Tech Brew Ride Home - Fri. 05/30 – Big Meta/Anduril Deal Is A Big Deal

Episode Date: May 30, 2025

Why Meta’s big deal with Anduril is a big deal for the entire tech industry. Microsoft is kinda not joining, but also kind of all in on the handheld gaming race. Count Hugging Face as someone else serious about AI robots. And in the longreads, more signs that the AI job apocalypse might already be upon us. Links: Meta Fired Palmer Luckey. Now, They’re Teaming Up on a Defense Contract. (WSJ) Mark Zuckerberg Finally Found a Use for His Metaverse — War (Bloomberg) EXCLUSIVE: Xbox's first-party handheld has been sidelined (for now), as Microsoft doubles down on 'Kennan' and Windows 11 PC gaming optimization (Windows Central) Black Forest Labs’ Kontext AI models can edit pics as well as generate them (TechCrunch) Hugging Face unveils two new humanoid robots (TechCrunch) Weekend Longreads Suggestions: For Some Recent Graduates, the A.I. Job Apocalypse May Already Be Here (NYTimes) How Led Zeppelin, Pink Floyd & Jethro Tull Financed the Making Monty Python and the Holy Grail (OpenCulture) 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 TechMeBright home for Friday, May 30th, 2025. I'm Brian McCullough today. Why Meta's big deal with Anderil is a big deal for the entire tech industry. Microsoft is kind of not joining, but also kind of all in on the handheld gaming race. Count hugging face as someone else serious about AI robots. And in the long reads, more signs that the AI job apocalypse might already be upon us. Here's what you miss today in the world of tech. Looks like Zuck and Palmer Lucky have made up. Meta and Anderil are partnering to build Eagle Eye. a line of XR products like helmets that enhance soldiers' hearing and vision and enable control of AI weapons systems.

Coding the journal. Lucky's Defense Company, Anderal Industries, and Meta said Thursday, they will together build a line of new rugged helmets, glasses, and other wearables that provide a virtual reality or augmented reality experience. The system called Eagle Eye will carry sensors that enhance soldiers hearing and vision, detecting drones flying miles away, or citing hidden targets, for instance. It will also let soldiers operate and interact with AI-powered weapons systems. Andril's autonomy software and meta's AI models will underpin the devices.

The collaboration brings together a social media giant that has long been the target of Washington's scrutiny and a weapons maker that is a rising star inside the Pentagon. The partnership offers another example of Silicon Valley's ideological evolution and big tech's expanding embrace of defense work. I should look at this as I have succeeded, Lucky said in an interview. I have successfully persuaded not just meta, but many others that working with the military is important. Meta in recent months has recruited former Pentagon staff to join its ranks, an effort to navigate the labyrinth of the defense procurement process. In November, it opened up its AI models for military applications, a new business line for a company whose profits have been powered by online advertising.

In a statement, Meta Chief Executive Mark Zuckerberg said the Eagle Eye Technology will help U.S. soldiers to protect our interests at home and abroad. Meta and Anderil have jointly bid on an Army contract for VR hardware devices worth up to about $100 million. If awarded, it would be meta's most significant tie-up with the Defense Department. The contract is intended to vet headset prototypes that are part of a larger $22 billion Army Wearables Project, of which Andruel became the lead vendor in February after Microsoft failed to deliver a functional VR headset. Andrewl said the collaboration on the headsets, which the companies have already mostly funded themselves, is going forward irrespective of winning the Army contract. Andrewill is betting

other parts of the military will also be buyers. The Meta partnership delivers a victory lap to Lucky whose entrepreneurial roots and much of his fortune can be traced to VR. At age 15, Lucky founded one of Silicon Valley's early VR headset companies called Oculus VR. In 2014, Meta, called Facebook at the time, bought the startup making him a billionaire. But Zuckerberg fired Lucky in 2017 following a controversial political donation, end quote. Yeah, that's why I say they've made up. For years, years in various public comments. Lucky seemed to suggest that he took personal offense at being outed from what was then Facebook, despite the fact that the whole meta-v-r effort was incubated by the acquisition of his Oculus. But also, as Bloomberg points out, this deal shows how much has

changed in the past couple of years in Silicon Valley, where developing war tech was once considered a hard red line. Quote, for starters, Anderol Industries is a defense tech company co-founded by Palmer Lucky, the man who created the Oculus VR headset that was acquired by meta-platforms for $2 billion in 2014. Only for Lucky to be pushed out when it emerged, he had financially backed a pro-Trump campaign group. That he would be welcomed back with open arms. Is yet another sign that such stances are no longer taboo in the halls of Silicon Valley companies. It could be argued they never should have been. Second, developing technology for war had been considered a hard red line for many of the engineers working within those leafy campuses,

at least in the era after the dot-com boom. At Google, for instance, workers in 2018 held walkouts and forced executives to abandon projects related to military use. Today, defense applications of technology are something companies want to shout from their rooftops, not bury in the basement. Again, it could be argued that should have always been the case, who will create tech for U.S. military, if not U.S. tech companies. In META's case, there's another factor at play. Mark Zuckerberg's deal with Anderol, which you assume is just the start of META's military Hardware Ambitions offers a lifeline to its ailing reality labs business. The unit has lost more than $70 billion since the start of 2019. Advancements in quality haven't led to jumps and sales.

I've written before that fitness applications are a great selling point, but apparently too few people agree with me. A newer form factor, sunglasses made in partnership with Rayban have shown potential but still represent a niche product. So instead, maybe the killer app for mixed reality is indeed a killer app. My mission has long been to turn warfighters into technomancers. Lucky is quoted as staying in a press release, and the products we are building with meta do just that. A prototype of the Eagle Eye helmet being developed by the companies is due to be delivered to the Pentagon this year, Lucky told journalist Ashley Vance in a podcast published alongside the official announcement. He compared its utility to what a player wears in the video game Halo,

a heads-up display offering reams of intricate information on targets and locations, plus an AI assistant Cortana, relying critical and life-saving directions. What's also striking about this shift is that it is a sign the historical flow of technological innovation is being turned around. Silicon Valley began as a region set up to develop chips for military tech before the assembled talent branched out into making products for businesses and consumers such as the personal computer. Many breakthroughs have followed this direction of travel, the internet, the microwave, GPS, super glued, and name a few, but it is now increasingly the other way around. As Lucky put it during the podcast discussing the deal, it turns out that meta's headsets are just as useful on the battlefield as they are on the head of any consumer.

See also artificial intelligence developed first and perhaps at the cutting edge always by private sector tech companies. The opportunity is too big to pass up and too lucrative to hold grudges. Lucky says he was willing to work with meta again because it had become a much different place from the one he was booted out of, end quote. So either Microsoft didn't. get the memo that handheld gaming is the hotness right now, or maybe this is a sign they did. Sources say Microsoft has sidelined its native Xbox handheld project to focus instead on Windows 11 gaming performance for third-party OEM handheld devices like an ASIS model debuting later this year, quoting Windows Central. Just to emphasize here, it's not Xbox's

ASIS device Canon that is being pushed back. It's Microsoft's own internal Xbox handheld that has been shelved for now. I have a variety of code names for this unseen device, but it's unclear as of writing which exactly is the correct one. At the moment, it seems, there are three prototype devices in development for Microsoft's Gen 10 effort with the handheld being parked for now. Indeed, Microsoft still wants to build its own Xbox handheld in the future, but Microsoft has decided to prioritize its teams to improve Windows 11 gaming performance specifically for devices like the AISS partner device, Project Kenan. It's possible that the existential threat from Steam OS, which on paper delivers better gaming performance than Windows 11

itself, has informed these decisions. Our sources have indicated to us that Microsoft is still deeply invested in developing its own Xbox gaming handheld technology in the future, but it was announced internally today that the priorities are moving more deeply towards third-party OEM handhelds in the interim. Project Kennan is the codename of Microsoft's partner Xbox handheld with AIS. We understand that Kenan is still targeting a launch for later this year. The hardware side is essentially finished. Tentatively, we believe this device is to be among the first using the AMD Z2 Extreme, but we are still working on solid confirmation for that. There's a significantly boosted effort between the Xbox and Windows teams

to improve the experience on the software side. Devices like the Asis Rog Ally and Lenovo Legion Go already run on regular Windows 11, and the Xbox layers and apps have gotten better, but there's still a lot of improvements that could be made. It was always a bit unclear if Microsoft Microsoft's handheld was designed to be a native Windows 11 PC gaming style handheld or more of a native Xbox console style experience. But we potentially now have the answer. It seems that it was indeed meant to be a device that could run full Xbox games, but Microsoft has decided to prioritize its teams on the partner opportunity around devices

like Canon, at least for now. I've been told that Microsoft still has big ambitions and is investing heavily to deliver a native Xbox handheld, but the shift is about prioritizing and allocating resources right now. There have been no layoffs or anything. like that as a result of this reprioritization, end quote. Want to take a family photo and studio Ghibliot? Okay, but what if you want that same photo to look like a Pixar character? What if you want several options that still are referencing the single first photo?

Well, iterations like this are now possible as Black Forest Labs has released Flux 1, Context, a suite of AI models that let users generate and edit images using both text and images as inputs, quoting TechCrunch. The most capable of the models in the new family called Flux1 Context can be prompted with text and optionally a reference image to create new images, writes Black Forest Labs in a blog post. The Flux1 Context models deliver state-of-the-art image generation results with strong prompt following, photorealistic rendering, and comprehensive typography, all at inference speeds up to 8x faster than current leading models, the company writes in a post.

Unlike traditional text image models, context understands both text and images as input enabling true in context generation and editing. Unlike some of Black Forest Labs' previous models, Flux1 Context Pro and Flux1 Context Max can't be downloaded for offline use. However, Black Forest Labs is making an open context model flux 1 context dev available in private beta for research and safety testing. Black Forest Labs, based in Germany, was said to be in talks to raise $100 million at a $1 billion valuation toward the end of last year. Many of the founders hail from Stability AI, the creator of the notorious stable diffusion image. image-generating model. Backers include Andrewson Horowitz, Oculus co-founder Brendan Arribay,

and Y Combinators Gary Tan. In the months since it emerged from stealth, Black Forest Labs has released a number of new image-generating models and enterprise-focused services, including an API, end quote. Hugging Face has unveiled two open-source humanoid robots, the $3,000, full-sized HopeJR, and a $250 to $300 Ritchie mini desktop unit expected to ship by the end of 2025. Quoting TechCrunch, Hope JR is a full-sized humanoid robot that has 66 actuated degrees of freedom or 66 independent movements, including the ability to walk and move its arms. Ritchie Mini is a desktop unit that can move its head, talk, listen, and be used to test AI apps. This robot release was made possible in part by the company's acquisition of humanoid robotics startup pollen robotics, which was announced in April, according to DeLang. He added that the pollen team gave Hugging Face a new capability required to make these boxes.

Hugging Face has been making a concerted push into the robotics industry over the past few years. It launched Le Robot, a collection of open AI models, data sets, and tools to build robotic systems in 2024, end quote. Time for the week on Long Read suggestions, and the first one builds off of something we talked about this week. The New York Times says that for some recent college graduates, the AI job apocalypse may already be here. You can see hints of this in the economic data. Unemployment for recent college graduates has jumped to an unusually high 5.8% in recent months and the Federal Reserve Bank of New York recently warned that the unemployment situation for those workers had deteriorated noticeably. Oxford Economics, a research firm that studies labor markets found that unemployment for recent graduates was

heavily concentrated in technical fields like finance and computer science, where AI has made faster gains. There are signs that entry-level positions are being displaced by artificial intelligence at higher rates, the firm wrote in a recent report. But I'm convinced that what's showing up in the economic data is only the tip of the iceberg. In interview after interview, I'm hearing that firms are making rapid progress toward automating entry-level work and that AI companies are racing to build virtual workers that can replace junior employees at a fraction of the cost. Corporate attitudes towards automation are changing, too. Some firms encourage managers to become AI-first, testing whether a given task can be done by

AI before hiring a human to do it. One tech executive recently told me his company had stopped hiring anything below an L5 software engineer, a mid-level title typically given to programmers with three to seven years of experience because lower-level tasks could now be done by AI coding tools. Another told me that his startup now employed a single data scientist to do the kinds of tasks that required a team of 75 people at his previous company. Anecotes like these don't add up to mass joblessness, of course. Most economists believe there are multiple factors behind the rise in unemployment for college graduates, including a hiring slowdown by big tech companies and broader uncertainty about

President Trump's economic policies. But among people who pay close attention to what's happening, in AI, alarms are starting to go off. This is something I'm hearing about left and right, said Molly Kinder, a fellow at the Brookings Institution, a public policy think tank who studies the impact of AI on workers. Employers are saying, these tools are so good that I no longer need marketing analysts, finance analysts, and research assistants, end quote. And finally today, this is not tech, but did you know Led Zeppelin financed the production of Monty Python and the Holy Grail? from open culture and a YouTube video discussing this quote.

Monty Python and the Holy Grail isn't a big budget spectacle, and nobody knew that better than the pythons themselves. Necessity being the mother of invention, they turned the project's financial constraints into one of its many sources of humor, fashioning memorable gags out of everything from coconut shells, substituting for horses to sudden shutdowns of filming that ends the story, but as explained in the canned history video above, putting together even the modest sum with which they had to work was hardly a straightforward endeavor.

Turned down by studios, the Pythons sought out the only financiers likely to possess both sufficient wealth and sufficient belief in an absurdist TV comedy troupe making their first proper film. Rock Stars. This was the mid-1970s recall when a group with a few hit albums could find themselves making quite literally more money than they knew what to do with. Such was the case with Pink Floyd, for example, after releasing the Dark Side of the Moon in 1973. Monty Python, for their part, had put out not only three seasons of their BBC series Monty Python's Flying Circus, but all also a variety of purchasable goods like books and LPs. The latter made them the music industry connections that they could use to enlist the likes of not just the Floyd, but also Led Zeppelin, Jeth Rottal, as well as record labels like Island, Charisma, and Chrysalis. As Eric Idle tweeted much later, Zeppelin contributed 31,000 pounds, Pink Floyd's company 21,000, and Jefferotall's

Ian Anderson, 6,300 pounds, 6,300 pounds, 627,000 in more recent value, or nearly 850,000 in U.S. Total. Altogether, Monty Python and the Holy Grills budget came to 282,000 pounds in 1974 pounds. By no means a King's Ransom, but just enough to put together a comic take on the Arthurian legend. No more conventional investors than the pythons were conventional filmmakers, the rock stars, and other music industry figures involved made no visits to the set, or offered any notes on the work in progress. One suspects that they were happy just to support a Monty Python project, and even more so to receive the tax break offered for films produced in the UK. In the event, of course, they all made their money back many times over with a cut of the Broadway musical adaptation spam a lot to boot. The film's immediate and outsized success can't have been far from the mind of George Harrison, that great enemy of the taxman, when Idol called him up a few years later, asking for the money to make Life of Brian, end quote.

No weekend bonus episodes for you this week. Talk to you on Monday.