Musk’s OpenAI Bid, Sam Altman’s Roadmap, Apple + Alibaba

Ranjan Roy from Margins is back for our weekly discussion of the latest tech news. We cover 1) Musk's $97 billion bid for OpenAI 2) Whether the bid is real 3) How damaging could holding up OpenAI's for-profit conversion be? 4) Musk throws OpenAI off its rhythm 5) New OpenAI roadmap: GPT-4.5 and GPT-5 are coming 6) Should models flip dynamically between standard LLM and reasoning 7) Anthropic strikes back 8) Apple + Alibaba partnership 9) iPhone SE launch looms 10) TikTok is back in app stores... so what? 11) Jamie Dimon says get back to work. --- Enjoying Big Technology Podcast? Please rate us five stars ⭐⭐⭐⭐⭐ in your podcast app of choice. For weekly updates on the show, sign up for the pod newsletter on LinkedIn: https://www.linkedin.com/newsletters/6901970121829801984/ Want a discount for Big Technology on Substack? Here’s 40% off for the first year: https://tinyurl.com/bigtechnology Questions? Feedback? Write to: [email protected] Learn more about your ad choices. Visit megaphone.fm/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Alex Kantrowitz?

  Elon Musk bids 97 billion for OpenAI, but is his bid real? Sam Altman reveals OpenAI's roadmap as the future of generative AI looks a bit clearer, and Apple finally has an AI partner in China. That's coming up on a Big Technology Podcast Friday edition, right after this. This episode is brought to you by Genesis. What does it actually take to put a Gentic AI to work across an entire enterprise? I recently spoke with Genesis Chairman and CEO Tony Bates about why orchestration is emerging as a competitive advantage in customer experience and what companies need to get right in the AI era. Then I sat down with Adam Mitchell, Head of Enterprise Business Solutions at Voya Financial, to go inside a large-scale Agentic CX transformation,

• 0:45Alex Kantrowitz?

  including the business decisions, trade-offs, and lessons along the way. You can watch both conversations now on my YouTube channel today. It's never been more challenging to get frontier compute. How do you know where to look, who to trust, or how much to pay? Akash is an open cloud that provides easy access, flexibility, and peace of mind. That's how companies like Razer were able to cut their inference cost by 15 times. Visit akash.network/alex for a free consultation. That's akash.network/alex for a free consultation. Welcome to Big Technology Podcast Friday Edition, where we break down the news in our traditional cool-headed and nuanced format. We have a massive week of news to break down for you.

• 1:30Alex Kantrowitz?

  We have this Elon Musk bid, or is it a real bid? We'll get into that for OpenAI. Also, we have so much more clarity on the roadmap of OpenAI and its fellow generative AI companies following this week, so we're going to talk about what's coming next from them. We also have an Apple Intelligence partner in China. It's Alibaba, of course. After a couple of false starts, Apple seems on the way to be releasing Apple Intelligence in its second-biggest market. And there's going to be plenty more to discuss. Joining us as always on Fridays is Ranjan Roy of Margins. Ranjan, great to see you again.

• 2:04Speaker 01

  Good to see you. I think I'm going to put in a bid for OpenAI as well. Let's make it competitive Elon.

• 2:09Alex Kantrowitz?

  Why don't we do it? Let's gather our money together and maybe we can put the $200 a month we've been spending for OpenAI's advanced features towards it. So, all right, this is our official bid, $400 for.

• 2:21Speaker 01

  $400 going once, going twice.

• 2:24Alex Kantrowitz?

  It's a nonprofit, right? So that should at least register.

• 2:28Speaker 01

  I think so.

• 2:29Alex Kantrowitz?

  So the news this week is it's kind of out of control as it always is with AI. And I was starting out for a fairly calm, normal week and then Monday, news breaks, Elon Musk is bidding $97 billion for OpenAI. So immediately, everybody covers this as if this is real, because of course Elon Musk has done this before. He took over Twitter with a $44 billion offer. So, okay, so what's another, you know, another few billion for OpenAI? I'll just run through this quickly. This is from Reuters. A consortium led by Elon Musk said on Monday it offered $97.4 billion to buy the nonprofit that controls OpenAI. Altman responds, he says, no, thank you, but we'll buy Twitter for $9.74 billion if

• 3:12Alex Kantrowitz?

  you want. That is the opening salvo. Then OpenAI's lawyers, I'm just going to fast forward through the story. They say, listen, Elon Musk is suing to prevent us from turning into a for-profit. So how is he now trying to buy us for $97 billion and do the same thing that he's telling us we can't do in court? And Musk responds saying, and this is from the New York Times, he will drop the OpenAI bid if the company preserves its nonprofit mission, basically saying, all right, you got me. I'll drop the bid if you stay a nonprofit and we all go home happy. So Ranjan, I'm curious how you view the moves of the week and whether you think Elon Musk, even if he's not successful in the takeover bid, is going to get something out of making this offer?

• 3:58Speaker 01

  It's not real. It's not real. I think that's a pretty safe bet in this, though, again, maybe something that starts as a troll like this, that starts as an investment troll slash legal troll could turn into something real.

• 4:13Alex Kantrowitz?

  It's happened before.

• 4:14Speaker 01

  It has happened before. That's fair. But I think the more I was reading about this, this really did present itself as a pretty smart troll. Because again, you put in the bid, you essentially force OpenAI in Sam Altman's hand. And even there's a quote from Ari Manuell around how the double dealing of Sam Altman and between the nonprofit and the for-profit arm, I mean, it's something we've talked about for now years. It's something that never has quite made sense. Somehow, they keep being able to just skate by this as they raise billions and billions more. So Elon pushing this issue and actually bringing

• 4:57Speaker 01

  it more to the forefront by making this somewhat ludicrous bid is a pretty interesting development in this.

• 5:05Alex Kantrowitz?

  Here, let's actually read directly from Ari's, Ari Manuell's comments at this Freakonomics live taping that happened yesterday. And just to full disclosure endeavor, Ari Manuell's company emailed this to me today, copying Musk's lawyer. So they clearly want it out there. He says, Manuell says, "We're not proposing to buy the charity OpenAI. We are proposing to buy the charity's majority share of Sam and Microsoft's for-profit OpenAI enterprise." So the charity would get 97.4 billion for that. So to me, this is interesting because I wonder if they're offering 97 billion and Altman's group is going to pay, wants to pay 30 billion to the nonprofit to be able to move to this for-profit structure,

• 5:48Alex Kantrowitz?

  whether this fully prevents this spinoff from ever taking place. Because if they have to match that 97 billion, I mean, what are we talking about in terms of funding?

• 5:56Speaker 01

  Well, that's why it's a savvy move because why should Sam Altman be able to price the nonprofit arm of OpenAI when clearly there's a vested interest in putting that as low as possible? So you can accrue more value to the for-profit side? And again, it's always been incredibly unclear what code sits in the nonprofit if it was all initially generated within the nonprofit, what assets, what customer lists, what revenue? It's never been clear what sits where, so to just be able to say, okay, this is worth 30 billion. That sounds good. Let's spin it out and let's leave the other. What is it? What did Masa give it? 260, I think, 260 billion?

• 6:40Speaker 01

  Leave the other 230 billion for the for-profit in my own personal wealth? I think it doesn't make any sense, so I'm actually happy that someone is calling it out. Someone's pushing their hand at this moment on it. Where this goes, does this just fade away a little later? I mean, I think we might be forgetting about this in a week or two, but who I do, who I think will not forget about it is every investor who has to in the next round or the next pitches, because it just proposes a seed of doubt to the overall structure, reminds everyone things are a lot more complicated than a simple, here's a revenue projection, here's a cap table.

• 7:25Speaker 01

  And I think that alone actually does cause Sam a lot of problems.

• 7:31Alex Kantrowitz?

  Look, I don't think we're going to be forgetting about this. I think we are all going to come to the realization, and I wrote this in Big Technology today in the Substack newsletter, that this is not a real bid, but it is a very impactful move. And one thing we should note is all of this stuff, all of it, is playing out in the docket of, in the Northern District of California, where Elon Musk, in the same case, where Elon Musk is suing to stop the for-profit conversion. I don't think it's a foregone conclusion that OpenAI is going to be able to pull this off. And then you start to ask some existential questions about the company, don't you?

• 8:10Alex Kantrowitz?

  Because we know they have to raise billions more dollars to continue with their mission. We know they probably have to raise billions more dollars to keep the lights on. And it is very hard to do that with this nonprofit hanging over you. So in the extreme case, and I'm not going there yet, but this certainly has made the probability higher that it could be lights out for OpenAI if they're unable to continue to fundraise.

• 8:37Speaker 01

  Do you think Masa cares about any of this, though? Do you think Masa, in terms of like when he's deciding to write the next gigantic check or actually push through? Because I don't know if it was finalized, the gigantic fundraiser with SoftBank. I mean, it was reported, but it's a the this still is more of a legal detail versus, I think, an existential question. It's a for any slightly more rational investor excluding SoftBank here, I think it does provide some more doubt, some more complexity, complication. But I think for the Softbanks of the world or that kind of money, I don't think it's going to change significantly anything.

• 9:23Alex Kantrowitz?

  I mean, I'd have to imagine that eventually, like this, you you run out of room. Maybe not this year, maybe not next year, but you you can't persist in this structure. We saw it happen when Sam was fired. We're seeing it happen now as business partners are trying to be compensated. And if Musk forces them to maintain that structure, it's going to be a problem.

• 9:47Speaker 01

  I mean, it clearly rattled Sam. Did you see his comments about Elon saying he operates everything from a position of insecurity? And I mean, he came out swinging on this one, so it clearly touched a nerve.

• 10:01Alex Kantrowitz?

  I did, and I think it's important for us to talk about that because, you know, again, as I was writing this story, we are looking at an OpenAI that just in the past few months has regained its footing since the Altman firing in 2022. And that might be an extreme thing to say because we're in February 2025. But you have to remember, the company was rattled all through Christmas 2022, comes back 2023, and it's the parade of executives leaving. Mira Maroti out, Ilya Sutskever out, a researcher every other day. And Now OpenAI finally, okay, it has some momentum. And then all of a sudden, boom, DeepSeek happens. Okay, now we have a technological-

• 10:41Speaker 01

  We went through shipmists, 12 days of shipmists we got. They came back.

• 10:45Alex Kantrowitz?

  Yeah, we had shipmists, right? So that seemed like a moment of stability, even if we've made fun of the Santa Voice ChatGPT. Like, okay, they are shipping, they started shipping the things they were talking about. You and I last week talked about how ChatGPT finally hit, you know, 300 million users after stagnating for about a year. So they're finally hitting their footing and then Musk does this. This is like a, if you're a CEO, this is a pretty complicating thing. We're like really putting a lot of efforts to balance all these stakeholders, balance Microsoft, figure out how to compensate your employees. What does the CEO do? How do you make this very novel legal transition from nonprofit to for-profit? What does that look like? And then just Musk comes in and he's like Leroy Jenkins and, you know, and what happens, right?

• 11:28Alex Kantrowitz?

  It's like Sam is completely thrown off. He gets to the Paris AI Summit. We've talked about before how he's the savviest of all communicators when it comes to these AI CEOs. Totally thrown off his footing, completely thrown off his footing. He's talking about how Elon Musk is an unhappy person and he opens himself up to a back and forth with Musk and his associates that he's not going to win and ultimately makes him look small. And then he got slapped by Ari Emanuel, who's pretty good. So he's like, Elon's unhappy. And Ari said, uh, Sam said that Elon was an unhappy person? Yeah, thank you for your analysis. Elon's unhappy because you're a phony trying to get away with cheating the charity and its original mission. Elon is not. So look, you know, we all from the peanut gallery were like, ha, ha, ha, look at them.

• 12:13Alex Kantrowitz?

  They're, you know, going back and forth and talking about how bad the other one is. But like, ultimately, it's important for, for OpenAI's focus to be on the technology. And Sam is at his best when he's talking about the technology, tweeting out ChatGPT previews and tweeting out Dolly previews and Sora previews and getting people excited and being at the Apple Intelligence Release Event, finding ways to partner with them. The more he has to deal with this, the worse it is for OpenAI. And, and to me, that's the secondary impact of Musk doing this is he's just completely thrown them off the rhythm. They've worked so hard to restore.

• 12:46Speaker 01

  Yeah, no, if you think about it, there's, there's essentially three major challenges at any given time Sam's dealing with. There's the product and technology side, which they've been kicking some ass on recently. I mean, deep research operator again. Very mesmerizing product, not great, but still like having a huge impact in opening people's imagination. Then there's the financial side, the actual like keeping the lights on, training the next models, which it seems now with the SoftBank relationship, they really are have found their footing. And then the third is exactly this, the underlying legal and structural complexity that the

• 13:28Speaker 01

  deal with Microsoft, the for-profit versus nonprofit. And it's something that has always been there, but that has just been quiet for a long time. So yeah, the more that becomes the primary issue, then all of your progress on the financial and the product slash technology becomes a lot more difficult.

• 13:49Alex Kantrowitz?

  Yeah. And for the record, I did email Musk's lawyer, Mark Toboroff, and I've been lighting up the guy's inbox the whole week, trying to get him on the phone. And I was like, hey, Mark, like, let's both be honest here. Elon Musk doesn't really want to buy OpenAI. And four minutes later, he writes back, that's completely wrong. So they're sticking with their story.

• 14:10Speaker 01

  That's completely wrong. Concise, to the point.

• 14:16Alex Kantrowitz?

  Thanks, Mark. By the way, for those who are joining us and are new listeners to the show, maybe you found the show last week as we recorded a video on Spotify. Just to let you know, Rajan and I show up every Friday to break down the week's news. So we do this Fridays, it's the Friday show. And then on Wednesdays, I do a flagship interview with somebody in the tech world or somebody with commentary on the tech world. So you might've heard Evan, the Evan Ratliff interview this, this week where he turned his voice into an AI clone and send it out to therapy and speaking with scammers. And over the next couple of weeks, we're going to speak with people with some political views. Chris Hayes is coming on, the MSNBC host and Sagar and Jetty of Breaking Points to talk about tech and also how it's impacting politics.

• 14:59Alex Kantrowitz?

  So if you're new here, we appreciate you and we want to say thank you for being here. All right, let's talk about the technology, shall we? So this wasn't just a dispute week. This was also a technology week where Altman decides this is time for me to share the roadmap for GPT 4.5 and GPT 5. So a couple of really interesting updates here, and this is all about the next couple of models that we're going to see. From OpenAI. So on Twitter, Altman says, we'll next ship GPT 4.5, the model we called Orion internally, as our last non-chain of thought model. After that, the top goal for us is to unify

• 15:41Alex Kantrowitz?

  O-series models and GPT-series models by creating systems that can use all our tools, know when they think, know when to think for a long time or not, and generally be useful for a wide range of tasks. In both ChatGPT and our API, we'll release GPT-5 as a system that integrates a lot of our technology, including O3, which is its latest reasoning model. We will no longer ship O3 as a standalone model. So a couple of really interesting news nuggets here in a very concise statement. So I would say, first of all, we know that GPT-5 is coming. Somebody asked Altman what the timing is going to be for both these models. He said GPT-4.5, which is going to be their next LLM, coming in weeks, and GPT-5 coming in months. Of course, how many months?

• 16:26Alex Kantrowitz?

  We don't know, but at least we have timing there. The bigger news from my perspective is that OpenAI is now going to sort of determine your intent and basically free you from the model picker if you're in ChatGPT. So you can decide whether, you know, right now, you're deciding, I want reasoning, or I want something normal. And the truth is, we as the user shouldn't have to determine that. Like, that should be something that the technology does on its own. And what Altman is saying is, yep, that is going to happen.

• 16:55Speaker 01

  So this, I think, this is a tough one. Having been in the weeds building with generative AI, I actually think this is a bad strategic move. The idea of trying to unify models, and then exactly what you said, determine intent and understand and pick the right model is a very difficult thing. And it only adds more complexity and more room for not building a great product. It makes things easier and seemingly You know, like, maybe it will, especially at the consumer level, add a little bit of ease. But but I think more and more, the more people actually want genuinely accurate results or are incorporating this into genuinely impactful things where they need accuracy.

• 17:40Speaker 01

  Having different models that are specialized and starting at that point and actually building and going back to our eternal, it's more about the product than the model. Putting the right models with the right products and interfaces actually is a better way to approach this versus the idea that magical GPT five will be so comprehensive that every query you have about every issue or anything you want to build, it'll just know what to do. I don't think that's a good way to approach this.

• 18:11Alex Kantrowitz?

  Okay, so that is maybe if you're coming at it as a company or a nonprofit, you know, we'll see that the main business is the API. But we've talked about it for chat GPT, the main business is going to be, sorry, chat GPT, look, I already called it chat GPT. For OpenAI, the main business is going to be chat GPT. And so if the main business is going to be chat GPT, this is actually good. It seems like it's a more consumer friendly way to use generative AI.

• 18:40Speaker 01

  No, I'm going to push back on that. You could also just not name them terrible names like oh, three, oh, three, mini and call them have a button that says for more complex tasks, click this for simpler informational tasks, click this like it's not, that's a UI challenge. That's not the future of humanity, GPT five AGI challenge. And I think to me, it's it's more from a product marketing perspective. We know they need to do something big with GPT five. It's been talked about so long. That they're obviously trying to turn it into this much bigger thing, but but I don't

• 19:21Speaker 01

  think even from the consumer side, that's necessarily the right approach. And then again, what will happen on this is the end results, if it's calling the wrong model for that specific task, if it's understanding user intent is the most difficult thing in the world. So trying to solve that layer of the overall process, I think, is not, it will make for a worse product and just give it a simple name or have a nice button rather than forcing me to click on a dropdown menu and try to decipher 04 versus 03 versus GPT4, like that kind of stuff. I think there's a UI solution to this. And Kevin Wiel's a

• 20:04Speaker 01

  pretty, pretty damn good, like, product designer and product creator. So he should be able to figure this one out.

• 20:13Alex Kantrowitz?

  You know who does this well? DeepSeek.

• 20:16Speaker 01

  DeepSeek.

• 20:16Alex Kantrowitz?

  That guy. But you could just click reasoning on DeepSeek. Otherwise, you get the traditional model.

• 20:20Speaker 01

  The Chinese company got the English words right in the UI button. Like,

• 20:27Speaker 01

  come on.

• 20:29Alex Kantrowitz?

  So there's another bit of news that's been buried, kind of in this new reshuffling. And that is that OpenAI did have a 03 reasoning model, right, which is going to be their latest reasoning model. They've already released 03 Mini. And now that was supposed to come out. So this is from TechCrunch. The company postpones that model in favor of this unified release. So the company originally said in December that it aimed to release 03 sometime early in the year, which would kind of be now. And just a few weeks ago, Kevin Wiel, the chief product officer of OpenAI, said that 03 was on track for a February or March launch. Again, now, now, that is released. Now that is pushed.

• 21:12Alex Kantrowitz?

  We don't know when that's coming. That's going to come in GPT-5. And by the way, GPT-4, which we're supposed to see in weeks, this is again from the TechCrunch article. So that's the product, Project Orion that we've been talking about. I think that was probably going to be called GPT-5, except it hasn't lived up to expectations. So GPT-5 or Orion is said to have suffered a number of performance-related challenges and technical setbacks. Bloomberg, the information in the Wall Street Journal have independently reported that Orion has shown less of an improvement over its predecessor, GPT-4O, than GPT-4 did over GPT-3. So let's just like very quickly parse this bit of nuance

• 21:53Alex Kantrowitz?

  out here. Does this mean like OpenAI basically has kind of hit a wall? Or is this like pretty concerning that we have both an underperforming model and a reasoning release that's been pushed back, especially after DeepSeek? I mean, what do you read into all this?

• 22:10Speaker 01

  Yeah, but I think this goes back to that distinction between model and product that on one hand, deep research is probably the most impressive product that has been released in any of the generative AI space, at least in the last few months, which is a lifetime in the space. But then the models themselves are not scaling at the like step change level that they were before between GPT-3 and 4, obviously, where anyone who just touched those things saw how much more impressive 4 was than 3. So I think that actually shows that exactly they could be having that kind of trouble in the background. It didn't affect the product

• 22:54Speaker 01

  as of today. So to kind of be betting the company or putting all of your focus on the next big model, I think is the wrong one.

• 23:03Alex Kantrowitz?

  Okay, I want to give you one more data point that goes to my side on the pick your model or the dynamic model switching. The other data point is that Anthropic is also going to switch to this. So Anthropic has also not released a reasoning model. This is from the information Anthropic strikes back. Anthropic is taking a slightly different approach to reasoning. It has developed a hybrid AI model that includes reasoning capabilities, which basically means the model uses more computational resources to calculate answers to hard questions. But the model can also handle simpler tasks quickly without the extra work by acting like a traditional large language model. So the company plans to release it in the coming weeks. Oh, we're going to get a new model from Anthropic in the coming weeks.

• 23:48Alex Kantrowitz?

  The interesting thing is that developers can't adjust the amount of reasoning versus traditional LLM on a sliding scale. You slide it to zero and then you can use it as a run-of-the-mill non-reasoning AI. I guess you slide it to 10 and it's a reasoning model. Actually, you know, maybe this is kind of a hybrid in terms of what we both want.

• 24:06Speaker 01

  This is what I'm saying. Give me a sliding scale. That's actually a beautiful UI trick right there. How hard is this problem you're trying to solve? And honestly, if it means I don't hit my Claude rate limit after just like 30 minutes of use, I will be the happiest person ever if you actually let me, you know, kind of help guide the type of work I'm doing. But yeah, so I'm going to put this more in the, this is the UI approach, the user interface approach, rather than the model is smart enough to understand intent. Give me a sliding scale.

• 24:41Alex Kantrowitz?

  Okay. So as long as we're talking about product and positioning of all these AI companies, what did you think of the AI Super Bowl ads?

• 24:48Speaker 01

  Okay. I'm gonna, I'm gonna take a moment here. And if there, if we had cameras here, I'd be looking over to camera three right now. Last week, we said AI has a branding problem. I think that extends both, a lot of the figureheads of the industry to the general public are not the most palatable folks. I think from an expectations management standpoint, the industry keeps promising more and more while not delivering exactly that today. And the ads I thought were terrible, like absolutely terrible. And just to go through some of the

• 25:29Speaker 01

  ads, and I'm guessing most of our listeners probably watched a number of them, and trying to describe them at least very quickly, OpenAI's ad, I'm assuming you saw?

• 25:39Alex Kantrowitz?

  Yes, I did.

• 25:40Speaker 01

  It's a series of dots going through kind of the history of creation over time from spears and stones and wheels to fire to eventually rockets in this very cool pixelated dot format.

• 25:55Speaker 01

  When you're trying to reach just the everyday consumer and get them excited about ChatGPT, it did not make any sense to me. It, you know, like, what does ChatGPT do? How can I use it in my life? It, it made no sense. It, it felt like it was built by an agent and created by an agency geared towards the most power users of power users already of ChatGPT. What did you?

• 26:23Alex Kantrowitz?

  I hated it too. Yeah. I mean, it just said ChatGPT at the very end.

• 26:28Speaker 01

  Yeah. I mean, this is where then Google, the Gemini ad, very heartwarming. It's about a dad, like, and it's kind of like a play on speaking in very corporate language, preparing for a job interview, talking to Gemini, very, very heartwarming, emotional journey, him and his daughter, the most important job he's ever had. But he only talks to Gemini at the beginning and asks, like, or Gemini asks, what's the most important job you've ever done? And at the end, Gemini tells him, great answer. So what Gemini has to do with any of this is not clear. I think Meta, we'll get into their ad,

• 27:12Speaker 01

  was actually pretty good, I thought, like, out of all of them. But my, I actually had the chance to watch the Super Bowl with my parents and my 76-year-old mom, after watching a lot of these ads, goes, so AI, AI, what should I do? Like, that was literally the question, what should I do? Like, I got to do something. And none of the ads geared anyone more towards anything that they can do, how it's going to bring value to their life. They were all, and I get Super Bowl ads. You shell out, what was it, like five or 10 million dollars for that 30 second spot?

• 27:50Alex Kantrowitz?

  Eight million, I think.

• 27:51Speaker 01

  Yeah, eight million. You hire an agency. You're paying them a lot of money. You're not going to put forth some kind of like feature oriented ad. But I still think something a bit more explanatory or creative in terms of here's how AI can help your life would have gone so much further rather than just the most kind of like agency-ish ads imaginable.

• 28:13Alex Kantrowitz?

  Yeah, I'm with you.

• 28:14Speaker 01

  That's my rant.

• 28:15Alex Kantrowitz?

  I fully agree with you. Look at us. It's a moment of agreement here on the show.

• 28:18Speaker 01

  Yeah, well, we'll take this one.

• 28:20Alex Kantrowitz?

  We'll take it. I will say that these ads that try to do this heartwarming moment showing people like bonding with AI. It's very interesting to watch this very real thing that's happening in the AI world where people are really forming insane relationships with their AI. And extremely personal, like weirdly personal, like we, again, we had the replica CEO talking about how people are marrying their replicas. I spoke about this with Ratliff. People are asking their ChatGPT instance for love advice, all these things. You send that to an ad agency and like the brief is show how people are falling in love with AIs and becoming best friends with them.

• 29:04Alex Kantrowitz?

  And the ad agency spits out this very sanitized thing because it is kind of creepy for a company to tell you this will be akin to your friend, right? And that's sort of where I think these heartwarming ads fall short is they want to show it. But if they really showed what was happening, it would be pretty freaky and creepy.

• 29:21Speaker 01

  No, but I disagree in terms of, like, even the Gemini ad between the father and his daughter. Show them using technology together. Like any of these things show someone's life being improved. There was also the agent force ad with Matthew McConaughey, of course, which again, he's running through an airport saying like, if my AI agent had given me better advice, as though the idea that Salesforce is going to deliver some consumer facing AI agent to you. They apparently their Heathrow Airport is a customer and somehow Salesforce's agent force will help Heathrow deliver a better customer experience, which maybe it can, but.

• 30:06Speaker 01

  Again, Apple Intelligence can't even find our flight information with Siri. So like, the idea that our, but meanwhile, I am planning an entire March vacation to go skiing, using a combination of ChatGPT, of perplexity. That's where I'm doing all my searching. So I'm using it because I know how to show that to people somehow in a creative way, rather than these vague promises of, uh, agents will help Matthew McConaughey run through Heathrow in a more efficient way.

• 30:40Alex Kantrowitz?

  Yeah, I agree with you. There's so many interesting consumer applications that you could just show them, right? If the technology, we both agree the technology is powerful. Just show it.

• 30:49Speaker 01

  It's, it's amazing stuff. I don't, I don't know why they feel the need that they have to make it a something different than it actually is, because what it is, is utterly amazing and will, there's so many different use cases that it will dramatically improve people's lives. But meanwhile, to me, that branding side, I've been thinking about this more, like, separate from all these other conversations we're having, the branding problem of AI gets worse and worse to non kind of tech-forward people. AI slop, I think, is the biggest threat to the overall industry, where the assumption that if something is created with AI, it is inherently bad,

• 31:32Speaker 01

  rather than the prompt or the process was bad behind that output, is a, is a very threatening thing for the entire industry. And marketers should be focused on that, rather than Matthew McConaughey looking at Woody Harrelson as he falls over a people mover in Heathrow.

• 31:50Alex Kantrowitz?

  I will give you the counter to that. The young people, they are, they see how powerful this can be because they're using it to do their homework. And so this will just be something that makes its way into our lives, even if the older generations don't get it right away. The people who are in school will graduate and they'll be just addicts to this stuff.

• 32:09Speaker 01

  Okay, that that's fair, but they're not going to be paying thirty four point five billion dollars in revenue for.

• 32:16Alex Kantrowitz?

  Yeah. Claude. Yeah, we also don't have sixty years, right, for for this to play out, I don't think.

• 32:21Speaker 01

  Well, actually, no, that's a good point. This, the the funding and overall momentum of the industry does not give, I don't even know what the high schoolers are called. It's not, is it Gen Alpha, I think?

• 32:34Alex Kantrowitz?

  I think so.

• 32:35Speaker 01

  Gen Alpha. We don't have time for Gen Alpha to build their consumer spending abilities to actually realize the value of these companies. They need to hit, I mean, maybe not the boomers, but at least the Gen X and the millennials. Like, they need to get all of them on board, joining us in paying ChatGPT Pro two hundred bucks a month.

• 32:59Alex Kantrowitz?

  I think I'm going to be good with my two hundred dollars a month after this month.

• 33:02Speaker 01

  Really?

• 33:03Alex Kantrowitz?

  I I'm not. You're going to stick with it?

• 33:05Speaker 01

  Fifty bucks, seventy five, seventy five, I think.

• 33:08Alex Kantrowitz?

  Altman, I think, did say that if you're just a ChatGPT, like, plus subscriber, you're going to get a certain number of deep research queries a month. So I'll I'll happily I'll happily stick to that quota, I think, like, maybe ten? That'd be good for me.

• 33:21Speaker 01

  Actually, it is a good question. I do wonder, and I'm very curious, like, what the pricing mechanisms are behind two hundred? Was it just kind of twenty times ten is two hundred? That sounds right? Is there a more scientific? Again, if you're like Amazon or an e-commerce company, your pricing is down to like a complete science? Are the price levels that people are throwing out there? Remember, like, Google Workspace and Gemini, Microsoft Copilot? Everyone just kind of threw out thirty, thirty dollars a month per user add-on to the existing subscriptions. That all went away. And I remember thinking, like, you're asking people to double the price

• 34:04Speaker 01

  of what they're already paying without them knowing what value they're going to get. So a lot of this stuff feels a bit random in terms of how it gets out there.

• 34:15Alex Kantrowitz?

  Okay, quickly, let's talk about the Meta ad.

• 34:17Speaker 01

  One of the Hemsworths, I think it was Chris Hemsworth, is talking to Chris Pratt. And they are both wearing their Meta Ray-Bans, which you and I are both very big fans of. And they're at an art exhibit and they see that banana on a wall and hey Meta, what is this piece of art? It's this piece of art and it's worth $6 million. One of the Chris's eats the banana. Oh, I'm actually just piecing together and then what's her name? The Kardashians mom? Isn't it Chris something as well?

• 34:49Alex Kantrowitz?

  This is my, my range of expertise doesn't extend to the Kardashians.

• 34:53Speaker 01

  Now I'm like, oh, wait, Chris, Chris and Chris. I think we're on to something here. Anyways, what I liked about the ad is in a funny way, it showed them actually using the product in the way the average user would use the product. You're at a museum, what is this thing I'm looking at? That's literally the ultimate, simplest, perfect use case of Meta Ray-Bans. And that's what they incorporated to the ad. But it was kind of funny as well and had some pretty famous people. So that was a good ad.

• 35:23Alex Kantrowitz?

  Yeah, it was good. I mean, you could, you, you see it both being used in real life. Like, again, the use case, that's pretty cool. And it was funny. And it was also something that was like pretty recognizable, that banana taped to the wall.

• 35:35Speaker 01

  Kris Jenner confirmed. So Chris, Chris and Chris. Good job, agency.

• 35:39Alex Kantrowitz?

  All right, we need to take a break, but when we come back, we're going to talk about Apple and Alibaba partnering up on Apple Intelligence. And then maybe we can dissect this kind of hilarious leaked, leaked audio from Jamie Dimon at JP Morgan talking about work from home. All right, we'll be back right after this. This episode is brought to you by App Point. Everyone's racing to roll out AI right now. Co-pilots, chatbots, agents doing real work. But here's the part nobody loves talking about. All that AI runs on your data and most teams have no single way to see it, secure it, and prove it's under control. That's exactly what App Point does. For 25 years, they've been the trusted layer beneath the world's most demanding data, now extended across your entire.

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• 37:57Alex Kantrowitz?

  And we're back here on Big Technology Podcast Friday Edition. Let's talk about the big news out of China this week, which is that Apple and Alibaba are going to work together to build Apple Intelligence into iPhones in China. This is from Bloomberg. Apple plans to overhaul China iPhones with AI by the middle of the year. Apple's working to bring its iPhone AI features to China, accelerating a complex undertaking that has required software changes and deep reliance on local partners. So the iPhone maker has several teams in China and the US working to adapt its Apple Intelligence platform for the region, aiming to launch, aiming for an early, for a launch as early as May.

• 38:37Alex Kantrowitz?

  In addition to the engineering work, Apple still has to have it approved in China through the regulatory system. It's a high-pressure task for Apple, which has suffered steep sales decline in China, its biggest single market outside of the US. To me, the most interesting part of this article is sort of how this technology is going to work. It's all about the censorship. In China, Apple will use its own on-device AI models like it does in the US, but Alibaba software will serve as a layer on top that can censor material that the government objects to without the user knowing. The Chinese government will be able to direct Alibaba to ask Apple to make changes to AI models when it has issues with the information being delivered to customers.

• 39:21Alex Kantrowitz?

  In cases where a customer's device is still running an outdated model, Apple will temporarily disable AI features until the data is updated to remove prohibited content. Mantra, what do you think about this move? I mean, obviously, Apple needs something in China. But again, it doesn't really seem like it's living up to its values by enabling such deep censorship. And maybe AI is just a product that if you're going to run it in China, you need to let the government censor it. I have a lot of complex feelings about this. What do you think?

• 39:48Speaker 01

  Yeah, I think there's the ethical side of it. There's the commercial side of it. I mean, I think the ethical side of it, obviously, AI is something before selling a device that you can then, the apps will do whatever they need to do, gave Apple a bit of wiggle room. And, you know, we're just selling the device. If the apps are censored, that's fine. Versus at the core device level, now we are engaging in censorship and we are playing this game is, it's not a great look, but, I mean, they have to do something. At a commercial level, so I think, again, they have to do this.

• 40:30Speaker 01

  And separating out my feelings about Apple Intelligence relative to the American product that I do have my hands on. I don't know that this is, I mean, when you think about DeepSeek coming out, when you think about just AI advancement in China, the idea that Alibaba is somehow going to help solve this for Apple in that market, rather than, as we said, or is it just kind of a sensorial level to the overall process? That doesn't make sense to me either. I get they have to do this. I don't think this is going to turn around their situation in China anymore. I mean, if I'm them, I'm a lot more worried about just trade and supply chains right

• 41:14Speaker 01

  now than sticking Apple Intelligence and partnering with Alibaba on the iPhone.

• 41:19Alex Kantrowitz?

  Yeah, I'm the same way. I mean, I was on CNBC this week and they asked me about it and I was like, look, if you believe that Apple Intelligence is a game changer, then this makes a big difference. But if you believe that Apple Intelligence has been underwhelming and you're not sure whether Apple Intelligence is going to really change the bottom line for Apple, clearly we didn't see a super cycle with the iPhone 16, which you and I predicted, then, you know, you say, okay, this is a nice incremental move, but not much more. And that is really where I land on it.

• 41:47Speaker 01

  Yeah, I think it'll be very, I mean, Apple in China, I think, actually will be one of the more interesting stories this year. And this is actually going to be one of the smaller parts of it. But again, from the supply chain side, from the chip side, from the pricing side, from the domestic sale side of the Chinese consumer actually buying iPhones versus switching to other equally good or better phones. I think it was such a growth story for so many years for them and it's still, the growth expectations are baked into the stock price right now, that I think that is something that could dramatically change in the coming months.

• 42:28Alex Kantrowitz?

  Okay, I'm ready to have the but in this story. The but is that it really does signify that Chinese AI is really taking leaps. And we knew that a little bit with Deep, a lot with DeepSeek. But the interesting nugget here is that Apple tried to work with Baidu last year to get this done and just couldn't. Now Alibaba, it has this open source model, Quen. It's good. And Apple has finally said, okay, this is a model that we can work with, and they're going forward. So that's a big moment here for Chinese AI.

• 42:59Speaker 01

  But do you believe it's a technology-driven decision? Or it's even more, they understand it's more a geopolitics slash trade driven decision? That they understand they need a big-name friendly partnership to stay in China, to keep selling in China, to bring AI onto their devices in China?

• 43:21Alex Kantrowitz?

  I think it's tech. I think it's tech because they did have Baidu. In there, they couldn't get it done. Baidu couldn't get it done. So now they have a company with a leading AI model that can get it done. And I think that's just a signal. I could be wrong.

• 43:34Speaker 01

  Not to keep bashing on Apple. They yesterday announced that there's going to be some big product launch. I think February 19th, get ready to meet the newest member of the family from Tim Cook. And no one I've seen is talking about this. We did not even put this into our show notes because it's just like, what is it going to be? But that feels like a bigger problem for me about Apple than any of the other stuff.

• 44:02Alex Kantrowitz?

  Okay, well, I have an idea. Everyone, every report that I've read says it's going to be a new iPhone SE. So a lower-cost model of the iPhone. And to me, that's pretty interesting because Apple is clearly seeing some saturation with the high-end models. People are keeping them for longer. iPhone sales in Q4 actually declined. So they need something to spark growth. And it's going to be the iPhone SE, according to German and a bunch of others.

• 44:31Speaker 01

  But is that a launch?

• 44:33Alex Kantrowitz?

  Well, it's weird. They have to drum up excitement for it because it is an important, it's going to be an important growth driver for them. They need to sell more iPhones. So now it's a launch. But the weirdest thing is that they talked about how it's the newest member of their family.

• 44:45Speaker 01

  Yeah.

• 44:45Alex Kantrowitz?

  Where they've already had it in. So maybe they're wrong about this prediction, but pretty confident it's going to be the iPhone SE.

• 44:52Speaker 01

  Apple car. It's back. They laid off the entire team, but it's coming.

• 44:57Alex Kantrowitz?

  I won't be dragged down that path again. The only car news I'm believing is Waymo from now on.

• 45:04Alex Kantrowitz?

  Oh, TikTok is back. Speaking of Apple, Apple put TikTok back in the App Store, and so did Google. Attorney General Pam Bondi said, listen, you can put it back, and the ban is not going to be immediately enforced. So Trump told the Attorney General on January 20th, "Don't take any action to enforce the act banning TikTok for a period of 75 days from today to allow my administration as an opportunity to determine the appropriate course of course forward." I can't get too excited about this. I mean, I feel like this TikTok story has just been, you know, rolling for two years and TikTok is still there. And okay, it was on outside the App Store for a couple, a couple of weeks, but it's back now.

• 45:46Speaker 01

  Yeah, I think this is a story where that remains to be written. And I mean, the fact that it was not in the App Store was the weirdest part of the last few weeks when it's obviously it's being used, it's live, it's okay. So the idea that people cannot download it and only phones that have it can use it. And there's phones being sold on eBay for thousands of dollars because they have TikTok on it. I think I'm glad to move past that part of the story.

• 46:17Alex Kantrowitz?

  Okay, let's end with a couple of workplace stories. First of all, I'm curious very quickly what your reaction was to the Meta layoffs this week. Zuckerberg said, basically, I've decided to cut underperformers. But it does look like, and as I guess has always happened, a number of high performers and people who received exceed expectations ratings were laid off. It's also kind of like rude to the people that you're laying off, who are now going to have on their LinkedIn like a date that they were laid off forever associated with being a underperformer.

• 46:51Speaker 01

  I mean, I think, though, we're still seeing it's February 2025, basically larger scale reorgs of overhiring during COVID. And that both means, like, from a pure numbers perspective, but I think a lot of this is also about reshaping your company for the next wave of competition, which is looking very different than just selling more ads on Instagram and Meta product or Meta and Instagram and Facebook. So I get

• 47:21Speaker 01

  To a certain extent, especially at the big technology companies, they need to reshape and rethink how their companies are built. And they're clearly doing that. So I guess him saying it's underperformers is just kind of feeding into the whole intense zuck thing right now. But in reality, I I hope it's more of a let's sit back, take a look at what do we want our company and organization to look like four years from now? And let's just start pushing it in that direction.

• 47:50Alex Kantrowitz?

  Yeah, but also in some ways, they just kind of did those employees dirty by labeling it this way. Why not just say it's like a force reduction?

• 47:57Speaker 01

  I mean, you work at Meta, like, what are you?

• 48:01Alex Kantrowitz?

  You knew what you signed up for. That's true. That's a good point. All right. I want to end with this because you haven't heard this audio before. So Jamie Dimon, CEO of JP Morgan, has addressed the workforce and had some thoughts about their desires to continue working from home. I'm not going to set it up anymore. I'm just going to play it.

• 48:23Speaker 02

  A lot of you were on the fucking Zoom. And you were doing the following, okay? You know, looking at your mail, sending texts to each other about what an asshole the other person is. Okay, not paying attention, not reading your stuff, you know? And if you don't think that slows down efficiency, creativity creates rudeness and stuff, it does. Okay. And when I found out that people are doing that, you don't do that in my goddamn meetings. You're going to meet with me. You got my attention. You got my focus. I don't bring my goddamn phone. I'm not sending texts to people. Okay, it simply doesn't work. And it doesn't work for creativity. It slows down decision making. And don't give me the shit that work from home Friday works. I call a lot of people on Friday. They're not a goddamn person to get a hold of.

• 49:06Speaker 02

  But here are the problems, okay? And they are substantial, okay? Which is the young generation is being damaged by this. That may, they may, it may not be in your particular staff, but they are being left behind. They're being left behind socially, ideas, meeting people. In fact, my guess is most of you live in communities a hell of a lot less diverse than this room.

• 49:27Alex Kantrowitz?

  Okay, so let's pause there. What do you think about that, Raja?

• 49:31Speaker 01

  Oh, man, I, I think I agree with Jamie just a little bit. I, I, I've.

• 49:39Speaker 01

  Nowadays in meetings, when the laptop is open, like even in person, I would actually say this. So I like that he recognized this as well. There's this assumption now that you are at half attention. And yet you're taking your time to sit there, that everyone is still slacking in other directions. Everyone's versus a meeting used to be you're sitting there and hopefully you're contributing and hopefully you're paying attention. Otherwise, it's a waste. It is a waste of time. So on that side, I think, I think he's not wrong. His, his tone is quite direct in a way that I do want from Wall Street. I do want that. So I'm glad to hear that.

• 50:23Speaker 01

  But I think the part about also younger people are being damaged for the longer term, like success and abilities in the workforce. I think that's a fair point, too. And again, maybe call me a boomer on this, but I think he's got some points.

• 50:40Alex Kantrowitz?

  I'll just say this. My reaction was, part of me, the part of me that believes in some flexibility for workers that like when you need to work from home because some, because your kid's sick or something came up, like you shouldn't have to fight for that. It's kind of ridiculous to have to fight managers for that. And so on that way, on that sense, I'm opposed to Diamond. Diamond's such a strut. I'm opposed to his strident tone here. However, that recording was objectively hilarious. It was just, it was just funny.

• 51:10Speaker 01

  I kind of wish it was not leaked audio. And that was like him talking at a, at some kind of some conference somewhere and actually saying all these things.

• 51:20Alex Kantrowitz?

  Well, that's the, that is the, the conspiracy theory is that JP Morgan leaked that.

• 51:24Speaker 01

  Oh, I like that. I like that.

• 51:28Alex Kantrowitz?

  Well, anyways, Ranjan, let's leak this audio out onto the internet and go enjoy our weekend, shall we?

• 51:33Speaker 01

  Let's do that.

• 51:34Alex Kantrowitz?

  All right. All right, folks. Thank you so much for listening. Ranjan and I will be back on Friday to break down that week's news, next week's news. Can't imagine anything interesting is going to happen, given the run we've had these past few weeks. So we hope to see you there and we'll see you next time on Big Technology Podcast.

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