Tech Brew Ride Home - Thu. 02/16 – Microsoft Reflects On The New Bing

Episode Date: February 16, 2023

Microsoft is revealing what it’s learned from us poking around on the new Bing. It seems that once developers begin using generative AI to code, they DO keep using it. Apple has postponed its headset announce to WWDC. Banks are shying away from crypto exposure. And after 16 years, border control is finally making use of NFC technology in passports. Sponsors: ZocDoc.com/techmeme Links: Microsoft explains Bing's bizarre AI chat behavior (Engadget) GitHub Copilot update stops AI model from revealing secrets (BleepingComputer) SEC Proposal Could Bar Investment Advisers From Keeping Assets at Crypto Firms (CoinDesk) Banks Are Breaking Up With Crypto During Regulatory Crackdown (WSJ) Apple Pushes Back Mixed-Reality Headset Debut Two Months to June (Bloomberg) Whatever happened to the metaverse? (FT) US Border Patrol Is Finally Able to Check E-Passport Data (Wired) 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 Thursday, February 16th, 2023. I'm Brian McCullough today. Microsoft is revealing what it's learned from us poking around on the new Bing. It seems that once developers begin using generative AI to code, they do keep using it.

Apple has postponed its headset announced to WWDC. Banks are shying away from crypto exposure. And after 16 years, border control is finally making use of NFC technology and passports. Here's what you miss today in the world. of tech. A while ago, I joked that in five years of this podcast, we rarely spoke about BuzzFeed, and then all of a sudden they were the top story for a couple of days. Well, same thing with Bing, right? Have we ever mentioned Bing before? Did anyone talk about Bing before about a month ago? Well, given yesterday's news, I thought it was worth mentioning that Bing themselves in a blog post

has been reflecting on what they think they've been learning so far from this whole AI experiment. Quoting and Gadget. Microsoft has released a blog post explaining what's been happening and how it's addressing the various issues that have been reported. To start with, the company admitted that it didn't envision Bing AI being used for, quote, general discovery of the world and for social entertainment, end quote. Those, quote, long extended chat sessions of 15 or more questions can send things off the rails. Bing can become repetitive or be prompted slash provoke to give responses that are not necessarily helpful or in line with our designed tone, the company said. That apparently occurs because question after question can cause the bot to forget what it was

trying to answer in the first place. To fix that, Microsoft may add a tool that lets you reset the search context or start from scratch. The other issue is more complex and interesting. Quote, the model at times tries to respond or reflect in the tone in which it is being asked to provide responses that can lead to a style we didn't intend. Microsoft, wrote. It takes a lot of prompting to get that to happen, but the engineers think they might be able to fix it by giving users more control. Despite those issues, testers have generally given Bing's AI good marks on citations and references for search. Microsoft said, though it needs to get better with, quote, very timely data like live sports scores. It's also looking to improve factual answers for

things like financial reports by boosting grounding data by four times. Finally, they'll be, quote, adding a toggle that gives you more control on the precision versus creativity of the answer to tailor your query, end quote. The Bing team thanked users for the testing to date, saying it helps us improve the product for everyone. At the same time, they expressed surprise that folks would spend up to two hours in chat sessions. Users will no doubt be just as diligent trying to break any new updates, so we could be in for an interesting ride over the next while, end quote. So another thing I've been thinking about is one wonders if one of the real lasting applications here will be chatbots in the style of that movie, Her, right? Like, just mentioned

there at the end of that piece, just to keep people entertained, just to keep them from being lonely. Or as Ben Thompson has put it, maybe ushering in whatever comes after social networking. But also, one of the names of the game for this tech going forward, I said yesterday will be whether people continue to use it. It will also be whether or not improvements can be made, improvements in efficiency, since this stuff requires so much compute, improvements in accuracy is needed clearly as well. So, interesting, as I mentioned yesterday, that GitHub has updated co-pilot with better and more secure code suggestions, but also they offered a key metric that I didn't see yesterday, which does support what I said yesterday, and also what I've been hearing from developers, even from developers at the podcast meetup in San Francisco, a week ago,

i.e. that once you use one of these tools to code, you never want to go back. GitHub says 46% of developers' code files across all languages were generated recently with Copilot, quoting bleeping computer. The company says the new AI model, which will be rolled out to users this week, offers better quality suggestions in a shorter time, further improving the efficiency of software developers using it by increasing the acceptance rate. Copilot will introduce a new paradigm called Fill in the Middle, which uses a library of known code suffixes and leaves a gap for the AI tool to fill, achieving better relevance and coherence with the rest of the project's code.

Additionally, GitHub has updated the client of Copilot to reduce unwanted suggestions by 4.5% for improved overall code acceptance rates. When we first launched GitHub Copilot for individuals in June 2022, more than 27% of developers' code files on average were generated by GitHub Copilot. Senior Director of Product Management, Shuiang Zhao said, Today, GitHub Copilot is behind an average of 46% of a developer's code across all programming languages, and in Java, that number jumps to 61%, end quote. So there's definite signs of people trying it out, sticking around, and even increasing

usage. The article goes on to mention the new security vulnerability filtering system that I mentioned yesterday, where a co-pilot thinks you're writing flimsy code, so it will suggest what it thinks would be more secure, and that's also, obviously, quality improvements. More regulatory churning on the crypto front, the U.S. Securities and Exchange Commission has proposed a rule that would bar investment advisors from storing assets at crypto platforms and lenders that are not registered as exchanges or banks, quoting Coin Desk. The rule approved in a 4-to-1 vote by the SEC on Wednesday would expand the agency's existing regulations that say an investment advisor needs to keep customers, money, and securities with a, quote, qualified custodian. The new version, if approved, would grow that safeguarding requirement to any asset that investment advisors are entrusted with, including crypto. Right now, crypto trading and lending platforms routinely offer custody for crypto customers, but they're not qualified custodians under this rule.

An appropriate custodian under SEC's regulations would generally mean a chartered bank or trust company, a broker-dealer registered with the SEC or a futures commission merchant registered with the Commodity Futures Trading Commission. While officials said the rule wasn't specific to crypto, the industry featured heavily in formal remarks reviewing it. Make no mistake, based on how crypto platforms generally operate, investment advisors cannot rely on them as qualified custodians, SEC Chair Gary Gensler said in a statement. Though some crypto trading and lending platforms may claim to custody investors crypto, that does not mean their qualified custodians, end quote. Apart from demanding that investment advisors trust only regulated financial institutions with their customers' money, mostly leaving crypto businesses on the outside. The SEC's proposal also says those qualified custodians would be subject to independent audits, regular disclosures, and would need to segregate customer assets into accounts under the customer's identity, end quote.

As McKenzie Sigelos tweeted, quote, this rule change would potentially ensnare crypto exchanges like Coinbase. Custody regulations would now include assets like crypto and require companies to become a qualified custodian to keep holding customer assets. And quote, yeah, but isn't that the point here? Exchangers like Coinbase wouldn't like it, but I'm sure they jump through these hoops if they have to. This comes alongside further reporting from the Wall Street Journal suggesting that spooked by a growing regulatory crackdown U.S. banks in general are backing away from crypto companies

and reevaluating their exposure to crypto, no matter how small that exposure might be. Quote, the few smaller banks that got deep into crypto are reducing their exposure to the market or cutting ties altogether. Banks that kept their distance from crypto are trying even harder to stay away, closing accounts and shunning customers with potential connections to the industry. New York's Metropolitan Commercial Bank recently announced that it was closing its crypto business, citing material changes in the regulatory environment. Signature Bank cut ties with the international business of finance, the biggest crypto exchange. The lender, one of crypto's leading banks, started pairing back its relationships with crypto depositors late last year.

The crackdown is squeezing crypto businesses. While the industry often pitched itself as an alternative to banks, these firms still rely heavily on banks to link up with a financial system that runs on hard currencies, such as dollars and euros. Without banks, crypto companies struggle to pay their employees and enable customers to move money in and out of digital currencies. If you don't have a bank account, it's very hard to do business, said Scott Shea, Signatures Chairman. For a time, banking regulators warmed to crypto activities. In 2020, the Office of the Comptroller of the Currency said it would allow banks to hold cryptocurrencies for customers. regulators reverse course following the FTX meltdown. In January, the three major banking regulators warned banks that they were concerned about their crypto ties. The regulators said they had,

quote, significant safety and soundness concerns and questioned if the industry could be safely banked. Quote, that was a red flare that went up that basically says, banks, if you're going to be anywhere near the crypto business, we're going to be looking at you very carefully, said Thomas Vartanian, executive of the financial technology and cybersecurity center. At the end of the day, banks are going to have to ask themselves if it's worth the aggravation, he said, end quote. Mark German's sources are saying that Apple intended to debut its mixed reality headset in April at some sort of special event, but has decided to postpone the launch just a bit to June at its annual WWDC. Why? Because apparently testing was finding hardware and software issues

that they need a bit more time to iron out, quoting Bloomberg. The debut of the headset has been a long time coming, with Apple working on the technology since around 2015. At one point, the company aimed to introduce the product in June of last year before pushing back the introduction until around January of 2023. It was then shifted to spring before the latest postponement. Dan Riescio, Apple's former hardware chief, who now helps oversee the Mix Reality Project, has become increasingly involved in the endeavor in recent weeks as the company looks to resolve remaining issues the people added, and Apple spokeswoman declined to comment. Apple's earlier plan was to unveil the product in early spring at a launch event aimed at consumers. It could then provide

more extensive details and development tools to third-party software developers at its annual June Expo known as WWDC. Now the company is aiming to debut all aspects of the device at that conference. The product would then go on sale later in the year. The timing could always change again, but the Cooperino-California-based company is intent on bringing the device to market by the end of 2023, if possible. It's meant to be a centerpiece of Apple's new product lineup during an otherwise modest year. The company is introducing a larger MacBook Air, new MacBook Pro desktop, and updates to the iPhone, but there won't be any significant changes to its watch, AirPods, or iPad, end quote. I thought this analysis from Jemima Kelly in the Financial Times

backs up a lot of what we've been seeing with our own eyes over the last few weeks, which is a year on from meta-hyping the Metaverse. changing their name, you know, releasing a big Super Bowl ad. Enthusiasm inside meta, but also outside it, for the virtual future that Mark Zuckerberg was all enamored with, has evaporated. And even meta is now more focused as we've seen on so-called efficiency. Quote, type Metaverse into Google Trans, and you'll see search traffic for the word has collapsed by about 80% over the past year or so.

These days, if you want to raise a load of cash, you're better off name-dropping generative AI. artificial intelligence that can generate text images or other data, venture capital investments into that particular sector jumped 425% between 2020 and 2022. So unenthusiastic are meta's own investors about the idea that Chief Executive Mark Zuckerberg was recently forced to say that the metaverse is, quote, not the majority of what we're doing, end quote. These days he's talking more about efficiency than the metaverse itself for good reason, too. Reality Labs, the division that makes the metaQuest headsets, made an operating loss of $13.7 billion. last year. The company has also fallen remarkably quiet about its big plan to hire 10,000 people in the

EU to work on the Metaverse. I asked Meta if that was still happening and whether anyone had been hired yet. They told me, quote, our expansion in Europe was always a long-term one, planned over a number of years. We remain committed to Europe. And quote, Microsoft, meanwhile, has killed its industrial metaverse team just four months after setting it up, laying off 100 members of staff. Where did it all go wrong? The Metaverse has a couple of major problems. The first is that nobody seems to be seems to be able to agree on what it is. Even the people setting themselves up as the leaders of our new fantastical future can't seem to come up with a common definition. The likes of Zuckerberg appear to think that it's basically a VR world, offering the thrill of having video meetings as

avatars and virtual boardrooms. Others imagine it as an internet that is somehow underpinned by the all-powerful distributed database known as the blockchain and involving the wondrous strings of code known as non-fundable tokens. I thought this defined a different techno-utopian fantasy known as Web3. Dave Karpf, a professor at George Washington University who studies the internet, tells me Zuckerberg's idea of the metaverse, less about blockchain and more about using a combination of VR and AR to create an immersive 3D internet, is closer to the consensus, but is still a woolly concept. It's also nothing new. There have been many attempts to create such a metaverse over the last two or three decades. That brings us to the metaverse's most serious problem. Nobody seems to want it. Carp himself forked out $1,500 for the

MetaQuest Pro, and has only used it three times. It's what I call the Field of Dreams fallacy, the assumption that if you build it, they will come, says Karp. At this point, we have to look at the results that we've seen so far, and the biggest problem is that no matter how good the hardware gets, people basically don't want that, end quote. All this is not to deny the likelihood that as technology advances, the internet will become more immersive, but this will happen gradually and messily. We are not about to step into a suddenly formed blockchain-powered virtual world together. The Metaverse never really began, and yet it's already over, end quote. Finally today, U.S. Customs and Border Protection has confirmed that it has begun

implementing software to verify e-passports, which is good, because it's been nearly 16 years since the U.S. started issuing passports with RFID chips as well as other countries, quoting Wired. Since 2006, the United States and many other countries have embedded these little chips in the back panel of their passports or e-passports as they're known. The chip digitally stores the personally identifying information of the documents owner, including name, date of birth, passport number, and biometric data like your photo, along with a cryptographic signature, meant to act as a check against tampering or forgeries. For years, the U.S. has required that visa waiver countries issue e-passports to their citizens who want to enter the U.S.

Yet, in all this time, CBP hadn't actually deployed the software to execute these validity checks. In early 2018, U.S. Senator Ron Wyden of Oregon and former Senator Claire McCaskill of Missouri wrote a letter to CBP calling on the agency to implement the cryptographic verification, given that the RFID e-passport infrastructure had been in place for years. Last week, five years after that request, CBP informed Wyden's office that it has had the e-passport verification system up and running since June. CBP says that so far the validation process has checked more than 3 million passports from visa waiver program travelers and has contributed to the arrest of 12 people who were allegedly attempting to enter the U.S. with fraudulent identification. During primary processing,

the e-passport technology alerted on the documents and the travelers were referred to the secondary where CBP officers determined that the travelers were in possession of fraudulent travel documents, the agency says in a statement. Though the verification has been running since June, CBP says that it still can't verify e-passports issued by Andorra, the tiny nation between Spain and France that has a population of fewer than 80,000 people. Other than that, though, CBP is running the validation checks for all visa waiver countries, end quote. Nothing for you again today. Talk to you tomorrow.