The AI Daily Brief: Artificial Intelligence News and Analysis - Multibillion Dollar AI Infrastructure Build Out Coming to the US

Episode Date: September 6, 2024

Sam Altman’s ambitious AI infrastructure buildout is taking shape, starting in the U.S. This episode explores the multibillion-dollar plans to boost AI infrastructure, involving global investors, chip production, data centers, and energy expansion. Also, updates on Elon Musk’s X AI and its rapid buildout of the Colossus AI system. Stay informed on how these infrastructure developments will shape the future of AI. Concerned about being spied on? Tired of censored responses? AI Daily Brief listeners receive a 20% discount on Venice Pro. Visit ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://venice.ai/nlw ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠and enter the discount code NLWDAILYBRIEF. Learn how to use AI with the world's biggest library of fun and useful tutorials: https://besuper.ai/ Use code 'podcast' for 50% off your first month. The AI Daily Brief helps you understand the most important news and discussions in AI. Subscribe to the podcast version of The AI Daily Brief wherever you listen: https://pod.link/1680633614 Subscribe to the newsletter: https://aidailybrief.beehiiv.com/ Join our Discord: https://bit.ly/aibreakdown

Today on the AI Daily Brief, a massive AI infrastructure spending plan comes into view. Before that in the headlines, the UK says there's no problem with Microsoft's deal with inflection. The AI Daily Brief is a daily podcast and video about the most important news and discussions in AI. To join the conversation, follow the Discord link in our show notes. Welcome back to the AI Daily Brief Headlines edition, all the daily AI news you need in around five minutes. We kick off today with a follow-up on a story we've been watching for a while, which is antitrust scrutiny around Microsoft. sort of but not really acquisition of inflection. This weird new thing has been a big trend in AI for the last year or so, where a big tech firm, Microsoft, Amazon, and Google have all done this

recently, hires the founders of a big startup, licenses the technology, and then invites some but not all of the employees to come over and join. Now, in the case of Microsoft's sort of but not really acquisition of inflection, a big chunk of the team really did come over. The way that the deal was structured, it paid back investors, but it's not like they got to. a big return or anything. We've recently seen other deals like this, most notably Google's recent deal with Character AI. And as I've discussed previously, I think that these types of deals have fairly significant implications for, if nothing else, the enthusiasm with which people will sign up to work with AI startups. If the norm becomes that startups are simply a junket for founders

to get a big payday, but no one else makes money, it's not really going to be a sustainable situation. Now, the speculation has, of course, been that a big part of the motivation for this is to avoid antitrust scrutiny, that particularly in the area of AI, which already has so many factors making it more concentrated, the big tech firms are worried about picking off smaller competitors, or particularly what governments will think if they hire those smaller competitors. The UK had been looking into Microsoft's specific deal with inflection in an examination that started back in July. The UK's competition and markets authority ultimately decided that even before it was acquired, inflection had only a very small portion of the UK chatbot market

and didn't really have a meaningful chance to be a competitive player long term in that space. The conclusion then was that the deal did not require a deeper investigation. Of course, the question becomes, if that's the conclusion that someone like the CMA came to, wouldn't that apply if Microsoft had acquired the company outright? Now, ultimately, of course, inflection could have just made a decision that this was the best deal that they were going to get, and it might be a situation where it's very easy to armchair quarterback it from the outside. But all in all, good news from Microsoft, who obviously didn't want to get stuck in Legal Meyer

when it comes to this deal, which really restructing. structure their AI team in general. Microsoft, it seems, has enough to be dealing with when it comes to AI. A recent report from the information suggests that the copilot software in the office suite has had something of a challenging time getting customers excited. The information writes that, quote, so far, only a small portion of Microsoft's business customers have adopted co-pilot. Between 0.1 and 1% of the 440 million existing users of Microsoft 365 are also paying for the new AI features. Now, notably that's an equity analyst estimate that's not direct numbers from Microsoft. Still, that translates to somewhere between 400,000, and 4 million paid seats.

Competitors are swarming to encourage the narrative, it seems as well. On a quarterly earnings call last week, Salesforce CEO Mark Beniof said, So many customers are disappointed about what they bought from Microsoft co-pilots because they're not getting the accuracy and the response that they want. Microsoft has disappointed so many customers with AI. The silver lining is that the companies that the information spoke to seem to be in it for the long haul. One chief information officer that they spoke to, for example, said,

so far we've had mixed results. Most people don't find it that valuable right now, but it's a product that's going to improve over time. Staying in the UK for a moment, the U.S., the European Union, and the UK have signed the world's first legally binding international AI treaty. It's the Council of Europe's AI Convention and makes signatories accountable for harms and discrimination that come from AI systems. It mandates that the outputs of AI systems respects citizens' equality and privacy rights and gives the victims of AI rights violations legal resources.

Specific consequences, however, are yet to be put in place. Now, although the treaty is legally binding, it certainly seems like something that is largely symbolic rather than legally significant. If anything, I think it reflects the continuing interest that the world has in trying to create some sort of regulatory systems around this new field. Moving into the Enterprise, Anthropic has announced Claude Enterprise, which they call its biggest new product since Claude debuted in the first place. One of the big updates is that Cloud Enterprise has a much bigger context window than previously. It'll allow clients to upload documents that are the equivalent of 130-minute sales conversations, 100,000 lines of code, or 15

full financial reports. Anthropic has been on a tear recently, pushing out new features including artifacts, as well as new workspace tools. Salesforce has made an acquisition in the AI space, acquiring AI voice agent developer Tenix, which they say will, quote, extend Salesforce's existing autonomous agent capabilities for a service agent by integrating Tenix's innovative voice AI solutions specifically tailored for service use cases. TLDR, the enterprise world is continuing to move aggressively towards an AI agent paradigm, and that's happening both top-down from big companies as well as bottom-up from startups. Speaking of, a cool startup that I've been noticing recently that just hit the newswaves is a company called Paradigm, which is making a bet on

agents to change the way that we use spreadsheets. There are a bunch of really interesting projects in this space, and it's something that we're watching closely. For now that is going to do it for today's AI Daily Reef Headlines edition. Next up, the main episode. Today's episode is brought to you by Plum. Generative AI promises to supercharge your productivity and give you superpowers, but if you're not an engineer, trying to harness AI can be incredibly frustrating. Hours wasted wrestling with complex tools only to give up when they don't work. We all have tedious tasks we'd love to automate and challenges AI could solve, but few of us have the skills to fully leverage these game-changing technologies. That's where Plum comes in. The mission? To make automating your work feel like magic. Imagine

typing out, AI, read my Gmail and ping me in Slack when something critical comes in, and watching it come to life before your eyes. No coding required. Whether you're a marketer, salesperson, or founder, Plum enables you to create custom AI workflows in minutes, not hours. Check out Useplum.com, that's Plum with a B, for early access to the future of workflow automation. Today's episode is brought to you by Plum. Want to use AI to automate your work, but don't know where to start? Plum lets you create AI workflows by simply describing what you want. No coding or API keys required. Imagine typing out, AI, analyze my Zoom meetings and send me your insights in Notion, and watching it come to life before your eyes. Whether you're an operations leader, marketer, or even a non-technical founder,

Plum gives you the power of AI without the technical hassle. Get instant access to top models like GPT40, Claude Sonnet 3.5, assembly AI, and many more. Don't let technology hold you back. Check out Use Plum, that's Plum with a B, for early access to the future of workflow automation. Today's episode is brought to you by Venice. The leading AI company store your entire conversation history and attach it to your identity forever. That's every question you asked, every answer you receive, every image you generate, every thought you share with the machine it's all being spied on. If you trust all the companies, hackers and NSA board members that will ever have access to your AI conversations, then rejoice, for you are well served. For the rest of us,

Venice is an alternative. Venice is a powerful AI app for text, image, and code generation that respects you as a sovereign individual and believes privacy and free speech are not only human rights, but necessary for civilizational advancement. Private, permissionless, and uncensored, you can try it for free without an account. AIA Daily Brief listeners, receive a 20% discount on Venice Pro. Visit venice.AI slash NLW and enter the discount code, NLW Daily Brief. That's NLW Daily Brief, all one word. Today's episode is brought to you by Super Intelligent,

which is, of course, our platform that helps you learn how to use AI tools, and perhaps even more importantly, gives you ideas on the best use cases that are actually going to help you achieve whatever it is you want to achieve. To recognize the end of summer and back to school slash back to work, we are running our best promotion ever when you sign up for Super Intelligent between now and the end of August using code so back, your first month will be 100% free. The platform features over 600 fun, highly practical AI tutorials that get you using AI fast and with an eye to actually transforming how you get things done.

We've just launched Super for Teams, so if you have a group of people at your company that want to figure out how to use AI together, I highly suggest you check it out. But for those of you who are using Super Intelligent as an individual, once again, if you sign up for Superintelligent between now and the end of the month using code so back, you will get your first month 100% free. Go to be super.a.i and check it out today. Welcome back to the AI Daily Brief. Today we're talking about a big plan to build out AI infrastructure in the U.S. And to get the proper background, we have to go back a little bit, as we so often seem to do, to when Sam Altman was fired by OpenAI, before, of course, being quickly rehired. One of the reasons that was cited for Altman's

dismissal was concerned that he was doing things that weren't related strictly to OpenAI, leveraging open AI's name. A couple months later, reports started coming out that Alman was gallivanting around the world seeking a huge amount of money. We're talking trillions of dollars to build out AI infrastructure. In February, the Wall Street Journal reported that, quote, the Open AI CEO is in talks with investors, including the United Arab Emirates government, to raise funds for a wildly ambitious tech initiative that would boost the world's chip building capacity, expand its ability to power AI, and cost several trillion dollars. The project could require raising as much as $5 trillion to $7 trillion. Now, for some sense of scale, the current size of the global semiconductor

industry, in 2023, chip sales reached around $527 billion, and that's expected to rise to a trillion annually by 2030. Semiconductor manufacturing equipment is a $100 billion a year industry. As the WSJ points out, the, quote, amounts Altman had discussed would also be outlandishly large by the standards of corporate fundraising, larger than the national debt of some major global economies and bigger than giant sovereign wealth funds. So this was what was going on back in February. Well, now we're getting a little bit more information. Bloomberg reported this week, Altman Infrastructure Plan aims to spend tens of billions in the U.S. Global Plan for AI would start with a major push in the U.S. Bloomberg writes, Altman spent the early part of the year seeking the U.S. government's blessing for the project, which aims to form a coalition of global investors to fund the costly physical infrastructure needed to support rapid AI development.

Now, Altman and his team are working on several details, including the plan to first target U.S. states. Bloomberg continues, the types of projects under discussion include building data centers, increasing energy capacity and transmission with turbines and generators, as well as expanding semiconductor manufacturing. Now, the Bloomberg piece makes it seem like this is not strictly separated from OpenAI. They write that OpenAI executives, including Altman, but not exclusively Aldman, have been meeting investors in recent weeks to advance the deal. OpenAI's chief strategy officer Jason Kwan, for example, recently traveled to Japan and Korea to speak about the plan. Their VP of global policy, Chris Lehane, spoke to investors in Canada.

This all seems to suggest that this is, in fact, an Open AI initiative. Now, this is all reports, and not confirmed, but when asked about the plan, open AI didn't exactly issue a denial. A spokesperson said that the company, quote, believes building additional infrastructure in the U.S. is critical to further advancing AI and making its benefits widely accessible. We are exploring opportunities with this goal in mind and look forward to sharing more details at a later date. The reporting also tells a little bit more about the tie up with the U.S. National Security infrastructure. OpenAI has apparently held meetings with the U.S. National Security Council about the investment, in which, according to Bloomberg's

sources, quote, Altman and other OpenAI executives emphasize that the global infrastructure plan would help fuel America's geopolitical advantage by establishing a multinational coalition to compete with China's own infrastructure consortium, and that foreign capital that might otherwise go to China would go to the U.S. One of the subtext of this, then, is a competition to win the Middle East, specifically the Gulf states to the U.S.'s AI cause rather than to China's. Overall, I think that while it's early, this could be an incredibly significant bit of news for the way that AI develops, and so I am going to keep a close eye on it. In the meantime, it's clear that AI infrastructure continues to be a big concern. The information recently reported that two different AI developers are planning $125 billion supercomputers. The information reports that, quote, recent comments from a state official in North Dakota

signaled that some companies are exploring deals that would enable proposed new data centers to become real. During a recent Public Service Commission meeting held about data center demand, the North Dakota Commissioner of Commerce said that two companies had approached him and the governor about building mega-AI data centers. The projects would both consume around 500 to 1,000 megawatts of power with plans to scale up to 5 to 10 gigawatts. of power over several years. Making them then orders a magnitude bigger than any data centers that are in existence today. The information writes to put the scale of the plan in perspective at the end of last year, Microsoft's global data centers for its Azure cloud computing business consumed around 5 gigawatts

of power combined. While the specific companies were not named, the official said that the companies have quote, trillion dollar market capitalizations, which basically means that they're talking about Nvidia, Amazon, Microsoft, Google, Meta, or Apple, perhaps Tesla, which has been a trillion company in the past, although is now around $700 billion in market cap. Now, in terms of how likely to see something materialized we are, the official said in that meeting that, quote, things can happen pretty fast when you've got a trillion dollars. That official also seems to be a big proponent, saying, if we don't do it, Texas will do it, Oklahoma will do it, other states will do it. Speaking of that, Elon Musk's XAI has announced that their Colossus AI training system featuring

100,000 GPUs has come online. Musk said from start to finish, it was done in 122 days. Coloss is the most powerful AI training system in the world. Moreover, he said it will double in size to 200,000 H-100 equivalents in a few months. The information noted that the announcement might carry some concern for other AI rivals. They write, if it's true that it only took four months to complete this cluster, its quote, rapid buildout would fly in the face of conventional wisdom about how long it takes to build such a system. Normally completing such a cluster could take a year. Of course, they point out that it would be both on brand for Musk to actually have a cheap. some nearly impossible goal, but also, as they put it, that he has a penchant for exaggerations.

So was it real? Only time will tell. But I think that the through line for today's stories is that this infrastructure buildout is hugely significant and does not show any signs of slowing down. That's going to do it for today's AI Daily Brief. Until next time, peace.