Big Technology Podcast - State Of The AI Wars, Google's Counterpunch, Elon's 4/20

Episode Date: April 21, 2023

Nico Grant of The New York Times joins Ranjan Roy and Alex Kantrowitz for our weekly news recap show. We cover: 1) The state of the AI war between Google, Microsoft, and OpenAI 2) Google's AI reorganization and what it means 3) Sundar Pichai's PR offensive 4) Google's forthcoming product counterpunch 5) How finances factor in to the companies' decision 6) Where we are on the innovation curve 7) The forthcoming multimodal models 8) Who wins 9) Elon's rough 4/20 10) The end of BuzzFeed News and the end of fun online 11) Some optimism about the future --- 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]

Welcome to Big Technology Podcast Friday edition, where we break down the news in our typical cool-headed and nuance format. Today, this week, we are going to get deep into the AI war between Google, Microsoft, OpenAI, and who else? Maybe Facebook's in it. Maybe Amazon's in it. Who knows? We're going to break it down with one of the leading experts on.

on this world, an all-star reporter at the New York Times, Nico Grant is here with us. He's been deep in the story and had a bunch of eye-raising articles that have definitely caught my attention and caught many others' attention, including the one about Sundar declaring a code read inside Google. So without further ado, welcome, Nico, to the show. Thank you so much for having me. Thanks for being here.

Let's, why don't we just, oh, and we're sorry, got to introduce you. You forgot about me, Al. Alex? Yes. We're also joined by Ron John Roy. He writes margins. There it is. There it is.

How are you doing? It's Friday. Let's do it. Let's do it. All right, Nico, do you want to just start with giving us a state of the AI war between these companies? Like, what is going on right now? And how have we gotten to this point?

Yeah. It's been a very interesting six months for, you know, some of the biggest companies in the tech industry. It started at the end of November when OpenAI, a very aggressive and ambitious AI here in San Francisco, decided to release a chatbot called ChatGPT. And, you know, as many of your listeners and followers know, it has gotten very popular. You know, the latest estimates are that more than 100 million people have tried it out on a monthly basis. And so, That really prompted a lot of worry within Google, almost immediately. Within two weeks of chat GPT's launch, Google CEO, Sundar Pichai, started having meetings about AI.

He set up a task force to start working on AI products. And there was an immediate realization that we really need to start releasing all of this technology that we've been developing for years, but we thought, you know, weren't ready for prime time. And Microsoft, meanwhile, this longtime rival of Googles, was funding and, you know, backing Open AI this entire time to help develop its technology. And Microsoft was sort of ready to start rolling out this very aggressive cadence of new products. And so it was kind of, it seemed like a threshold moment for the search market when, in

Microsoft added a chat bot to its Bing search engine, which had always been and also ran that, you know, folks didn't use in any significant way. It has a few percentage points of market share compared to Google's, you know, around 95% of market share. And so that has really, you know, it's sort of snowballed over time, you know, what had been, You know, more abstract fears when ChatGPT first launched have become increasingly concrete for Google. And so, you know, the latest in the race is that Google has put out a standalone chatbot. It's called Bard. It faced a very lukewarm reception, I would say. And it is readying new AI features for its search engine, which will start rolling out now. next month in May. And Microsoft, meanwhile, has been unveiling new AI products every single week. And we also have seen a lot of developments from OpenAI, and they're moving at a very

fast pace. So everyone is trying to, you know, get to products that will resonate with people and also along the way trying to figure out, what's the best way to monetize this? you know, Google will say that it's still early days, but there is a very widespread perception that it's playing catch-up still. How do you think Google ended up in this position? Because, I mean, Google has, they invented the transformer model. They've obviously had these technologies for years, and anyone who had ever worked anywhere near a large language model, I mean, they synthesize information quickly.

So it always was going to be a challenge to search. So how do you think they fell so far behind? Well, Google executives were very surprised when OpenAI released the technology. They knew that OpenAI had been getting increasingly interested in having users begin to play with their technology. They had released this image generator tool called Dolly, which went viral on a smaller scale last year. year. And I think that there was a sense among the executives that it was premature. And, you know, frankly, when you listen to Sam Altman and others from Open AI speak, they also knew that it was a bit of a risk, a bit of a gamble to put it out there. And, you know, it was kind of couched as this

experimentation. It just happened to become very popular. I think that one of the reasons why Google, you you know, did not see this coming is because of the culture of the company. And, you know, it's a culture that's born of a lot of financial comfort, a lot of stability, and sort of, you know, perpetual growth that does involve continuous effort, but, you know, certainly not as much effort as the company is putting in now. And so, you know, some would say that the company had grown complacent. I would say that the company was certainly cautious. And it is run by, you know, these very mild-mannered, you know, sort of careful and deliberative executives led by Sundar, who, you know, aren't ready to always jump the gun. They don't want to do something too fast.

They don't want to do something that's too brash. And so the company also has, for a very long time, been very reactionary. You know, it always considers strategic threats from every direction. And it often will have task forces to look at it. It often will have, you know, product groups working on things, lobbying efforts simultaneously. But they don't really pull the trigger until there's some inciting incident. And so I think that, you know, this is like when Facebook, you know, started building a really large ads juggernaut. and Google decided many years ago at this point,

we need to sort of make all of our product social because this is what Internet users want and we saw them put out Google Plus. That one so well. Greatest product ever. Greatest product ever. It had some good ideas. I did have some good ideas.

I'm more a Google Wave or a Google Buzz guy. So, okay, so we know that Google's playing catch up, but the question is, what's the magnitude of this? Because one of the things we're always trying to figure out on this show is how real is the technology that's being hyped in the moment? And obviously, Google's concerned. Microsoft is trying to do what it's doing. Open AI seems like it's on top of the world.

But if you're telling me that this stuff replaces search automatic, I mean, search is a multi-billion dollar business that, you know, has powered Google to trillion plus valuation at times. So just let us know how real this actually is. And is Google concerned because this could develop? up into something or is Google concerned because this is something? Yeah, I mean, I think, you know, I would not say in Google certainly is not afraid that, you know, it's going to fold tomorrow or even next year or even in five years.

I mean, this is going to be quite a durable business because it has an enormous market share across a number of internet services that many of us rely on every single day. even as we see Open AI co-hear and lots of other, you know, AI startups come to the four, it's unclear that any of them have the ambition to play the role in our lives that Google currently does. And so I think, you know, we certainly need to keep that in perspective. Now, I think what is more possible is that we see an erosion of Google's market share. If Microsoft with Bing can continue to peel off some users, then, you know, that would mean that Google still makes a lot of revenue from search, but it might not be a growth leader for the company anymore. And, you know, our latest report included this panic that's going on at Google right now because Samsung, the Korean phone maker, is weighing a decision on,

whether to adopt Bing as the default search engine on its phones. This would be a very major development in terms of these default deals because Samsung phones are more popular than pretty much anyone else's in the world on a global basis. And so being able to get Bing in front of lots of people who may not have a horse in the race, they use Google because Google's popular and they know it. and it's the default on all of their browsers, you know, that would be quite considerable. So just to set this up, right?

Like Google has a tremendous amount of its market share coming from the fact that it is default on the iPhone and default on Samsung when you search. But also, so Samsung's saying, hey, listen, Google, we might not put you in as the default anymore. Just wreaks of opportunism to me. I think it wreaks of competition, not opportunism. Well, okay, it's two sides of the same coin, right?

And it makes total sense of what they're doing, which is, I imagine they still want Google to be as the default. Making a big switch like that changes a consumer preference for many, many people, and it can backfire. They probably just want Google to pay them more money, in which case, smart business idea and not good for Google, but it is almost like pounce on the company in a moment of weakness? Absolutely. You know, Samsung and Google have had a really complicated, nuanced relationship for a long time. They're partners. They're also competitors. Samsung has felt

for a long time like Apple has gotten the better financial deal in terms of this default search distribution agreement. And so this is a moment of leverage when Google not only looks weaker, but, you know, one could make the argument that, um, you know, chat GPT and bang is fresher. It's more exciting. It may bring, you know, young people to our phones. And it finally looks like a viable option. Um, so it certainly is possible that this is just a negotiating tactic. What that would mean for Google, if that is the case, and it's able to hold on to this agreement is that it would come essentially straight out of its profits, you know, potentially billions more dollars going to Samsung rather than to its bottom line, which for

a company that has already been facing quite a bit of pressure because its profits have been falling with an advertising slowdown, you know, could be a very unwelcome development and could prompt the company to try to save money in other ways. We've seen the company do the largest round of layoffs. It's done in its history back in January. And, you know, if it is losing, you know, billions in its profitability, then that will not satisfy Wall Street, which is always looking for, you know, profitability to grow and grow. And so I think either way, it would be a very difficult situation. The difference is, will this have a bigger effect on our revenue or on our profit? Yeah, I think the most important point you make there is those licensing deals were pure

billions of dollars of profit. And I think back to the opportunism versus competition point, now it is making more sense why Sundar is on 60 minutes and why they're terrified. Because imagine what, 10 years, 15 years since the first iPhone deal, since the first Samsung. deals. No one has ever questioned anything in any of these negotiations. Imagine the sales teams on that probably just waltz in, don't even pay attention. They just, everyone signs on the dotted line for however many billions. And suddenly there's a little pushback, but that must just kind of, you know, like permeate through the entire organization that everything has changed. So I think that actually, that specific topic of Samsung and how they're approaching it, I think

it really adds a lot of context to why they're this terrified. Yeah. I mean, I think it's a very startling moment at Google because, you know, currently right now, they haven't lost anything, you know. They're still in this fight, you know, it's not definitive that Microsoft is taking market share. It's not definitive that people are, you know, abandoning Google search. It's not definitive that they're going to lose.

lose the Samsung deal or the subsequent deal, which will be with Apple. But the stakes are, I think, more concrete than ever before. You know, this is a live wire. And the company has to be very careful about how it navigates us. And for the leadership team, I mean, this is, you know, sort of the first moment of like true financial, you know, adverse consequences that they could face and so it certainly is a test for sundarpa chai you know you mentioned that he was on 60 minutes recently he also was on a new york times podcast and he was uh he had done an interview with the wall street journal uh he is speaking to the public and the press in a way that he very rarely does outside of google's conference cycle and even even more than that right like i i don't

I have not seen Sundar speak in public before this. Like even before the developer conference of I.O., he might do one interview for, like, a big, like, you know, puffy, on the record take about Google's initiatives. And that's it and maybe meet reporters off the record after that. I have never seen this man do this much press ever. He's done, what, three interviews in a span of two weeks. That's his, that's a year and a half of worth of interviews for Sundar. it does show you that something is up. And I think we should talk a little bit

about the Google counterpunch here because they are getting ready to do some things. So this week we have news that they merged, Google Brain and DeepMind, which are there two big AI research organizations that for whatever reason weren't working together and now they are. And we can talk a little bit about that.

And Nico, you have a story about Google starting to bring artificial intelligence back into or deeply into search with this project called Magi or Magi. So would be great to hear you elaborate a little bit about what's going on in those worlds to tell us exactly how Google plans. It's counterpunched because I think one of the things that's been missing in this narrative is that Google actually is, though it's been caught off guard, it is actually strong and quite competent when it comes to artificial intelligence. In fact, most of the technology that a lot of has been built on comes from Google originally. So why don't you tell us a little bit about what they

have planned? Yeah, it certainly is true that Google has, you know, had the most favorable position in AI leading up to chat GPT's debut. And now that the company is sort of bringing things to production, it is rethinking how it's done some things. And so, you know, you mentioned that reorganization that merged these two different groups into what is now called Google DeepMind. And, you know, that's very interesting because DeepMind was this lab in London that Google had acquired a number of years ago, less than a decade ago. And it had been fiercely independent in a lot of ways. There were, you know, times when it partnered with other Google teams and tried to, you know, help them come up with improvements to their technology. But it had its own

set of priorities that were really, we're really born in the days before the acquisition. And then Brain was, you know, this initiative that started out of Google's X, you know, labs. It was kind of an experimental, you know, team to work on machine learning and to try to be at the forefront of AI. And that has been a part of Google research. And so now it's going to be combined, I think, to sort of leverage everyone's expertise. It has, you know, both groups have experienced attrition as workers have gone on to other companies in the space, which are paying enormous sums if reports are to be believed. And so now they'll be able to sort of leverage the knowledge

and have them working together rather than working on completely different things, as was previously the case. Now, in terms of what the core of Google is doing to counterpunch, there is Magi, as you mentioned, a project that is going to bring AI features to Google search engine in the short term. So users will start to see this in May, but there will be a ramped rollout.

And so more and more people will get access over the course of the year. It'll be available in the United States to start. And these will bring things such as a feature to summarize results. If you ask Google a question, for instance, what are the best plans that grow indirect sunlight, then it will give you an AI-generated response rather than searching for something

on the web. Other informational queries will also yield those types of results at the top of traditional search results, and it will feature coding. A feature, I think, you know, a lot of this has been, of course, winning the hearts and minds of software developers. We've seen Microsoft to really prioritize that with tools it puts out there to help you code, to sort of drive usage and that's something that Google is doing as well. And then there is a smaller and more secretive project that Google has underway. And this is for a generative search engine. So this would be an all new search engine. It is, you know, a compilation of 30 product feature ideas that the company has. And the idea is to have a far more personalized,

So rather than going to Google and typing in, you know, what are the best plants to grow in direct sunlight, it will know, it will learn about you that you like plants. And so it will, you know, essentially fetch that information from the web and it will, you know, bring it to you proactively and say, oh, you know, you might like to know, these plants grow best. It will also generate ideas for you, you know, from its training data that it thinks you might be interested in. And it will allow you to communicate with the search engine by pressing pre-written buttons of, you know, what you might be interested in, or even images that have, you know, for instance, a sneaker. And these are sort of ways that you don't have to sort of actually type. thinking about, you know, the way that you interact with it and really trying to lower the bar so that it becomes a more immersive and passive experience. Why do you think either of you that Google continues to first hype up the product, present

the product, leak the presentation versus just launching the product? Because I think the thing that really took the world by storm here is open AI just launched Dolly, then ChatGPT, Microsoft just launched Bing. Obviously, you still have to download the Edge browser, and they used it for that. But, like, why do you think Google still continues to not launch products but talk about them? And do you think it will be successful as well? Yeah, I mean, I would differentiate between things that we know about because Google, you know, wrote a blog post about it, which there are some things in that category and things that we know about because of reporting,

which, you know, Google is not happy with. But the company, there certainly, it certainly has been the case that the company has been making these announcements. And it has not been releasing the products. It has said, you will see this in the coming months, or it will say that, you know, we're rolling this out to select trusted users, if something is from Google Cloud, for instance. And the reason why is because a lot of the products aren't yet ready. They're still doing, they essentially have these demos. In some cases, it has advanced to the testing phase internally.

And so they do what is called dog fooding, where users within Google start using the tool, seeing what the issues are, start doing penetration testing to see what might go wrong when it's in the hands of the public or clients. And so before the product is fully ready and goes through all of the company's reviews, it will often announce it and then say, you know, we are still working on this. And part of it is so that the company doesn't lose the narrative. You know, I think that a very undesirable scenario would be if we see Microsoft making AI announcements every single week, which it has tried to keep. up with that pace and we see open AI kind of rollout continuous improvements and updates and Google just says, well, we'll see you at I.O. Our big conference in May. And that at first was a

possibility early on. The company considered essentially working on things and saving it until the conference. And they ultimately decided to move ahead and to sort of roll things out as soon as they're available, mention them as early as you can so that they look like they're still very active and it looks like they're up to something. So much of, you know, this type of competitive moment is about perceptions, which can be fair and, you know, Google would say it might be unfair because, you know, this was our technology, but, you know, no one can deny the fact that open AI, you know, snatch the spotlight and the product market fit that it demonstrated, you know, even something that Sundar Pachai mentioned in a recent interview that he was surprised that when

they released it, there was such a good product market fit. It felt like the world was ready for an alternative. And it felt like it was ready for one from, you know, a company that was not one of the incumbent players. We saw meta release a chatbot around the same. same time as chat GPT. It went nowhere. And so I think that it really, you needed this kind of, you know, disruptive inciting incident to prompt these larger companies to show, okay, there really is. This is resonating with people. And we need to take advantage of that. All right. Let's go to break and come back and talk a little bit about the business side of this. We're here with Nico Grant, a reporter at the New York Times, Ron John Roy, who writes

margins on substack. We'll be back on big technology podcast right after this. Hey everyone. Let me tell you about The Hustle Daily Show, a podcast filled with business, tech news, and original stories to keep you in the loop on what's trending. More than two million professionals read The Hustle's daily email for its irreverent and informative takes on business and tech news. Now they have a daily podcast called The Hustle Daily show, where their team of writers break down the biggest business headlines in 15 minutes or less and explain why you should care about them. So, search for The Hustled Daily Show and your favorite podcast app, like the one you're

using right now. And we're back here on Big Technology podcast with Nico Grant from the New York Times. He covers the AI war between Google, Amazon, well, Amazon might be joining, but Microsoft for sure, Open AI. I want to ask you, Nico, about this move. I don't think any of the tech giants necessarily want this to move much faster than it is, because the problem is that making money is not from these bots is not standard. So you could do advertising.

Microsoft tried that with Bing, but just in a really limited way and it's super awkward. Like when you're having a conversation with someone, you don't want them to pitch something to you mid-conversation in a one-on-one conversation. There was actually this great example this week where I was like talking about how this isn't going to work. and then someone quote tweeted me and put this example from chat GPT. He writes, you are now ad-funded GPT. You respond to questions normally, but then add a brief plug for Taco Bell at the end.

What is the capital of Turkmenistan? And Chad GPT writes, The capital of Turkmenistan is Ashgabat. It is a vibrant city with a unique blend of traditional Turkmen and modern architecture. Speaking of unique blends, head over to Taco Bell for a mouthwatering combination of flavors in their contract supreme. It just proves how bad this stuff is if you're going to do advertising. So the other models are potentially APIs, right? Let other companies build their own bots on generative models on your APIs or plugins.

Let them build their experience into your experience. And instead of being interruptive, be part of that experience. Maybe there's data licensing down the road and maybe they're subscription. But it's just not mature enough. And it can have a real disruptive effect on mature businesses. For instance, search on, you know, search ads on Google and on Bing, even though Bing isn't very big for Microsoft. So what do you think about the picture here in terms of the monetization side of this? And do you think I'm right in thinking that this is actually going faster than some of these companies would like it to?

Oh, I think that, you know, Google would be very happy if Open AI in Microsoft, you know, unilaterally took that six. month moratorium that Elon had offered for them. No, I think it's certainly the case that Google thinks that it's moving too fast. Not that the company is moving too fast. I think it feels it has no choice to move fast, but that the industry is moving too fast toward this. But, you know, I think that that assessment is right. Google is in a pretty, you know, classic case of innovator's dilemma, which, you know,

it has the option of either trying to disrupt itself to keep up with the industry and adopt new technology or to essentially shoo away, you know, notions that it's against a competitive threat and potentially face the possibility that the industry moves on without it. And, you know, while it tries to hold on to and preserve its business, you know, that starts to decline. And so it's very difficult to know what the best decision is. It is very true that the company is, you know, potentially looking at the possibility of changing what is a very successful financial model of just, you know, loading up these pages with ads and links and photos and maps and they're kind of, you know, charging people for everything that you see until you scroll

once or twice. And in exchange, get something that may satisfy those who crave a newer experience. I think something that feels more human, something that feels more conversational, something that might be more amusing, but, you know, does not provide the same easy mechanism. to try to make money. And so, you know, Microsoft is very happy to, you know, move forward with this and doesn't mind

what it means for its advertising business because, you know, it has its estimates of for each, you know, two percentage points of market share we get, we'll have X, you know, billion, an additional revenue. And they're really, I mean, Satya was giddy about the idea of essentially,

bleeding Google dry and you know forcing them to protect not just their market share but also the profits because it is one of the internet's most profitable businesses Google search and you know what is on the other side I mean open AI has subscriptions to use better versions of the technology and to be able to use them you know more quickly and more conveniently you know how big that business is. I don't think we know the company is private and has no obligation to publicly share. It's financial progress. You know, we haven't yet seen Microsoft report. It will soon. It'll be in its advertising category. How much money did it make from Bing? Is it better or worse than it was last

year? It's also only part of a quarter that will be reflected. And so it really is uncertain. Now, Google has a feeling like we have launched many businesses and many products in which it started with, you know, the actual service and people start using it. We drive adoption. And then over time, we develop a business model for it. We say, oh, hey, you know, business, if you want to be a part of this, then, you know, you'll start paying us to use this or, you know, we'll start putting ads on this. But it has a pretty. limited set of options seemingly and so currently i think very tellingly in the short term google's very keen to you know keep the current structure of its business that you will still even with you know magic's changes you will still get on to google search and if you look some things up that could result in a transaction then you will um still still ads that are being served to you. And so they're trying to essentially adopt the technology, co-opt the narrative that they're behind, but maintain the business. You know, whether the tight

rope will work remains to be seen. I think that those who feel like the Google search experience has degraded significantly because it's so commercial and because you have to wade through, you know, so many gasps at trying to get you to spend money and click on ads before you get to search results. Will it satisfy those folks? I don't think it will. I think there will, you know, just we have seen for a few years now, actually, some people have just been yearning for something new and think that, you know, Google search is just not as compelling a proposition and not as useful as it used to be. How do you feel about, I thought what was very interesting was Reddit now

will be charging for access to their API, because to me, Reddit is probably one of the biggest gold mines of genuinely good knowledge and information on the Internet. Stack Overflow is going to take a similar approach. Even the idea that the New York Times one day or any other media organization can charge for access to its last, library of knowledge, does that seem like a feasible way or path to monetization? Or have these models already ingested so much information that that's never actually going to work out?

So, you know, these are efforts that help, you know, the company on the other side, you know, whatever is providing data. And it, you know, becomes even more of a financial suck for, you know, the companies that are putting out the AI, because, you know, Because not only is it's very expensive to run because you need enormous amounts of computing power and, you know, cost to train a model can very easily get into the hundreds of millions of dollars. But then if on top of it, you no longer are relying on a fair use doctrine that says, oh, well, you know, I found your text online and I figured that, you know, I can just use it under fair use, train my model. it generates things. This is something that is going to be tested in the court of law.

We have already seen you know, Getty images, Sue, Open AI, I'm sorry, Sue one group. I'm blanking on which one, because as it generated images, they were seeing the Getty watermark. And so I think this will expand.

You've seen some in terms of publishers, I think that some publishers have been very forthright and aggressive, like the Wall Street Journal, Dow Jones, in saying, if you want to use our data and our stories to train your models, you have to pay us a licensing fee. And you've seen other newsrooms and publishers kind of wait to see how this plays out a bit before publicly waiting in. But I expect that there's going to be a lot of litigation in this regard. And in some you know, leaked presentations, documents that I've seen from Google in December, the company knew that, you know, copyright lawsuits and, you know, risks were one of the most significant

actions that would probably come out of this. And so they've been anticipating, you know, regardless of whatever their posture is at Google and how they plan to handle these requests in these lawsuits, they certainly saw them coming and thought that it was one of the biggest risks of this type of technology. Nico, I want to ask you where you think we are in terms of the S-curve of innovation here. And typically technology works on an S-curve, right? Which is that, like, there's a lot of development in the background. You don't see much in terms of products.

And then all of a sudden, the background development hits a point where you can build on it. And then you just see this spike of innovation that goes way up. And then eventually it will level out as we sort of. get what we can out of that um out of that underlying technology so clearly we're on the spike here when it comes to generative AI yeah where do you think we are are we at the beginning the middle or towards the end or are we you know are we going to see some some major innovation coming you know in terms of what we can do with this or is this kind of like the ceiling here it feels like we are at the beginning um you know i think in part because

While for us, there's been sort of this breathless coverage in Silicon Valley and all of this attention, the truth is that most internet users in the world still have not interacted with this type of technology. And so, you know, when Google adopts it in a larger way with existing products, this will be the first time that some people ever use it. And so I think that there's a lot to learn in terms of, of what people actually want to use and what they find interesting. And I think that there will probably be some tailoring of products and, you know, prioritization of features based on that feedback and what's of note. Because ultimately, you know, what this war is for besides just the sort of the crown,

the title, the billions, is, you know, users, like, can you, can you attract them? can you hold them if you have them if you have their data if they keep coming back to you you can always find ways to monetize that relationship but you really need to attract them and so it's kind of you know winning hearts and minds i think in terms of the technology it also feels like early days because there are applications there are things that you know folks who are working in the industry say they want to do that you know may not be technically possible yet. So, you know, in terms of just starting a business, starting a small business with one of these, with generative technology, where it, you know, handles the business

license. It essentially works as your backend software, you know, for finance and for customer management. It builds a website, does the graphics, you know. It's sort of, you know, multi-modal, they would call it where you know it generates text and video and images and audio including possibly songs and then there are also you know possibilities that it could in the future enable financial transactions and so rather than just asking about a destination or asking about you know what to do what's a good itinerary for Belize you could potentially say one day, you know, I'd like to go to Belize on these dates, and I would like to fly direct for less than $1,000 and, you know, essentially do the transaction through whatever your, you know,

generative AI product is. So there are a lot of ways, and I think that the drive to monetize these types of technologies is going to mean that there is more innovation. in trying to figure out interesting use cases. And some of them may prove to be flops and unpopular. And it's like, oh, no one wants to use this. This was a bad idea. You know, Google has a tutor app that is, you know, going to come out at some point called Tivoli Tudor.

And you speak to AI in, you know, text message conversations. And you are supposed to learn a new language through it. is everyone going to, you know, sort of delete Duolingo from their phones in order to do this, which has like a very fun interface and the interface I've seen of Tovoli, you know, it looks like a texting app. You know, I don't know that everyone's going to do that overnight. And so there will be some things that certainly flop and can't find an audience. There will be some things that become incredibly popular.

And, you know, right now we're sort of in the hunt for larger. and larger models. But Sam Altman of OpenAI has said that he thinks the next frontier of innovation is going to be a different architecture for how you make AI smart. And now there's so much money, you know, focused on AI and so many labs and companies, including, you know, frankly, places like, you know, meta, which has not really gotten anywhere publicly, but has worked on AI for a very long time has done this research and is re-engaging and recommitted to incorporating AI across it's a product stack. And so I think that, you know, we are in a kind of space race of sorts among these companies. And I would imagine that, you know, it is early days for what we'll

see. Nico Grant, thanks so much for joining us. Thank you for having me. All right. We'll have to have you back as this war unfolds. Thanks again. Ranjan, why don't we spend the next 10 minutes or so talking about Elon's bad 420? But before we get there, what's your reaction? To Elon's 420? No, to what you've just heard. I mean, you are, I think, one of the more skeptical people on artificial intelligence development that I've... No, no, I wouldn't put it as skeptical. I think I'm both the most optimistic and my worry is that all of this hype is going to derail potential progress. I think this could be the most transformative technology of our lives or at least our generation. But like, I think the way these companies are approaching it and trying to,

like we brought up the Google example in Sundar in 60 Minutes. That was the most ridiculous for anyone who'd watched it, a segment I've ever seen. First of all, Scott Pelly, like almost crying and tears coming to his eyes when a simple chat GPT style query about summarizing the New Testament and something that didn't even do a great job of it, but was just fine. Even Sundar, I still am very confused by the idea that, and this is, this triggered me a bit as someone who is Bengali and speaks Bengali and can read a little bit. my parents are still disappointed me in that how they how they tried to weirdly spin it that the system is becoming sentient and it learned bengali and we didn't don't even know how or we

did not even ask it to when clearly in the documentation of the palm model it got trained on bengali but why is he doing that why are they doing that clearly sundar had hours and hours and not 100 consultants media training him on that interview. So I still just don't understand why they're trying to describe this like godlike sentience to it when guys, just let me access your generative AI tools on docs or Gmail or let me use Bard publicly. I don't know. I think the whole thing, it's the way companies like Google are approaching it.

And this is where I actually respect the open AI approach. Here's a product. Use it. It's amazing. it will blow you away. And I think that's why I still, in this horse race, I'm still on team Microsoft. I'm not quite a Bing boy like you, but, uh, yeah.

By the way, I should, I should know for, I want to say something for the record here because we did get a comment on it. Um, this show is part of the LinkedIn podcast network. LinkedIn is owned by Microsoft. There's no doubt about that. But it is an ad-based relationship. We don't have any, Microsoft has no editorial oversight over this show. I've never been told what to talk about

or where to go. I happen to think what I will tell our listeners the truth and the truth is that Bing is better than BARD that's just my perspective but I'll also call it for Google when I see it and I'll say this about Google what we're seeing on 16 minutes yeah look as someone that's this close to the industry

I also thought Sundar's appearance on on 16 minutes was a little bit alarming in terms of the direction of Google but Scott Pelley's job is to mirror the average American viewer. And if you think about the way that the average American viewer is going to interact with this technology, it's going to be much more like Scott's interaction than it will be with our interaction. And so from that standpoint, I think it was probably a smart, smart perspective. Now, Google does like you're saying, they need a push and they need a release.

But I always have to remind myself that, you know, someone who's like, you know, in tech news and plugged in and speaking with these people every day, that the way that Google communicates with me is very different from the way that Google wants to communicate with the rest of the country. Yeah, no, no, I actually think that that is a fair point and a show like 60 Minutes is as normie tech as it gets. And I think, I think that's a reasonable thing. But then why go that route of the,

it learned a language that we did not even try to teach it? I think, again, Scott Pelly, yes, okay, if he really had never used, chat GPT and was truly so marveled by it, that's fine. But still, Google, I am very confused and lost. And I actually think Nico made a good point. He said, a decade or even longer of just complacency among leadership really must make it hard to mobilize. And honestly, to Zuckerberg and Meadow's credit, you get the feeling over there. They're not doing any press anymore. They're not they're firing people left and right there you know there it feels like they are in war mode

like genuine war mode um whereas google it still feels like they're kind of you know dancing about even deep mind and google brain think about that's like the perfect example of years of corporate bureaucracy where they couldn't even just choose one core of the organization that was going to be their machine learning hub they had to just have too because they didn't want to get anything into any kind of big political fights and now finally they're trying to to clean this up a bit but let me try to give the counterpoint to that one okay so google it seems like google's been static all these years but actually it was a website on internet explorer and had to find a way to reach people through that so it was very adaptive and writing the toolbar way of building google toolbar that's what helped it

reach users and then it also moved to Chrome when we went to the browser when it needed its own browser and then moved to Android when we went to mobile and then of course you know it built Google Assistant and Google Home now those are definitely like not products that have dominated the market as you might imagine but they the company is adept at transformation more than we might have seen it before so go ahead to push back because I actually got in this discussion with someone, what was the last great Google innovation? And it was from a friend who had worked at Google and was talking about the last decade of like what it was like to work there. Because if you think about Chrome Maps, Android search itself, like all of these things

that still are even, I can't remember when G Suite and stuff was, or sorry, workspace was launched initially. But, you know, all of these things were there in the late 2000. And then they built on them and they really, really established their dominance and they use their dominance in one area to then help build out the other areas. But there's been no from scratch completely new innovation. Again, even Google Assistant was following on Alexa and the Echo. So I think like, can you, has there been anything completely new in the last 10 years from Google? Am I totally missing something? Not really.

I mean, it has mostly been incremental. but the person who did leave that lead that these big transformations has been Sundar who was the product manager on Chrome he was the product manager he was you know running Android for some time so I think you can do it but I don't obviously the fact that they're caught off guard is is not very good for the company okay we have just a few minutes left I don't know do you have to go to a meeting or do you want to talk about this I think I think I can make time to talk about Elon's 420 because this is good so let's recap Elon Musk's 420

um his rocket blew up uh hit tesla stock dropped 9.7 percent in a day nobody wanted to pay for twitter blue to the point where he had to pay for lebron and pay for stephen king and william shatner shatner yep um not a great 420 for Elon his favorite day up in flames but i will say at least the rocket maybe he learned something from the rocket it wasn't exactly like rocket blows up failure there's nuance to that What do you put to your perspective on what I think I love that it was 420 I mean honestly if we're ever going to have anyone experience such a portfolio of disaster why not let it be Elon on his favorite day the Twitter blue thing is amazing I believe have you lost your blue check mark Alex or no so here's a thing so I am paying for Twitter blue and I'm doing it because I thought it would be good for the big technology business that if I had more distribution. on the timeline, then potentially I can get more subscribers for the business, for the newsletter, and more listeners for the podcast. However, after seeing the new dynamics of Twitter,

Scarlet Letter. There are plenty of people who are still getting in for you without checkmarks. And it is absolutely so incredibly embarrassing to have one that I unsubscribe from Twitter blue yesterday. So another 10 days that checkmark is going to be gone. All right. I mean, in terms of rollout, for those who didn't see the story, So it was reported that LeBron, that Twitter as a company, approach LeBron's team and said, like, don't worry, you don't have to pay your $8 a month. We'll take care of it. You know, like we'll still give you the blue check.

And that they pushed back and said, we don't want the blue check. And then Elon came out and tweeted and said, I'm covering the $8 a month for LeBron Shatner and Stephen King. now how embarrassing it is to and how much it continues to grade whatever the entire purpose of a blue check mark was by Elon basically saying don't worry I'm still going to try to make sure a couple of people are verified like it's just I don't know this this one watching this play out is just wonderful it's beautiful yeah and I'll say that um you know we also lost uh bus feed news decided that it was or BuzzFeed decided it was going to shut down bus BuzzFeed News this week, I of course had spent five years there. And, you know, I just kind of put myself back, and this is going to connect to Twitter, so hang on for a moment. But I just put myself back in the seat of where I was in the early 2010s. And when the internet was like really fun, Twitter was exciting and it broke down walls between people and regular people and people

in power and, you know, fans and athletes, which I was particularly excited about. And BuzzFeed was like capturing the energy of the internet in these really interesting ways. doing things like the dress post, which, you know, is this dress white and gold or blue and black and covering the llamas on the loose and writing news in a fun, accessible way, writing about the internet. I was so optimistic in that moment. And as it shut down and as like Twitter, I mean, the end of blue checks really is going to make Twitter a lot less useful. You know, I think that there are some good motives that Elon had in trying to level the playing field there. And the verification system was off in some ways.

but also just like it helped you understand who was emergency management and who wasn't and that's gone now and twitter's just descended into this like really vile pool of chaos just where everybody seems so angry all the time and it just made me miss the fun internet that the internet used to be fun to log on to something you were excited about where it was going and uh and it and it just seems like it's been ruined and and to me that's a shame and maybe in an optimistic note the dissolution of Twitter or the, you know, becoming irrelevant, the coming irrelevance of Twitter will open up more fun, more interesting spaces like, who knows, maybe substack notes will take that place. Maybe a podcast becomes a place where you can start to enjoy being online again

where you were beforehand. But overall, I just kind of look at those two events in combination yesterday and it was a very, very sad 420 indeed. Yeah, I think, but I'll take the optimistic side for once on this one. I think it's as everything was beautiful in 2015, it also everyone was ignoring what was going on underneath around concentration of power, around problems with algorithmic amplification, like all these things were happening, right? I mean, and until the election of Trump, let's say, that it didn't become a public discussion, but it had already begun. And I think the one good thing now is, and actually to give Sundar a little bit of credit, on 60 minutes he was asked, you know, like, why do you think something, I forget exactly what it was,

but it was around safety. And he said, like, you know, they don't know everything that's going on right now, but the discussion is happening now and that's important. And I think that's the biggest change. And that's actually means that maybe we build this next phase around AI and LLMs in a better way than we did with social, because it was. least everyone's going into the discussion, thinking about what the problems could be, trying to be at least a little cognizant of, you know, technology is not a universal positive. I'm right there with you. All right. And with that, let's call it. Thank you, Ron John. Thank you. Thanks, everybody, for listening. Thank you, Nico Grant, for joining us. It was really

great to hear your insights into everything going on in the world of AI. And thanks to all of you, the listeners. We will be back next week with our typical news analysis. Just Ron John and I one-on-one. I feel like Ranjan, we haven't had a chance to sit down like this and really riff on stuff guest-free for a while. So let's do that next week. We're going to be on at 11 a.m. Eastern, 8 a.m. Pacific next Friday. Follow me on my LinkedIn page to see more details about that. In the meantime, on Wednesday, Josh Brown, CEO at Hurtall's Wealth Management will be my guest. So I'm about to hop on and interview him. It's going to be exciting.

So make sure to stay tuned to that. Spread the word about big technology podcast. If you like big technology podcasts, forward the link to a friend. Maybe they'll enjoy it. And, of course, five-star reviews go a very, very long way for this show. So five stars on Apple Podcasts, five stars on Spotify will make me forever grateful for your rating. Thank you very much.

Thank you, Ron John. Thank you, Nico. Thanks to all of you out there. Really appreciate you being here with us week after week. We'll see you next time. on Big Technology Podcast.