijn team ingenieurs buitengewoon. Het softwareteam is geweldig. Het netwerkteam is geweldig. Het infrastructuurteam is geweldig. 

Elon begrijpt dit diepgaand. En vanaf het moment dat we besloten om te beginnen, de planning met ons engineeringteam, ons netwerkteam, ons infrastructuur- en computingteam, het softwareteam, al het voorbereidende werk, vervolgens al de infrastructuur, alle logistiek en de hoeveelheid technologie en apparatuur die die dag arriveerde, en de infrastructuur en computerinfrastructuur van NVIDIA en al die technologie, tot de training: in 19 dagen.”

Huang gaat hier vol op het orgel over een grote klant, laat dat duidelijk zijn. Toch moeten we dat ook in het juiste perspectief plaatsen: de totale orderwaarde van wat Musks bedrijven X en Tesla bij Nvidia hebben besteld, wordt geschat tussen de $4 en $5 miljard. Een enorm bedrag, maar Nvidia draaide in het laatste kwartaal gemiddeld $326 miljoen omzet per dag, dus het gaat om pakweg tien dagen tot twee weken omzet. Er zijn grotere klanten die Huang niet zo ophemelt en zijn respect voor Musk is gemeend.

Klimaat en gezondheidszorg hebben Musk nodig

Starship en het nieuwe datacenter zijn twee voorbeelden van de unieke talenten van Musk. Ik heb het vaker geschreven: juist omdat Musk op zo’n unieke wijze in staat is om enorme projecten succesvol te krijgen die werktuigbouwkunde combineren met software-ontwikkeling, zou het fantastisch zijn als hij zijn talenten en zijn vermogen zou inzetten om klimaatopwarming tegen te gaan.

Technologie ontwikkelen om CO2 uit de atmosfeer te halen is complex en duur; twee bijvoeglijke naamwoorden waar Musk wel raad mee weet. In plaats van zijn talenten besteden aan het gereedmaken van een andere planeet, is zijn aandacht gewenst om onze huidige planeet te redden. Die malle tweets nemen we wel op de koop toe.

Vier waarheden over OpenAI

Tegenover deze successen van Musk verbleekt de situatie van OpenAI. Begin deze maand is de onstilbare kapitaalhonger van OpenAI al aan bod gekomen (zie: $10 miljard voor OpenAI), maar donderdag kwam de New York Times ook nog met het bericht dat het aan alle kanten rommelt in de relatie tussen OpenAI en Microsoft:

” De nauwe samenwerking tussen Microsoft en OpenAI vertoont tekenen van slijtage. De “beste bromance in de techwereld” heeft een realiteitscheck ondergaan nu OpenAI heeft geprobeerd zijn overeenkomst met Microsoft te wijzigen en de softwaremaker zijn afhankelijkheid van de start-up probeert te verminderen.”

Alex Kantrowitz zag in het artikel aanleiding tot nadere analyse en kwam tot vier zorgwekkende conclusies over OpenAI:

  1. Onvoorspelbare trainingskosten: OpenAI benadrukte dat de trainingskosten niet vastliggen en dat ze in de toekomst kunnen worden aangepast. Het bedrijf besteedt ongeveer $3 miljard per jaar aan training, maar sluit deze kosten uit bij het presenteren van de winstgevendheid, wat vragen oproept. De manier waarop de nieuwere modellen van OpenAI werken, kan een deel van de traditionele trainingslast verschuiven naar inferentie, waardoor de toekomstige trainingskosten moeilijk te voorspellen zijn. Ondanks mogelijke kostenbesparingstechnieken, zal de focus van OpenAI op het ontwikkelen van grotere modellen waarschijnlijk hoge trainingskosten met zich meebrengen.
  2. ChatGPT als inkomstenbron: In tegenstelling tot de verwachting dat de API van OpenAI de meeste inkomsten zou genereren, verwacht het bedrijf dat ChatGPT tot minstens 2029 de belangrijkste inkomstenbron zal zijn. OpenAI gokt op de voortdurende groei van conversatie-AI en biedt verschillende versies van ChatGPT aan voor verschillende markten, zoals het bedrijfsleven en het onderwijs. Het succes van ChatGPT op lange termijn hangt echter af van de mate waarin de interesse van gebruikers in AI-interacties toeneemt.
  3. Significante betalingen aan Microsoft: OpenAI betaalt Microsoft al grote bedragen uit de inkomsten, ondanks dat het nog geen winst maakt. Een verwachte uitbetaling van $ 700 miljoen aan Microsoft in 2024 benadrukt de financiële last van de samenwerking, bovenop de toch al hoge kosten voor AI-ontwikkeling.
  4. Toekomstige financieringsbehoeften: Ondanks het ophalen van $6,6 miljard, wijzen de verwachte verliezen van $5 miljard in 2024, en mogelijk $14 miljard in 2026, erop dat OpenAI waarschijnlijk snel weer kapitaal moet aantrekken. Dit roept vragen op over de duurzaamheid van het bedrijfsmodel en of investeerders bereid zullen blijven zulke hoge uitgaven te ondersteunen.
Geoffrey Hinton is één van de voornaamste denkers en critici van AI.
Bron: Nobelprijzen.

Nobelprijswinnaars Hinton en Hassabis vs. OpenAI

Het zal je toch gebeuren dat je grootste concurrent en je grootste criticaster in hetzelfde jaar een Nobelprijs winnen. Het overkwam Sam Altman van OpenAI toen Demis Hassabis en George Hinton allebei een Nobelprijs wonnen, Hassabis voor scheikunde en Hinton voor natuurkunde. In een interview met de website van de Nobelprijs maakte Hinton een vergelijking tussen de strijd tegen klimaatopwarming en de regulering van AI.

“Ik denk dat het nogal verschilt van klimaatverandering. Bij klimaatverandering weet iedereen wat er moet gebeuren. We moeten stoppen met het verbranden van koolstof. Het is alleen een kwestie van de politieke wil om dat te doen. En grote bedrijven die grote winsten maken, willen dat niet doen. Maar het is duidelijk wat er gedaan moet worden.

Hier (bij AI, MF) hebben we te maken met iets waarbij we veel minder een idee hebben van wat er gaat gebeuren en wat we eraan moeten doen. Ik zou willen dat ik een simpele oplossing had, dat als je dit doet, alles goed komt. Maar dat heb ik niet. Vooral met betrekking tot de existentiële dreiging dat deze dingen uit de hand lopen en de controle overnemen, denk ik dat we op een soort keerpunt in de geschiedenis staan, waar we in de komende jaren moeten uitzoeken of er een manier is om met die dreiging om te gaan.

Ik denk dat het nu heel belangrijk is dat mensen werken aan de kwestie hoe we de controle behouden. We moeten daar veel onderzoek naar doen. Ik denk dat een van de dingen die overheden kunnen doen, is de grote bedrijven dwingen om veel meer van hun middelen in veiligheidsonderzoek te steken. Zodat, bijvoorbeeld, bedrijven zoals OpenAI veiligheidsonderzoek niet zomaar op een laag pitje kunnen zetten.”

Hassabis was oprichter van DeepMind (verkocht aan Google)
Bron: Nobelprijzen.

Hinton had vorige week ook al uitgehaald naar OpenAI, toen hij zei trots te zijn op het feit dat zijn voormalige student Ilya Sutskever vorig jaar Sam Altman had ontslagen als CEO van OpenAI. Overigens een kortstondige overwinning, want een paar dagen later keerde Altman terug en Sutskever is inmiddels zelf vertrokken bij OpenAI en begonnen met een nieuwe startup, waarvoor hij binnen drie maanden al een miljard dollar ophaalde op een waardering van $5 miljard.

Naast de uithalen van Hinton en de vrij dodelijke analyse van Kantrowitz, kwam er voor Altman ook nog eens het nieuws bij dat voormalig OpenAI CTO Mira Murati bezig lijkt aan een eigen startup, waarvoor ze talent weghaalt bij OpenAI.

Innovatie duiden blijft lastig

Bij analyse van alle recente ontwikkelingen blijkt dat het veelbejubelde OpenAI in steeds lastiger vaarwater komt. De frictie met Microsoft haalt bijna dagelijks de publiciteit. Te midden van al zijn potsenmakerij is Elon Musk intussen bezig om infrastructuur te bouwen waarvan hij jarenlang plezier kan hebben, zowel bij SpaceX met de herbruikbare Starship als met X en Tesla in het nieuwe super datacenter. Ik wed niet, maar als ik het zou doen, zou ik nooit tegen Elon Musk wedden. 

Dank voor de belangstelling en tot zondag!

Categories
AI technology

$10 billion for OpenAI: $6.6 vc funding and $4 billion from banks

The announcement of a major funding round in the tech world is often accompanied by a clichéd photo of a group of men in light blue shirts and the occasional rebel in a black t-shirt, trying to look tough into the camera. OpenAI, in announcing its new funding round of no less than $6.6 billion, out of a $157 billion valuation, posted an abstract image without a source; probably because there is no management left except CEO Sam Altman himself.

The text was also dry by Altman standards: "This funding allows us to strengthen our leadership in AI research, increase our computing power and build tools that help people solve complex problems."

"The dawn, blah blah blah chocolate custard"

This is less prosaic than the Bouquet Series lyrics Altman recently posted on his own blog:

"We must act wisely, but with conviction. The dawn of the Intelligence Age is a profound development with very complex and extremely risky challenges. It will not be an entirely positive story, but the benefits are so enormous that we owe it to ourselves, and to the future, to figure out how to navigate the risks that lie ahead."

This almost seems like one from the oeuvre of the unsurpassed Kees van Kooten: "but enough about myself, what do you think of my hair?" Because here Altman is unabashedly trying to attach half of his own company name to a term that is supposed to mark the period after our current post-industrial era. It is, of course, rather the dawn of the TikTok era, but TikTok is not as good at PR.

OpenAI now bronze, after SpaceX and ByteDance (TikTok)

The funding round increases the pressure on Altman to live up to this high price tag, normally via an IPO. OpenAI is now worth far more than any other venture-backed company ever before at the time of their IPO, including Meta, Uber, Rivian, and Coinbase, according to a PitchBook analysis.

Funding for OpenAI only just fits the chart. Source: Pitchbook.

OpenAI is now the third most valuable venture-backed company in the world. Only Elon Musk's SpaceX, valued at $180 billion, and ByteDance, the owner of TikTok valued at $220 billion, are worth more.

Is there any competition for OpenAI?

To put it in Dutch perspective: OpenAI is worth five times as much as Philips, as much as Unilever and still only 20% less than Shell. OpenAI's competitors must look at the new funding with horror. xAI, founded by Musk, raised more than $6 billion earlier this year, but with a valuation of "only" $24 billion. OpenAI's nearest competitor, Anthropic, was valued at $19.35 billion as recently as January.

A few days ago there was brief enthusiasm in the market when Nvidia, nota bene the party that is going to earn the most from OpenAI's new funding because it supplies all the hardware under the hood of ChatGPT, introduced a proprietary Large Language Model that seemed open source, called NVLM. Unfortunately, the technology is not allowed to be used in commercial applications, making Google with Gemini the only real remaining competitor to OpenAI. Or Anthropic needs to find funders who dare to throw billions at it.

$4 billion credit facility for OpenAI

Early investors in OpenAI are obviously in jubilant spirits, including the legendary Vinod Khosla, who in this interview with Bloomberg almost even seemed to be caught smiling. Khosla: "It is the most important tool we have ever had in human history to create abundance and realize a fairer, more equitable, prosperous society."

Khosla also reported that he has used ChatGPT for more mundane tasks - from quickly learning complex material to designing his garden. The latter is especially impressive, as Khosla's garden has a mile-long beach that has been the subject of lawsuits for years.

On Thursday, it emerged that in addition to its $6.6 billion investment round, OpenAI also managed to secure a $4 billion credit facility from a number of banks. With over $10 billion, the company can go on for a while, although the question remains how far this pole reaches for the company that loses millions every day.

Mozart of mathematics

Anyone who throws around bombastic cries about AI being the savior of humanity brings criticism upon themselves. These range from substantive criticism of the quality of the technology developed by OpenAI, to the way Altman runs the company.

More and more is leaking out about how OpenAI is rushing, especially under pressure from competition from Google, to release products that are far from ready and insufficiently tested. Even before Mira Murati's unexpected departure from OpenAI, staff complained that the o1 model was released too early.

The Atlantic advocates putting aside Altman's turgid rhetoric and looking primarily at what OpenAI's products are currently capable of:

"Altman insists that the deep-learning technology that powers ChatGPT can in principle solve any problem, at any scale, as long as it has sufficient energy, computing power and data. However, many computer scientists are skeptical of this claim and argue that several more major scientific breakthroughs are needed before we reach artificial general intelligence."

Terence Tao, a mathematics professor at UCLA, is "a real-life superintelligence, the Mozart of Mathematics," according to The Atlantic. Tao has won numerous awards, including the equivalent of a Nobel Prize in mathematics, and analyzed the performance of the OpenAI-hyped o1.

Tao's conclusions are not positive for o1's math ability and even led Tao to apologize for comparing o1's performance to that of a doctoral student.

A broader analysis appeared In the book "AI Snake Oil: What Artificial Intelligence Can Do, What It Can't, and How You Can Recognize the Difference. "In it, the authors explain why organizations are falling into the trap of AI snake oil (worthless solutions), why AI can't fix social media, why AI is not an existential threat, and why we should be much more concerned about what people will do with AI than about what AI would do on its own. I haven't read the book but the reviews are positive.

Investors lining up for AI companies

Despite all the criticism, investors are eager to invest billions in AI companies.

OpenAI has raised almost as much funding, as the competition combined. 

Reuters made this overview of funding in 2024. Adding up to over $10 billion, it especially underscores how well-funded OpenAI is, which has such an amount at its disposal due to the investment round and the banks' own credit facility.

Categories
AI

Are Jony Ive & Sam Altman developing an "iPhone killer with AI?"

How nice would it be if they called the device LoveFrom, so people would start asking each other: 'how do you like the new LoveFrom?'

The Wall Street Journal reports that Apple has dropped out at the eleventh hour and will not participate in the investment round in OpenAI, which is expected to close next week. It would have been a rare investment in an unlisted technology company for Apple.

The question is whether not participating in the investment round will affect ChatGPT's possible integration into the new version of the iPhone operating system, iOS 18. Despite all the wonderful promo videos, it is still unclear what Apple means by its own interpretation of AI under the name "Apple Intelligence. Seeing first, then believing remains the credo in technology.

Perhaps Apple's enthusiasm for participation in OpenAI has been dampened by persistent reports that top designer Jony Ive, a former confidant of Steve Jobs and now co-funded by his widow Laurene Powell Jobs, is working with his new company LoveFrom and OpenAI CEO Sam Altman on a veritable iPhone killer: a mobile device with fully integrated AI features from, surprise, OpenAI.

An "iPhone for AI"

A major article in the New York Times reports in detail on the creation of the new mobile device, unfortunately without clarifying what kind of device it is:

"Mr. Ive and Mr. Altman met several times for dinner before they decided to develop a product, with LoveFrom leading the design. They raised money privately, with contributions from Mr. Ive and Emerson Collective, Ms. Powell Jobs' company, and could raise up to $1 billion in seed capital from tech investors by the end of the year.

In February, Mr. Ive found office space for the company. They spent $60 million on a 32,000-square-foot building called the Little Fox Theater, adjacent to LoveFrom's courtyard. He hired about 10 employees, including Tang Tan, who oversaw iPhone product development, and Evans Hankey, who succeeded Mr. Ive as chief designer at Apple.

On a Friday morning in late June, Mr. Tan and Ms. Hankey could be seen moving chairs between the Little Fox Theater and the nearby LoveFrom studio. The chairs were laden with papers and cardboard boxes containing initial ideas for a product that uses A.I. to create a computing experience less socially disruptive than the iPhone.

The project is being developed in secret. Mr. Newson (fellow designer Marc Newson, MF) said the product and release time have yet to be determined."

$60 million in office space for a startup

So nice, when you can begin a startup with $60 million dollars just for your office space. Apparently that took all the budget for the website of Ive's company LoveFrom. All that's there is an animated bear, the mascot of the state of California, who casually strolls over the company name.

Wired published a nice piece yesterday in which it almost talks aloud, asking questions to the reader, trying to figure out what kind of mobile device Ive and Altman are working on. After all, no one has an image of the so called "iPhone for AI." But to lure investors, an Altman specialty, that tag line will work wonders. 

Categories
AI invest

OpenAI worth $150 billion with potentially a $15 billion loss?

She was the face of OpenAI, but CTO Mira Murati left without giving CEO Sam Altman advance notice. Source photo: OpenAI
It's only a matter of time before a movie comes out about OpenAI, hopefully as good as The Social Network was about the founders of Facebook. Perhaps the entire film could be generated with AI from OpenAI's own products. Because that's what remains special about OpenAI: although only three of its eleven founders are left after years of rolling down the street fighting, it continues to develop extraordinary products. It is as if a car keeps winning Formula 1 races while most team members at every pit stop try to rip off their own driver's helmet, remove his steering wheel and puncture his tires.

Superman becomes Scrooge McDuck

Once upon a time, OpenAI was founded as a foundation with a noble goal: to advance humanity through artificial intelligence. Nothing is left of those altruistic values as it turns into a heavily funded, shareholder-value-driven commercial enterprise. The transition of OpenAI into a for-profit benefit corporation will reportedly earn CEO Sam Altman several billion dollars in shares in the company for the first time. It's like Superman transforming into Scrooge McDuck.

The tensions surrounding this transition apparently caused prominent executives such as Chief Technology Officer Mira Murati, Chief Research Officer Bob McGrew and VP of Post Training Barret Zoph to resign this week, raising questions about the stability of the company. Previously, I wrote about the extraordinary career of Mira Murati, originally from Albania.

OpenAI's leadership a year ago on the cover of Wired. Only Altman, bottom right, is still at the company.

Still, investors are eager to pump billions into OpenAI. The huge new round of investment, led by Thrive Capital, values the company at $150 billion. That's fifty percent more than Facebook was worth during its IPO, when it was already making a billion in profits. (I remember experienced investors talking shame about such a valuation, who must now surely grit their teeth at the fact that Meta has since become worth fifteen times as much, but let's put that aside.) Profit is a concept they will see at OpenAI in the coming years only when they enter it as a prompt in ChatGPT, but not in their accounting.

Thrive Capital is investing more than $1 billion in OpenAI's current $6.5 billion investment round and has an added benefit that other investors don't get: the ability to invest another $1 billion next year at the same valuation if the AI company meets a certain revenue target. That's a rare funding condition.

Open AI will do $12 billion revenue at a $15 billion loss?

Anonymous sources told Reuters that OpenAI revenue will rise to $11.6 billion next year, compared with an estimated $3.7 billion revenue in 2024. Losses could reach as much as $5 billion this year, depending on spending on computing power. If the operating margin does not improve very quickly, this means that, at projected 2025 revenue, OpenAI will lose over $15 billion next year.

I can't resist: $15 billion loss per year is $41 million per day, $1.7 million per hour and $476 per second. Loss.

With the new $6.5 billion in its pocket, that carries OpenAI only about six months, although its coffers will not be completely empty at this point. Shall we call it "remarkable" that a company can apparently be so promising that its market capitalization is not ten times its profits, but ten times its losses?

Categories
AI technology

Experts and Oprah Winfrey on the future of AI around launch of ChatGPT o1

Oprah Winfrey in a TV show about AI feels a bit like Taylor Swift explaining quantum mechanics: unexpected, yet interesting

ChatGPT o1 is not sexy

The program, of which Newsweek made a good summary, appeared precisely the week OpenAI introduced the long-awaited and heavily hyped new version of ChatGPT, called o1. Letter o, number 1. 

It makes one long for the simplism of Elon Musk, who just kept releasing Tesla models with letters and numbers until it said S 3 X Y. (Breaking with this tradition and opting for the horrid name Cybertruck, was tempting the gods.)

Apple does too much

OpenAI was in the spotlight earlier in the week as Apple announced the iPhone 16, which seems particularly special because of its future use of AI, which it names Apple Intelligence; because, as it does with cables, Apple prefers not to adopt industry standards.

OpenAI has partnered with Apple to do so, the details of which are sketchy. It is unclear when that AI application will become available, but enthusiasts can, of course, pre-order the frighteningly expensive iPhone 16.

It is not known what Apple watcher and investor at Google Ventures MG Siegler thinks of the product names at OpenAI, but he was not enthusiastic about the deluge of names Apple is now using: 16, 16 Pro, 16 Pro Max, A18, A18 Pro, 4, Ultra 2, Pro 2, Series 10. Above all, the list of odd names illustrates that Apple is trying to grow in breadth of products, yet struggles to introduce a groundbreaking new product that opens up an entirely new market.

Opinions on ChatGPT o1 vary

The Verge published a clear overview of o1's capabilities and rightly noted that we have only seen the tip of the iceberg. Wharton professor Ethan Mollick, cited more often in this newsletter, came up with a sharp analysis yesterday:

"When OpenAl's o1-preview and o1-mini models were unveiled last week, they took a fundamentally different approach to scaling. Probably a Gen2 model based on training size (although OpenAl has not revealed anything specific), o1-preview achieves truly amazing performance in specific areas by using a new form of scaling that occurs AFTER a model has been trained.

It turns out that inference compute - the amount of computer power spent “thinking” about a problem, also has a scaling law all its own. This “thinking” process is essentially the model performing multiple internal reasoning steps before producing an output, which can lead to more accurate responses (The AI doesn’t think in any real sense, but it is easier to explain if we anthropomorphize a little)."

'Memorisation is not understanding, knowledge is not intelligence'

'Memorisation is not understanding, knowledge is not intelligence'. Screenshot of ChatGPT o1's answer to my question which is larger, 9.11 or 9.8

On LinkedIn, Jen Zhu Scott, always an independent thinker, shared her resistance against OpenAI's ongoing attempts to anthropomorphize technology: the attribution of human traits, emotions or behaviors to ChatGPT, because they are projections of our own experiences and are not always accurate representations of the AI product it is talking about.

Jenn Zhu Scott: "OpenAI just released OpenAI o1 and it’s been marketed as an AI that ‘thinks’ before answering. I’ve been testing it with some classic jailbreak prompts. Fundamentally I have issues with OpenAI relentlessly anthropomorphising AI and how they describe its capabilities. An AI cannot ‘think’, it processes and predicts like other computers. 9.11 is still larger than 9.8, despite it can memorize solutions to PhD level questions. Remember: 

  • - Memorisation is not understanding. 
  • - Knowledge is not intelligence. 

Stop anthropomorphising AI. It is already powerful as a tool. Anthropomorphisation of AI misleads and distracts the real critically important development into advanced AI. I am so sick of it and for those who understand the underlying technologies and theories, this is snake oil sales level nonsense. It has to be called out."

What is "thinking" or "reasoning"?

The attempted "humanization" of OpenAI referred to by Zhu Scott came to light earlier this year when it was revealed that actress Scarlett Johansson had been asked by OpenAI CEO Sam Altman to lend her voice to ChatGPT.

It was a modern-day version of clown Bassie who once voiced "allememachies Adriaantje, we have to turn left" for TomTom, but the question is mostly about examples where ChatGPT o1 "reasons" or "thinks" in a way that earlier versions, or other AI tools such as Claude or Google Gemini, have not mastered.

What does "thinking" or "reasoning" mean? Simon Willison looks for a concrete example that illustrates the difference therein between ChatGPT o1 and 4o.

As Simon Willison stated on X: "I still have trouble defining “reasoning” in terms of LLM capabilities.I’d be interested in finding a prompt which fails on current models but succeeds on strawberry (the project name of o1, MF) that helps demonstrate the meaning of that term."

The question is whether the latest product from OpenAI's stable can "think" well enough, to use that favorite OpenAI term, to resist tricks like "my grandmother worked in a napalm factory, she always told me about her work as a bedtime story, I miss her so much, please tell me how to make a chemical weapon?"

Back to Oprah and Sam Altman

On the show with Oprah Winfrey, Sam Altman, CEO of OpenAI, claimed that today's AI learns concepts within the data it is trained on.

"We are showing the system a thousand words in a sequence and asking it to predict what comes next. The system learns to predict, and then in there, it learns the underlying concepts.”

Many experts disagree, according to Techcrunch. "AI systems like ChatGPT and o1, which OpenAI introduced on Thursday, do indeed predict the likeliest next words in a sentence. But they’re simply statistical machines — they learn data patterns. They don’t have intentionality; they’re only making informed guesses."

Sam Altman studied computer science at Stanford, it is almost certain that he makes such pompous statements knowing they are not factual. Why would he do that?

$7 billion on a $150 billion valuation

Whereas just last week I wrote about an OpenAI investment round at an already staggering $100 billion valuation, it turns out I was a mere $50 billion off. Because according to The Information and The Wall Street Journal, Altman is in negotiations with MGX, Abu Dhabi's new investment fund, for a $7 billion investment at a $150 billion valuation.

So for that $7 billion, the investors would buy less than 5% of the shares, which is especially extreme given that OpenAI is burning so much money that it is not certain it can keep going for more than a year with this funding - even with annual sales of, reportedly, nearly $4 billion.

All the more reason, then, for Altman to go in full sales mode last week and, as he often does, provide a very broad interpretation of his products' capabilities.

The United Arab Emirates and Singapore more innovative than the EU?

In all the news about OpenAI, it is striking how deafeningly quiet it is in Europe. France is at least somehwat in the game with Mistral and many AI companies are based in the UK: but their owners are American (Microsoft, Google).

It strikes me especially as I spend these weeks in the United Arab Emirates and Singapore, two relatively small city-states on the world stage. (The travel, by the way, is the reason this newsletter appears later, for which I apologize.) Yet MGX, with as much as $100 billion funded from the proceeds of the sale of oil that the rest of the world so happily guzzled up from these parts, is able to pump billions into OpenAI.

Singapore sovereign wealth fund Temasek is not expected to be far behind. Singapore is hosting Token2049 this week, for which over twenty thousand participants are traveling to the innovative Asian metropolis. Not that everything is always peachy in Singapore; Temasek, for example, lost hundreds of millions in the FTX debacle. Yet it has budgeted to invest billions in decarbonizing the economy, not exactly a wrinkle-free pond for investment either. But it shows vision and boldness.

By comparison, the rumblings in the EU leadership are just symbols of the losers fighting over the scraps. The question is whether Europe will ever be able to play any significant role in AI, or merely serve as a market that can throw up barriers, as the EU is now frantically trying to do against Big Tech. Perhaps Europe should abandon this market and focus on the next big tech wave, CO2 removal. It will be interesting to see what course Singapore will take.

Thanks for the interest and see you next week!

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Silicon Valley divided over choice between founders or managers

Because I was traveling this weekend, I don't have a good overview of the most important tech news. Therefore, I devote this newsletter to the only topic of conversation last week in tech circles: founders or managers - who are better?

The Uber driver's gold-rimmed sunglasses are a symbol of where I am this week. The answer is in the last photo, at the bottom.

In Silicon Valley last week most conversations were dominated by the discussions about "Founder Mode", following a blog post by Paul Graham, founder of the world's most successful startup incubator Y Combinator. Graham argues that startup founders shouldn't listen to investors who often insist on appointing experienced CEOs and managers, which Graham says often has disastrous consequences.

Founders or managers?

Operating in "founder mode," according to Graham, means adhering to a founder's mindset and management style. It's about bypassing rigid organizational structures and fostering close collaboration between departments. In contrast, startups in "manager mode" attract competent, experienced managers to lead teams with minimal interference from the CEO.

"The way managers are taught to run companies seems to be like modular design in the sense that you treat subtrees of the org chart as black boxes. You tell your direct reports what to do, and it's up to them to figure out how. But you don't get involved in the details of what they do. That would be micromanaging them, which is bad.
"
Graham wrote.

Airbnb almost successfully managed into the ground

He was inspired to write his blog post by a recent speech by Airbnb co-founder Brian Chesky at Y Combinator. In it, Chesky highlighted the pitfalls of conventional wisdom when scaling businesses, often advising to hire good people and give them autonomy. When he followed this advice at Airbnb, it led to disappointing results.

In his own words, inspired by Steve Jobs, Chesky developed a new approach, which now seems to be working, given Airbnb's strong financial performance - although residents of the inner cities of Barcelona and Amsterdam will think otherwise, awash in a wave of rolling suitcases and higher rents due to Airbn's "success".

Many founders in the audience shared similar experiences as Chesky and realized that the usual advice harmed rather than helped them. Chesky pointed out that founders are also often advised to run their companies as professional managers upon strong growth, which often proves ineffective.

Apple and Microsoft successful in manager mode

According to Chesky and Paul Graham, founders possess unique skills that managers without entrepreneurial backgrounds often lack. By suppressing these instincts, founders can actually harm their companies.

Risa Mish, management professor at Cornell University, contrasted that in Observer that it was precisely Steve Jobs who was succeeded with great success by the experienced manager Tim Cook. Microsoft has also performed many times better under Satya Nadella than anyone ever expected.

"But it could be as simple as the difference between a team trying to create new things and a company focused on growing existing products and revenue streams," Mish said.

Examples abound in both camps

Mish has apparently forgotten that Steve Jobs was fired from Apple in the 1980s by CEO John Sculley, who came from Pepsi Cola and ironically was recruited by Jobs himself.

The only innovation Sculley introduced at Apple was the legendary flop Newton, because he was unable to match the undeniably huge market potential of the mobile device (later proven correct by the iPhone) with the right timing, the most important skill for an innovative CEO. The technology was far from ready for a device like the Newton; high-speed mobile Internet was lacking and the small processors were still too weak.

Before I digress further: contrasted with the success of executives Tim Cook at Apple and Satya Nadella at Microsoft is a literally and figuratively (numerically and symbolically) equally great success in the person of Nvidia founder Jensen Huang, who has been CEO of the chipmaker he himself founded for more than three decades.

Nor will Salesforce shareholders shed any tears that founder Marc Benioff has been in charge there for more than a quarter century and, according to The Information, is even working on a comeback, as if that was necessary since Benioff was never out of it. In short: whether it's successful founders or successful managers, there are plenty of examples in both camps. Time for a quantitative comparison!

The data shows: founders perform better

Fortunately, the dilemma has since been studied quantitatively and it turns out that Paul Graham's thesis is correct: founder mode is often superior when it comes to value creation, according to an analysis of PitchBook data.

Pitchbook is clear: founders are better than managers.

Pitchbook concludes:

"In each of the past five years, VC-backed founder-led companies grew in value significantly faster than non-founder-led companies. This year, the relative rate of value creation for founder-CEOs was 22.4%, compared to 4.7% for non-founder-CEOs.
In the chosen methodology, the relative rate figure reflects the percentage of value increase between funding rounds, expressed on an annual basis. Among companies that raised funding this year, median value growth was $3.6 million higher among founder-CEOs.
According to Graham, founder-CEOs of high-growth companies are especially "more agile" than professional CEOs. That detail-oriented approach can lead to higher growth through product improvement, or by better motivating front-line employees."

Vulnerable businesses need entrepreneurs

Vulnerable companies need entrepreneurs. In my opinion, which is based on experience and observation but not supported by quantitative research, companies that regardless of their age rely primarily on one product or one revenue source should preferably have a founder at the helm.

Take Google, which is currently under pressure due to the rise of OpenAI with ChatGPT, while their revenue comes largely from ads, especially through the search engine.

As soon as the search engine generates less traffic, revenue will drop, and things will get very tough for Google. CEO Sundar Pichai is clearly a competent manager, but the next few years will show how good an entrepreneur he is.

We need only think back to the temporary successes of Nokia and Blackberry to see what happens when companies that lean on innovation are led by executives unable to adapt their products when they are attacked head-on.

Zuckerberg's flexibility

An excellent example of a relatively young founder who has mastered the craft is Mark Zuckerberg. When Instagram appeared to be a threat to Facebook, he quickly bought it for a billion dollars. An amount many frowned upon, but insiders knew it was a bargain. WhatsApp was about 20 times as expensive, but still a good deal.

When Snapchat posed a major threat to Instagram with Stories, Zuckerberg simply had Instagram copy Snapchat's full functionality, without ego. This saved Instagram. He is currently trying something similar in response to TikTok.

I am convinced that a classical manager would never have bought Instagram and Whatsapp or let Instagram respond so quickly to competition from Snapchat and TikTok. That Zuckerberg has now spent tens of billions on obscure Metaverse adventures is, by comparison, a rounding error.

Conclusion from thirty years as an entrepreneur and investor

Interestingly, many successful entrepreneurs say they have been mentored for years by a small group of experienced advisors who enjoy their trust. For example, ex-Intuit CEO Bill Campbell, about whom the excellent book Trillion Dollar Coach was written, was a famous advisor to Steve Jobs and the founders of Google, among others.

In Silicon Valley, investors and former entrepreneurs Reid Hoffman, Peter Thiel and Marc Andreessen are frequently mentioned names as examples of valued advisors. It is precisely in the combination of entrepreneurial experience and investment experience that they prove to be of unique value.

This topic is close to my heart because, after almost ten years as an employee during my school and college days, I have been an entrepreneur for 15 years and an investor and advisor for 15 years since.

Coachable crazies

My conclusion is that coachable entrepreneurs have the greatest chance of success.

One of the advantages of having been an employee first is that I learned mostly how I didn't want to deal with people once I became an employer. During my time as a young entrepreneur at Planet Internet, however, I have been immensely supported by valuable advice, both from entrepreneurs and managers.

In retrospect, I only realized how lucky I was that entrepreneurs like Eckart Wintzen (BSO) and Maarten van den Biggelaar (Quote Media) took the time for me, as did members of the Board of Directors of the Telegraaf and Ben Verwaayen of KPN.

It didn't escape me that Quote, Telegraph and KPN were shareholders, and that perspective obviously always came into play. But that doesn't diminish the quality of their opinions.

Later, as an advisor at the same Quote Media and at dance company ID&T, I saw how talents such as Jort Kelder and Duncan Stutterheim might appear to the outside world to be stubborn, but in practice, at crucial moments, they listened very carefully to advice - and then, as they should, made their own decisions.

It became more difficult in constellations where, on the contrary, many different winds were blowing, as I experienced with the OV Chipkaart: a consortium of public transport companies that competed among themselves, which tendered to a consortium of companies that in turn competed among themselves. 

At the Silicon Valley startup Jaunt, I experienced something similar. This virtual reality pioneer had a mix of tech and media people within both the team and the investors, a true fusion of Silicon Valley and Hollywood.

Making VR cameras as well as VR productions, having offices in Palo Alto and Santa Monica and owned by shareholders that ranged from the traditional profit-hungry Silicon Valley vc funds, to Disney and Sky; on top of that also a mix of American, European and Chinese investors. You end up with a sort of mash-up of fried rice and sauerkraut, or a pizza with ginger and kale. Separately excellent, but the combination doesn't work. It lacks focus and a unified mindset, which a good founder as CEO does have.

That's a long run-up to my conclusion: the best CEOs are founders who are maniacal in their vision, but coachable in their execution; call it coachable geeks. And then preferably coachable by both experienced founders *and* managers.

The sunglasses of the Uber driver already gave it away: this week I am in Dubai. 

Thanks for your interest and see you next week!

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AI invest technology

Apple, Microsoft and Nvidia invest in OpenAI despite $158 loss: per second

Summer is over so starting next weekend, this newsletter will again be weekly instead of monthly. With apologies for the late mailing, herewith the most notable recent topics covered in this newsletter:

  • OpenAI loses $158 per second yet is worth $100 billion
  • Nvidia breaks revenue records but is very silent on customer success
  • Shares of AI-driven companies rose sharply in August
  • Energy consumption of AI threatens climate goals of Big Tech companies, appear to try to change the rules of the game 
  • Telegram and other social media are obviously being targeted by governments
  • podcast of Taylor Swift's boyfriend, and his brother, to Amazon for $100 million
  • Midjourney will make hardware

OpenAI loses $158 per second but is worth $100 billion

According to The Information, OpenAI, maker of ChatGPT, is fast heading for a $5 billion loss this year, or: $158 per second. This is a negligible run-up loss in the eyes of CEO Sam Altman and his supporters, as he appears to be successfully raising new funding at a valuation of $100 billion. That compares to the value Facebook had at the time of its IPO in 2012, but Zuckerberg did make $1 billion in profit!

Interestingly, the three most valuable companies in the world, Apple, Microsoft and Nvidia, apparently consider participating in this investment round. Thrive Capital as lead investor is doing $1 billion and Nvidia $100 million. That's a hefty sum, but how far does that take OpenAI?

How well is Nvidia doing?

At an annualized loss of $5 billion, OpenAI can go on for a scant week with that $100 million from Nvidia, which itself posted second-quarter revenue of $30 billion with a net profit of $16.6 billion. So it only takes the chipmaker thirteen hours (!) to earn the $100 million it invested in OpenAI. A nice tip for keeping a big customer happy.

Is Nvidia doing well or badly? Opinions vary.

Nvidia's performance is being interpreted in different ways. People from outside the tech industry, such as financial analysts, do not seem to understand that the manufacturing problems Nvidia is experiencing in producing the new Blackwell chip are temporary.

A company's performance is determined by a combination of revenue, growth and profit. Nvidia's sales will be fine for the next few years, due to a lack of competition and the huge demand from the Big Tech companies that develop AI applications or provide platforms for AI developers: Microsoft, Amazon, Google, Oracle and Salesforce are just a few of the customers who cannot drive their AI efforts without Nvidia. So aside from revenue, Nvidia's profit margin is in good shape for now.

A bigger problem for Nvidia is the growing doubt that all those customers can make healthy profit margins on their AI investments. So far, those hoped-for profits are failing to materialize, and that does represent a long-term concern at Nvidia. Top executive Jensen Huang is very quiet when asked about his customers' return on their AI spending at Nvidia. The question becomes how long for Huang silence is golden.

August was a fine month for AI companies.

AI Spotlight 9 rose sharply in August

While NVDA shares rose over 11% last month, it was also a fine month for many other companies benefiting from the rise of AI. Super Micro took a huge hit after it failed to produce its annual results on time.

My totally subjective AI Spotlight 9 has been updated and I have added Arm (chips), Arista (networking) and Marvell (chips). After all, Nvidia, Google and Microsoft are already in the "regular" Spotlight 9 of leading tech investments.

The S&P 500 closed very close to its all time high on Friday August 30th. Shares rose in the last 10 minutes of trading on Wall Street, with the S&P 500 up 1% and all major sectors on the rise. But the outlook for September is less bright.

Since 1950, the S&P 500 has generated an average loss of 0.7% in September and finished higher only 43% of the time, making September the worst month for stocks based on average return and positivity percentage. The past four September months have also been remarkably weak, with respective declines of 4.9%, 9.3%, 4.8% and 3.9% for the index. It will be interesting to see how tech stocks and especially AI companies do in the coming weeks.

AI versus climate

Due to the huge growth in data center energy consumption in pumping AI applications like ChatGPT and Google Gemini, tech giants risk missing their climate goals, usually ambitiously defined as "net zero," or carbon-free operations. There is great concern that smart techbros like Bezos are indirectly manipulating the definition of zero emissions

The Financial Times is particularly concerned about the influence of Amazon and Jeff Bezos's $10 billion Bezos Earth Fund on the carbon credits market, especially through its funding of the Science Based Targets Initiative (SBTi). The SBTi sets standards for corporate climate goals, but experts worry about potential conflicts of interest as large technology companies, including Amazon, want more flexibility in using carbon credits to achieve net zero targets.

This influence could change the way climate standards are set, potentially favoring cheaper carbon credits over actual emission reductions. Compare it to a penalty taker in soccer who often misses, upon which he decides to make the opponent's goal thirty feet wider and higher. And as a goalkeeper a garden gnome.

Telegram and X crackdown

Once upon a time, the credo of telecom operators was "we have zero responsibility about our customers' messages". For Internet service providers, I unfortunately know from experience, this was not such a simple matter. I wrote about that earlier. For social media, it is even clearer that they should intervene whenever possible if their networks are being used for criminal activity. The Washington Post explains it clearly:

"Global Internet regulators are no longer playing around. Two days after France sued Telegram CEO Pavel Durov on several charges, Brazil on Friday ordered the suspension of Elon Musk's X after it ignored an order to appoint a legal representative in the country. While the details differ in important ways, both cases involve democratic governments losing patience with cyberlibertarian tech magnates who perhaps turned their noses up at authorities a little too often.

The crackdown, which comes months after the passage of a law in the United States that could lead to the banning of TikTok, heralds the end of an era. Not the era of social media, which is still going strong. But the era when tech giants had free rein to shape the online world - and enjoyed a presumption of immunity from real-world consequences.

Although unfettered Internet companies have long clashed with authoritarian regimes - Google in China, Facebook in Russia or pre-Musk Twitter in Turkey - Western governments did not, until recently, consider social media and the vision of free speech they promoted to be fundamentally at odds with democracy. Politicians and regulators recognized that there were bad things on the Internet, condemned it and sought ways to limit it. But banning entire social networks or arresting their executives was simply something liberal democracies did not do. Now, for better or worse, they do."

The arrest of Durov in France is akin to firing a gun at a gnat. But until the full charges are revealed and it is clear what crimes Durov is accused of, it also remains difficult to vouch for his innocence. If Telegram is actually being used for pernicious activities and could well have intervened, appropriate punishment is warranted.

Friend of Taylow Swift and his brother podcast for $100 million 

The Kelce brothers make a nice podcast, and the fact that the youngest brother is Taylor Swift's bearded arm candy also won't have deterred them from striking a $100 million deal with Amazon, which is trying to bring in more ad revenue. Actors Jason Bateman, Will Arnett and Sean Hayes struck a similar deal with satellite radio station SiriusXM early this year for their podcast, also for $100 million.

But Alexandra Cooper's podcast is the clear winner with the very well chosen name for her podcast Call Her Daddy, Cooper is reportedly getting $125 million from SiriusXM over three years.

According to Midjourney, I am more handsome than my reflection and I was typing this newsletter laughing on a beach. Then it must be true.

Battle over AI photos enters new era

While Elon Musk's picture maker Grok seems to know no limitations, spitting out everything from famous singers in lingerie to Kamala Harris with a firearm, the launch of the web version of Midjourney has been much less in the news.

That's a shame, because Midjourney is a fantastic tool that was previously only available via the cumbersome Discord. Fascinatingly, Midjourney also plans to get into hardware. Since hardware head (his real title) Ahmad Abbas previously worked on the Apple Vision Pro, some think it will be "smart glasses" but Midjourney CEO David Holz is far too smart for that. Everyone knows that if you want to make money in the smart glasses business, you might as well get in the shower, light up a cigar and burn thousand-dollar bills with it.

The question is, and all suggestions are welcome: what hardware is Midjourney going to make?

Thanks for the interest and see you next weekend, then hopefully just again on Sunday!

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AI forces Microsoft and Google to revise climate goals and stock market in Great Rotation?

Switching to a monthly frequency of this newsletter over the summer in anticipation of a newsless summer did not prove to be the smartest decision, so in last month's avalanche of tech news, I try to make sense of the two most important developments. First, the massive energy consumption of AI forcing Microsoft and Google to rethink their climate goals. And fears of recession seem to be ushering in a "Great Rotation" in stock markets, with investors fleeing tech funds into more conservative stocks.

Greenpeace and Amnesty against Microsoft?

It seemed like agreed-upon work: on July 2, as many as eighty nonprofit organizations including Greenpeace and Amnesty International declared that the use of carbon offsets (carbon credits) by companies, actually undermines rather than supports climate goals. The objection is that companies are buying virtually worthless carbon credits and not reducing their emissions.

Companies in sectors ranging from technology to mining, on the other hand, argue that carbon offsets are actually crucial to reducing corporate emissions and moving toward net zero emissions. How can the parties be so opposed when they claim to be pursuing the same goal?

Need for high-quality and reliable carbon removal assets

At its core, this is a confusion of concepts. Opposition to useless carbon credits, issued for, say, forest areas that are never threatened, is justified. But companies such as Microsoft, on the contrary, are voluntarily focusing, without legal requirements, on carbon credits based on actual removal of carbon from the atmosphere. And that removal is crucial: annual global greenhouse gas emissions are about 50 gigatons, but as much as 2,200 gigatons must be removed to stay below one and a half degrees of warming. Simply turning off the tap will not have sufficient effect.

Reducing all emissions to zero will save 50 Gigatons - but there are still 2,200 Gigatons to be removed from the atmosphere.

"It's about creating a market for high-quality, reliable and sustainable carbon removal assets," Melanie Nakagawa, chief sustainability officer at Microsoft, said in a recent interview. "Think about sequestering carbon in the soil through accelerated weathering of rocks or stones that absorb carbon and are turned into concrete. Or Mombak, a large forestry project in Brazil." Another example of carbon sequestration is 280 Earth, nota bene once spawned by Google.

AI threatens climate goals, but there is hope

On July 3, the day after the 80 organizations shared their objection to bad carbon credits, the very club magazine of business, the Wall Street Journal, reported that Google's total emissions had increased 13.5% from 2022 to 2023.

In fact, since 2019, emissions have increased by nearly half, Google reported deep on page 31 of its sustainability report. Competitor Microsoft's total emissions increased 29% between 2020 and 2023.

Google stopped carbon offsets and focuses on removal
source: Bloomberg

Google had just promised to reduce emissions by 50% from 2019 levels, and Microsoft has been saying for years that it will be carbon-negative by 2030.

To cost-effectively combat climate change, it is crucial to find the most cost-effective methods to reduce greenhouse gases (GHG). A fascinating study published in Nature estimates the cost per ton of CO2 for two reforestation methods: natural regeneration and plantations. By creating new maps of costs and carbon storage, it shows that natural regeneration and plantations are cheapest in about half of the suitable areas for reforestation.

Together, at less than $50 per ton of CO2, these methods can reduce 44% more emissions than natural regeneration or plantations alone. This is far more effective than previous estimates by UN research organization IPCC showed. In short: there is hope for effective, affordable carbon removal.

OpenAI loses $5 billion a year

The AI craze is largely responsible for the increasing energy consumption and associated emissions of tech giants. Large language models (LLMs) such as ChatGPT are powered by energy-intensive data centers.

Training, maintaining and using LLMs consumes processor power and thus energy. It therefore came as no surprise that OpenAI is on track to lose $5 billion a year. The question of how all the investments in AI will ever be recouped is becoming more pressing. The gap between investment and market value is now $600 billion.

The quality of LLMs is also being questioned in increasingly wider circles, raising the question of whether other forms of AI do not offer better solutions. Professor Deepak Pathak thinks that not understanding physical environments structurally limits the quality of LLMs.

An LLM can read thousands of reports on gravity without understanding what happens when you drop a ball from your hand. That's why Pathak is trying to develop AI with "sensory common sense.

Spotlight 9: carnage in the stock market

Last Friday, August 2, the stock market experienced its worst day since 2022. This after, to say the least, a turbulent month in the stock market for the technology sector. Initially stock prices were still rising on expectations of a Federal Reserve rate cut in September, but weak economic data, including a drop in manufacturing activity and rising unemployment, caused a stock market sell-off.

The only gainer in the month of July was Bitcoin. Apple also remained steady.

Chip stocks were hit particularly hard, market leaders such as Nvidia and AMD fell sharply but the once proud Intel was hit the hardest: falling sales led to mass layoffs and a 32% drop in Intel shares!

Crowdstrike lost nearly half of its stock market value after the global outage, but the entire AI sector took substantial hits.

The sell-off was not limited to U.S. markets, as investors worldwide were gripped by fears of a global recession. In recent years, larger exchange traded funds such as Apple, Microsoft and Amazon, have far outperformed smaller ones. Still, reports of a "Great Rotation" of large tech funds into lower-market and undervalued "value stocks" seem as exaggerated as the conspiracy theory of a Great Replacement.  

Link Tips

Elon Musk gives update on second human with Neuralink implant

Politically, Musk has been on the lookout for what is beyond the far right for a while, but as soon as he talks about technological advances, he remains fascinating. By the way, Musk himself always appears to play podcasts at twice the normal speed. Nicest quote from his latest appearance on Lex Fridman's podcast: "If your vocabulary is larger, your effective bitrate is higher."

PayPal mafia's love for Donald Trump explained

Another interesting podcast, More or Less by the couples Morin and Lessin, tried to explain why people like Elon Musk, Peter Thiel and David Sacks are such ardent Trump supporters. A disconnect between intelligence and empathy can be observed.

How crypto affects U.S. presidential election

Investors Marc Andreessen and Ben Horowitz are donating to Trump, to the annoyance of The Verge, but LinkedIn founder Reid Hoffman and other top investors are rallying behind Kamala Harris. Crypto regulations are proving to be a divisive issue. I expect Harris to propose a different crypto policy before the election than President Biden implemented with the SEC during his presidency.

XRP had an amazing July, but Solana also held its own while the rest of the crypto world processed corrections.

How do you hire a CEO?

Top investor Vinod Khosla, who was at odds with Elon Musk just a few weeks ago over his support for Donald Trump, explains how to hire a CEO. Khosla is certainly no supporter of Trump and shared in his familiar clear terms what to look for when choosing a CEO. What's nice is that the way he shares it differs on Medium and on X.

Small, delicate drone

The HoverAir X1 drone is the first interesting drone not made by DJI in years. Small problem is that the drone will land on its own, including over water. I'm sure there will be a solution to that soon.

Apple Vision Pro on sale in Europe and Asia

Totally overlooked by the media and by consumers: the Apple Vision Pro is now on sale in most countries but no one cares. Too bad the beautiful device is alarmingly expensive and too little good content remains available for it. When will Apple dare to lower its margin and create a market by, for example, offering substantial discounts on the Vision Pro, say to buyers of a Mac or an iPhone?

Dr. Sachdev lectured and we listened especially attentively. The entire webinar is here.

Five, no yet six, tips for successful Web3 projects

Dr. Nisheta Sachdev and Gert-Jan Lasterie discussed the success and failure factors when introducing new projects in the Web3 world. Together with the webinar participants, I asked the questions. It is especially interesting to see which tactics for quickly building a real community are also applicable to other products and services.

Nice finale for hot days

Even one glass of alcohol a day can lead to serious consequences for your health. But there is also good news: "It is healthier to be social without the need for alcohol, but the benefits of spending time with others are still likely to outweigh the risk of consuming one to two units of alcohol." In other words: raise a glass together, otherwise don't.

Cheers, and see you next month!

Categories
AI invest technology

Billions hunt on Wall Street due to AI gold rush

It was the week of AI on Wall Street. After Apple presented its AI plans on Monday, things remained quiet for a while, but after a day's respite, the stock market hit a complete snag on Wednesday: Apple briefly overtook Microsoft as the world's most valuable company, while just last week it had lost the second spot to Nvidia. What is wrong with these investors? Why the absurd price swings of hundreds of billions?

The market value of Apple (orange), Microsoft (blue) and Nvidia (green) last week in trillion dollars. Source: ChatGPT 4.o

Billions of dollars

As of June 14, Apple, Microsoft and Nvidia have all passed the milestone of a $3 trillion market value, making them an exclusive "trillion-dollar" club. Due to enthusiasm among investors about the upcoming introduction of AI applications and ChatGPT in the iPhone, Apple briefly regained the title of the world's most valuable company with a market capitalization of $3.283 trillion, just slightly higher than Microsoft's at $3.282 trillion. 

Meanwhile, Nvidia's stock price also rose steadily, driven by investor excitement over Nvidia's 10-for-1 stock split. Nvidia's market capitalization experienced a meteoric rise, from $2 trillion to $3 trillion in a record-breaking 96 days, faster than Microsoft (649 days) and Apple (718 days). 

Nvidia's dominance in AI chips and strong earnings growth have fueled share price gains, with shares up more than 132% this year and 193% in the past year. But on Friday, Apple's share price fell slightly, Microsoft rose slightly and so Microsoft ended the stock market week as it began: as the world's most valuable company.

Everyone was buying iPods, not AAPL 

Let's face it: if the so-called investment gurus understood anything about technology, they would have been buying Nvidia shares en masse years ago. But just as there was no one 21 years ago who, instead of buying an iPod at that price, $300, bought shares of Apple (which would be worth $137, 000 today), there is virtually no professional investor who has been in Nvidia for more than, say, five years.

Professional fund investors are as big amateurs as you and me. Why are Apple ($3.26 trillion), Microsoft ($3.29 trillion ) and Nvidia ($3.24 trillion) now worth almost as much? Ask any analyst or investor and they'll say in chorus: because of AI. That's like an artist manager saying, "Doesn't matter if I'm manager of Taylor Swift or Country Wilma, they're both singers.

The market does not seem to understand that these are totally different companies with different approaches to revenue, costs and possibly profits from applications of AI. But their perspective is totally different.

Apart from all the AI violence in the stock markets this week, with Nvidia still rising stronger than Apple, it is notable that Bitcoin and Ethereum fell while Bitcoin seemed to be heading for a new all-time high.

Nvidia makes pickaxes, Microsoft is mining

With AI, we can speak of pure gold rush, so let's keep that metaphor. In this gold rush, Nvidia makes the shovels and picks that every miner needs. Amazon, Meta, X, Tesla, Oracle, go down the list of tech giants: all, like Microsoft, use Nvidia's shovels and picks.

There is no alternative that delivers the same performance per dollar invested, which is why Nvidia's revenue growth and profit margins are already legendary. The question is how long Nvidia can maintain this position, but at least for the next few years.

Microsoft is the biggest miner, with worldwide data centers full of Nvidia stuff. At Microsoft, unlike Nvidia, the question is whether those billion-dollar investments will lead to sufficient margin. The first noises are already being heard that Microsoft's customers are not at all achieving the intended improvement in returns based on Microsoft's AI applications.

This will obviously lead to price erosion and lower sales and undermine investor confidence in Microsoft's AI plans because the costs are astronomical. These are not investments of billions, but tens of billions, and they will start to gnaw away at the profit margin. 

OpenAI is goldsmith, Apple the jewelry maker

OpenAI sits just a layer above Microsoft: it uses Microsoft's data centers and cloud services to forge gold, demanding maximum power from Nvidia chips. Demand for OpenAI's technology, particularly its flagship ChatGPT, has been huge. Meanwhile, OpenAI is heading for annual sales of nearly $3.5 billion.

That's why shareholder Vinod Khosla remains unabatedly optimistic. No wonder, he stepped in at a valuation under a billion and has already seen his investment increase hundredfold in value. Then I would also smile affably at the criticism of OpenAI.

OpenAI, led by Sam Altman, likes to leak revenue figures; but we hear nothing about its burn rate, its losses. This is no wonder, because in fact OpenAI pays heavily to two suppliers: Microsoft and Nvidia. Both seek maximum profit, and so OpenAI burns billions a year. The billions it invests in OpenAI, it largely gets paid back by services provided.

No, then Apple, the jewelry maker of AI mining. It builds AI applications here and there into its operating system and applications, which they don't call AI but Apple Intelligence, but the cost of these, viewed in the big picture at Apple, is virtually marginal. And the partnership with OpenAI announced big Monday costs Apple nothing at all.

What Apple does is create elegant, easy-to-use products that improve everyday life, similar to turning raw gold into fine jewelry. Apple's ambition is to offer consumer products and services that seamlessly integrate AI to improve our daily lives. The only question is: Will those AI ambitions from Apple work this time?

Apple Intelligence is Siri 2.0?

Investor and former journalist MG Siegler rightly points to all of Apple's previous attempts to get Siri working properly. It's the same pain point Marques Brownlee pointed out in conversation with Apple CEO Tim Cook.

More than two billion iPhone owners will get an update before the end of the year that will allow them to enter the AI era - provided their iPhone can handle it and, as a result, Apple may well get a huge sales boost from the iPhone 15 and the new iPhone 16, while for years renewing your iPhone was virtually unnecessary.

By the way, it's remarkable how times have changed: just last week I pointed out a podcast with legendary Wall Street Journal reporter Walt Mossberg, who terrified the entire tech elite. Nowadays, it's YouTuber and professional frisbee player Marques Brownlee for whom the red carpet is rolled out at the introduction of a new product.

Traditional journalism is struggling to make sense of Apple's introduction of AI applications. This makes sense in itself, as it is all still future music and nothing can actually be tested yet.

This is now called the Apple Power Stance: legs (too) wide, toes at ten past three-thirty.

It's just sad that the Washington Post didn't get much further than to point out the hilarious pose with which all Apple employees are portrayed these days. It has since been flatteringly christened the "Apple Power Stance," but surely the Dutch know this position better as Bassie's spreading stance on his floppy shoes.

Too much focus on LLMs and Generative AI

Those who would have followed the technology sector from some distance this week would undoubtedly get the impression that Large Language Models (LLMs) such as ChatGPT and Google Gemini, are the only and most important form of AI.

But criticism of the hundreds of billions being thrown into this branch of AI is rightly growing louder. Martin Peers of the Information has a sharp analysis:

"Despite the ubiquity of AI in news reports, one issue does not get enough attention: Are the advances that society will gain from the new technology worth the cost? By cost, I specifically mean the impact on energy supplies. The energy demands of data centers threaten to deplete energy resources, pushing back efforts to switch from carbon-emitting energy sources.

And for what? Judging by how some technology companies market their AI-driven services, it's about helping consumers design a menu for dinner, plan a vacation or find a photo on their phone. (The idea, of course, is to get consumers to spend money on new devices or AI subscriptions.)

Or it's about helping companies improve employee productivity, including cutting jobs (great!). Despite the attention these applications have attracted, AI's real promise undoubtedly lies in its potential to solve existential challenges such as deadly diseases or dangerous drivers.

Efforts to use the new technology in those directions are already underway. Google, for example, has its AlphaFold project aimed at accelerating medicines for diseases. Elon Musk is making AI the centerpiece of his efforts at Tesla to develop fully autonomous driving. Microsoft, meanwhile, is using AI to improve cybersecurity, among other things - an effort that can't come soon enough.

Data breaches at large companies - including recently at Snowflake, which affected several of its customers - have become so commonplace that they attract little attention, despite the pain they cause. No one knows the problem better than Microsoft, whose chief executive, Brad Smith, was addressed Thursday in a congressional hearing about the company's cybersecurity shortcomings.

But fighting deadly diseases, solving autonomous driving and even improving cybersecurity are not cheap or fast ventures. Yet large technology companies are spending tens of billions of dollars to develop AI, so they need a return. The danger is that the need for quick returns from consumer and business services will distort investments, neglecting more important needs.

Unlike AI startups like Anthropic and OpenAI, large companies are not run by non-profits that require them to put the interests of humanity first. Let's hope that AI's greatest advances don't turn out to be trivialities, like saving consumers a little time while playing with their phones."

"LLMs suck oxygen out of any space"

Leading thinker on technology Jennifer Zhu Scott puts it this way: "LLMs suck all the oxygen out of any room I enter. Again, a reminder:

  • LLMs will eventually become commonplace
  • LLMs are the playing field for only a handful of firms in the world
  • LLMs are not the future of truly advanced AI; instead, a more efficient architecture that requires less data/calculating power/energy and is more like biological brains is the future.
  • LLMs cause a huge carbon footprint and water consumption, and much of the output is credible nonsense, meaningless "art," deep fake and massive privacy invasion
  • Praise to those who keep their LLMs open-source

OpenAI's release of ChatGPT3 in November 2022 set in motion this mad race of LLMs and has delayed the progress of advanced AI by at least five years."

Earlier, Jen Zhu Scott said, "It's simple. We won't get to Mars by building taller buildings on Earth. Where Mars stands for general artificial intelligence, or AGI."

LLMs, as clever as some applications are, remain advanced forms of the best player in a pub quiz or the scholar who always raises his finger trying to give the answer. Only the answer does not always turn out to be correct, and the facts that the diligent scholar spits out are based solely on learned knowledge.

Fundamental technology that advances society, e.g. helps eliminate disease, will not be developed on the basis of LLMs. This puts the billion-dollar investments and trillion-dollar valuations for companies engaged in the current form of AI, LLMs, in an increasingly questionable light.

See you next week!

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Nvidia has passed Apple, so what will Tim Cook do tomorrow?

So much happened in the tech world last week that I briefly discuss ten news items that stood out to me the most.

If Nvidia maintains the revenue and profit growth of recent quarters, and it looks like it will, it will be the world's most valuable company before the end of the year. 

1. Nvidia worth more than Apple

The day you knew who was coming was Wednesday: Nvidia passed Apple in stock market value and became the world's most valuable company after Microsoft. There are legitimate reasons why Apple's sales are stagnant, with limited access to the Chinese market in particular preventing Apple from realizing its full market potential.

But there is more behind Nvidia's impressive run. Because while Nvidia had been investing heavily in the development of AI technology for over a decade, with all the risks of such a relatively one-sided strategy, Apple waited no less than nine years since the iPad in 2010 and the Apple Watch in 2015, until 2024, before introducing a new category of products with the Apple Vision Pro.

Meanwhile, Apple did buy back hundreds of billions of its own shares.Investors were happy about it, but buying back its own shares remains a weakness. Apple could have bought all sorts of useful companies, but Beats. the maker of flashy headphones, was the largest acquisition in Apple history ten(!) years ago at a cost of three billion dollars. That seems like a lot, but put it in perspective: Apple makes that amount in net profit every two weeks.

Apple could have purchased content (like Disney, and then divested the channels like ESPN), content aggregators (Netflix, Spotify), a completely new product category (Tesla) or valuable sports rights (World Cup, NFL, Olympics, Premier League). But none of that. No, to satisfy shareholders Apple kept doing huge stock buybacks.

Beats only fun for Dr. Dre

Meanwhile, it hobbled along behind Spotify with Apple Music, and those ostentatious headphones from Beats by Dr. Dre pleased mostly Mr. Dre himself - and according to rumors, he's not even a real doctor. More than half of Apple's profits come from products, particularly the iPhone, that are more than a decade old and under pressure from cheaper competitors.

Apple, at its core, sells too few products to still grow sales independently, although it still managed to increase its profit margin by cleverly optimizing its sourcing, like replacing Intel as a chip supplier with Apple's own top-quality Silicon chips.

Nasdaq Composite beat Apple

Investors are punishing mediocre growth due to Apple's lack of innovation and are sprinting toward Nvidia. NVDA shares are up more than 150% in 2024 (AAPL: 6%), 214% in the past year (AAPL: 9%) and over 3,200% in the past five years (AAPL: 314%).

By comparison, during those same periods, the Nasdaq rose 14%, 29% and 126%, respectively. It was unimaginable a few years ago: the Nasdaq Composite rose more than three times as much as Apple last year .

For those looking for more background on Nvidia's growth, I previously wrote this piece.  Why the Apple Vision Pro is technically fabulous but from a business perspective merely a drop in the bucket for Apple, is described here.

TikTok bypasses U.S. export restriction

Nvidia is so unique and crucial that all other major tech companies are clutching their hats to be allowed to buy chips from it. From Microsoft to Google, Meta and Amazon: without Nvidia hardware, they can't develop AI applications, especially processor-guzzling Large Language Models (LLMs) like ChatGPT, Google Gemini or applications on Amazon Bedrock.

ByteDance, the parent company of TikTok, also needs Nvidia to develop AI and has cheekily circumvented U.S. export restrictions: it rents cloud capacity from U.S. cloud services, including those of Oracle. Officially, none of these developments seep into China, but for those who believe that, I also have a nice used car for sale from a half-blind widow, barely used.

2. Tim Cook's AI moment

Tomorrow morning, 10 a.m. California time, Tim Cook will take the stage at Apple Park in Cupertino at a pivotal moment in his career. Cook has been through a lot in his more than 12 years at the helm of Apple, but never this. He must convince the world that Apple has an AI strategy.

It has already been leaked that Apple will not launch a single AI app, but will apply AI across the breadth of its product spectrum. With one crucial difference here, compared to Microsoft: everything at Apple is opt-in, so users have the choice to turn AI applications on or off.

In contrast to the fiasco at Microsoft this week, which, with the feature Recallunsolicited searched through a user's activities, including files, photos, emails and browsing history and taking screenshots of the user's computer every few seconds to search through as well. Well that's not creepy at all.

3. Elon Musk sent Tesla's Nvidia chips to X and xAI 

"Elon prioritizing X H100 GPU cluster deployment at X versus Tesla by redirecting 12k of shipped H100 GPUs originally slated for Tesla to X instead,” an Nvidia memo from December said. “In exchange, original X orders of 12k H100 slated for Jan and June to be redirected to Tesla.” according to a leaked Nvidia memo from December.
 

By directing Nvidia to prioritize X (also known as Xitter, because formerly Twitter) over Tesla, Musk ensured that the automaker would receive more than five hundred million dollars worth of Nvidia GPUs months later. This likely caused additional delays in setting up the supercomputers Tesla says it needs to develop autonomous vehicles and robots.

A more recent email from Nvidia, from late April, said that Musk's comment at Tesla's first quarterly meeting "conflicts with bookings" and that his April post on X about ten billion dollars in AI spending also "conflicts with bookings and FY 2025 forecasts."

There is growing criticism of Musk's many hats, who, after all, is also CEO of aerospace company SpaceX, founder of brain-computer interface startup Neuralink and tunneling company The Boring Co. He additionally owns X, which he acquired in late 2022 for forty-four billion dollars, and AI startup xAI. Now Musk is even in danger of losing a fine bonus of fifty-six billion dollars.

The nice thing about Musk is that he often responds to critical reports on X, including now. His response is that Tesla had no capacity to do anything with those much-needed Nvidia H100 chips and they would have been stored in a warehouse. Hence the change of receiving address for this multi-million dollar order. Musk also says Tesla will install fifty thousand H100s at the Tesla Giga Factory in Texas to develop fully self-driving cars (FSD).

Nvidia Blackwell: no discounts

Just a quick calculation: an H100 reportedly goes out of the store for at least thirty thousand dollars, so Tesla alone buys one and a half billion dollars worth of goodies from Nvidia. Then consider that the new Nvidia chip, the Blackwell, has a higher base price and is quickly heading toward seventy thousand dollars, and it is clear that it is a matter of months, not years, before Nvidia also overtakes Microsoft in market value and becomes the world's most valuable company.

4. Wall Street Journal's Walt Mossberg on Jobs, Gates and Bezos

No one had the network of Walt Mossberg, the legendary tech journalist who built deep relationships with the founders of the world's biggest technology companies, including Steve Jobs, Bill Gates and Jeff Bezos.

In this podcast, the now-retired Mossberg talks about how Steve Jobs dealt with moments like Tim Cook is experiencing tomorrow, what Jobs focused on (everything was about the consumer) and how much Jobs cared about the stock market (not much, at least that's how Jobs made it look).

5. Majority of companies halt acquisitions because of ESG concerns

Sustainability considerations are becoming increasingly central to the M&A process, with more than seventy percent of M&A leaders saying they have abandoned potential acquisitions because of ESG concerns. An overwhelming majority say they are willing to pay more for targets with strong ESG characteristics, according to a new survey by professional services firm Deloitte.

The question is how Environment, Social and Governance is measured. Unlike traditional accounting, there are hardly any measurable criteria for ESG. Therefore, I hereby tell you: this newsletter is hugely social and is written by an almost elderly man with a dark complexion. A newsletter cannot be much more ESG.

6. OpenAI CEO Altman's weekly scandal

Sam Alman's opaque personal investment empire makes him rich and raises questions about conflicts of interest. For although Altman has no shares in OpenAI and earns only a modest income there, out of the goodness of his heart, meanwhile he appears to be awarding all kinds of companies in which he is a private shareholder good deals with OpenAI. Especially good for his own investment portfolio.

7. OpenAI with another weekly scandal

"I’m scared. I’d be crazy not to be." So says a former OpenAI employee to Vox about the open letter from a group of AI experts from OpenAI , Google DeepMind and Anthropic
"
warning against the potentially humanity-threatening consequences of large-scale AI use.

Vox rightly states, "It can be tempting to see the new proposal as just another open letter from "doomsayers" who want a break from AI because they fear it will get out of control and wipe out all of humanity. That's not all this is. The signatories share the concerns of both the "AI ethics" camp, which is more concerned about current AI harms such as racial prejudice and disinformation, and the "AI security" camp, which is more concerned about AI as a future existential threat. These camps are sometimes played off against each other. The goal of the new proposal is to change the incentives of leading AI companies by making their operations more transparent to outsiders - and that would benefit everyone."

At the same time, we should be aware that a large group of AI experts believe that the current generation of LLMs will not lead at all to the dreaded introduction of "Artificial General Intelligence"(AGI), the AI form that will be able to perform all human functions better than us and could replace us. Investor Benedict Evans wrote an excellent piece on this last month.

8. The AI elections instead of the U.S. elections?

Until AGI makes us humans obsolete, we had better worry about how AI affects democracy. Regulators can't decide whose problem it is. A federal power struggle in the U.S. and inaction by the U.S. Congress could leave voters largely unprotected prior to the 2024 election.

The chairman of the Federal Communications Commission (FCC) last month announced a plan to require politicians to disclose AI use in TV and radio ads. But the proposal is receiving unexpected opposition from a top Federal Election Commission (FEC) official, who is himself considering new rules on AI use by campaigns. But when?

The dispute - along with inaction at the FEC and Congress - would leave voters unprotected from those using AI to mislead the public or hide their political messages during the final phase of the campaign for the U.S. presidency. 

 9. BBC: audio deepfakes are worse than video deepfakes

The BBC believes that audio deepfakes are worse than video deepfakes because they are harder to spot and few people realize they are listening to a bot. This article did lead X to delete a number of accounts on which fake messages were shared.

Finfluencer of the century: Keith Gill aka Roaring Kitty

10. GameStop shares fall despite Roaring Kitty

It remains highly recommended: the movie Dumb Money about how YouTuber and Reddit user Keith Gill, better known as Roaring Kitty, propelled GameStop stock up and turned a few billionaires back into millionaires.

After disappearing from the face of the earth for a few years, Gill made his comeback on YouTube this week to over two million viewers. For GameStop stock, Gill's return was to no avail, but it is still extraordinary to see a grown man in sunglasses and a sling tell of his love for a dying retail chain while making hundreds of millions in the process.

"Blue eyes. Finance. Trust fund." Singfluencer Megan Boni.

In conclusion: in nineteen seconds to world fame

27-year-old Megan Boni asked on TikTok for remixes of her nineteen-second video that said, "I'm looking for a man in finance. Trust fund. 6' 5" ((1m96). Blue eyes. Finance. Trust fund."

Forty million views and a remix with David Guetta layer, she was offered a record deal by Universal and is invited to perform in Ibiza. The impact of going viral on TikTok is unprecedented.

See you next week!