Tech Brew Ride Home - Fri. 04/05 – Apple Layoffs!

Episode Date: April 5, 2024

Apple joins the tech layoff club. Microsoft warns China is planning to disrupt elections using AI. Disney+ is joining Netflix in cracking down on password sharing. How much is the going rate to buy pictures or videos to train AI models on? And, of course, the Weekend Longreads suggestions. Links: Apple Cut at Least 600 Workers When Car, Screen Projects Stopped (Bloomberg) China will use AI to disrupt elections in the US, South Korea and India, Microsoft warns (The Guardian) Disney+ will crack down on password sharing in June (CNN) Inside Big Tech's underground race to buy AI training data (Reuters) YouTube Says OpenAI Training Sora With Its Videos Would Break Rules (Bloomberg) Weekend Longreads Suggestions: How One Tech Skeptic Decided A.I. Might Benefit the Middle Class (NYTimes) How WhatsApp became the world’s default communication app (Engadget) The 18 most interesting startups from YC’s Demo Day show we’re in an AI bubble (TechCrunch) YC’s latest Demo Day shows fascinating wagers on healthcare, chip design, AI and more (TechCrunch) Learn more about your ad choices. Visit megaphone.fm/adchoices

On April 4th, 2023, around 2 in the morning, a man was found stabbed multiple times on a sidewalk in downtown San Francisco. Hey, who did this to you? What happened next turned the story into a political firestorm. Reports have identified the victim as Bob Lee, the founder of Cash App. From Bloomberg Podcasts, this is Foundering, the Killing of Bob Lee, beginning April 16. Welcome to the Tech meme right home for Friday, April 5th, 2024. I'm Brian McCullough today. Apple joins the Tech Layoff Club. Microsoft warns China is planning to disrupt elections using AI.

Disney Plus is joining Netflix and cracking down on password sharing. How much is the going rate to buy pictures or videos to train AI models on? And of course, the weekend long read suggestions. Here's what you miss today in the world of tech. Finally happened. According to various filings, Apple laid off more than 600 employees. in California. Some layoffs correspond to addresses where Apple's display and car research teams were reportedly based, but there could be other cuts that we don't know about. Quoting Bloomberg,

the Cooperino-California-based company filed eight separate reports to the state to comply with the worker adjustment and retraining notification or warn program. Companies must file a report to the state agency for each California address that includes employees affected by a layoff. At least 87 of the people worked at an address corresponding to a secret Apple facility for its next-generation screen development, while others were located at buildings related to the car project. At the end of February, Apple began to wind down both initiatives, which were seen as major moonshot efforts to advance the company's technologies or enter sizable new areas. The car project was canceled amid indecision among executives about its direction and cost concerns. The display program

was shuttered due to engineering supplier and cost challenges. According to the reports. 371 employees were released at Apple's main car-related office in Santa Clara, California, while dozens more at multiple satellite offices were also impacted. In some cases, members of the Apple Car Group were relocated to other teams, such as for artificial intelligence or work on personal robotics. An Apple spokeswoman declined to comment on the number of employees affected by the job cuts. The warned notices don't disclose the full scope of the job reductions because Apple had many engineers on both projects in other areas, including Arizona, end quote. Microsoft is warning that China plans to disrupt elections in the U.S., South Korea, and India this year,

using AI-generated content after apparently making a dry run in Taiwan elections recently, quoting the Guardian. The U.S. tech firm said it expected Chinese state-backed cybergroups to target high-profile elections in 2024, for with North Korea also involved, according to a report by the company's threat intelligence team published on Friday. As populations in India, South Korea, and the United States head to the polls, we are likely to see Chinese cyber and influence actors, and to some extent, North Korean cyber actors, work toward targeting these elections, the report reads. Microsoft said that, quote, at a minimum, China will create and distribute through social media AI-generated content

that, quote, benefits their positions in these high-profile elections. The company added that the impact of AI-made content was minor, but warned that could change. While the impact of such content in swaying audiences remains low, China's increasing experimentation in augmenting memes, videos, and audio will continue and may prove effective down the line, said Microsoft. Microsoft said in the report that China had already attempted an AI-generated disinformation campaign in the Taiwan presidential election in January. The company said this was the first time it had seen a state-backed entity using AI made content in a bid to influence a foreign election. A Beijing-backed group called Storm 1376, also known as Spamouflage or Dragon Bridge, was highly active during the Taiwanese election.

Its attempts to influence the election included posting fake audio on YouTube of the election candidate Terry Gao, who had bowed out in November endorsing another candidate. Microsoft said the clip was likely AI generated. YouTube removed the content before it reached many users. The Beijing-backed group pushed a series of AI-generated memes about the ultimately successful candidate, William Lai, a pro-sovereignty candidate opposed by Beijing, that leveled baseless claims against Lai accusing him of embezzling state funds. There was also an increased use of AI-generated TV news anchors, a tactic that has also been used by Iran, with the, quote, anchor making unsubstantiated claims about Lai's private life, including fathering illegitimate children. Microsoft said the news anchors were created by the cap-cons. tool, which is developed by Chinese company Bite Dance, the owner of TikTok. Microsoft added that Chinese groups continue to mount influence campaigns in the U.S. It said Beijing-backed actors

are using social media accounts to pose divisive questions and attempt to understand issues dividing U.S. voters. Quote, this could be to gather intelligence and precision on key voting demographics ahead of the U.S. presidential election, said Microsoft in a blog post accompanying the report, end quote. Disney CEO Bob Eiger says Disney Plus will start cracking down on password sharing in June in some countries and then more broadly in September, basically everywhere. Quoting CNN. Although Disney Plus and Disney's other streaming services, terms of service explicitly prevent customers from impersonating someone else by using their username or password, it hasn't been broadly enforcing its policy. Hulu, one of Disney's

other streaming services, began limiting how often customers can share account login information outside their households starting on March 14th. The crackdown comes as its rival Netflix, has attributed a jump in sign-ups from its recent crackdown on password sharing. Shortly after the crackdown went into effect last May, Netflix added 100,000 new accounts on the following two days, according to data from Antenna. Netflix has also achieved a more than 100% increase in sign-ups from the prior 60-day average. A similar boost at Disney could help move the company's streaming platform toward profitability. Disney Plus continues to lose money, although the company said it expects

to turn a profit soon. Netflix is the gold standard in streaming, Iger said, in an interview. They've done a phenomenal job in a lot of different directions. I actually have very, very high regard for what they've accomplished. If we can only accomplish what they've accomplished, that would be great. Iger also said Disney Plus also consolidated its streaming business, but didn't elaborate on which departments or roles. The password crackdown had been expected for months. On an earnings call with investors last year, Iger said a looming crackdown would help Disney grow. We certainly have established this as a real priority. Iger said on Disney's fiscal third quarter earnings call, we actually think that there's an opportunity here to help us grow our

business, end quote. So we've heard a lot about AI companies scrambling to get data to train their models on, but how much are they willing to pay? Reuters has the answer, quote, at its peak in the early 2000s photo bucket was the world's top image hosting site. The media backbone for once hot services like Myspace and Friendster, it boasted 70 million users and accounted for nearly half of the U.S. online photo market. Today, only 2 million people still use photobucket, according to analytics tracker similar web, but the Generative AI Revolution may give it a new lease on life. CEO Ted Leonard, who runs the 40-strong company out of Edwards, Colorado, told Reuters he is in talks with multiple tech companies to license photo buckets 13 billion photos and videos to be

used to train generative AI models that can produce new content in response to text prompts. He has discussed rates of between $5 and $1 per photo, and more. more than $1 per video, he said, with prices varying widely based on the buyer and the types of imagery sought. We've spoken to companies that have said, we need way more, Leonard added, with one buyer telling him they wanted over a billion videos more than his platform has. You scratch your head and say, where do you get that, he said. Photo bucket declined to identify its prospective buyers, citing commercial confidentiality. The ongoing negotiations, which haven't been previously reported, suggests the company could be

sitting on billions of dollars worth of content and give a glimpse into a bustling data market that's arising in the rush to dominate generative AI technology. Tech companies are also quietly paying for content locked behind paywalls and login screens, giving rise to a hidden trade in everything from chat logs to long-forgotten personal photos from faded social media apps. There is a rush right now to go for the copyright holders that have private collections of stuff that is not available to be scraped, said Edward Claris from law firm Claris Law, which says it's advising content owners on deals worth tens of millions of dollars apiece

to license archives of photos, movies, and books for AI training. A Shutterstock competitor free pick told Reuters it had struck agreements with two large tech companies to license the majority of its archive of 200 million images at 2 to 4 cents per image. There are five more similar deals in the pipeline, said CEO Joaquin Quenka Abella declining to identify buyers. Seattle-based Defined.aI licenses data to a range of companies, including Google, meta, Apple, Amazon, and Microsoft CEO, Daniela Braga told Reuters, rates vary by buyer and content type, but Braga said, companies are generally willing to pay $1 to $2 per image, $2 to $4 per short-form video,

and $100 to $300 per hour of longer films. The market rate for text is 0.001 per word, she added. Images of nudity, which require the most sensitive handling go for $5 to $7, she said, end quote. Though this gives me an idea, a startup idea. What if somebody started like a brokerage where all of us agreed to take photos to send in for AI training, a dollar to $2 per image? I mean, I think people would be willing to do that a lot. Again, shot and then chaser. YouTube's CEO says that OpenAI potentially training Sora on YouTube videos would violate YouTube. terms of service, and that themselves, Google adheres to YouTube's creator contracts to train Gemini, quoting Bloomberg. In his first public remarks on the topic, YouTube CEO Neil Mohan said he had no first-hand knowledge of whether OpenAI had, in fact, used YouTube videos to refine its artificial intelligence-powered video creation tool called Sora. But if that were

the case, it would be a, quote, clear violation of YouTube's terms of use, he said. From a creator's perspective, when a creator uploads their hard work to our platform, they have certain expectations, Mohan said. Thursday in an interview with Emily Chang hosted Bloomberg Originals. One of those expectations is that the terms of service is going to be abided by. It does not allow for things like transcripts or video bits to be downloaded, and that is a clear violation of our terms of service. Those are the rules of the road in terms of content on our platform, end quote. OpenAI, which is backed by Microsoft, didn't immediately respond to request for comment. OpenAI chief technology officer Mira Murati said in an interview with the

Wall Street Journal last month that she wasn't sure whether SORA was trained on user-generated videos from YouTube, Facebook, and Instagram. The journal reported this week that OpenAI has discussed training its next generation large language model GBT5 on transcripts of public YouTube videos citing people familiar with the matter, end quote. Time for the weekend long read suggestions. First up, the New York Times has a profile of one of the more notable AI optimists out there, MIT labor economist David Autor says AI might actually help restore, quote, the middle-skill, middle-class heart of the U.S. labor market. Quote, modern AI, Mr. Autor said, is a fundamentally different technology, opening the door

to new possibilities. It can, he continued, change the economics of high-stakes decision-making so more people can take on some of the work that is now the providence of elite and expensive experts like doctors, lawyers, software engineers, and college professors. And if more people, including those without college degrees, can do more valuable work, they should be paid more, lifting more workers into the middle class. The researcher, whom the economist once called, quote, the academic voice of the American worker, started his career as a software developer and a leader of a computer education nonprofit before switching to

economics and spending decades examining the impact of technology and globalization on workers and wages. Mr. Auteur 59 was an author of an influential study in 2003, that concluded that 60% of the shift in demand favoring college-educated workers over the previous three decades was attributable to computerization. Later research examined the role of technology in wage polarization in skewing employment growth towards low-wage service jobs. Until now, Mr. Autour said, computers were programmed to follow rules. They relentlessly got better, faster, and cheaper, and routine tasks in an office or a factory could be reduced to a series of step-by-step rules that have increasingly been automated. Those jobs,

were typically done by middle-skill workers without four-year college degrees. AI, by contrast, is trained on vast troves of data, virtually all the text images and software code on the internet, when prompted powerful AI chatbots like OpenAI's chat sheet BT and Google's Gemini can generate reports and computer programs or answer questions. It doesn't know rules, Mr. Atour said. It learns by absorbing lots and lots of examples. It's completely different from what we had in computing. An AI helper, he said, equipped with a storehouse of learned examples can offer guidance in health care. Did you consider this diagnosis? And guardrails don't prescribe these two drugs together. In that way, Mr. Autour said, AI becomes not a job killer, but a, quote, worker complementary

technology, which enables someone without as much expertise to do more valuable work, end quote. You know, caveat, caveat because I'm investing in AI companies, but that's why I'm doing it. I actually buy into this argument. I'm betting that while computers might one day be orders of magnitude smarter than us, there's going to be a long interregnum where they are sort of the man-computer symbiosis that JCR Licklider said in that famous paper decades ago, you know, the helpers, the Jets and robots, the Star Trek computer, the promise of computers we were always sold on, computers that make humans better. Next, in Gadget takes a look at how WhatsApp became the world's default communication tool, quote, WhatsApp is kind of like a media platform and kind of like a

messaging platform, but it's also not quite those things. Surrah Matu, a researcher at Princeton who runs the university's digital witness lab, which studies how information flows through WhatsApp told and gadget, it has the scale of a social media platform, but it doesn't have the traditional problems of one because there are no recommendations and no social graph, end quote. Indeed, WhatsApp's scale dwarves nearly every social network and messaging app out there. In 2020, WhatsApp announced it had more than 2 billion users around the world. It's bigger than IMessage, 1.3 billion users, TikTok, 1 billion, telegram, 800 million, snap, 400 million, and Signal, 40 million. It stands head and shoulders above fellow meta platform's Instagram, which captures around

1.4 billion users. The only thing bigger than WhatsApp is Facebook itself with more than 3 billion users. WhatsApp has become the world's default communications platform. 10 years after it was acquired by meta, its growth shows no sign of stopping. Even in the U.S., it is finally beginning to break through the green and blue bubble battles and is reportedly one of Meta's fastest growing services. As Meta CEO, Mark Zuckerberg told the New York Times last year, WhatsApp is the, quote, next chapter for the company, end quote. And then finally, because I try to do this every time, tech crunches list of their favorite companies from Y Combinators Demo Day this week, two links in the bottom of the show notes to the

two demo days. To answer the question, you're probably not asking, yes, I felt the earthquake in New York City this morning. Strongest I've ever personally felt, the house was literally moving. Archie got his hackles up and started barking pretty wild. Speaking of natural phenomena, I have a bit of a dilemma on Monday. All of the sudden, my wife and daughter got a wild hair to drive upstate to see the eclipse. And originally it was going to be okay, fine. My son and I will stay here.

but now he wants to go too, so I'm having serious family fomo about a big family adventure. I shouldn't go, because I know I took Monday off last week, and I've got multiple Zoom meetings for the fund on Monday, but, well, my kids are inching closer to becoming teenagers, and as you've heard, I've been having intense feels about spending time with them while they still want me around. So I don't know. I haven't made a decision yet. If I decide to go, I'll post the David Marcus interview we did on Monday. If I post that interview on Saturday or Sunday, then you'll know I stayed home and you'll have a show per usual. But it'll be a game time decision. So talk to you on Monday or Tuesday, depending on what I decide.

But if I take Monday off, I'll at least leave you with that bonus episode interview. Have a good weekend.