Tech Brew Ride Home - PayPal On The Block?

Episode Date: July 15, 2026

New York became the first state to pause new data center permits, worrying the AI industry. Stripe and Advent offered $53B+ for PayPal, OpenAI's first device leaked as a screen-free speaker, and PrismML shrank a model to run on iPhones. AI advocates fear New York's moratorium on new data centers could embolden Democrats to enact more state restrictions and seize on the issue in the midterms (Politico) Sources: Stripe and PE firm Advent have jointly offered $60.50/share to acquire PayPal, a 28% premium to Tuesday's close, valuing it at $53B+; PYPL jumps 15%+ (Reuters) Sources: OpenAI's first device will be a moveable, screen-free smart speaker with a camera and sensors, meant to serve as an AI companion that taps into ChatGPT (Bloomberg) OpenAI says Apple's claim that OpenAI never responded to its concerns is false; emails: an Apple lawyer mixed up two OpenAI staffers in Apple's initial outreach (NBC News) OpenAI says Apple's claim that OpenAI never responded to its concerns is false; emails: an Apple lawyer mixed up two OpenAI staffers in Apple's initial outreach (9to5Mac) PrismML launches Bonsai 27B, a model based on Qwen3.6 27B that it says runs natively on Apple devices via MLX; its CEO says Apple is evaluating the tech (CNBC) Subscribe to the ad-free feed. Learn more about your ad choices. Visit megaphone.fm/adchoices

Welcome to the Tech Brew Ride Home for Wednesday, July 15th, 2026. I'm Brian McCullough today. New York has become the first date to pause new data center permits worrying the AI industry. Stripe and Advent offered more than $53 billion for PayPal. OpenAI's first device leaked as a screen-free speaker. And PrismML shrank a model to run on iPhones. Again, here's what you missed today in the world of tech. To all the IT pros out there, today's sponsor has a special gift for you. That gift is Ace of Uptime, an online card-based game where you can go up against the problems that threaten uptime on a daily basis. Each level pits you against a recognizable adversary. We're talking about alert overloads, heat that's trapped in a cramped server room and systems that look fine but are far from it. Choose your move and see whether your decisions resolve the issue or escalate it.

The game is fast, fun, and designed to let you test how you'd respond when uptime is on the line. think you can beat the villains of downtime? Head over to Eton.com slash ace to find out that's Eton.com slash ace. New York Governor Kathy Hochel has signed a moratorium blocking new environmental permits for data centers over 50 megawatts for up to one year, making New York the first state to do so. And AI advocates fear this moratorium could embolden Democrats especially across the country to seize on a hot-button populist issue to enact more such state restrictions in the midterms. Quoting Politico, the executive order that Democratic Governor Kathy Hocchel signed Tuesday

marks the first state-level pause on data center construction following dozens of municipalities in red and blue states that have passed similar moratoriums. But industry supporters and detractors alike say it's unlikely to be the last amid poll numbers showing growing public skepticism toward AI. The moratorium also serves as a bridge of sorts between moderate Democrats such as Hocchel and progressives like Senator Bernie Sanders of Vermont, who have clamored for more restrictions on data centers and artificial intelligence. The party as a whole remains torn on how hard a line to draw against one of Silicon Valley's top priorities, despite a trend of Democrats from Pennsylvania to California embracing the push for new guardrails on the sprawling energy-hungry AI hubs.

Senator Sanders told Politico on Tuesday that the concept of a moratorium dismissed just months ago as a radical idea is entering the mainstream. There is a growing understanding that maybe we better slow the process up in order to understand the extraordinary impact that AI is going to have on our economy, on our privacy rights, on the mental health of our kids, and existential threats as well, Sanders said. The senator introduced legislation with Representative Alexandria Ocasio Cortez of New York this year that would impose a nationwide pause on data center construction. A month later, one of the party's most powerful moderates, Representative Frank Pallone of New Jersey, the top Democrat on the House Energy and Commerce Committee, endorsed a federal moratorium as well. The moratorium call has yet to gain traction among congressional Democrats as a whole, but data center developers are expressing angst about where the trend is heading.

If a state as large as New York can pause on permitting, developers have to assume it could happen anywhere, said Joseph Hoffer, principal and chief AI officer. at the Monument Advocacy Lobbying Firm. I wouldn't call it a panic, but the concern is real and it moved fast, Hoffer said. The real worry in the industry isn't New York specifically. It is the precedent. Caleb Max, CEO of the National Artificial Intelligence Association, said he feared the impulse would spread to other states. I think we're just kind of at the cusp of probably dozens of states, if I have to be

honest, he said, citing, quote, devastating poll results on people's attitudes toward data centers. the industry doesn't wake up quick and start solving this, it's going to get a lot worse, he said, end quote. Some Democrats remain unchanged in their opposition to a federal pause, despite Hocel's decision. Representative Josh Gottheimer of New Jersey, Democrat, co-chair of the House Democratic Commission on AI, warned that a moratorium risks surrendering the lead in innovation to China, just having a blanket moratorium saying we're going to just pack up and go home, hand over AI to China, and let them beat us makes zero sense to me. Gotthimer told Politico on

Tuesday, there's a similar vibe across the aisle where Republicans are keen on protecting ratepayers from rising energy costs associated with data centers, but like Gottheimer, don't want to risk giving China an edge in the AI race. Republican Representative Nancy Mace expressed support for a data center pause in her state of South Carolina, but most in the party are unwilling to go that far, instead supporting the voluntary rate-payer protection pledges tech companies signed with the White House in March. Those agreements task data center developers with buying, bringing, or building their own power supply for the projects to ensure ordinary customers don't bear the brunt of rising energy costs. Energy costs, water

scarcity, and general unease with AI are all contributing to a surge of frustrated constituents. But governors and state lawmakers in both parties have struggled to stake out a lane on data centers. Lawmakers in 15 states have introduced legislation that would impose a moratorium on data centers according to information from the National Conference of State Legislatures. Only two states, Maine and New York, had bills reached the governor's desk and neither was signed until now. State lawmakers have introduced more than 300 bills related to data center regulation overall this year, end quote. Sources report that Stripe and private equity firm Advent have jointly offered $60.50 and 50 cents a share to acquire.

PayPal, which would be a 28% premium to Tuesday's close, valuing PayPal at more than $53 billion. Quoting Reuters. The offer submitted earlier this month is backed by about $50 billion and committed financing from banks, said one of the known sources. The sources declined to be named, as the deal discussions are confidential. PayPal, Stripe, and Advent declined to comment, Reuters first reported the news late on Tuesday. Combining Stripe and PayPal, the most widely used payment platforms for Internet merchants,

would create one of the world's largest global online payments company, processing some $3.7 trillion of annual payment volume. The proposal follows an initial approach made in early April, the sources said. Strype and Advent have not received a response from PayPal and are seeking to advance discussions in the coming weeks, the sources said. Under the proposal, Stripe and Advent would jointly own PayPal with each holding an equal stake, rather than breaking up the company, the people said, adding that there is no certainty the approach will result in a transaction. Founded in the late 1990s, PayPal was an early player in digital payments, but has faced competition as consumers have embraced alternative payment methods, and rivals such as Apple Pay and Google Pay have gained

market share. PayPal has spent the past several years grappling with slowing growth and intensifying competition in digital payments, wiping out much of the value it gained during the pandemic. The company's market capitalization peaked at about $360 billion in 2021 and fell to as low as roughly $36 billion this year. It has lost more than 40% of its market value over the past 12 months. After taking over in March, PayPal CEO Enrique Lores started a sweeping turnaround exercise to simplify the payments provider and sharpen its focus on growth. In April, the company split its operations into three units covering checkout consumer financial services Venmo and payments and crypto while making a series of management changes.

Despite the valuation premium, William Blair analyst Andrew Joffrey said we do not think PayPal's new CEO will likely embrace what could be viewed as a low-ball offer. If the current offer is an opening salvo, we could see Stripe and Advent going as high as $70 per share. The strategic appeal is that Stripe's business has been overwhelmingly focused on merchants, while PayPal adds more than 430 million consumer accounts and direct consumer payment and banking relationships. PayPal's consumer offerings could be attractive to materially accelerate Stripe's efforts to build out its digital wallet offering, Coen analyst Brian Bergen said, the deal would give Stripe direct consumer relationships

with a large user base and the potential for future financial services distribution, which PayPal has recently increased its efforts on. Stripe would also gain Venmo's peer-to-peer network and PayPal's consumer-facing checkout button. A Stripe PayPal combination would allow more transactions to flow across its network, reducing reliance on processors like Visa or MasterCard,

which could in turn help bypass transaction fees and earn more from each payment. The deal could also bolster Stripe's stablecoin ambitions, giving the company a vast consumer distribution network to help drive mainstream adoption of stablecoin-based payments. Stripe has invested heavily in its crypto unit, Bridge. The potential PayPal transaction, if completed, will add to the recent M&A activity in the global payment sector where buyers have pursued targets amid rapid changes in financial technology and the rise of artificial intelligence. Payment companies are also increasingly seeking to scale. through M&A, as well as exposure to faster growing segments such as cross-border and business-to-business

payments amid slower growth for traditional payment processing. In 2025, global payments agreed to acquire rival world pay from FIS and private equity from GTCR for $24.25 billion in a complex three-way deal. As part of that deal, GTCR sold its 55% stake in FIS and exited its remaining 45% holding. The sector has also seen a steady stream of smaller deals, including the acquisition of Paynear Global by Canadian payments firm Nuvi for $2.75 billion. Nuvi is backed by Advent International and other private equity firms. PayPal's revenue rose 7% to $8.35 billion in the first quarter, beating analysts' average estimate of $8.05 billion.

On a currency-neutral basis, total payment volumes jumped 8% over a year ago to about $464 billion. Lores outlined plans in May to leverage artificial intelligence to streamline operations at PayPal across the company and eliminate duplication in workforce layers but did not provide additional details. The company has said these initiatives would save about $1.5 billion over the next two to three years, adding it will reinvest that amount to drive new growth. Privately held stripe is among the world's most valuable companies. It was valued at $159 billion in a tender offer for employees and shareholders in February, a more than 70% jump from a similar share sale a year earlier, end quote.

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It automatically redacts sensitive information and even suggest improvements to your existing workflows. To see what Scribe could look like for your org, head to Scribe.how slash ride home and mention right home for your first month of Scribe capture free on select plans. That's S-C-R-I-B-E dot how slash ride home. Mark German says that Apple's lawsuit notwithstanding, OpenAI's first hardware device will be a movable, screen-free smart speaker with a camera and sensors meant to serve as an AI companion that taps into chat GPT. Quoting Bloomberg, OpenAI success in hardware will hinge on bringing a novel approach to the market, something it aims to do with the smart speaker. For instance, the device's technology is meant to become increasingly personalized and proactive as it gains a deeper understanding of its owner over time, to the people. Open AI envisions the device anticipating needs, surfacing information proactively

and serving as an expert on its user, they said, though the speaker is designed to stay in the home, it will be easy to move around the house. Open AI believes the product's defining feature will be its personality and ability to connect on a human-like level with users. The speaker incorporates mechanical elements that can move on their own, creating a sense that it is alive and not just an object responding to commands. The machine will also draw on personal information, such as emails to better understand its owner. The goal is for the device to feel like a companion and become a physical manifestation of OpenAI's ChatGPT.

Still, the exact plans could change as the company works through the development and legal process, and OpenAI spokesperson declined to comment. The device's communication abilities will rely on a more advanced version of the ChatGPT voice mode, GPT live, that OpenAI rolled out this month. The new voice mode is designed to act more like a human. It can listen and talk at the same time,

adapt more naturally during conversations, and quickly process information. Though the new product resembles a speaker, OpenAI internally describes it as the first of its kind, a computer built for AI to help make people more productive. It includes a camera and other sensors that help it understand a user's surroundings and context, as well as advanced AI models beyond those available on conventional smart speakers. Another central difference is that the device includes a rechargeable battery,

allowing it to be carried from room to room throughout the day. A user could bring it into the laundry room while doing, doing chores, move it into the kitchen for cooking assistance, and later place it in a living room or bedroom to have it play music. It can also remain plugged into a single room if the customer chooses. To build up its devices business, OpenAI spent $6.5 billion last year to acquire I.O. products, a startup co-founded by Apple design veteran Johnny Ive. Ive's studio Love From also is helping craft the new lineup. And the endeavor involves many former Apple designers and engineers responsible for creating products such as the iPhone and Mac.

believes the love from team's expertise in making technology feel personal will help distinguish the company's first hardware product, end quote. Speaking of that Apple lawsuit against OpenAI, quoting 9 to 5 Mac, last Friday Apple filed a trade secrets theft lawsuit against Open AI IO products and two former employees. In the lawsuit, Apple accuses its former employees of stealing confidential hardware information to advance OpenAI's consumer device ambitions. Apple also alleges that OpenAI. failed to respond when the company first raised the issue directly in February. Quote, in February as its investigation was in its early stages, Apple wrote OpenAI to raise

its concerns that Apple's confidential information could be making its way into OpenAI's business improperly. Apple asks Open AI to discuss what precautions Open AI was taking to avoid this problem, to investigate it, and to remediate any issues. Open AI never responded. This necessitated Apple's further investigation revealing the alarming, unlawful contact discussed above, end quote. However, according to NBC News, OpenAI says that it did not respond to Apple's initial outreach, but that communications broke down after an outside lawyer for Apple mistakenly emailed the wrong OpenAI employee and confused him with another person. According to the report, Gabriel Gross, quote, an outside attorney representing Apple with the law firm, Weil,

Gottshaw, and Manges sent an email to Che Chang, OpenAI's general counsel with the subject former Apple employees at OpenAI, retaining non-public confidential and proprietary information, and containing attachments supporting Apple's accusation. Then 13 minutes later, Gross emailed Chang once again, thanking him for a phone call that supposedly took place in the interim and for offering your cooperation so quickly. The problem is that the second email wasn't intended to Chang, but rather to a former Apple employee who had gone to work at OpenAI, whose last name is Wang, says NBC News. Gross had emailed both Chang and Wang moments ago.

and had spoken with Wang on the phone in the interim, but replied to Chang by mistake. Believing Gross had emailed him with fabricated information to advance Apple's case against OpenAI, Chang got in touch with two in-house Apple attorneys, accusing the company's outside attorney of, quote, lying about speaking with me on the phone, adding, I don't know who he is and we have never spoken. He then asked Gross to be removed from the case. Gross later apologized to Chang, while one of Apple's in-house attorneys told Chang that he could remain in contact with Gross and his law firm, as the case, move forward. The talks appear to have ended there, says NBC News, adding that opening eye claims

it had no record of subsequent outreach by Apple's lawyers until Friday when Apple filed its lawsuit, end quote. And one more real quick on the Apple AI angle quoting CNBC. Apple is in talks with a small Silicon Valley company that says it can shrink powerful artificial intelligence models enough to run directly on an iPhone. The startup CEO told CNBC, PrismML, a Kosoaventure's backed spin-out from the California Institute of Technology publicly released compressed versions of Alibaba's open-source Qwen model on Tuesday. The company said it reduced the model from roughly 54 gigabytes to less than 4 gigabytes,

allowing all 27 billion of its parameters to run on an iPhone 15 or newer. Prism ML CEO Babak Hasibi told Cmbiz that Apple and other companies have been, evaluating the startup's models and measuring their speed, energy efficiency, and performance on devices. They're really evaluating our technology right now, has he be said, of Apple. He characterized the discussions as very early and said it remains unclear where they will lead, but that things are progressing nicely. His words, Apple did not immediately respond to a request for comment, end quote. So in terms of today's World Cup semifinals, which are happening right as I hit Publish on that, if you know you know.