Microsoft & OpenAI Visit Davos, Is The Vision Pro Dead On Arrival, Google Makes More Cuts

Ranjan Roy from Margins is back for our weekly discussion of the latest tech news. We cover 1) Satya Nadella on the state of Microsoft’s partnership with OpenAI 2) Satya Nadella on OpenAI’s governance 3) Sam Altman on OpenAI’s potential for a big breakthrough this year 4) Altman on whether AI will replace jobs 5) How Generative AI will factor in politics this year, and whether it will actually be a big problem 6) The threat of video deepfakes 7) HeyGen’s translation of Argentina president Javier Milei’s speech 8) Google's latest layoffs 9) Does Google have a worsening culture problem? 10) Meta buying 350,000 NVIDIA h100 chips. --- 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/ 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?

  Let's recap and react to the big AI conversations at Davos. Plenty of news items this week also have us asking whether the Vision Pro is dead on arrival. Google is making more cuts and Meta has bought a boatload of Nvidia chips. All that and more coming up right after this.

• 0:19Alex Kantrowitz?

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• 1:02Alex Kantrowitz?

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• 1:22Alex Kantrowitz?

  Welcome to Big Technology Podcast Friday Edition, where we break down the news in our traditional cool-headed and nuanced format. We have so much to talk about this week, including plenty of updates from Davos, where it seems like everybody gathered, and then real product news from Apple and corporate news from Google and Facebook, just buying up every Nvidia chip in the world. Joining us as always here on Fridays is Ron John Roy, who writes margins on Substack. Ron John, welcome.

• 1:51Speaker 02

  Alex, are you in Brooklyn or are you in Davos right now?

• 1:55Alex Kantrowitz?

  Honestly, the best thing about YouTube is that you can literally sit in on every single conversation from Davos and you don't need to go. And I've been there. All right, Alan, I have to drop it.

• 2:06Speaker 02

  This is where Alex is going to say, I have been to Davos. I, Ranjan, have not been to Davos, but tell us about Davos, Alex.

• 2:15Alex Kantrowitz?

  Having been there once, I was very, very happy to watch everything on YouTube and then actually like be able to speak with people about what it all meant. And I think we're gonna have a good time going through what happened there here this week. So we're gonna do a new thing here. We're gonna play a few recordings of some of the big names that actually spoke there and react to what they said and kind of unpack it. So the two speakers that I picked out were Satya Nadella and Sam Altman, not surprisingly. They've been driving a lot of the news in the tech world and the AI world recently, and they spoke about some really interesting things, including the state of their partnership

• 2:56Alex Kantrowitz?

  and where the research is going. And this is from their conversations with Brad Stone at the Bloomberg House. So Ranjan, what do you say? Let's get right into it.

• 3:05Speaker 02

  Let's get into it.

• 3:07Alex Kantrowitz?

  Okay, so first of all, in case you're wondering about how Microsoft feels about the OpenAI partnership, here is what Satya Nadella had to say about it.

• 3:15Speaker 03

  I feel very, very good about the construct we have. I feel at the same time very capable of controlling our own destiny. So it's not like that we are single threaded even today on Azure. And this is not about even OpenAI. It's all about reflection of what our customers want. Every customer who comes to Azure, for example, in fact, our own products, it's not about one model. We care deeply about having the best frontier model, which happens to be, for example, today, GPT-4. But we also have MixTral as a models as a service inside of Azure. We use Llama in places. We have Pi, which is the best SLM from Microsoft.

• 3:56Alex Kantrowitz?

  Now, doesn't that sound like Satya Nadella taking pains to really push home the point that they're not reliant on OpenAI? And doesn't it sound like Microsoft is trying to hedge away from OpenAI?

• 4:08Speaker 02

  I don't think he's taking pains. I think he's pretty confident about saying that they're not dependent on OpenAI. I mean, very clearly saying, right now, the best model is GPT-4, but we are using Llama and everything else. I think is pretty interesting. And again, on that, I've been using Microsoft Copilot recently more. Again, their public-facing chat interface, because it actually gives you access to GPT-4 and Dolly 3 for free. You just have to be signed in. Unlike ChatGPT, where you need to pay for ChatGPT Plus to

• 4:48Speaker 02

  get access to the latest models on a reliable basis. And it's crazy to me, because they're giving it away for free. And we've talked about it previously on the show. But it's clear to me, Microsoft is not going to be reliant on OpenAI. What that partnership looks like going forward, I really don't understand what it is right now. I don't know. What do you think it is? What do you think Satya's vision is right now for OpenAI? Because he didn't seem to give a clue.

• 5:16Alex Kantrowitz?

  That is a great question. I mean, I think that's one of the big questions that we're going to have to answer this year. I don't have an answer to it, honestly. And there was a conversation that was had on CNBC throughout the week about how impactful OpenAI was, and AI in general, was to Microsoft's valuation. You know, Microsoft, we should note, just surpassed Apple as the most valuable company in the world again. And there were rumblings that OpenAI and AI itself has added a trillion dollars to Microsoft's valuation and market cap. And so what are you left with if they now are trying to distance themselves from OpenAI? I guess what Satya Nadella is really doing right here is, he's saying, I'm riding the horse that I have, which is OpenAI. But I also know that there's going

• 6:00Alex Kantrowitz?

  to be some sort of commoditization of the technology that they're building, assuming OpenAI doesn't continue to outpace the field. And it will be difficult to do that. And so therefore, he's waiting on the hedge. But then the question is, does the hedge provide? The competitive advantage to Microsoft if everybody is starting to be able to take advantage of that. Like, one of the models he mentioned was Lama, which is open source. So where does Microsoft's advantage lie there? Is it productizing this AI? Maybe. I mean, enterprise is definitely a place where this is going to factor, but it is very confusing.

• 6:35Speaker 02

  Yeah, I think especially a company like Microsoft, it's worth, there's multiple layers. When we say enterprise, we even have to think about it in two levels. There's a consumer software or enterprise software layer again. When I open Microsoft Word or PowerPoint, what capabilities do I have? And Microsoft's moving pretty fast in this. Like, you know, they're way ahead of Google in terms of what they've actually launched and released to their customers. And then, of course, there's the more deep integrations within Azure, people building their own products. And in both of those, it's clear that they're making big strides and they're not dependent on OpenAI models.

• 7:16Speaker 02

  I mean, I think, I think it's clear that the product level is a going to potentially be a big competitive advantage for them. And again, I've been using Microsoft Copilot a lot more. And just for fun, when Alex, when we were going over this week's, this week's topics, and I was like, I'll do this nowadays more when I'm looking up a news story. I'll check ChatGPT, Bard, Copilot, see, you know, can you give me a list of articles around a specific topic? In great moments in Bard, Google's chatbot product, I asked, you know, can you list some news articles and then provide a recap of what Satya Nadella and Sam Altman said at Davos?

• 7:59Speaker 02

  And the answer is, elections are a complex topic with fast-changing information. To make sure you have the latest and most accurate information, try Google search.

• 8:09Alex Kantrowitz?

  Okay, so I really don't feel so bad for, I just bashed Bard on air on CNBC. It was just like, they were asking me about Gemini. I was like, first of all, Bard's not good. And they're like, you mean, I'm like, yeah, the capabilities of a consumer product is not up to date. So maybe the commodization isn't going to be as fast. Okay, let's, let's listen now to how confident Nadella is on OpenAI, having sorted out its governance issues.

• 8:41Speaker 03

  So I'm comfortable. I have no issues with any structure. What we just want is good stability. And, and as I said, we don't even need, like, I'm not even interested in a board seat, or we don't need, we definitely don't have control. We have no, we just want to have a good commercial partnership. And we want to be investors in the entity in even the way they're structured. So what I would like is good governance and real stability. That's it.

• 9:07Alex Kantrowitz?

  You have a

• 9:08Speaker 02

  Good governance and stability.

• 9:11Alex Kantrowitz?

  What I would like.

• 9:12Speaker 02

  What I would like.

• 9:13Alex Kantrowitz?

  But it's not what I have.

• 9:15Speaker 02

  I, do you know one thing about those moments I always wonder? He had to anticipate the question.

• 9:20Alex Kantrowitz?

  Right.

• 9:20Speaker 02

  He might have even been given this topics beforehand. I feel there's got to be a better answer you come up with. Again, at this point to me, I don't know, does Microsoft, you continue deflecting these kind of questions and say generic answers? Or do you commit to here's what this means for us and what we want from them?

• 9:39Alex Kantrowitz?

  Well, I guess like the thing that I'm mostly surprised about is why he didn't say, I'm confident the governance issues are in good hands right now. Obviously, he doesn't think that. So I guess that like

• 9:49Speaker 02

  Oh.

• 9:51Alex Kantrowitz?

  You know what I'm saying?

• 9:52Speaker 02

  Yep. Good nuance. He did not, yeah, you're right. What I would like, never said they've moved past and we're looking forward to the future or something generically corporate like that. He said, what I would like.

• 10:05Alex Kantrowitz?

  So speaking of like some of the issues that we're going to see this year, it will be this continued governance question with OpenAI. And it kind of goes back to the question about Microsoft is like, what is their AI, can their AI play exist without OpenAI?

• 10:21Speaker 02

  I, okay, again, and this is going to be my umpteenth Google or Microsoft co-pilot reference already in this episode, but

• 10:31Speaker 02

  I think OpenAI is in trouble. I think OpenAI is in trouble. I think, again, ChatGPT+ plus and that interface, it's a great product. It's been the leader in this. But when you start looking at Microsoft essentially distancing themselves from OpenAI, the same way AI has added theoretically a trillion dollars to Microsoft's market cap, you have to assume the Microsoft partnership has been instrumental in pushing OpenAI to the 80 to 100 billion dollar valuation as well. You have the lawsuits from the New York Times. So from a copyright perspective, OpenAI is the poster child in Target. From a product standpoint,

• 11:14Speaker 02

  their own investor is giving away their product for free, which still blows my mind. I mean, at every level. And then from a governance and just corporate and organizational standpoint, they clearly have not really made people feel good about where they are. What's the bull case for OpenAI for you?

• 11:35Alex Kantrowitz?

  Well, I think we're about to talk about it, but I'll say first of all.

• 11:38Speaker 02

  All right, let's hear it from Sam, I guess.

• 11:40Alex Kantrowitz?

  Yeah, Satya is, I think he is in the fool me once, shame on you, fool me twice, shame on me mode, where he's like, all right, the first time we didn't see this coming, we're not gonna, we will be prepared in case the second time comes and we're not gonna bet the company on one anymore. And I think that's the gist of his statements here because he was also like, speaking to Brad and Brad asked him, this was, this answer that he gave about governance was in, Brad is Brad Stone from Bloomberg. The response that he gave was in response to a question about like, is he satisfied with OpenAI government, governance? And he tells Brad like, you're speaking to Sam later, aren't you? Like, he has to figure that out before he gave this answer. So I found that

• 12:21Alex Kantrowitz?

  really revealing. Now, okay, your question, what is the bull case for OpenAI? I, let's just listen to Sam Altman.

• 12:28Speaker 04

  We're right about what's gonna happen here. This is like, bigger than just a technological revolution in some sense. I mean, sort of like all technological revolutions are societal revolutions, but this one feels like it can be much more of that than usual. And so it is going to become a social issue, a political issue. It already has in some ways, but I think. It is strange to both of us that it's not more of that already, but with what we expect to happen this year, not with the election, but just with the increase in the capabilities of the products and as people really catch up with what's going to happen, what is happening, what's already happened, there's like a lot of inertia always in society.

• 13:10Alex Kantrowitz?

  So that is fascinating to me that Sam is basically telegraphing the fact that there are going to be enormous breakthroughs from OpenAI this year. And, you know, maybe some of it is CEO talk, but this has sort of become a theme for him, talking about all the stuff that we're going to see this year is going to be like, you know, pretty groundbreaking stuff. And, you know, it doesn't seem like it's going to be like just a little bit smarter GPT model. I mean, what he's teasing is like something like he talks about that we're going to have to reckon with on a societal level. So that's the bull case for OpenAI, I think, is that they actually build that.

• 13:50Speaker 02

  I don't know. I think to me, the more I've looked, because again, I do believe and agree that the advancements and the speed of advancement is continuing, again, even like mid journey V six versus V five is, is, you know, like a step change in how good the quality is and how easy it is to use. So the idea that maybe OpenAI is going to have some massive new release, I think is very reasonable. Is it something that other people are not going to do? I don't know. Like, are other people catching up? The clods of the world, even mid journey, other competitors of different parts of OpenAI's ecosystem.

• 14:31Speaker 02

  But, but again, anytime the conversation moves into these kind of like theoretical AGI Terminator-ish scenarios, you know, I start to question how much of that is just kind of like, as you said, CEO talk and promises versus reality. Again, like on this, and we should definitely talk about, you know, the societal impact side of things. I think there's a lot of issues that are already being created by GPT three and then four, so eventually five. But I don't know, that I wasn't sold on that.

• 15:08Alex Kantrowitz?

  What does your gut tell you? Big stuff coming for OpenAI or that was CEO speak this year?

• 15:14Speaker 02

  Okay, again, it's a tough one. I think big stuff is coming, but I don't think it will be significantly different or better than what other companies are doing.

• 15:24Alex Kantrowitz?

  Okay, I'll take the other side of that coin. Given what I'm hearing from Sam, I am very curious to see what technology they release. And there were some attempts at Davos to get him to talk about what's coming, but he very gently refused. So, okay, but one more thing about, you know, one more clip that we'll listen to is about the societal impact. And obviously, the question is like whether this is going to take jobs. And I just spoke with Albert Vinger about that a couple of weeks ago, but or last week, but this is something that was put to Sam

• 15:57Alex Kantrowitz?

  front and center. And here's his response on how it's impacting coders.

• 16:01Speaker 04

  You know, you hear a coder say, okay, I'm like two times more productive, three times more productive, whatever than they used to be. And I like can never code again without this tool. You mostly hear that from the younger ones, but it turns out, and I think this will be true for a lot of industries, the world just needs a lot more code than we have people to write right now. And so it's not like we run out of demand. It's that people can just do more. Expectations go up, but ability goes up too.

• 16:25Alex Kantrowitz?

  Okay, I'm personally with Sam on this one as well. I do think that we are just going to see more capabilities and people who are using AI, living up to the expectations that their companies have in terms of being able to ship. And I don't really see like, I don't see it as something that's going to really reduce wages or minimize jobs across the economy. What's your perspective?

• 16:49Speaker 02

  Oh, see, I think there will be a tremendous impact on jobs. I think it's going to reshape and reformulate a lot of different industries. I'm actually, I am still, I don't even know if the word is bullish, but convinced that that will happen. And I think, you know, there is going to be impact and there's going to be people needing to learn different skills and there's going to be, you know, it's, it's going to be a big issue. But I did like that idea that the world will need more lines of code. That's pretty good. That's, I think, like, from a pure, like, coding perspective, maybe it doesn't shrink things too much that people who understand, there's still going to

• 17:30Speaker 02

  always need to be people understand code and how to apply it. So, and how to use AI systems to generate code. So I think that's reasonable. I mean, as a writer, I think. I actually probably, maybe the world does not need as many words.

• 17:47Alex Kantrowitz?

  Oh, my God. It certainly does not.

• 17:49Speaker 02

  Exactly, exactly.

• 17:51Alex Kantrowitz?

  It needs better words, but not more words.

• 17:54Speaker 02

  Yeah, words, the volume could decrease a little bit. So, so I think on that side, again, if you are a writer for an SEO optimized recipe site, that's probably going to change. I mean, all those things, that these things will all change, I think, but, but I think from a societal impact, I mean, we have to talk about the upcoming US election. We just, the Iowa caucuses were this Monday, like, it's front and center right now, and it's happening right now.

• 18:25Alex Kantrowitz?

  So I think that we, yeah, let's definitely get into this, especially as it pertains to AI. And obviously, this is going to be a theme for us this year. Both like the elections that are, I mean, 70 to 80 Democratic elections across the globe this week, this, sorry, this year, and of course, one in the US. We have a global audience. We won't go too crazy on US politics, but, but it is obviously a testing ground for a lot, this US presidential election is a testing ground for a lot of worries of technologies, new technologies, and of course, AI is going to be front and center. And I think there is this, it's so, first of all, I'm glad people are concerned about the fact that AI could pose some problems in the election.

• 19:06Alex Kantrowitz?

  But I think that the level of attention that's getting compared to the problem is maybe disproportionate. Maybe some, maybe people are trying to make up for the lack of attention for social media and then how that, how that effort played and trying to say like, AI will have an equal impact. And I just don't really see it. So let's just read the headline. So this is from the Wall Street Journal, OpenAI Bans the Use of AI Tools for Campaigning and Voter Suppression. And basically, it says, OpenAI's ChatGPT and DALL-E are some of the most powerful AI chatbot and image generation applications available. And then, OpenAI said people aren't allowed to use its tools for political campaigning

• 19:50Alex Kantrowitz?

  and lobbying. People also aren't allowed to create chatbots that impersonate candidates. And other real people or chatbots that pretend to be local governments. I think that like, this is a thing. In campaigning, the cost to create media is so low that you don't really need AI to flood the world with disinformation and misinformation. Like, it's gonna be a problem with AI or without AI. And I don't think this dramatically causes a bigger problem. And I think that people, you know, if people are chatting with a politician chatbot, like, come on, like, is that gonna sway an election? I doubt it. What do you think, Ron John?

• 20:29Speaker 02

  I don't know. I, I, I, so on one side, I do think the algorithms, and we've, you spoke with Kyle Chaka, Chaka? Chika? Chika on Wednesday, I've been, I mean, it was a really good episode on his new book. And the impact of algorithms, to me, that's a much greater issue than generative AI specifically. Because, again, what is the distribution side of it is just as important, if not more important than the actual content creation side, as you said. You know, you don't need generative AI to make up something and just tweet or post about it and then send it around.

• 21:09Speaker 02

  But I do think the, the, there's the disinformation side, then there's the kind of like, complete fabrication and creation of a, like, the deep fake side. The idea that, uh, there, there was actually a politician back in December, um, who had created, using generative AI, and it felt a little kind of PR gimmick issue, as Democrat Shemane Daniels was running for Congress and created her own AI-generated robocalls. That, and the idea was she could make it more personalized and you could make it, you know, target people better and not have to do all the work of recording your own voice to target all these people. That, to me, was actually like, an interesting.

• 21:52Speaker 02

  Reasonable productive use case of this. It's like actual tailored messaging to different constituencies that you use AI to generate. So you don't have to sit in a studio all day to record wherever you would one records robocalls. But of course, you know, we are in for an endless world of deep fakes of Biden saying something or Trump saying something or who whatever other candidate saying something and people believing it. And I think that is a capability that exists this year that has not existed in any previous election.

• 22:29Alex Kantrowitz?

  Yeah, I'll tell you where I think this actually starts to resonate. It's when video generation gets good. And then when we can't tell the difference between, you know, what a real video of something like Donald Trump saying is in a fake video.

• 22:42Speaker 02

  Oh, wait. Oh, sorry. Go, go, go.

• 22:45Alex Kantrowitz?

  Yeah. Okay. So I guess like what I'm going to say on this one is, and maybe, maybe I should like, I think what you're about to say is that already exists. I would all say as a counter is when it gets easy for everybody to make it. And then when that happens, it's not going to be as much as people believing that these videos are the truth. It's going to be about people believing what they want to believe and not caring whether they're fake or real. That's going to start to cause some problems. All right. What do you have to say about that?

• 23:13Speaker 02

  Okay. So it already exists.

• 23:15Alex Kantrowitz?

  I knew you were going to say that.

• 23:17Speaker 02

  You said I was going to say it and I said it. So, and so there's a company or there's a product, Heygen, H E Y G E N. And I've used it before. They kind of went viral and it's actually mind blowing that you can upload, you know, like a 30 to one minute, 30 second, one minute clip of yourself and it will, originally they went viral, but it would translate into another language in your exact voice and relatively match your lips up to the new words that are being spoken. And I tested it. I was like having it have me speak Chinese and Spanish and showing it to native speakers. And they're actually like, This is not bad. And it actually kind of looked like it was me speaking.

• 23:59Speaker 02

  And so this morning, there was a really interesting, on Twitter, I opened it. My entire for you feed was Javier Millay, the new Argentinian firebrand president, him giving a speech in Spanish that was translated in Heijen to English. So it's his voice, it's his words, it's his speech, but it's now reaching an English language audience in English. And, and everyone was sharing it. And obviously, it was more about the content itself. And this was not a deep fake in the sense of it was making things up about what he was saying. But it's honestly, it's so good that being able to change what people are saying and

• 24:42Speaker 02

  make it look reasonable and make it their lips look like they're kind of saying what there's, you're getting them to say in their voice, that's here, that's here this year.

• 24:51Alex Kantrowitz?

  Definitely. Yeah, I saw you tweet about that. And then I went and watched the video. It is really incredible how they can do those translations and make a video look like somebody is literally speaking the language in their voice, which is wild.

• 25:03Speaker 02

  Yeah. And it honestly, the platform, you just hit translate, you specify the target language, it takes like, maybe like, for every minute of video, like 10 minutes, you can tell there's probably some like serious processing going on on the other side. And then it looks good. It looks very good. So, so that technology is here. And we haven't even seen the first major mishap, and I think we will.

• 25:31Alex Kantrowitz?

  Yeah. So maybe that's something that we see this year. The Davos consensus is what everybody at Davos starts to agree on, like all the elites, the prime ministers and the governmental officials and the business elites. They tend to walk away from the conference agreeing on something. And then it almost universally ends up being wrong. Like they showed up in January 2020, they didn't speak at all about COVID. And of course, that's what dominated the world for the next couple of years. So Ben Smith was on Squawk Box, Ben Smith, the editor in chief of Semaphore, was on Squawk Box and talking about what the consensus is this year. And his perspective is that everybody at Davos this year is sure that Donald Trump

• 26:12Alex Kantrowitz?

  is going to win the presidential election in the US in 2024, which indicates. Who knows? Maybe that's good news for Biden or some other candidate that we don't even know about.

• 26:22Speaker 02

  The Davos curse is the new Sports Illustrated curse for older listeners.

• 26:30Alex Kantrowitz?

  So, Apple has the Vision Pro coming out soon. It put the device in the hands of lots of influencers, reviewers. People took pains to say this is not a review. I just got 30 minute demo from them. But we're already starting to see some reactions here about the direction of this device. And Ranjan, they are not good. So Bloomberg had a headline, big headline, that said, "Apple's Vision Pro Headset Lacks Blockbuster Buzz and Heated to Energize Shares", and basically saying that it's unlikely to play a major role in changing the perception that its growth headache is in the past. And this is from, this is a quote from Denny Fish,

• 27:15Alex Kantrowitz?

  who manages tech funds at Yanis Henderson. He says, "It's hard to ask someone to pay $3,500 for a product where there's a limited amount of content people can't get on their phone, which means it'll be pretty darn nichey, at least for a couple of years." I think that's a great point. Have you seen the reviews of the Vision Pro? I mean, my perspective is, you know, I don't think it will necessarily be dead on arrival, but it's really going to have a rough go of it as it gets released by Apple.

• 27:46Speaker 02

  Yeah, I think what is a rough go is the big question, because obviously you hear some people, you know, just make simple calculations at $3,500 times X units, suddenly you have a billion-dollar new business. But the reviews have been rough. It's everyone's saying it's heavy. Everyone's saying that, you know, the typing does not work very well. It's like pinching. No, pinching is to select, but there's supposed to be these virtual keyboards that you just like use your, move your fingers and it types on the keyboard.

• 28:16Alex Kantrowitz?

  Yeah, let me read Gervan's quote from there. He says, "Apple's", Mark Gervan from Bloomberg, "The Vision Pro virtual keyboard is a complete write-off, at least in 1.0. You have to poke each key one finger at a time, like you did before you learned how to type. There is no magical in-air typing. You can also look at a character and pinch. You'll want a Bluetooth keyboard."

• 28:37Speaker 02

  Yeah, no, this is big. I mean, I think these issues are big. However, I think the one thing, the one thing I read that seemed to be a good synopsis of what Apple's launch strategy is, because even though they've been giving out units and there's certainly been coverage and it's clear they've had fairly, you know, controlled demos with influential members of the press.

• 29:03Alex Kantrowitz?

  And friendly members of the press.

• 29:05Speaker 02

  And friendly members of the press, that this is not a big launch. As crazy as that sounds to say, this is not some like gigantic launch, that this is something where they're just trying to get, you know, this in the hands of the right people. In the end, it's going to be the developer ecosystem that creates the use cases. It's going to be the, you know, companies that build the right apps and experiences on it. Some number of people will, you know, try it out and talk about how cool it is to their friends who eventually will get a version two. I think, I think that not overblowing the potential of this at the start is actually the right move.

• 29:45Alex Kantrowitz?

  Okay, so I actually completely agree with you on that point, believe it or not. I just wonder whether there's a way for them to not blow out the importance. Like, it is going to have to be a very, very managed takeoff, if that's the case, because think about the release event that they did about this, right? Not just a device, a new form of computing. So how do you go from that, showing all these like magical scenarios, now to be like, all right, this is a half-launch, patience please?

• 30:17Speaker 02

  Yeah, no, that's fair. Also, let's not forget, remember the launch event, the dad who was wearing it and like staring at his two kids, like.

• 30:24Alex Kantrowitz?

  It was very sad, yes.

• 30:26Speaker 02

  Yeah, the saddest dad in the world, I think, I think.

• 30:30Alex Kantrowitz?

  Those kids will grow up thinking that their dad's eyes are just projected on this.

• 30:34Speaker 02

  Fake.

• 30:35Alex Kantrowitz?

  Vision provisor.

• 30:36Speaker 02

  Vision provise. I don't know, it's going to be interesting, I think. I think, again, especially like out of all the reviews, we still have seen none of people using it on their own terms. And I do think that was pretty interesting because. The moment it remains a controlled demo, it feels even further away from reality. And they're still, and I think you had predicted these would not go out at the beginning of February, end of January.

• 31:05Alex Kantrowitz?

  I did.

• 31:05Speaker 02

  They're still sticking to it. So, so in a couple of weeks, we're gonna have, we're gonna know some people.

• 31:12Alex Kantrowitz?

  I'm not giving up on that bet yet. I'm not giving up on the bet.

• 31:14Speaker 02

  Wow, all right, January 18th, they're still saying, I think it was February 2nd, right?

• 31:19Alex Kantrowitz?

  I promise you that delay is coming.

• 31:22Speaker 02

  All right, all right, stick with it.

• 31:24Alex Kantrowitz?

  Okay, I'm not fully confident anymore, but I think it might come. So they also are shipping the thing without Netflix. Did you see this? Netflix is not participating. And they're just not supporting it. They're gonna tell people to just watch it on their laptops.

• 31:43Speaker 02

  Yeah, I was very, it was interesting because it said that like a lot of the, you know, major entertainment streaming platforms are making custom apps for the Vision Pro. I guess, is it a power move by Netflix to say, we're just gonna wait and see? And if we see others create interesting use cases, then we'll follow along. But, but it is, because as we've talked about, I think, you know, entertainment memories, like are the kind of initial use cases far before people figure out how to, you know, rethink computing, which is a little more grandiose. Just watching a movie in an insanely immersive environment is a good starting point. So I was pretty surprised by that because I would think Netflix would clearly

• 32:28Speaker 02

  want to align itself with, if this creates a new type of cinema, you would think Netflix would want to be a leader in it.

• 32:36Alex Kantrowitz?

  But maybe this is just revenge of the app developer, right? Apple has been squeezing app developers like Netflix for so long, obviously still fighting the anti-steering thing where they're not really supposed to tell people anymore, tell app developers anymore that they can't point people to pay on their own pages. And sort of like, okay, well, here we go now. Like maybe Netflix is like, you want us to help you launch your next device and make it successful? How about rethinking what we're paying? You know, or rethinking our ability to let people know where to subscribe on our app?

• 33:10Speaker 02

  Actually, in terms of revenge of the app developers, Spotify, as we all know, has become been one of the very vocal voices about, you know, in battle with Apple around the the App Store tax and annoyance that they have to play ball and give away 30% of their subscription revenue through to Apple if it's comes through the App Store. This is the smallest, nerdiest UI thing, but like today I was sharing a song from Spotify, and I noticed they put iMessage, the ability to share it, after everything else that exists on your phone, whereas every other app puts iMessage first if you have an iPhone. And you could just see there was some developer who very clearly was thought that one through

• 33:52Speaker 02

  that some little jab at Apple through some little UI tweak that we're going to try to punch you where we can. So, yeah, I think these companies, they go back and forth.

• 34:03Alex Kantrowitz?

  Exactly. And yeah, that's my story in big technology this week. I mean, it'll be out Friday morning, but just the perspective is that Apple's offensive moves have actually opened up lanes for its competitors, especially Meta. So we talked about that last week. We'll have to rehash it again, but that is something that's happening. It'll be interesting to see what happens with these with these developers as they're asked to come onboard the Vision Pro and maybe they say, listen, you want your product to be successful. All right, well, let's make a deal around that 30%.

• 34:33Speaker 02

  Well, hold on, I'm going to make a call here, though.

• 34:35Alex Kantrowitz?

  Yeah.

• 34:35Speaker 02

  It is it only though, because anytime, let's say this is a completely new medium. Is it brand new companies that actually figure it out and take advantage instead of the incumbents? And I mean, which puts Apple in a great position, but and I think it could be that, you know, the next Netflix that lives in the immersive Vision Pro environment might not be Netflix at all?

• 34:59Alex Kantrowitz?

  Yeah, well, it's going to take money to program for the Vision Pro. So Netflix has the money. It's going to be tougher.

• 35:05Speaker 02

  Not with generative AI.

• 35:07Alex Kantrowitz?

  That's true. Yeah, that's right. We are the real format of the Vision Pro will be seeing political propaganda, deep fakes.

• 35:15Speaker 02

  That's the promise. It's a new world.

• 35:18Alex Kantrowitz?

  All right, let's take a break. We'll come back here and we're going to talk a little bit more about layoffs at Google and Meta's big investment in Nvidia. Back right after this.

• 35:26Alex Kantrowitz?

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• 37:27Alex Kantrowitz?

  And we're back here on Big Technology Podcast Friday Edition, breaking down the week's news. So, Google laid off 12,000 people last year. They are laying off 1,000 early this year, but those layoffs will continue to trickle. As the year goes on, we've also seen layoffs at Discord and at Amazon. The Twitch unit was impacted significantly. I mean, the tech layoffs are not over. We've talked about them. But what's strong, what's really sticking out to me with this round of Google layoffs is like, the employees are rebelling a little bit. Like, first of all, you're seeing stuff on Y Combinator that we'll get to, but there is this post, I think it's real, from a current employee on LinkedIn.

• 38:12Alex Kantrowitz?

  And their perspective is, "My hot take, Google does not have a single visionary leader, not one, not from the C-suite, to the SVPs, to the VPs, they are all profoundly boring and glass-eyed." Okay, this person, by the way, their post got plenty of likes from people with like the Google profile picture. So, maybe those are people who have left the company, but it says that, this is a software engineer and it says that they're still there. God, I wish I could, maybe I should just read the whole thing. "Google has not launched one single successful executive-driven thing in years. Sometimes VPs try to decree, 'We need a new chat app or AI-first demo for I/O.' There's a huge death march and in the end, the thing is half-baked and roundly derided. If it doesn't get 100 million users in six months, they give up, give it up and shut it down."

• 38:56Alex Kantrowitz?

  Like the joke algorithm that I learned about in college, BOGO Sort. "In each iteration of the algorithm, you reorder everything randomly and if the elements happen to land in order, you are done. Some of Google's executives are competent referees. I couldn't name which, but it feels like I've seen it done in my eight-plus years. They point in a direction, they're subordinate, swarm the area, try a bunch of stuff, and sometimes something sticks and it's cool. Right now, all of these boring, glassy-eyed leaders are trying to point in a vague direction, AI, while at the same time killing their golden goose, given they have no real vision of their own." They really need their subordinates to come up with cool stuff for them. And at the same time, they've been rolling layoffs. I mean, it goes on and on and on. It's a remarkable post. What do you think about the fact that this is?

• 39:41Alex Kantrowitz?

  Should we just look at this as disgruntled employee? Or what do you think it is?

• 39:46Speaker 02

  No, I think, and we've talked about this a lot, that out of companies launching completely new products, paradigms, anything, what was the last major thing that Google did? And, you know, is it YouTube, Google Maps? All these things have been around for a long, long time. And, and as you said, it's the, or as this author wrote, that idea that things have to hit such a scale that if it doesn't get to 100 million users in six months, they give up and shut it down. I've heard that from people who were previously at Google. And that's exactly, you know, the, the opposite of some kind of longer innovation where you're experimenting and testing and certain things take off. And then those, you continue investing.

• 40:28Speaker 02

  And, and yeah, I think the, what is the vision is still unclear. It's clear that this is going to completely transform their golden goose. And what's it going to look like after that? No one knows. But already you see like generative search on Google is pretty good. But Microsoft's Copilot is an iOS dedicated app, is a website, works well. They're going after search already. Companies like perplexity are going after search already. And Bard is still barring, so. And isn't even available on an iOS app. So I think like, yeah, it's, it's, it's tough over there.

• 41:08Alex Kantrowitz?

  Let me read some, now I'm going to go to my favorite comment, which was on my compinator. Okay. It says, Sundar is not a psychopath. You're making a common error ascribing humanity to Sundar. This is about the layoffs, by the way. Sundar is a growth robot with no moral system. See this description of Larry Ellison. You need to think of Larry Ellison the way you think of a lawnmower. You don't anthropomorphize your lawnmower. The lawnmower just mows the lawn. You stick your hand in there and it'll chop it off. The end. You don't think, oh, the lawnmower hates me. The lawnmower doesn't give a shit about you. Lawnmower can't hate you. Don't anthropomorphize. The lawnmower. Don't fall into that trap about Oracle. The difference is, is that Sundar is an industrial scale trash compactor, not a lawnmower. And then someone responds, the comparison to Oracle is pretty good.

• 41:53Alex Kantrowitz?

  Working for Sundar's Google, it sounds like this is a current employee. Feels a lot like working for a company whose only product is quarterly earnings reports. I have no idea what the company's mission anymore is besides, uh, number goes up. The old descriptions of Google's creative disruptive academic culture seem very foreign at this point. Our raw materials are the brains of new comp site graduates and our product is money.

• 42:17Speaker 02

  Okay, there's a lot of gold in that one. I'd never heard the Larry. Had you heard the Larry Ellison?

• 42:22Alex Kantrowitz?

  No, that's a first for me.

• 42:23Speaker 02

  Yeah, that, that was quality. You don't. If, if you put your hand in the lawnmower and it chops it off, the lawnmower doesn't hate you. Um, yeah, no, I, that's, I think a pretty fair summation like, like I think for Google, if you think about the whole vision thing. To organize the world's information was a very difficult problem and hard and noble thing. I mean, that's actually right now with large language models. Organizing large chunks of the world's information has become one of the simplest things to do. And it, what do you do after that? Like, actually, we have, what is, what do you think Google's next growth area could be?

• 43:07Alex Kantrowitz?

  I don't know.

• 43:08Speaker 02

  Putting more ads on YouTube videos.

• 43:11Alex Kantrowitz?

  Yeah, it better freaking be AI. Like it better be large language models.

• 43:15Speaker 02

  I think shoving even more ads into a YouTube pre-roll and making you watch like four minutes of ads to watch a 30 second video. That's the future.

• 43:25Alex Kantrowitz?

  What a torture to make you sign up for YouTube premium or something like that. Yeah.

• 43:30Speaker 02

  I still haven't, do you?

• 43:31Alex Kantrowitz?

  It's a real like, oh, sorry.

• 43:33Speaker 02

  Are you a YouTube premium subscriber?

• 43:35Alex Kantrowitz?

  No, but I think about it all the time.

• 43:38Speaker 02

  Yeah, same, same, but I just refuse to.

• 43:41Alex Kantrowitz?

  It's a lot of money.

• 43:42Speaker 02

  I know, it's not, I will, on, actually, so years ago, before YouTube had ads, I asked someone at Google.

• 43:52Speaker 02

  How are you going to monetize this? And they insisted that there would eventually be some pre-roll ads, but they would never have, what is it called when an ad shows up in the middle of a long video? There's some specific advertising. Mid-roll ads, yeah. Never have mid-roll and that you would always be able to skip every ad. Like this was this very proud person. I think it was like 2010, 2011, maybe saying this to me. And then look at YouTube now.

• 44:24Alex Kantrowitz?

  Yeah. Yeah, it does. It does seem like there were, where there's smoke, there's fire and within Google. Like, it does seem like this is maybe not like perfectly correct about what's going on, but maybe directionally accurate. So we'll, we'll keep looking into it. It would be interesting. I mean, they've definitely slowed down. There's no doubt about that under Sundar. Last story for us this week. Meta is like one of the first companies to announce how many H100 chips they have from Nvidia. They say they have, at the end of this year, they're going to have about 350,000 Nvidia H100s, which is what you train, train AI on overall. And, and overall 600,000 H100 and H100 equivalents of compute. If you include other GPUs.

• 45:09Alex Kantrowitz?

  Okay, this is a massive amount of computing that they're using for AI. Zuckerberg also said they wanted to achieve, they want to achieve artificial general intelligence, which has long been the goal of the Facebook AI research lab. By the way, quick plug, Joel Pinho, who runs Facebook AI research or Meta AI research, whatever it's called now, is going to be on in two weeks. And next week, we have an awesome guest, Dennis Crowley, the founder of Foursquare is coming on. We're going to talk about Foursquare, the Foursquare moment, New York politics, all that stuff. Okay, so with that plug now done, we hope you stick around for those episodes. This is a tremendous amount of money. I think the estimates are that they're, they've spent around 10 billion on these chips.

• 45:50Alex Kantrowitz?

  And this number is half of all the H100s Nvidia said it was going to make this year. Obviously, this is cumulative, but holy shit, what an investment that company is making in this stuff.

• 46:03Speaker 02

  I mean, it's better than the metaverse, I think. I think, you know, like the line item for, you know, the innovation of reality labs. And this is one important thing, that for a long time, the amount of spend on reality labs, everyone was only ascribing to the metaverse itself and virtual reality, basically. Whereas for a long time, they've said, like, AI research lived under that same budget. So investors have to be, again, very happy that more and more of that money now is actually going to this infrastructure war. And I think it's smart. This is where a lot of the battle will take place. And to position yourself well for this, I don't know. Or actually, do you think this is the right strategic move?

• 46:47Alex Kantrowitz?

  Yeah, yeah. And I'll just point to a tweet from Brad Gerson, who is the investor who wrote this open letter to Mark Zuckerberg that effectively kicked off the year of efficiency, saying that Meta needs to get fit and control costs. And he's reacting to Meta spending all this money on Nvidia H100s. And here's what he says. People continue to underestimate just how well positioned Meta is for this AI moment. No giant monopoly being attacked, in parentheses, Google. No low margin business model at risk of commoditization, such as cloud software. And it reaches 3 billion people a day. And it might just give us open source artificial general intelligence. So if he is, you know, celebrating this investment in AI,

• 47:30Alex Kantrowitz?

  it sort of tells you the way that that investors are going to look at it. And man, what a moment for Meta, right? Like, positioned pretty well, heading back towards a trillion dollar market cap. And people are now using Meta products as a virtue signal for how good they are in society, AKA threads, something you would never imagine a Mark Zuckerberg property being associated with. And so they must be quite happy and riding high right now. And you know what? For good reason.

• 48:01Speaker 02

  I have to say, when you come up with the term, 2023 would be the quote unquote "year of efficiency" that is so bland and corporate, yet you actually execute on it as a giant company, I have to give you a give you some credit. They said they would do something, and they did it.

• 48:21Alex Kantrowitz?

  Right, exactly. And how infrequently that happens in the business world. So yeah, well, we tell you we're going to be here every Friday and we're here and we're going to do it again next week. So, thank you, Ranjan. Thanks, everybody for listening. We do what we say. We're going to execute the year of news on Friday. It's on. Okay, thanks so much. Thank you, Ranjan. Thank you, everybody for listening. As I mentioned, next Wednesday, we should have Dennis Crowley on the show, the founder and CEO, I guess, former CEO of Foursquare, talking about what that was all like and also about his interest in owning small soccer teams, actually, in in North America. That could be, that'll be really interesting and fun. I've been looking forward to having Dennis on the show for a while. So

• 49:03Alex Kantrowitz?

  very excited that's going to happen. And then again, the week after, Joe Alpinia. In the meantime, Ranjan and I will be back next Friday for another show, breaking down the news. We'll see you next time on Big Technology Podcast.

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