The Exchanges

Q do Amazon. We'll do Apple, and we'll see what else we can get to. Netflix? I don't know. Let's, let's do that right after this. And we're back here on Big Technology Podcast with Rita Albregatti. He's the technology editor at Simaphore. A headline from the future about Amazon. I have it here. Amazon partners with OpenAI and Anthropic to bring shopping into chatbots. Are we going to see it?

A Yeah. I mean, that would make total sense to me. I think that would make total sense. Cause right now, I mean, that's what people want, right? That's what everyone is trying to basically do that with Amazon now. And they would love to like disintermediate Amazon, like, like all these, all these chatbot companies perplexity to like, they'd love to just have you be able to shop on Amazon and never have to go to Amazon. And of course, like that's a bad deal for Amazon. So the natural, I think the natural solution is they've got to work together and they've got to figure out how to, you know, with whatever it is, MP, MCP servers or something else, um, to just kind of make this, make this shopping experience work.

AI assessment note: “Yeah. I mean, that would make total sense to me.”

Q was when the application was starting to materialize, like you really had a sense that this stuff might work, and now twenty-twenty-five has been like, um, everybody's taking all of their money and putting all of it into this project in the hopes that, uh, you know, it really will continue growing the way that it has. Is that, is that a good sort of representation of where we are?

A I like that. I like that. Yeah. I do think that's right. And I did, I did write in the predictions last year about, you know, infrastructure and the fact that it was probably an obvious prediction, but that like we were just going to see a huge, like multiples more compute this year than we, than we did last year. Um, and also talked about how these data centers were going to get so big that they're going to be, these large frontier models are going to be trained across multiple locations, which we started to see in like the last quarter. So yeah, I mean, I, I totally agree with that. And I think we'll see, I think we'll see that continue next year.

AI assessment note: “I do think that's right. And I did, I did write in the predictions”

Q 1500 pages crawled, One visit. Uh, Anthropic, it's, was, it's now gone up from 6000 to 60,000 pages crawled. One visit. Prince says, people aren't following the footnotes. Is this time to panic? I mean, I sort of, I'm gonna title this, uh, this conversation or the, the beginning of this podcast episode, The Web's Existential AI Threat. Am I getting over my skis, Reid? Am I, is this hyperbole?

A I think it's always a great time to panic in the media business, to be honest. Um, and I'm, and that's not just a joke. I mean, I think it's, it's like, I remember, you know, being in, uh, you know, studying journalism in college and talking about, you know, panicking, uh, in the media business. And at that time it was, you know, just, just the web was, uh, was completely destroying it. I think what's interesting and Matthew Prince has been on this, you know, he's been talking about this now for a while. I've talked to him about it. I think it's, I think it's admirable what he's doing, but I also think that, you know, traffic was never a good metric to judge whether, you know, a story is valuable and media articles valuable. So if that metric goes away, then yeah, I mean, it's going to hurt the, it's going to hurt the current industry, but I think it actually is, is maybe in the end, a positive thing. Um, and I think there's, there's two things going on. I mean, one is the traffic and the other is like, You know, that they're scraping all these websites and pulling in the information and that part, if you, if you get rid of traffic as a metric, you don't need, uh, you don't need to allow these things to scrape your websites, right? I mean, it's possible to, to put a hard paywall in place. And to essentially stop that scraping. So, but then you don't get, then you don't get the …

AI assessment note: “I think it's always a great time to panic in the media business”

Q way about Apple before to my recollection. So to continue on our, um, on our line of question here, is this is Apple intelligence, just one bad Apple, or is it indicative like Gruber is saying of a company in disarray and not crisis? And then what do you make of the magnitude of, I would say the number one Apple watcher and perhaps fan coming out against the company?

A Yeah, he's really picking on the Apple. Um, I think it's, um, I think it's, it is really remarkable, because, I mean, Gruber has been, you know, the ultimate Apple fanboy over the years, um, and, and Apple loves him. I mean, I, I think, you know, him doing this, it's almost, it almost seems to me like a, like a spell has been lifted. He sounds like somebody who's been under a spell, I think probably for many, many years. And is now sort of waking up to reality because it's not like this is, you know, something brand new. It's not like this is a huge turn of events, right? This has been a gradual thing that's been going on for, for many years as the company has sort of scaled back on innovation, really leaned on the fact that it's, it's walled garden. Some might call it a monopoly. Um, and it really, I think used that marketing power, that goodwill that it's had, you know, since the days of Steve jobs here, To kind of show that, hey, we're not actually behind on AI. And of course they are behind on AI. And, you know, that's just the reality. And I think when you, when you come out and you sort of, and you make all these promises, I mean, it's bound to come back and bite you. And I think that was, that was obvious to anyone who was not under the Apple spell. I think immediately when they, you know, when they did that big marketing show a year ago. Uh, so, you know, it, it, it's j…

AI assessment note: “I think it is really remarkable, because, I mean, Gruber has been, you know, the ultimate Apple fanboy”

Q Okay. I actually want you to, if you're willing to, or you want to, to steal man, uh, because you're, you know, yes, yes, there's an argument, a good argument to be made for why this continues. Um, but where could you see it unraveling if it does?

A Look, it's a great question. I think, I think that probably the biggest risk is that there's some algorithmic breakthrough that actually means you don't need powerful computers anymore, right? Like, someone figures out, oh, actually, I don't know, the human brain is a very efficient computer, right? It runs on whatever, 20 watts or something. It's a, doesn't require a big data center. Um, there are actually companies To come to think of it that are growing human brains and want to use them as computers, like actual brain tissue. So, you know, this isn't total sci-fi and they're like, well, you know, we've, we actually can do AGI on a, you know, on a thumb drive or something, right? It's like, we don't need these big data centers anymore. Then maybe the whole thing collapses, right? It's like all of a sudden you just, you can, You know, there's, there's this, the data centers become dark fiber because, you know, all of a sudden, like, you could, you could run everything you need on one tiny sliver of the You know, the massive data center that opening eyes building in Texas. I don't know. That's one. Like, I think that's a real possibility, but like, of course, I don't know, like who's developing that. Like, I think, you know, maybe it's the many brain tissue computer people. Right.

AI assessment note: “biggest risk is that there's some algorithmic breakthrough that actually means you don't need powerful computers”

Q Definitely. All right, let's do it. Pardon the interruption style. Meta. Uh, the question for Meta is like, what is going to happen to that super intelligence lab? I mean, that is, it's a multi-billion dollar effort. Uh, it hasn't, has it produced anything? Uh, and it is really going to be sort of deliver or, or chaos or crisis mode for that division next year.

A Yeah, I think it's going to continue to be chaos and crisis mode. I mean, you're already seeing stories coming out. I think it was, I think it was in the times about some sort of friction between the product teams and, and the super intelligence team. So I think, I think that will continue. I think it's just so remarkable that Meta, you know, they were so early on AI, they tried to acquire DeepMind, you know, before Google did, um, and then sort of just lost focus on it. And now it's just, it just seems to be all over the place. Um, and it's, it's gonna be all about, I think, for them, like, again, it's products, right? It's like these glasses, you know, the glasses incorporating AI into those and, you know, in across its products, which has been sort of a, you know, a clunky experience, right? I don't think that the Facebook and Instagram AI products that they put out have been necessarily that popular. So I think it'll just be more chaos as they, as they try to figure it out.

AI assessment note: “Yeah, I think it's going to continue to be chaos and crisis mode.”

Q felt good enough on the highways in Dallas that You know, it wasn't gonna crash, and it operated around curves, uh, and around traffic very well. It switched lanes. A lot of people have been saying good things about it. I don't know. Reid, is this gonna be the year, and why, why is Tesla not really viewed in the same league as Waymo? I guess it's not as good.

A Well, I mean, I think politics plays a big part in that, right? I, I think it's, it's one of my gripes is like, I think tech reporters allow their personal feelings and, you know, political feelings, emotions, um, to kind of like skew their, their analysis of, of these companies. And the Tesla FSD has come such a long way. Like I tried that out when it was brand new in Sacramento with some Washington Post colleagues at the time, and it was absolutely terrifying. I mean, it's, it's amazing now. I mean, it drives you from San Francisco to like other anywhere, basically in Northern California with barely ever having to touch the wheel. I mean, it's like 99.9% of the way there. So if they don't make some kind of breakthrough that allows them to, at least in some kind of like geographical, you know, geofence area, get rid of the driver and start offering robo taxis, I think that will be That would be a surprising loss, I think, like a, like a hit on Tesla. Um, because they, I mean, again, they've bet the future of the company on this, right? It's not a, it's not a car company anymore. It's a robotics company, and they have to, they have to make this work. Um, but the reason people don't, to answer your question, look at Tesla in the same way as Waymo is because they took a totally different approach that, that I think made them look like a, Like a cheap knockoff of, of, um, of Waymo…

AI assessment note: “the reason people don't, to answer your question, look at Tesla in the same way”

Q Apple intelligence debacle. If such a meeting hasn't yet occurred or doesn't happen soon, then I fear that's all she wrote. The ride is over. When mediocrity, excuses, and bullshit take root, they take over. A culture of excellence, accountability, and integrity cannot abide the acceptance of any of those things and will quickly collapse upon itself with the acceptance of all three. What do you read from that read?

A Yeah. Again, I just think it's, that's been true for a long time and you can, you can ride, you can ride the wave for a very long time when you have, when you have essentially a monopoly, right? So I think for people who've really watched the company closely, it's like, you sort of know this, but You know, it just takes a really long time for this stuff to kind of play out. And we're just, we're just seeing decisions that happened, you know, a decade ago start to start to really manifest itself. And I don't think Apple's going anywhere. I mean, I think, you know, they'll have, they'll have many more years and probably good years in the future, but, um, it's just not, it's not going to be looked at the same. Um, I also think if you look at these companies, like, All the other big tech companies are kind of like doing everything now, right? They're like, you know, Meta is, is doing their own AI chip and spending billions of dollars to roll out these data centers. Sure. Apple, Apple is going to do that too, but I think it's not the same thing. And I mean, look at, look at Amazon with, with AWS, they all have these multiple lines of, of business, Google, you know, they're, they're moved, they're leading quantum computing and Apple just, it's just an iPhone company. And I think it's just, That's, that's a really narrow thing in today's world where, you know, there's this explosion o…

AI assessment note: “I just think it's, that's been true for a long time”

Q Apple intelligence debacle. If such a meeting hasn't yet occurred or doesn't happen soon, then I fear that's all she wrote. The ride is over. When mediocrity, excuses, and bullshit take root, they take over. A culture of excellence, accountability, and integrity cannot abide the acceptance of any of those things and will quickly collapse upon itself with the acceptance of all three. What do you read from that read?

A Yeah. Again, I just think it's, that's been true for a long time and you can, you can ride, you can ride the wave for a very long time when you have, when you have essentially a monopoly, right? So I think for people who've really watched the company closely, it's like, you sort of know this, but You know, it just takes a really long time for this stuff to kind of play out. And we're just, we're just seeing decisions that happened, you know, a decade ago start to start to really manifest itself. And I don't think Apple's going anywhere. I mean, I think, you know, they'll have, they'll have many more years and probably good years in the future, but, um, it's just not, it's not going to be looked at the same. Um, I also think if you look at these companies, like, All the other big tech companies are kind of like doing everything now, right? They're like, you know, Meta is, is doing their own AI chip and spending billions of dollars to roll out these data centers. Sure. Apple, Apple is going to do that too, but I think it's not the same thing. And I mean, look at, look at Amazon with, with AWS, they all have these multiple lines of, of business, Google, you know, they're, they're moved, they're leading quantum computing and Apple just, it's just an iPhone company. And I think it's just, That's, that's a really narrow thing in today's world where, you know, there's this explosion o…

AI assessment note: “I don't think Apple's going anywhere... but it's not going to be looked at the same”

Q called Project Rainier, and I've always wondered about these proprietary chip efforts because you hear the same thing from every CEO that talks about them, which is, we'll take every chip that NVIDIA will give us, and we're very confident in our own chips, uh, which to me is somewhat contradictory. So, what have you found, and, um, and which part of the executive statement should we believe the most?

A Well, you know, I went out, I went out and, um, you know, visited the Amazon chip lab and talked to them and, and, you know, they obviously they're, they're, you know, they're, they want to talk up their technology. Um, the interesting thing I think about, there's a couple of interesting things about the Amazon effort. So, You know, they've been at it for a while now. They acquired this Israeli company, Annapurna Labs, 10 years ago, and, you know, this is their second generation of the Tranium chips, Tranium II, and this chip is, I mean, it's not as good as, like, an NVIDIA chip on a one-to-one basis, if you compare them, but if you, if you network them together, and you're talking about hundreds of thousands of these things, and every piece of the network You know, of, of the data centers are custom built to be as efficient as possible. You do start to get sort of these, these efficiency gains, and that's kind of what it's all about, right? We've talked about this now, you know, this has come up on this show a few times. Um, so This, their big project is called Rainier, right? This, they're gonna build this huge cluster of chips, and they say that it's also, they've found a way to connect multiple buildings together, you know, using, um, using this elastic fabric technology that they've been at for, for a while. If that's true, I think it's really interesting. I mean, to my kn…

AI assessment note: “it's not as good as, like, an NVIDIA chip on a one-to-one basis”

Q quite a long time horizon compared to what we're hearing from Matthew Prince today. I mean, even I'm actually curious to hear your perspective about the timeline on whether, when this agent stuff becomes a reality, because we have people that are like going out to the press saying, oh yeah, we're using agents all the time. Um, but in reality, most people are like, what are you talking about?

A Yeah, I mean, the timeline stuff is, I think, I think this stuff happens, and this is also another reason that I kind of am like, I mean, I know Prince is talking about, like, traffic numbers today, but I'm also sort of like, It makes me, I think slower change is just better in general for society. Like you don't want this stuff to happen overnight. It'll just be, it'll be total chaos. And I think we are getting slow change. I don't think, I mean, I don't really, I don't think this agent thing has really taken off at all. And I think what's really happening is like people are trying this stuff and it's, and it can't be trusted. It's too, you know, there's too much hallucination, too many errors. Like, you know, in a lot of these, in a lot of the really great AI Agent use cases. If it makes one mistake, you can't, you can't use it. Like, it's just, you know, you can't trust it. So I think it's actually gonna be, I think it's gonna be a while before this stuff gets good enough.

AI assessment note: “I think it's gonna be a while before this stuff gets good enough.”

Q for me. Um, but I'm sure somebody will give it to you at a high interest rate. Um, let's talk about this last thing you had dropped in our document, which is that, uh, there's a new thing that Google has that's trying to help publishers make money outside of just traffic. It's called offer wall. Do you want to talk a little bit about why you found that interesting?

A Yeah. Well, I just thought it was relevant in this broader conversation, right? That, I mean, if I understand it correctly, it's sort of like, You can, um, you know, you, if you're a publication, like you can have micro transactions and they're, you know, they sort of make it easy for you to collect revenue. I don't know whether that's subscriptions, ads or whatever. I mean, I don't know. It's probably, it's probably not like hugely significant, but it kind of just shows that these companies are, are thinking about this issue and like, how do they, I don't think, I don't think Google wants like, you know, people like you and, You know, the media to kind of go around saying that they're, they're destroying the web and they're putting publishers out of business, right? They want to figure out a way to, to make it work. So I don't know. That was sort of my, my general takeaway, but you might have a different, a different opinion.

AI assessment note: “it kind of just shows that these companies are, are thinking about this issue”

Q to train its artificial intelligence system was legal under US copyright law. Um, the judge sided with the tech companies on the pivotal question, uh, Saying that Anthropic made fair use of books written by the authors that brought the suit to train its Claude large language model. Um, first of all, do you agree with the judge? And second, what do you think this means for the AI industry?

A Yeah, I actually do agree. And I think, I think this is what most copyright lawyers thought would happen. Um, it was super interesting. I thought it was that, okay, it's like the ruling is sort of like, if I could summarize it, um, You know, just in non-legal terms, it's kind of like if you're, if you're an AI agent, you can learn from stuff or if you're an AI model, like you can learn from things just like a human, you know, learns from stuff. But the thing, the funny part is like they said, the way they had obtained these books was actually not legal, that that was, that that was piracy. So I think that's, that was super interesting to me. It's like, well, if you're gonna train on this stuff, you should at least have to buy it. Like, I think, you know, if you're, if you're gonna ingest a bunch of books, like buy the books, I think it's hilarious that like so many people are, are outraged by these models training on books and they don't say anything about the fact that like there's websites where you can just go illegally download pirated books. Um, so yeah, I mean, no, I totally agree with that. I think, you know, Why not let them train on this stuff? But they shouldn't be able to reproduce it. Like you shouldn't be able to say, send me like chapter four of, you know, Alex Kantrowitz's book. Like that's not cool. Um, or the whole thing.

AI assessment note: “Yeah, I actually do agree. And I think, I think this is what most copyright lawyers thought”

Q kind of curious to hear your perspective on this because it is a little bit of a re more, I think more realistic pullback on this notion that this takeoff and intelligence explosion is underway. And it was kind of interesting to hear light cap give the different, um, The opposite perspective of what the CEO shared a week before in a blog post. What do you make of this?

A Well, I don't think like, again, I don't think anybody can actually know. Right. I mean, if, if you do get to some, you do sort of end up it's there's some threshold or breakthrough, I don't know, maybe it's possible, but like, nobody knows if that will or even could happen. So, I mean, I think Sam has always talked about this. Like, is it a fast, is it a long runway and then a fast takeoff or a short, whatever. But it, I think he's always sort of said it's going to be, it's going to be this gradual thing. And that's how technology usually develops. Like it doesn't, Doesn't usually just quickly take off. There's like adoption that has to happen. Everything. I think in this scenario, it's like, you're not, you're not even talking about technology anymore. You're talking about like some, some future thing that might be created. Um, I mean, who knows? I, I, I tend to agree that it's not gonna be, this is not gonna be some fast takeoff thing, but I, I don't really know. I think a lot of these people, like the thing to remember about AI is like, You could like, there's lots of people who have predicted like all of this happening with AI. They've like predicted it up to this point, but like, they never had any actual evidence. They just saw basically like as compute increased, The availability of compute increase, the capabilities went up, but along the way, there are all these geniu…

AI assessment note: “I tend to agree that it's not gonna be, this is not gonna be some fast takeoff thing”

Q But do you really think that the phone is not going to be part of the mix? I mean, I imagine even if AI becomes, even if we get AGI, you know, so to speak, we'll, we'll still be using phones for a while. Like the humane pin, I don't, I don't see that happening.

A Well, yeah, again, I'm not, it's not that I know what the form factor is. I just know, like, when we, even, even calling the, the iPhone a phone is almost, is almost thinking like in a previous, it's a previous era of technology, right? Like, it's a, it's a device that, that connects us to, you know, to intelligence, right? To, to the world, to the world, to this web that gets us, you know, into the cloud and allows us to communicate or allows us to be entertained. And if you think of it that way, I mean, there's, there's all, there's all kinds of devices, all kinds of things that could sort of replace that or add to that, that sort of take you outside of this, of this ecosystem that, that Apple has built. So I, I just think, again, who knows what it is? Like when neither of us are, are, you know, we're not technologists, right? Like we, we cover this stuff, but it's just, if you look at The trajectory, you know, of new technology, that's what will happen.

AI assessment note: “there's all kinds of things that could sort of replace that or add to that”

Q towards the end and left it in good shape. Do what you have to basically crush inflation and then build from there. And in fact, I was, I asked you, Reid, if there are any stories you want to discuss today, and you said it's a great time to invest In AI stocks, thanks to Trump tanking the market. So, uh, I turn that to you. Is this the moment?

A Right. I mean, yeah, back to not get, I mean, look, I don't, I don't invest in individual stocks. Um, I basically never have because, you know, being a business reporter, um, all these years doesn't allow me to, but I, it does look, you're just Tesla aside. I mean, I would say Tesla is probably an AI stock, but Tesla aside, like, you know, There, there, there's huge demand for this new technology. I mean, at the end of the day, like how, I mean, something very drastic would have to happen to change the current situation, which is you have a new wave of technology that is going to completely upend the world economically in the long run. It's just a question of how fast it will happen. Um, In all these companies that are, you know, building the infrastructure around that are, they're kind of no brainer investments in my mind. Um, but it's easy for me to say, right? I'm not, I'm not like, you know, putting my money. I mean, I have whatever, a four Oh one K, but, um, how, how does that not like, how does a company spending a lot of money to build a new technology that has tremendous demand? Like, how does that not make sense? You tell me, I, I can't, That, you know.

AI assessment note: “all these companies that are, you know, building the infrastructure around that are, they're kind of no brainer investments”

Q the bot. Then, you know, these numbers that Matthew Prince is putting out highlights kind of like the big question we've been talking about on the show for a long time, which is what is the valuation? Uh, of, of these, of these chatbots and these from foundational model companies, and when is it going to be justified? And I guess if you gobble up the whole web, you're okay.

A Well, you know, like you mentioned sports scores and that's an interesting one. Like people used to buy, used to pay for newspapers so they could open it up and see the sports score. Right. And then, you know, online publications started putting the scores up. And now I think the way it works is if you, if you Google a sports score, you just see the score right there. And I, I believe they have a deal. Maybe it's with ESPN, but like, Eventually it's, it's gonna, I think they just get those scores directly from the leagues and they're just gonna be paying the league for that information. This is not really a, it's not, that's not really like a valuable service that somebody is, that some publication is providing. So I think if you're, if you're developing, if you're, you're putting out some really valuable thing, I think it'll find, it'll find a way to, you know, to, to be valued, right? Like, and you talk about these bots, like, I don't even know if that's how this is gonna shake out. Like, I think what you might have, Is sort of everyone will have their own personal bot that sort of handles their information diet. And maybe that bot has subscriptions to things and it reads, you know, publications for you, but you're at least paying for it. I mean, that's, that's one way this could go. I think like we're, we're looking at this right now through the lens of what we already know,…

AI assessment note: “if you're putting out some really valuable thing, I think it'll find a way”

Q what you make of this, uh, is this sort of like the end of this, like, sort of debate over cancel culture? I mean, to me, it seems like, you know, this whole, this whole thing might have been silly, like, basically, like, If you say dumb things and do dumb things, there's going to be consequences no matter who you are, what side of the aisle you sit on.

A Yeah. I, it's a really interesting way of putting it. The cancel culture flip a roo. There's so much hypocrisy on, on every side of that, right? As you, as you pointed out, I mean, it's the same thing with the free speech debate, right? Everybody, everybody wants free speech until their speech they don't like, and then they want to silence it. Right. And you know, I, I, I think we should take a step back and look at this and, and say, look, I mean, I think it's horrible that people would come out and, and praise Hamas. I mean, just, I, I could not disagree more. I think it's, there's probably a lot of anti-Semitism behind that, um, that sentiment.

AI assessment note: “There's so much hypocrisy on, on every side of that”

Q says, um, operator and deep research seem more like prod, uh, like a party trick than an actual application right now. And I guess it might be useful in some maybe obscure data entry case, but These companies are already using, like, macros and robotic process automation, and I don't know if this will necessarily be a leap ahead. You've been following the news. What do you think about it?

A Well, yeah, I mean, I think you, you know, you bring up a good point. I mean, look, I think, I, I think it's probably big just because you're giving, you're giving developers, you're giving the general public access to something that will allow them to just Unleash their creativity on, you know, on, on this technology. And I think that's always interesting. Like, it's just sort of exciting to, to kind of like see what people come up with. I haven't played around with it yet, but I don't know if you've done this. I, I learned that it's called vibe coding. I didn't really know, but like, I've, I've indeed. Yeah. I mean, I, I started doing that and, um, you know, it's just like, It's incredible what you can do, you know. You know, when just playing around with this stuff, as somebody who just doesn't really know anything about coding, what you can build is, It's amazing, but it's also, you can kind of see how, like again, back to like the infrastructure build outs, you could see how, you know, you start hitting these token limits, these context limits that sort of, you know, I think limit the technology right now, but like, I will, those barriers will, will be, you know, as long as people keep investing in the, you know, in the infrastructure, which I think they will, those barriers are going to go away. And then I think that's when it becomes really You know, even more transforma…

AI assessment note: “I haven't played around with it yet, but I don't know if you've done this. I learned that it's called vibe coding”