Tech Brew Ride Home - Tue. 02/11 – Elon Wants To Buy OpenAI

Starting point is 00:00:00 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 TechMean Bright Home for Tuesday, February 11th, 2025. I'm Brian McCullough today. Elon makes an unsolicited bid to buy Open AI, or at least the nonprofit that controls it, and maybe he doesn't really want to own it. It's complicated. I'll explain. YouTube continues to be the biggest thing in media. Forget smart watches, get ready for smart earbuds, and the crazy cheap Chinese EVs can now do crazy cheap self-driving too.

Starting point is 00:00:57 Here's what you miss today in the world of tech. Yeah, so I definitely jinxed things yesterday when I read that time. article about Sam outfoxing Elon, because late yesterday, investors led by Elon Musk made an unsolicited $97.4 billion bid to buy the nonprofit that controls OpenAI, complicating Sam Altman's plans to convert to a for-profit entity, quoting the journal. Musk's lawyer Mark Toberoff said he submitted a bid for all the non-profits assets to OpenAI's board of directors Monday. It's time for OpenAI to return to the open source safety focus force for good it once was, Musk said, in a statement provided by Toborov, we will make sure that happens, end quote.

Starting point is 00:01:44 Altman quickly rejected the offer on X. He wrote, No thank you, but we will buy Twitter for $9.74 billion if you want, using the previous name for the Musk-owned social media platform, and moving the decimal point in the billionaire's bid for OpenAI, one space to the left. In a Slack message to employees, Altman wrote, Our structure ensures that no individual can take control of OpenAI. These are tactics to try and weaken us because we are making great progress. The bid is being backed by Musk's artificial intelligence company XAI, which could merge with OpenAI following a deal. He also has several

Starting point is 00:02:20 investors backing him, including Valor Equity Partners, Barron Capital, a treaties management, ViCapital, and 8VC, a venture firm led by Palantir co-founder Joe Lonsdale. Ari Emanuel, CEO of Hollywood company Endeavor is also backing the offer through his investment fund, end quote. Now, to underline the animosity underlying all of this, in response to Altman's tweet on X saying that they would buy Twitter, Musk replied, quote, Swindler. And Axios got a quick interview with Altman at the AI Action Summit in Paris, quote, there's been like versions of Elon trying to, you know, somehow take control of Open AI for a long time. So it's like, Okay, here's this week's episode, Altman told Axios. Open AI is not for sale. Open AI's mission is not for

Starting point is 00:03:09 sale, to say nothing of the fact that, like, a competitor who is not able to beat us in the market, and, you know, instead is just trying to say, like, I'm going to buy this with total disregard for the mission, is a likely path there, end quote. Okay, but why is Elon trying to buy Open AI now? And note, he's not trying to buy Open AI, but the nonprofit that in theory owns part of OpenAI, Sure, maybe Elon thinks he can get Open AI now before it gets much bigger, but there's something more strategically subtle, possibly at play here. Remember, Sam Altman and OpenAI are trying to transform Open AI into a for-profit company, and that's not as simple as just checking a box on a forum. You have to make sure the nonprofit is made whole for the transaction, which means

Starting point is 00:03:55 you need to value things properly. And that involves courts and even the state of California getting involved. So what if just by doing this, it complicates that whole process, throws a spanner in the works, if you will. So Elon could win, even if he doesn't take over the company just by making things more difficult for Sam, someone no less than President Trump has intimated Elon hates. Quoting the Wall Street Journal, Musk's $97.4 billion offer with the backing of a consortium of investors could force Open AI's board of directors to reassess how it is valuing the nonprofit, which the board has said will be fairly. compensated in the transaction and own a stake in the for-profit. The higher the valuation of the

Starting point is 00:04:35 non-profit, the bigger its stake would likely be in the for-profit OpenAI following a conversion. At the same time, Open AI, is negotiating how much equity Microsoft, its biggest investor, should get in the for-profit company, along with other backers and employees. It is also seeking to raise up to $40 billion of new capital. Investors in that round will likely expect equity when Open AI becomes a for-profit as well. Satisfying all those parties was already complicated. If Musk's Gambit increases the equity awarded to the nonprofit, it will be even more difficult, end quote. Then there's the fact that for any profit transformation to take place, the Attorneys General from California, where Open AI is located, and Delaware, where it is incorporated, have to sign off because they oversee the process that makes

Starting point is 00:05:20 sure charities and nonprofits don't get ripped off. I think he is probably just trying to slow us down. He obviously is a competitor, Altman told Bloomberg. I wish he would just compete by building a better product, but I think there's been a lot of tactics, many, many lawsuits, all sorts of other crazy stuff. Now this, end quote. But remember, the board of directors of the nonprofit is still, in theory, independent. With a valuation high enough, they might have the fiduciary duty to at least consider it. Quoting from the journal again, if Elon's is a fair price and the Open AI nonprofit is empowered to make the decision, it could sell, said Harvey Dale, a professor of nonprofit law at New York University. The board could reject Musk's bid for reasons beyond money, though, as a charity, Open AI's

Starting point is 00:06:03 obligation is to fulfill its legal purpose, safely advancing artificial intelligence to benefit humanity. The question of the appropriate price is secondary to the question of whether the board should sell the charitable assets at all, said Jill Horwitz, a law professor at the University of California, Los Angeles, end quote. So again, Elon might be unable to take over Open AI in the end, but maybe that's actually a secondary goal to simply tweaking Sam Altman. As Dan Premack tweeted, quote, my understanding is that at Elon Musk is not trying to buy the OpenAI non-profit, per se, but rather the underlying for-profit assets that at Samma must buy in order to reorg the company. So it's partially a troll and partially setting a price that may cause

Starting point is 00:06:47 Sam to pay more than he might want to, end quote. Like if Sam wanted to say to the various parties, hey, look, we value the nonprofit stake in Open AI at, say, $40 billion. But if you turn down a bid valued at $97 billion, that suggests you think that is low ball, that the nonprofit stake is worth much more than that. So then Sam would have to pay out more to shake off the nonprofit status, which would mean he would have to raise more money than he wanted. From the YouTube is bigger than most people realize file in his annual letter to the community. YouTube CEO Neil Mowen says TV has a... overtaken mobile as the primary device for YouTube viewing in the U.S., indicating, in his words,

Starting point is 00:07:34 YouTube is the new TV, quoting the Hollywood reporter. According to Neil Moen, YouTube's CEO, TV screens have officially overtaken mobile as the primary device for YouTube viewing in the U.S. In other words, more people are watching YouTube on TV sets than any other device, at least here in the U.S. It is, as Moen writes in his annual letter from the CEO, an indication that YouTube is the new television. But the new television doesn't look like the old television, Moen writes. It's interactive and includes things like shorts. Yes, people watch them on TV's podcasts and live streams right alongside the sports sitcoms and talk shows people already love.

Starting point is 00:08:09 YouTube has consistently dominated Nielsen's monthly gauge report, handily topping Netflix as the most watched streaming video platform, and TV has long been a priority for YouTube. In last year's letter, Moen noted that the YouTube TV VMVPD passed 8 million subscribers and that the company was investing in the platform. The company unveiled sweeping changes to its TV app experience last year. Moen also underscored three other big bets for 2025 in his letter. In a section titled, YouTube will remain the epicenter of culture, he noted that 45 million Americans watched election-related content on Election Day last year, and he noted the success of videos like Joe Rogan's interview with President Trump and the SNL sketch with Kamala Harris on the platform.

Starting point is 00:08:53 From elections to the Olympics to Coachella to the Super Bowl and the Cricket World Cup, the world's biggest moments play out on YouTube, Moen writes, adding that the company also plans to roll out more tools to support podcasters, improve monetization for creators, and make it even easier to discover podcasts this year. But YouTube is also working to bring more AI tools to creators, and despite early hype around AI image and video generation products, YouTube is developing them too. Moen suggests that YouTube creators are finding simpler, practical tools to be more helpful. As impressive as the generative models are, creators tell us that they're most excited about the ways AI can help with their bread and butter production.

Starting point is 00:09:29 That's why we're investing in tools to help them in the everyday work of creation, like coming up with a new video idea, title, or thumbnail. Moen writes, we're also using AI to help creators find new audiences. For videos with dubbed audio, more than 40% of the total watchtime comes from viewers choosing to listen in a dubbed language. Last year, we launched auto-dubbing, which helps creators translate their videos into multiple languages with a touch of a button. Later this month, we'll make audio dubbing available for all creators in the YouTube.

Starting point is 00:09:56 to partner program. We'll continue to make improvements here and expand to more languages throughout the year, end quote. Google Maps now shows Gulf of America instead of Gulf of Mexico for users in the U.S. Users in Mexico see Gulf of Mexico and everyone else sees both names. So it's basically a geofence sort of thing. This is obviously in response to the new administration seeking to rename the body of water for official U.S. purposes. But this was not done at the direction of the the administration. Google has also removed Pride Month, Black History Month, Indigenous People Month, Holocaust Remembrance Day, Hispanic Heritage, and more events in mid-20204 from Google Calendar for not being, quote, scalable or sustainable, they say. Quoting the verge, Google confirmed

Starting point is 00:10:49 it's made changes to the default calendar events, but with a different explanation about when and why. Here's Google's explanation on what's going on, provided by spokesperson Madison Cushman-Veld. For over a decade, we've worked with Time and and date.com to show public holidays and national observances in Google Calendar. Some years ago, the calendar team started manually adding a broader set of cultural moments in a wide number of countries around the world. We got feedback that some other events and countries were missing and maintaining hundreds of moments manually and consistently globally wasn't scalable or sustainable. So in mid-20204, we returned to showing only public holidays and national observances

Starting point is 00:11:27 from time and date.com globally, while allowing users to manually add other important moments. unquote. Powerbeats Pro 2 earbuds have debuted for $250 with an H2 chip, active noise cancellation, better water resistance, and a 20% lighter design than the previous generation, which you might say, Brian, who cares about earbuds? But they've also got heart rate monitoring, and that's why I'm mentioning it. Expect this to be a trend going forward. Your lowly earbuds are going to get way smarter with everybody adding sensors and even cameras, as we've heard rumors about from Apple rights, so get ready for your earbuds to become as smart as your smart watch. Quoting Mac Rumors. A key new feature for active users is heart rate monitoring, a feature

Starting point is 00:12:19 Mac Rumors discovered some time ago based on code and Apple's software updates. When both earbuds are in the ears and heart rate monitoring is active, LED optical sensors pulsed over 100 times per second to measure heart rate via blood flow, integrating with popular fitness apps, to collect data during workouts, and sync it to the Apple Health app. Supported apps at launch include Open meditation, Peloton, various fitness workouts, runna, running, slopes, skiing, ladder, strength training, and Nike Run Club for running and Yao Yao for jump roping. For iOS users, heart rate monitoring automatically begins when a workout is started in a compatible app, and it automatically ends when the workout is stopped. Android users will need to manually turn on heart rate

Starting point is 00:13:01 monitoring via the earbuds themselves or in the beats app, but monitoring will automatically the end when the workout is completed. Apple says that when a user is wearing both an Apple Watch and Powerbeats Pro 2, apps and Apple Health will default to using data from the Apple Watch, a choice Apple made to not disrupt the existing base of Apple Watch users who have already been tracking heart rate data. Apple notes, however, that both methods have been thoroughly validated and should yield similar results. Powerbeats Pro 2 are available to order at Apple.com starting today in four colors, electric orange, hyper-purple, jet black, and quicksand. They're available at the same $249.99. Price point as the previous generation, and they will be on store shelves, starting this

Starting point is 00:13:40 Thursday, February 13th, end quote. Finally today, remember how Chinese automakers are making insanely cheap electric cars for broad consumption, at least outside of the U.S. Well, get this. They can do self-driving cheaper, too, apparently. Chinese EV maker, B.Y.D, has unveiled a God's-Eye self-driving system and aims to install it on its entire lineup, including its 9,000 $600 Seagull Hatchback. Oh, and there's a deep seek angle, quoting the Financial Times, dubbed God's Eye. The driving system was developed in-house by B.D and will equip the carmaker's mass market models with features commonly only found on upscale EVs such as remote parking via smartphones and autonomous overtaking on roads. We are starting an era where autonomous driving

Starting point is 00:14:34 is for everyone, said founder Wang Chon Fu at a live stream event in BYD's Shenzhen headquarters on Monday. Advanced driver assistance systems were no longer an unattainable luxury, but an essential tool like safety belts and airbags, said Wang. BYD has become the biggest EV producer in China, the world's largest car market, by providing a wide range of affordable EVs built using its highly vertically integrated supply chain. However, the company's slow progress in developing self-driving capabilities has long been regarded as one of its biggest shortcomings. Investor anticipation of BYD's update of its self-driving technology plans set the company's Hong Kong listed shares surging 21% over five sessions last week. No matter whether on hardware

Starting point is 00:15:15 specifications or smart driving functions, BYD's cars are taking the lead over all the competitors in the segment, Lou added. BYD is a company that specializes in optimizing the cost structure, so it's no surprise that it started investing in in-house self-driving R&D. Last year, light vehicles with so-called level two partial automation features accounted for only about eight and a half percent of the Chinese market, according to S&P Global Mobility Data. Consumers in China are more willing to pay extra for sophisticated in-car technology than in most parts of the world. According to an EY survey of consumers last year, only 39% of surveyed Chinese EV owners rated expensive services primarily consisting in-car connectivity as a challenge, while 45% of European

Starting point is 00:15:55 and 47% of U.S. respondents highlighted it as a primary concern. Elon Musk's Tesla is attempting to win Beijing regulators' approval for its self-driving software. B.YD on Monday also joined a cohort of local peers, including Gili, Great Wall Motor, and Stalantus partner Leap Motor that are seeking to integrate Chinese startup sensation deepseek's artificial intelligence into their vehicle systems. Analysts said they expected Deepseek, which last month overturned assumptions about U.S. supremacy and AI, would allow Chinese carmakers to offer more powerful features such as the use of more sophisticated in car voice commands. After the Deep Seek surprise during the Chinese New Year intelligence initiatives could remain a key theme among auto stocks, said Paul Gong,

Starting point is 00:16:36 an auto analyst at UBS. Longer term, we see Chinese carmakers taking the lead on intelligence innovations and democratizing these technologies in mass market cars, he said, end quote. Nothing more for you today. Talk to you tomorrow.

Tech Brew Ride Home - Tue. 02/11 – Elon Wants To Buy OpenAI

There aren't comments yet for this episode. Click on any sentence in the transcript to leave a comment.