Big Technology Podcast - Microsoft & OpenAI Visit Davos, Is The Vision Pro Dead On Arrival, Google Makes More Cuts

Episode Date: January 19, 2024

Ranjan Roy from Margins is back for our weekly discussion of the latest tech news. We cover 1) Satya Nadella on the state of Microsoft’s partnership with OpenAI 2) Satya Nadella on OpenAI’s governance 3) Sam Altman on OpenAI’s potential for a big breakthrough this year 4) Altman on whether AI will replace jobs 5) How Generative AI will factor in politics this year, and whether it will actually be a big problem 6) The threat of video deepfakes 7) HeyGen’s translation of Argentina president Javier Milei’s speech 8) Google's latest layoffs 9) Does Google have a worsening culture problem? 10) Meta buying 350,000 NVIDIA h100 chips. --- Enjoying Big Technology Podcast? Please rate us five stars ⭐⭐⭐⭐⭐ in your podcast app of choice. For weekly updates on the show, sign up for the pod newsletter on LinkedIn: https://www.linkedin.com/newsletters/6901970121829801984/ Questions? Feedback? Write to: [e-mail]

Let's recap and react to the big AI conversations at Davos. Plenty of news items this week also have us asking whether the Vision Pro is dead on arrival. Google is making more cuts and meta has bought a boatload of Nvidia chips. All that and more coming up right after this. Welcome to Big Technology Podcast Friday edition where we break down the news in our traditional cool-headed and nuanced format we have so much to talk about this week, including plenty of updates from Davos, where it seems like everybody gathered, and then real product news from Apple and corporate news from Google and Facebook, just buying up every invidia chip in the world. Joining us, as always, here on Fridays is Ron John Roy, who writes

margins on Substack. Ron John, welcome. Alex, are you in Brooklyn or are you in Davos right now? Honestly, the best thing about YouTube is that you can literally sit in on every single conversation from Davos, and you don't need to go. And I've been there. All right, Alan, I have to drop it. This is where Alex is going to say I have been to Davos. I, Ranjan, have not been to Davos, but tell us about Davos, Alex. Having been there once, I was very, very happy to watch everything on YouTube and then

actually, like, be able to speak with people about what it all meant. And I think we're going to have a good time going through what happened there here this week. So we're going to do a new thing here. We're going to play a few recordings of some of the big names that actually spoke there and react to what they said and kind of unpack it. So the two speakers that I picked out were Satya Nadella and Sam Altman, not surprisingly. They've been driving a lot of the news in the tech world, in the AI world recently, and they spoke about some really interesting things, including the state of their partnership and where the research is going. And this is from their conversations with Bradstone at the Bloomberg House. So, Rajah, what are you going to say?

Let's get right into it. Let's get into it. Okay, so first of all, in case you're wondering about how Microsoft feels about the Open AI partnership, here is what Satya Nadella had to say about it. I feel very, way, good about the construct we have. I feel at the same time very capable of controlling our own destiny. So it's not like that we are single-threaded, even today on, Azure. And this is not about even open AI. It's all about reflection of what our customers want. Every

customer who comes to Azure, for example, in fact, our own products is not about one model. We care deeply about having the best frontier model, which happens to be, for example, today, GPD4. But we also have mixed trial as a models as a service inside of Azure. We use Lama in places. We have Pi, which is the best SLM from Microsoft. Now, doesn't that sound? like Satya Nadella taking pains to really push home the point that they're not reliant on open AI? And doesn't it sound like Microsoft is trying to hedge away from open AI? I don't think he's taking pains. I think he's pretty confident about saying that they're not dependent on open AI. I mean, very clearly saying, you know, right now the best model is GPT4,

but we are, you know, using Lama and everything else, I think is pretty interesting. And again, On that, I've been using Microsoft co-pilot recently more. Again, their public-facing chat interface because it actually gives you access to GPT4 and Dolly 3 for free. You just have to be signed in, unlike chat GPT, where you need to pay for chat GPT plus to get access to the latest models on a reliable basis. And it's crazy to me because they're giving it away for free. And we've talked about it previously on the show, but it's clear to me, Microsoft is not going to be reliant on open AI, what that partnership looks like going forward. I really don't understand what it is right now. I don't know.

What do you think it is? What do you think Satya's vision is right now for open AI? Because he didn't seem to give a clear. That is a great question. I mean, I think that's one of the big questions that we're going to have to answer this year. I don't have an answer to it, honestly. And there was a conversation that was. had on CNBC throughout the week about how impactful open AI was and AI in general was to Microsoft's

valuation. You know, Microsoft, we should note, just surpassed Apple as the most valuable company in the world again. And there were rumblings that Open AI and AI itself has added a trillion dollars to Microsoft's valuation and market cap. And so what are you left with if they now are trying to distance themselves from Open AI? I guess what Satya and Adela is really doing right here is he's saying I'm riding the horse that I have, which is open AI, but I also know that there's going to be some sort of commoditization of the technology that they're building, assuming open AI doesn't continue to outpace the field and it will be difficult to do that. And so therefore, he's waiting on the hedge. But then the question is, does the hedge provide the competitive

advantage to Microsoft if everybody is starting to be able to take advantage of that? Like one of the models he mentioned was Lama, which is open source. So where does, does Microsoft's advantage lie there? Is it productizing this AI? Maybe. I mean, Enterprise is definitely a place where this is going to factor, but it is very confusing. Yeah, I think especially a company like Microsoft, it's worth, there's multiple layers that when we say enterprise, we even have to think about it in two levels. There's a consumer software, or enterprise software layer. Again, when I open Microsoft Word or PowerPoint, what capabilities do I have? And Microsoft's moving pretty fast in this. Like, you know, they're way ahead of Google in terms of what they've actually

launched and released to their customers. And then, of course, there's the more deep integrations within Azure, people building their own products. And in both of those, it's clear that they're making big strides and they're not dependent on Open AI models. I mean, I think it's clear that the product level is going to potentially be a big competitive advantage for them. And again, I've been using Microsoft co-pilot a lot more. And just for fun, when Alex, when we're going over this week's, uh, this week's topics, and I was like, I'll do this nowadays more when I'm looking up a news story. I'll check chat GPT, Bard, co-pilot, see, you know, can you give me a list of articles around a specific topic? In great moments in Bard, Google's chatbot product, I asked,

You know, can you list some news articles and provide a recap of what Satya Nadell and Sam Altman said at Davos? And the answer is, elections are a complex topic with fast-changing information to make sure you have the latest and most accurate information. Try Google search. Okay. So I really don't feel so bad for, I just bashed on air on CNBC. It's just like, you know, you're asking me about Gemini. I was like, first of all, Bard's not good. And they're like, you mean the, I'm like, yeah, the capability is consumer product.

It's not up to date. So maybe the commoditization isn't going to be as fast. Okay, let's listen now to how confident Nadella is on opening eye, having sorted out its governance issues. So I'm comfortable. I have no issues with any structure. What we just want is good stability. And as I said, we don't even need. Like, I'm not even interested in a board seat or we don't need, we definitely don't have control.

We have no, we just want to have a good commercial partnership, and we want to be investors in the entity, in even the way they're structured. So what I would like is good governance and real stability. That's it. You have a good governance and stability. What I would like. What I would like. What I would like. I have. Do you know one thing about those moments? I always wonder, he had to anticipate the question. He might have even been given this topics beforehand.

I feel there's got to be a better answer you come up with. Again, at this point to me, I don't know, does Microsoft, you continue deflecting these kind of questions and say generic answers? Or do you commit to here's what this means for us and what we want from them? Well, I guess like the thing that I'm mostly surprised about is why he didn't say I'm confident the governance issues are in good hands right now. Obviously, he doesn't think that. So I guess that, like, you know what I'm saying? Yep, good nuance. He did not.

Yeah, you're right. What I would like never said they've moved past and we're looking forward to the future or something generically corporate like that. He said what I would like. So speaking of like some of the issues that we're going to see this year, it will be this continued governance question with Open AI. And it kind of goes back to the question about Microsoft is like, what is there AI? Does, can their AI play exist without Open AI? I, okay, again, and this is going to be my umpteenth Google, or Microsoft co-pilot reference already in this episode, but I think Open AI is in trouble.

I think open AI is in trouble. I think, again, chat GPT Plus and that interface, it's a great product. It's, you know, been the leader in this. But when you start looking at Microsoft essentially distancing themselves, from Open AI. The same way AI has added theoretically a trillion dollars to Microsoft's market cap, you have to assume the Microsoft partnership has been instrumental in pushing Open AI to the $80 to $100 billion valuation as well. You have the lawsuits from the New York Times. So from a copyright perspective, Open AI is the poster child in Target. From a product

standpoint, their own investor is giving away their product for free. which still blows my mind. I mean, at every level, and then from a governance and just corporate and organizational standpoint, they clearly have not really made people feel good about where they are.

What's the bull case for Open AI for you? Well, I think we're about to talk about it, but I'll say, first of all, okay, all right, let's hear it from Sam, I guess. Yeah, Satya is, I think he is in the fool me once, shame on you, fool me twice, shame on me mode, where he's like, all right, the first time we,

didn't see this coming. We're not going to, we will be prepared in case the second time comes and we're not going to bet the company on one anymore. And I think that's the gist of his statements here because he was also like speaking to Brad and Brad asked him, this was this answer that he gave about governance was in respect Brad is Bradstone from Bloomberg. The response that he gave was in response to a question about like, as he's satisfied with the open AI government governance. And he tells Brad like, you're speaking to Sam later, aren't you? Like, He has to figure that out before he gave this answer. So I found that really revealing.

Now, okay, your question, what is the bull case for Open AI? Let's just listen to Sam Holtman. If we're right about what's going to happen here, this is like bigger than just a technological revolution in some sense. I mean, sort of like all technological revolutions or societal revolutions, but this one feels like it can be much more of that than usual. And so it is going to become a social issue. a political issue. It already has in some ways. But I think it is strange to both of us that

it's not more of that already, but with what we expect to happen this year, not with the election, but just with the increase in the capabilities of the products. And as people really catch up with what's going to happen and what is happening, what's already happened, there's like a lot of inertia always in society. So that is fascinating to me that Sam is basically telegraphing the fact that there are going to be enormous breakthroughs from OpenAI this year. And, you know, maybe some of it is CEO talk, but this has sort of become a theme for him, talking about all the stuff that we're going to see this year

is going to be like, you know, pretty groundbreaking stuff. And, you know, it doesn't seem like it's going to be like just a little bit smarter GPT model. I mean, what he's teasing is like something like he talks about that we're going to have to reckon with on a societal level. So that's the bull case for Open AI, I think, is that they actually build that. I don't know. I think to me, the more I've looked, because again, I do believe and agree that the

advancements and the speed of advancement is continuing, again, even like mid-journey V6 versus V5 is, is, you know, like a step change in how good the quality is and how easy it is to use. So the idea that maybe Open AI is going to have some massive new release, I think, is very reasonable. Is it something that other people are not going to do? I don't know. Like, are other people catching up? The clods of the world, even mid-Journey, other competitors of different parts of Open AI's ecosystem. But again, any time the conversation moves into these kind of like theoretical AGI Terminator-ish scenarios,

You know, I start to question how much of that is just kind of like, as you said, CEO talk and promises versus reality. Again, like on this, and we should definitely talk about, you know, on the societal impact side of things. I think there's a lot of issues that are already being created by GPT3 and then four, some eventually five. But I don't know. That, I wasn't sold on that. What does your gut tell you? big stuff coming for Open AI or that was CEO speak this year? Okay, again, it's a tough one. I think big stuff is coming, but I don't think it will be significantly different or better than

what other companies are doing. Okay, I'll take the other side of that coin. Given what I'm hearing from Sam, I am very curious to see what technology they release. And there were some attempts at Davos to get him to talk about what's coming, but he very gently refused. So, okay. Okay, but one more thing about, you know, a more clip that we'll listen to is about the societal impact. And obviously, the question is, like, whether this is going to take jobs. And I just spoke with Albert Vinger about that a couple weeks ago, or last week. But this is something that was put to Sam front and center. And here's his response on how it's impacting coders.

You know, you hear a coder say, okay, I'm like two times more productive, three times more productive, whatever than they used to be. And I, like, can never code again without this tool. You mostly hear that from the younger ones, but it turns out, and I think this will be true for a lot of industries, the world just needs a lot more code than we have people to write right now. And so it's not like we run out of demand. It's that people can just do more. Expectations go up, but ability goes up too. Okay, I'm personally with Sam on this one as well. I do think that we are just going to see more capabilities and people who are using AI living up to the expectations that their companies have in terms of being.

able to ship. And I don't really see it as something that's going to really reduce wages or minimize jobs across the economy. What's your perspective? Oh, see, I think there will be a tremendous impact on jobs. I think it's going to reshape and reformulate a lot of different industries. I'm actually, I am still, I don't even know if the word is bullish, but convinced that that will happen. And I think, you know, there is going to be. impact and there's going to be people needing to learn different skills and there's going to be, you know, it's going to be a big issue. But I did like that idea that the world will need more lines of code. That's pretty good. That's, I think, like, from a pure, like, coding perspective,

maybe it doesn't shrink things too much that people who understand, there's still going to always need to be, people understand code and how to apply it. So, and how to use AI systems to generate code. So I think that's reasonable. I mean, as a writer, I think I actually probably maybe the world does not need as many words. Oh my God. It certainly does not. Exactly, exactly. It needs better words, but not more words. Yeah. Words, the volume could decrease a little bit. So I think on that side, again, if you are a writer for an SEO optimized recipe site, that's probably going to change. I mean, all those things, these things will all change, I think. But I think from a societal impact, I mean, we have to talk about the upcoming U.S. election. We just, the Iowa caucuses

this Monday, like, it's front and center right now. And it's happening right now. So I think that we, yeah, let's definitely get into this, especially as it pertains to AI. And obviously, this is going to be a theme for us this year, both like the elections that are going to be 70 to 80 Democratic elections, across the globe this week, this, sorry, this year, and of course, one in the U.S. We have a global audience. We won't go too crazy on U.S. politics, but it is obviously a testing ground for a lot. This U.S. presidential election is a testing ground for a lot of worries of technologies,

new technologies, and of course AI is going to be front and center. And I think there is this, so first of all, I'm glad people are concerned about the fact that AI could pose some problems in the election, but I think. that the level of attention that's getting compared to the problem is maybe disproportionate. Maybe some, maybe people are trying to make up for the lack of attention for social media and then how that effort played and trying to say like AI will have an equal impact. And I just don't really see it. So let's just read the headline.

So this is from the Wall Street Journal. OpenAI bans the use of AI tools for campaigning and voter suppression. and basically it says OpenAIs, ChatGPT and Dolly are some of the most powerful AI chatbot and image generation applications available. And then OpenAI said people aren't allowed to use its tools for political campaigning and lobbying. People also aren't allowed to create chatbots that impersonate candidates and other real people or chatbots that pretend to be local governments.

I think that like this is a thing. in campaigning, the cost to create media is so low that you don't really need AI to flood the world with disinformation and misinformation. Like, it's going to be a problem with AI or without AI. And I don't think this dramatically causes a bigger problem. And I think that people, you know, if people are chatting with a politician chatbot, like, come on. Like, is that going to sway an election?

I doubt it. What do you think, Rajan? I don't know. So on one side, I do think the algorithms, and you spoke with Kyle Chaka, Chika, Chaka, on Wednesday, I mean, it was a really good episode on his new book and the impact of algorithms. to me that's a much greater issue than generative AI specifically because, again, what is the distribution side of it is just as important, if not more important, than the actual content creation side. As you said, you know, you don't need generative AI to make up something and just tweet or post about it and then send it around. But I do think there's the disinformation

side, then there's the kind of like complete fabrication and creation of a, like the deep fake side, the idea that, uh, there, there was actually a politician back in December, um, who had created using generative AI. And it felt a little kind of PR gimmick issue as Democrat Shemaine Daniels was running for Congress and created her own AI generated robocalls that, and the idea was she could make it more personalized and you could make it, you know, target people better and not have to do all the work of recording your own voice to target all these people. That to me was actually like an interesting reasonable productive use case of this. It's like actual tailored messaging to different constituencies that you use AI to generate so you don't have to sit in a studio all day

to record wherever one records robocalls. But of course, you know, we are in my for an endless world of deepfakes of Biden saying something or Trump saying something or whatever other candidates saying something and people believing it. And I think that is a capability that exists this year that has not existed in any previous election. Yeah, I'll tell you where I think this actually starts to resonate. It's when video generation gets good and then when we can't tell the difference between, you know, what a real video of something like Donald Trump saying is in a fake video. Oh, wait.

Oh, sorry, go, go, go. Yeah. Okay, so I guess like what I'm going to say on this one is, and maybe I should, like, I think what you're about to say is that already exists. I would all say as a counter is when it gets easy for everybody to make it. And then when that happens, it's not going to be as much as people believing that these videos are the truth. It's going to be about people believing what they want to believe and not caring whether they're fake or real. That's going to start to cause some problems.

All right, what do you have to say about that? Okay, so it already exists. I think you were going to say that. You said I was going to say it, and I said it. So there's a product, Hey Gen, H-E-Y-G-E-N, and I've used it before. They kind of went viral, and it's actually mind-blowing that you can upload, you know, like a 30-to-1-minute, 30-second, one-minute, clip of yourself, and it will, originally they went viral, but it would translate into another language in your exact voice and relatively match your lips up to the new words that are being

spoken. And I tested it. I was like having it have me speak Chinese and Spanish and showing it to native speakers. And they're actually like, this is not bad. And it actually kind of looked like it was me speaking. And so this morning, there was a really interesting, uh, On Twitter, I opened it. My entire for-you feed was Javier Millay, the new Argentinian firebrand president, him giving a speech in Spanish that was translated in Hagen to English. So it's his voice, it's his words, it's his speech, but it's now reaching an English-language audience in English, and everyone was sharing it.

And obviously, it was more about the content itself, and this was not a deep fake in the sense of it was making things up about what he was saying, but it's honestly, it's so good that being able to change what people are saying and make it look reasonable and make it their lips look like they're kind of saying what you're getting them to say in their voice. That's here. That's here this year. Definitely. Yeah, I saw you tweet about that and then I went and watch the video. It is really incredible how they can do those translations and make a video look like somebody is literally speaking the language in their voice, which is wild. Yeah. And, it honestly the platform you just hit translate you specify the target language it takes like maybe like

for every minute of video like 10 minutes you can tell there's probably some like serious processing going on on the other side and then it looks good it looks very good so so that technology is here and we haven't even seen the first major mishap and i think we will yeah so maybe that's something that we see this year. The Davos consensus is what everybody at Davos starts to agree on, like all the elites, the prime ministers and the governmental officials and the business elites, they tend to walk away from the conference agreeing on something and then it almost universally ends up being wrong. Like they showed up in January 2020. They didn't speak at all about COVID. And of course, that's what dominated the world for the next couple of years. So Ben Smith was on

Squawk Box on Ben Smith, the editor-in-chief of Semaphore, was on Squackbox and talking about what the consensus is this year. And his perspective is that everybody at Davos this year is sure that Donald Trump is going to win the presidential election in the U.S. in 2024, which indicates, who knows, maybe that's good news for Biden or some other candidate that we don't even know about. That's a lot of run. The Davos curse is the new Sports Illustrated curse for older listeners. Apple has the Vision Pro coming out soon. It put the device in the hands of lots of influencers, reviewers.

People took pains to say this is not a review. I just got a 30-minute demo from them. But we're already starting to see some reactions here about the direction of this device. And Ranjan, they are not good. So Bloomberg had a headline, big headline that said Apple's Vision Pro headset lacks blockbuster buzz and heated to energize shares and basically saying that it's unlikely to play a major role in changing the perception that its growth heyday is in the past and this is from this is a quote from Denny Fish who manages techs tech funds at Janice Henderson he says

it's hard to ask someone to pay $3,500 for a product where there's a limited amount of content people can't get on their phone, which means it'll be pretty darn nichey, at least for a couple years. I think that's a great point. Have you seen the reviews of the Vision Pro? I mean, my perspective is, you know, I don't think it will necessarily be dead on arrival, but it's really going to have a rough go of it as it gets released by Apple. Yeah, I think what is a rough go is the big question? Because obviously you hear some people, you know, just make simple calculations at $3,500 times X units.

suddenly you have a billion dollar new business, but the reviews have been rough. It's everyone saying it's heavy. Everyone's saying that, you know, the typing does not work very well. It's like pinching, no, pinching is to select, but there's supposed to be these virtual keyboards that you just like use your, move your fingers and it types on the keyboard. Yeah, let me read German's quote from there. He says Apple's Mark Herman from Bloomberg, the Vision Pro virtual keyboard is a complete write-off, at least in 1.0.

you have to poke each key one finger at a time like you did before you learned how to type there is no magical in-air typing you can also look at a character and pinch you'll want a Bluetooth keyboard yeah no this is big i mean i think these issues are big however i think the one thing the one thing i read that seemed to be a good synopsis of what apple's launch strategy is because even though they've been giving out units and there's certainly been coverage and it's clear they've had fairly you know controlled demos with influential members of the press it's that this is not and friendly members of the press that this is not a big launch as crazy as that sounds to say this is not some like gigantic launch that this is something where they're just trying to get you know

this in the hands of the right people in the end it's going to be the developer ecosystem that creates the use cases. It's going to be the, you know, companies that build the right apps and experiences on it. Some number of people will, you know, try it out and talk about how cool it is to their friends who eventually will get a version two. I think, I think that not overblowing the potential of this at the start is actually the right move. Okay. So I actually completely agree with you on that point, believe it or not. I just wonder whether there is a way for them to not blow out the importance. Like, it is going to have to be a very, very managed takeoff, if that's the case,

because think about the release event that they did about this, right? Not just a device, a new form of computing. So how do you go from that showing all these, like, magical scenarios now to be like, all right, this is a half-launch patience, please? Yeah, no, that's fair. Also, let's not forget, remember the launch event. the dad who was wearing it and, like, staring at his two kids. Like, it was very sad.

Yes. Yeah, the saddest dad in the world. I think, uh, I think those kids will grow up thinking that their dad's eyes are just projected on those fake, uh, Vision pro visor. Vision pro eyes. Um, I don't know. I, it's going to be interesting, I think. I think, again, especially like out of all the reviews, we still have seen none of people using

it on their own terms. And I do think that was pretty. interesting because the moment it remains a controlled demo, it feels even further away from reality. And I think you had predicted these would not go out at the beginning of February end of January. They're still sticking to it. So in a couple of weeks, we're going to know some people I've not given up on that bet yet. I'm not giving up on the bet yet. Wow. January 18th, they're still saying, I think it was February 2nd, right? I promise you that delay is coming. coming. All right. All right. Stick with it. Okay. I'm not fully confident anymore, but I think it might

come. So they also are shipping the thing without Netflix. Did you see this? Netflix is not participating and they're just not supporting it. They're going to tell people to just watch it on their laptops. Yeah, I was very, it was interesting because it said that like a lot of the, you know, major entertainment streaming platforms are making custom apps for the vision pro i guess is it a power move by netflix to say we're just going to wait and see and uh if we see others create interesting use cases then we'll follow along but but it is because as we've talked about i think you know entertainment memories like are the kind of initial use cases for before people figure out how to, you know, rethink computing, which is a little more grandiose.

Just watching a movie in an insanely immersive environment is a good starting point. So I was pretty surprised by that because I would think Netflix would clearly want to align itself with if this creates a new type of cinema, you would think Netflix would want to be a leader in it. But maybe this is just revenge of the app developer, right? Apple has been squeezing app developers like Netflix for so long, obviously still fighting the anti-steering thing where they're not really supposed to tell people anymore, tell app developers anymore, that they can't point people to pay on their own pages

and sort of like, okay, well, here we go now. Like maybe Netflix is like, you want us to help you launch your next device and make it successful? How about rethinking what we're paying? You know, or rethinking our ability to let people know where to subscribe on our app. Actually, in terms of revenge of the app developers,

Spotify, as we all know, has been one of the very very, very vocal voices about, you know, in battle with Apple around the app store tax and annoyance that they have to play ball and give away 30% of their subscription revenue through to Apple if it comes through the app store. This is the smallest, nerdiest UI thing, but like today I was sharing a song from Spotify. And I noticed they put iMessage, the ability to share it after everything else that exists on your phone, whereas every other app puts iMessage first, if you have an iPhone.

And you could just see there was some developer who very clearly was, thought that one through that some little jab at Apple, through some little UI tweak that we're going to try to punch you where we can. So yeah, I think these companies, they go back and forth. Exactly. And yeah, that's my story in big technology this week. I mean, it'll be out Friday morning, but just the perspective is that Apple's offensive moves have actually opened up lanes for its competitors, especially meta.

So we talked about that last week. We'll have to rehash it again, but that is something that's happening. It'll be interesting to see what happens with these developers as they are asked to come on board the Vision Pro, and maybe they say, listen, you want your product to be successful. All right, well, let's make a deal around that 30%. Well, hold on. I'm going to make a call here, though. Yeah.

It is it only though because any time let's say this is a completely new medium is it brand new companies that actually figure it out and take advantage instead of the incumbents and I mean which puts Apple in a great position but and I think it could be that you know the next Netflix that lives in the immersive vision pro environment might not be Netflix at all yeah well it's going to take money to program for the vision pro so Netflix has the money it's going to be tough generative AI. That's true. Yeah, that's right. We are the real format of the Vision Pro will be seeing political propaganda deep fakes. That's the promise. It's a new world.

All right, let's take a break. We'll come back here. We're going to talk a little bit more about layoffs at Google and Meta's big investment in Nvidia. Back right after this. Hey, everyone. Let me tell you about the Hustle Daily show,

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They are laying off 1,000 early this year, but those layoffs will continue to trickle. As the year goes on, we've also seen layoffs at Discord and at Amazon. The Twitch unit was impacted significantly. I mean, the tech layoffs are not over. We've talked about them. But what's really sticking out to me with this round of Google layoffs is like the employees are rebelling a little bit.

First of all, you're seeing stuff on Y Combinator that we'll get to, but there is this post. I think it's real from a current employee on LinkedIn. And their perspective is, my hot take, Google does not have a single visionary leader, not one, not from the C-suite to the SVPs to the VPs. They are all profoundly boring and glass-eyed. Okay, this person, by the way, their post got plenty of likes from people with like the Google profile picture. So maybe those are people who have left the company, but it says that, This is a software engineer and it says that they're still there. God, I wish I could.

Maybe I should just read the whole thing. Google has not launched one single successful executive-driven thing in years. Sometimes VPs try to decree we need a new chat app or AI first demo for I. There's a huge death march. And in the end, the thing is half baked and roundly deride it. If it doesn't get 100 million users in six months, they give up, give it up and shut it down. It's like the joke algorithm that I learned about in college, Bogosort. In each iteration of the algorithm, you.

reorder everything randomly and if the elements happen to land in order, you are done. Some of Google's executives are competent referees. I couldn't name which, but it feels like I've seen it done in my eight plus years. They point in a direction. The subordinate swarm the area, try a bunch of stuff. And sometimes something sticks and it's cool. Right now, all these boring, glassy-eyed leaders are trying to point in a vague direction, AI, while at the same time killing their golden goose.

Given they have no real vision of their own, they really need their asses. subordinates to come up with cool stuff for them, and at the same time, they've been rolling layoffs. I mean, it goes on and on and on. It's a remarkable post. What do you think about the fact that this is, should we just look at this as disgruntled employee, or what do you think it is? No, I think, and we've talked about this a lot, that out of companies launching completely new products, paradigms, anything, what was the last major thing that Google did? And, you know, is it YouTube, Google Maps, all these things have been around for a long, long time. And as you said, it's the, or is this author wrote, that idea that things have to hit such a scale

that if it doesn't get to 100 million users in six months, they give up and shut it down. I've heard that from people who were previously at Google. And that's exactly, you know, the opposite of some kind of longer innovation where you're experimenting and testing and certain things take off. and then you continue investing. And, yeah, I think what is the vision is still unclear. It's clear that this is going to completely transform their golden goose and what's it going to look like after that? No one knows.

But already you see, like, generative search on Google is pretty good. But Microsoft's co-pilot is an iOS dedicated app, is a website, works well. They're going after search already. Companies like perplexity are going after search already, and BART is still barding. And isn't even available on an iOS app. So I think, like, yeah, it's tough over there. Let me read some of, now I'm going to go to my favorite comment, which was on my compinator. Okay.

It says, Sundar is not a psychopath. You're making a common error ascribing humanity to Sundar. This is about the layoffs, by the way. Sundar is a growth robot with no moral system. See this description of Larry Ellison. You need to think of Larry Ellison the way you think of of a lawnmower. You don't anthropomorphize your lawnmower. The lawnmower just mows the lawn lawn. You stick your hand in there and it'll chop it off the end. You don't think,

oh, the lawnmower hates me. The lawnmower doesn't give a shit about you. Lawnower can't hate you. Don't anthropomorphize the lawnmower. Don't fall into that trap about Oracle. The difference is that Sundar is an industrial scale trash compactor, not a lawnmower. And then someone responds. The comparison to Oracle is pretty good. Working for Sundar's Google, it sounds like this is a a current employee, feels a lot like working for a company whose only product is quarterly earnings reports. I have no idea what the company's mission anymore is besides a number goes up. The old descriptions of Google's creative, disruptive, academic culture seem very foreign at this point. Our raw materials are the brains of new comp site graduates and our product

is money. Okay, there's a lot of gold in that one. I'd never heard the Larry, had you heard the Larry Ellison lawnmower? No, that's the first for me. Yeah. That, that was quality. You don't. If you put your hand in the lawnmower and it chops it off, the lawnmower doesn't hate you. Yeah. And that's, I think, a pretty fair summation. Like, I think for Google, if you think about the whole vision thing,

to organize the world's information was a very difficult problem and hard and noble thing. I mean, that's actually right now with large language models. Organizing large chunks of the world's information has. has become one of the simplest things to do. And what do you do after that? Like, actually, yeah, what is, what do you think Google's next growth area could be? I don't know.

Putting more ads on YouTube videos. Yeah, it better freaking be AI. Like, it better be large language models. I think shoving even more ads into a YouTube pre-roll and making you watch like four minutes of ads to watch a 30-second video. That's the future. torture to make you sign up for YouTube premium or something like that.

Yeah, I still have it. Do you? It's a real like, oh, sorry? Are you a YouTube premium subscriber? No, but I think about it all the time. Yeah, same, same, but I just refuse to. It's a lot of money. I know. YouTube should be free.

Actually, so years ago, before YouTube had ads, I asked someone at Google, how are you going to monetize this? and they insisted that there would eventually be some pre-roll ads, but they would never have what it's called when an ad shows up in the middle of a long video. There's some specific advertising mid-roll ads, yeah, never have mid-roll, and that you would always be able to skip every ad. Like this was a very proud person, I think it was like 2010, 2011 maybe saying this to me and then look at YouTube now.

Yeah. Yeah, it does seem like where there's smoke, there's fire. And within Google, like it does seem like this is maybe not, like, perfectly correct about what's going on, but maybe directionally accurate. So we'll keep looking into it. It would be an interesting. I mean, they've definitely slowed down. There's no doubt about that under Sundar. Last story for us this week, meta is like one of the first companies to announce how many H100 chips they have from Nvidia. They say they have. At the end of this year, they're going to have about 350,000 Nvidia H-100s, which is what you train AI on. Overall, and overall, 600,000 H-100 and H-100 equivalents of compute if you include other GPUs. Okay, this is a massive amount of computing that they're using for AI. Zuckerberg also said they wanted to achieve artificial general intelligence, which has long been the goal of the Facebook AI research lab. By the way, quick plug, Joel Pino, who runs Facebook. Facebook AI research or meta AI research, whatever it's called now, is going to be on in two weeks.

And next week we have an awesome guest. Dennis Crowley, the founder of Foursquare, is coming on. We're going to talk about Foursquare, the Foursquare moment, New York politics, all that stuff. Okay. So with that plug now done, we hope you stick around for those episodes. This is a tremendous amount of money. I think the estimates are that they've spent around $10 billion on these chips. and this number is half of all the H-100s, NVIDIA said it was going to make this year. Obviously, this is cumulative, but holy shit, what an investment that company is making in this stuff.

I mean, it's better than the metaverse, I think. I think, you know, like the line item for, you know, the innovation or reality labs. And this is one important thing that for a long time, the amount of spend on reality labs, everyone was only ascribing to the metaverse itself and virtual reality, basically. Whereas for a long time, they've said, like, AI research lived under that same budget. So investors have to be, again, very happy that more and more of that money now is actually going to this infrastructure war. And I think it's smart. This is where a lot of the battle will take place and to position yourself well for this.

I don't know. Or actually, do you think this is the right strategic move? Yeah, yeah. And I'll just point to a tweet from Brad Gersner, who is the investor who wrote this open letter to Mark Zuckerberg that effectively kicked off the year of efficiency, saying that meta needs to get fit and control costs. And he's reacting to meta spending all this money on Nvidia H100s. And here's what he says. People continue to underestimate just how well positioned meta is for this AI moment. No giant monopoly being attacked in parentheses Google. No low margin business model at risk of commodity. such as cloud software and it reaches three billion people a day and it might just give us open source artificial general intelligence so if he is you know uh celebrating this investment in AI it sort tells you the way that that investors are going to look at it and man what a moment for meta right like positioned pretty well heading back towards a trillion dollar market cap and people are now using meta products as a virtue signal for how good they are in society, aka threads, something you

would never imagine a Mark Zuckerberg property being associated with. And so they must be quite happy in riding high right now. And you know what? For a good reason. I have to say, when you come up with the term, 2023 would be the quote unquote year of efficiency that is so bland and corporate, yet you actually execute on it as a giant company. I have to give you, uh, give you some credit. They, they said they would do something and they did it. Right. Exactly. And, uh, how, how infrequently that happens in the business world. So yeah, well, we tell you we're going to be here every Friday and we're here and we're going to do it again next week. So thank you, Ron John. Thanks everybody for listening. We do what we say. We're going to execute the year of news on Friday. It's on. Okay, everyone.

Thanks so much. Thank you, Rajan. Thank you, everybody for listening. As I mentioned, next Wednesday, we should have Dennis Crowley on the show, the founder and the CEO, I guess, former CEO of Foursquare, talking about what that was all like and also about his interest in owning small soccer teams, actually, in North America. So that could be, that'll be really interesting and fun. I've been looking forward to having Dennis on the show for a while. So very excited that's going to happen.

And then again, the week after Joe Alpena. In the meantime, Ranjan and I will be back next Friday for another show, breaking down the news. We'll see you next time on Big Technology Podcasts.