RAMageddon Reshapes Tech (And It's Not Pretty)

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Unknown
Coming up next on AI inside, Jeff Jarvis and I dig into Ramadan as it's being called. It sent Apple prices soaring, and there's a whole lot of other impacts that we dive into. Plus, the week that both anthropic and OpenAI released their most powerful models under government restrictions. Very interesting. The precedent that's being set here. And what happens when Google tells meta, I'm sorry, we don't have enough compute for you.

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Unknown
That's coming up next on this episode of the AI Inside podcast.

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Unknown
And welcome to AI Inside the Podcast, where we take a look at the AI that is layered throughout the world of technology. Week after week, sometimes a day early, sometimes a day late, but always week after week. Unless we don't. Anyways, I'm all my fault. We're doing this early because I have something tomorrow morning, so you know what?

00:01:04:15 - 00:01:25:21
Unknown
Like we got lives, man. I know that they. I know that, you know, having done podcasting for 20 years, I know that the standing rule is like, you know, stay persistent, stay on, on, on schedule and everything like that. But, you know, life is kind of a rule of life, too. Yeah, yeah. It's just like sometimes, you know, we got we got lives and and they kind of come up and they don't care that we have a podcast schedule, so it's okay.

00:01:25:25 - 00:01:51:28
Unknown
Isn't that one coming for you? We got plenty to talk about. We're a day early. It's all good. Yeah. It's okay. How you doing before we dive in? I'm good, I'm good. I'm excited about our last interview episode. We had an interview with Liz Reed. Don't know if you knew this or not, dear listener or viewer, but you may have noticed an extra episode appear in your feed on Friday.

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Unknown
Liz Reed is the VP of search. And you know, there was there was a little bit of spicy, spicy quality within the interview and certainly hearing from people. I'm here from some people who are very spicy about the interview, but I thought it was good. I think it was. I think it was good to hearing about, you know, how she does her job and what she does.

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Unknown
The controversy is around publishers. We asked her what she advises publishers, publishers, kind of. Some publishers say we don't want you sticking advice. We want you to taking money. But, I think she's an extremely powerful position. And it's really interesting to me to, to look at how they think about search as it becomes not search anymore as it becomes AI.

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Unknown
Right, right. More and more and more, the way I put it is that we've moved from keywords to questions to commands, and I think that's where we're going to go more and more. And so it's in the very nature of search that we've lived with the beginning of Google. So it's I think it's really interesting stuff. I think she's really smart.

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Unknown
Recommend you watch. You may not agree with everything, but it'll be interesting. Yeah, for sure for sure. And definitely, you know, I've heard from some people who do not agree. Who are, you know, feeling or saying, you know, I think the term gas gaslit has been thrown out a couple of times to what I've seen from some replies.

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Unknown
I was just talking to somebody yesterday. Publishers were saying like, hey, they aren't listening to us. You know, I was talking about yesterday who covers publishing who in a really good plug, Oliver Darcy from status who does a great, great job covering publishing and media. And he said, boy, the hostility to Google out there is really something. And so I think that's I think we got the flotsam and jetsam of that.

00:03:39:09 - 00:04:01:22
Unknown
I think that publishers thought that Google somehow could or should rescue them. And the case and as we enter into a whole new world with AI, Google's trying to figure it out as much as anybody is, and it's disrupting absolutely everything. And so publishers continue to think that they're the victims of technology rather than thinking, this is this is not going to be popular.

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Unknown
What I'm saying either. But I think that it's still interesting to listen to what Google says and what they think. And it may not be sufficient to make publishers happy, but it's they're not there to do that. They're there to make users happy. And they have a I guess they have a business to run. And they're, you know, it's it is their business to run, I suppose.

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Unknown
Yep. It's just been one way for a very long time. And now things are changing as they are in many other directions, not just in Google's lap, how things are changing. You know, it's changing everywhere. Yep. So yeah, now it was a really great, great interview and I hope to have more like it. So there you go.

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Unknown
Why don't we talk a little bit about Ramadan. Ramadan is the term that I just love the sound of it. I know it's got a nice ring to it. Definitely. It continues to kick around. We're starting to see some things really come to a head right now. First of all, there was a report from Jefferies Investment Bank, a research note anyways, this week.

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Unknown
And they were warning that memory prices are going to surge 40 to 50% in Q3 of this year, 40 to 50% another over yet and ain't over yet because the number 30 to 40% on top of that in Q4. And then the report says there's really not going to be any relief until maybe 2028. And it's just it's just crazy like and I saw another story.

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Unknown
I didn't put it in here earlier about just kind of the impact that this is having on the smartphone market and how smaller I think we're going to talk about it tonight on Android Faithful, actually, how smaller smartphone makers like it's going to get really hard for them to do business because of the increasing costs of of these components.

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Unknown
And of course, you know, why are we talking about this on AI inside? Just as a reminder, because most of you probably know at this point, but it's because data centers are scooping up. They're they're snorting up all of the of the memory chips that they can find. Yeah, I kind of figured that these would be these would be different chips for AI.

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Unknown
But no, this is a this is a commodity. And I hadn't seen this coming. You know, obviously I did within the last few months. But in the spread of AI and the data centers, who would have thought that the humble little memory chip would be where things would come to a head and supply and demand are really coming to bear here.

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Unknown
So it's going to the impact of AI on all of our lives before it comes for your job, before it comes for your literacy, before it comes for your sanity is coming for your iPhone. That's right. Well Apple of course you know they announced that their their prices are going up like like crazy. Not yet on the iPhone but that's got to come.

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Unknown
Not on the iPhone. Yeah that was that was notable. Not on the iPhone and not on the Apple Watch. But like MacBook air up $200 the MacBook neo. I think that jumped like 2 or $300 that just launched, you know, and that was their low cost laptop. And it's jumping a couple hundred bucks. MacBook Pro 16 inch up 300.

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Unknown
The base iPad up $100. The the tiny little Apple TV was $129. It was this easy super entry point. Now it's $200. You know, it's the first time that Apple has raised prices across so many of its product lines at once. And Tim Cook, still CEO before Turnus, takes his place here very soon, called this. I think his words were 100 year flood on memory and storage costs.

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Unknown
He says. You know, these price increases their unavoidable. Unfortunately, like even us, even Apple can't not increase prices. But like you said, they didn't do that on the iPhone. And so are they kind of eating the cost there to keep keep momentum or like what do you think. Yeah I don't I don't understand the hardware well enough to know whether that's commodity memory chips that are useful elsewhere or those things that because of everything is scrunched into an iPhone.

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Unknown
It's more custom and not affected that the orders are already set in the future. I just don't know. Yeah. I mean, they're certainly not the same chips that you take out of your iPhone and put in your MacBook. Obviously not. Yeah. And is it more coordinated with the with the processing chips? In a way. I just don't know.

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Unknown
Very interesting. Apple is in a position just based on their size, based on all of the different ways that they make money. It's not just hardware, it is also services and everything else, but just their their massive kind of footprint gives them cushion and options. You know, they have an insane amount of users locked into their ecosystem.

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Unknown
Other companies can't do that. Right. And so you've got companies like GoPro. I think I have that story in here where GoPro is actually considering a sell off. I don't know if this is the right story. I don't know if I'm looking at the right story, but basically go GoPro is basically issued a warning saying they have substantial doubt about the company's ability to continue.

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Unknown
Their memory costs have shot up 80 to 115% at the end of Q1. They've seen revenue decline 26%. They're laying off 23% of their workforce. They're exploring a potential sale. And, you know, largely because of this. And I mean, GoPro is is not like a fly by night name. And yet they're kind of pushed to the point, pushed to the brink of like, shoot, what do we do?

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Unknown
Like we have to explore all options here. So what does that say for the smaller players in the industry? It's going to be really interesting to me. Yeah. Last week the the steam game machine was meant to cost $750. And I think it's going to be more than it's going to be $1,049. Yeah, yeah. So all these small guys.

00:10:03:23 - 00:10:28:00
Unknown
They've got to pay what the market can grab out of them. Well, I think I saw also didn't X-Box console prices. Yeah. They they jumped another hundred dollars. I mean everything is just boom. It's going up soaring. We and this is not a these prices are soaring. It's not an insignificant factor in consumer pricing. And so this is inflationary.

00:10:28:03 - 00:10:52:04
Unknown
Yeah that's true. Yeah. It's indicative of a larger thing to this moment in time. Yeah. It is really something consumers for companies for just all. We are so digitally dependent now this matters all around. Well so and so how this how this kind of ties back into the, the AI side of things too. You've got Samsung, you've got SK Hynix.

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Unknown
Micron. Did we talk about micron in there. Not really last week. No. Yeah. That that they've got a major deal. I always have a soft spot in my heart for micron, if only for the fact that it's a Boise, Idaho company. And I see I know, so I'm always like, oh yay, Microsoft or Mike microns in the news.

00:11:09:27 - 00:11:38:22
Unknown
I think they've just seen astronomical demand for what they're selling and their value is skyrocketed. They are those three companies, probably more. But Samsung, SK Hynix, micron, over 95% of global Dram memory production, 50% of the total memory capacity is of. Their total memory capacity is locked up inside of these long term contracts with the really big tech companies.

00:11:38:24 - 00:12:08:28
Unknown
So all of that's locked up. That basically means less supply that's available for everyone else. And that long term kind of contractual share could actually rise and probably will rise even more. Yeah, there's probably probably contractual right clauses that say that that we got first dibs. Yes. Exactly. Preferential. Yes, yes. And so the the dramatic effects of that where we're at right now.

00:12:09:00 - 00:12:28:25
Unknown
Daniel, wonderful person in the chat. Sorry. It's covering up your video, Jeff, but says new phones coming out, so we'll want to shift the old stock. New phones will be more expensive. I mean, I guess that's that's kind of always the case, but probably more the case. I wonder if old stock will retain a higher value now because.

00:12:29:00 - 00:12:53:00
Unknown
Yeah, I mean, not because the memory inside of it is inexpensive, but because it's gonna look it's going to look cheaper with. Yeah. When the price of everything is increased, I wonder if the older devices will actually hold their value more. So yeah, it's, interesting, interesting time. You think I talked about your your TV has memory, your car has memory, you know?

00:12:53:03 - 00:13:21:03
Unknown
Yeah. Yeah, you're probably your toaster oven has memory. God knows. Probably so. And I, you know, we'd already been talking about the smartphone market, but I'm finding here in my notes that I have some IDC data. IDC is saying that the smartphone market is going to decline 13% in 2026, the largest drop ever. 160 million fewer smartphones shipped year on year currently.

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Unknown
And IDC says that that sub $100 smartphone segment, which is around 171 million devices, is going to become, quote, effectively uneconomical. There's a lot of the lower cost devices, like how do you how do you make that make sense when they were already kind of scraping together bottom of the barrel in order to make those prices and in if you look at Apple stock on June 2nd, their stock hit 315 as a high.

00:13:51:12 - 00:14:20:17
Unknown
And then the low, five days ago was 275. That's creeping up again today, yesterday and today. But yeah, this is this is hitting them because they're going to sell fewer devices. Yeah. Which I mean and maybe that's part of the reason why they didn't raise the the iPhone price I wonder I wonder if they're sitting on or like shouldering the the cost on the select devices loss leader as loss leader.

00:14:20:17 - 00:14:37:17
Unknown
And if at some point they're going to be like, we can't do that anymore, we have to raise these prices, or maybe with the new refresh of whatever devices they have coming out, you know, a year from now, I guess it would be right. We've already passed WWDC at this point, so it would be, well, no, wait. When do their new devices come out?

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Unknown
They don't come out at WWDC, right? God, I'm so confused. Suddenly Apple new devices that is that is timed with WW DC right? I don't know because I'm not an apple boy. Next gen. Yeah, I know this is so funny. No no new hardware. That's right. So WW DC they're really showing off. It's developed. This is I'm showing my Apple ineptitude.

00:15:03:04 - 00:15:29:19
Unknown
I'm so like blank on Apple because I haven't really covered them throughout my career. It's always been Android. So Daniel says September thank you Daniel for saving me although I've probably already done the damage. But anyways. Yeah, so so well. But that kind of proves my point. What I was kind of leading to is I wonder if they're holding it down and waiting for the next hardware refresh to be the jump, like I guess, new catalog.

00:15:29:21 - 00:15:52:05
Unknown
Oh gee, look at how wonderful things we have here. Make it worth a price increase. Yeah. Also, I mean, I haven't seen price increases from Samsung, which of course has access to its own chip making. And we're Google yet because they've got stock and in place. Yeah. But we're going to have to see the others follow. Yeah. Yeah very very interesting.

00:15:52:05 - 00:16:11:11
Unknown
So your Mac is going to cost you more. Your phone might cost you more if you're not on Apple iPhone. It's a weird little question. I wonder whether on the PC side, the one hand, you want to run more AI fancy stuff on your locally, so you need a lot more memory to that. On the other hand, screw it.

00:16:11:11 - 00:16:34:16
Unknown
The memory is costing you a fortune. That's why God made a cloud. So why don't I just use less memory locally and use more things on the cloud? Does it does it kind of push, hosted services more? I don't know yet. Well to see. Yeah probably probably possibly. Do those hosted services then increase their prices because because there are problems with every.

00:16:34:16 - 00:16:43:17
Unknown
Yeah. Because they feel the heat or whatever. Yeah. It is a definite flex time.

00:16:43:19 - 00:17:13:28
Unknown
Flex time happening right now in the memory market. Real quick reminder that we have our Patreon that you can support us at Patreon.com. Inside, we've got some amazing patrons who support what we do here DJ root, Fred Davison, just a couple of amazing patrons behind the scenes helping us continue to do the show. You know, also hopefully listening to the the daily version of the podcast that I'm doing over there five days a week, five days a week.

00:17:13:28 - 00:17:34:09
Unknown
Jeff. Yay! You know what? You know, what I noticed with that is like, so I've got Android faithful, I've got AI inside, I've got two days a week of daily tech news show, and then now I've added five days a week of AI inside daily. And when Tom Tom Merritt on Daily Tech news show, when he goes out of town, he's like, hey Jason, can you cover for me?

00:17:34:09 - 00:17:54:10
Unknown
And so I do. And I think last week I had a 13 podcast week. She in top of everything else. And I added that up. I was like, no wonder I feel so busy. Like, my goodness, how do I how how does that happen? God, you're like an opera star having to worry about your voice.

00:17:54:12 - 00:18:10:23
Unknown
Well, on a day like today, like I'm doing for podcasts today. So yeah, by the end of it, my voice is going to be taxed. You could be cheering your daughter in volleyball. Well, yeah, I got to take her to a volleyball clinic. It's a you're not there Cheering okay. So you watch watch the voice. You know where where the scarf.

00:18:10:24 - 00:18:16:15
Unknown
Yeah. You know drink some tea with some honey. You're a star.

00:18:16:17 - 00:18:36:25
Unknown
This is how how it is being a being a podcast. Meanwhile people like Leo Laporte like that's just like normal back in the day. I don't think he does as many today. But yeah, back in the day he did. Yeah. Yeah for sure for sure. All right. Going to take a quick break. Come back talk about more. We've got some interesting movement happening in mythos and open source AI a lot coming up.

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Unknown
So hang tight. We'll be back in a second.

00:18:40:28 - 00:19:13:21
Unknown
All right. So the mythos movement, let's start with anthropic here. Last Saturday, the Commerce Department lifted its block on Cloud Mythos five. So it's now going out to 100 USC. My voice is already starting to. Oh! Oh, no. What have you done? I did it to 100 US institutions getting access to that companies, government agencies, all part of Project Last Wing.

00:19:13:28 - 00:19:41:17
Unknown
Like before, though those names haven't been made public. To my understanding, the consumer version of this fable five, which I will admit I was totally enjoying access to when it existed, still kind of sits in a limbo space. Sources are saying that talks are moving forward on releasing that at some point, but there is no timeline. So okay, mythos five back in action, I suppose.

00:19:41:20 - 00:20:07:28
Unknown
Yeah. And word has that fabled maybe as well soon now that that's kind of out with but but the the precedent here is frightening. It's really frightening. The government government can decide who can use these tools. So I read from Benedict Evans newsletter he says this is a mess with random unqualified officials banning and banning products with no process or transparency.

00:20:08:02 - 00:20:34:01
Unknown
One has to laugh at anthropic and the safety activists who spent years saying they wanted restrictions. But when they came, they said no, not like that. One could also point a finger or two fingers at the figures in tech, who said we should vote Trump because Biden stood for arbitrary regulation of AI. On the other hand, while this policy is incoherent, like everything that comes from this government, the cyber threats are taken very seriously by serious people, and doing something is reasonable.

00:20:34:03 - 00:20:57:25
Unknown
So, you know, it's not as if this is 100% insane. It's just 90% insane. And again, as he says, there's no process, there's no transparency, there's no there's nothing you can judge in the future of how to operate, whether you're anthropic or any other AI company. And as we're going to get to in a few minutes, it sets China up for some killer blows against RA industry.

00:20:57:27 - 00:21:24:27
Unknown
It does. Yeah. This is this is this this puts government in a position again of saying, who can use certain programs and who can't. Well, and it's not just might be a precedent. Right now we have open AI also staying in the US. And then we'll get to China. But releasing their next model series GPT 5.6, we're announcing slash releasing came out last Friday.

00:21:24:28 - 00:21:51:03
Unknown
Three different versions. They've got like a you know, they're they're kind of following the anthropic approach of naming them. Soul is like the most powerful. Terra's the balanced one. Luna is fast and cheap. But speaking of the kind of precedent aspect of this, it is also restricted. It's available in a limited preview. 20 companies can participate. And and those companies were approved by the government.

00:21:51:03 - 00:22:25:16
Unknown
And so yeah, OpenAI says basically that Saul is competitive with mythos preview using only about a third of the output tokens. That's what they say based on cybersecurity benchmarks, but that it doesn't cross OpenAI's own cyber critical threshold. I mean, the the point, though, is that OpenAI had to kind of get government clearance on part of this process, and I don't think that they were entirely excited about it, but they did, and I think they were slightly public about that.

00:22:25:16 - 00:22:44:13
Unknown
Not not super pointedly so. But, you know, they were like, you know, get to the to the extent to, you know, it would be a shame if this is just the way it is going forward. But here we are. Well, I think OpenAI has been trying with this administration to be saying, oh, we're the good child. We'll do what you want, right?

00:22:44:14 - 00:22:59:16
Unknown
Pentagon? You're going to kick anthropic out. Well, hey, will play. We're okay. We're there. So it doesn't help them immensely. But on the other hand, they'll play.

00:22:59:19 - 00:23:25:05
Unknown
Yeah. And then in both cases then what if you do what do you do if you're international, what do you do if you're in Europe? You can't count on using these tools. They could be cut off at any second. Well yeah, that's that's the crux of the interview I had with Joel Pino from from cohere. You know, their cohere is Toronto based company.

00:23:25:05 - 00:23:50:11
Unknown
And, you know, Joel spoke a lot about sovereignty, you know, AI model sovereignty. And just like the I mean her her point was that the, what is the right word? I want to say differentiation. But it's not that. It's it's really spreading like like through cohere. You have access to a lot of different ways that you can go.

00:23:50:13 - 00:24:19:13
Unknown
It isn't just locked into a single direction, a single solution like one from anthropic or whatever, and that that kind of broad access to a lot of different places is the antidote to something like this. Because if that doesn't work, you can always go over here and go over there. But, but at the same time, companies want to be able to pinpoint exactly how and what they use for certain things.

00:24:19:13 - 00:24:42:19
Unknown
You go all in on one thing and it goes away. Yeah. You're screwed. Yeah. So there was a story in Bloomberg this week I put up from investing that said that Austria is reportedly calling on the European Union to explore bringing anthropic into the bloc as US moves against them. And it's not clear what they mean by bringing it in.

00:24:42:20 - 00:25:09:26
Unknown
Move the whole company, their host it there. I don't know, but but it's interesting to say that anthropic may have better allies in Europe than it has in its own native land. And the Europeans are saying we need to be able to rely on these tools. And so maybe we should entice some form or another them to come over.

00:25:09:28 - 00:25:41:20
Unknown
To move over? Like what? Like move the business to be. And that's what it's not clear. It's just merely hosting there. Is it is it guaranteed that they get their own versions of the models there, or is it literally moving the company? I'm not sure what this meant. I couldn't figure it out, but I think I think, you know, Laporte last week kind of joked that anthropic would move out of the country, but this was maybe a I mean, that doesn't look entirely, you know, impossible based on this.

00:25:41:21 - 00:26:02:10
Unknown
Oh that's interesting. I hadn't considered that. Wow. That would be kind of crazy if that happened. Obviously there's no indication that that is exactly what it would happen, but that would be that would be pretty huge news if suddenly anthropic was like, yeah, you know what? We're we're tired of facing this fire, but I'm just going to go over there.

00:26:02:11 - 00:26:23:07
Unknown
We're going to we're going to do what we do and deal with it. It also gives, you know, I think it also gives anthropic some cover for negotiation. Say, well, yeah, that's true. We we've got options. We got journals man. We're ready to move later Rosen options. You have good schnitzel over there you know.

00:26:23:09 - 00:26:56:13
Unknown
Just saying if you if you've had that schnitzel before, you understand, like we're really convinced that this could work. And the beer is good. The beer is very good. Oh, man. Now I'm super Bud Light. Yeah, a little bit. Just a little bit. Let's see here. Oh, the China angle. Yeah. You had mentioned China. This this is the interesting other aspect, other side of this because not only is it just the China angle, but it's also the open model angle, which they kind of seem to be going hand in hand at, you know, at, at the same moment.

00:26:56:13 - 00:27:21:27
Unknown
But so let's see here. So we've got China's a zip I'm probably mispronouncing AI released a model called GLM 5.2. It's an open weight license. It's free. It runs on consumer grade hardware. And Wall Street Journal said China has matched anthropic in cybersecurity, resetting the AI race. Now that's their headline. Or that was what they were kind of touting.

00:27:21:27 - 00:27:59:23
Unknown
But that is the headline, which, I mean, who knows if that feels like maybe it's a little overstated here to say the least. Let's see here, the most of its is published, a detailed rebuttal anyways, saying that that's outright false, arguing that mythos what makes what makes mythos special is not in finding individual vulnerabilities, but in finding them autonomously at scale and then stringing all that unrelated stuff together into these, like, case implicated exploits.

00:27:59:25 - 00:28:28:23
Unknown
Yeah, totally. That's what comes to mind for me. It's like, okay, but so you're saying there's a chance, like it's not going to take too long. And that's and to me that's the trend matters. That's the thing. The trend matters. And it's nitpicking as to how they are. Because the point here is China can completely undercut the entire USA industry at the same time that they're getting crap from our own government, which I didn't come along and offer this stuff open for free.

00:28:28:23 - 00:28:50:19
Unknown
They can they can train on their own chips. They can train with their own electricity. They can release open weight free models. Not because because they have different motivations. They can undercut. It's industrial espionage at a whole new level. They can. You know, when I was in newspapers and Craigslist came along and Craigslist listed, not kill newspapers, Craig did not do that.

00:28:50:22 - 00:29:09:03
Unknown
But newspapers had a real problem trying to figure out how do you compete with free, right? Right. And it's nigh unto impossible. So what happens if the our entire AI industry, just as they're trying to raise prices because their costs are so damned high and they're only going to go higher. See earlier discussion China comes in and says, whoop, beat this.

00:29:09:05 - 00:29:21:13
Unknown
Yeah. Not only do we do we have the same security. You know, you want to talk about how your stuff is so secure and wonderful. Well we can do the same thing. And here it is for free. And your stuff is so expensive. Well here's our stuff. And maybe it's not quite as good, but it's going to be in two weeks and it's free.

00:29:21:14 - 00:29:43:17
Unknown
Yeah, right. And your stuff is closed. Local is open model. And I saw a video right before we got on Dario Ramadi pooping open weight and said, well, it's not the same as open source. It's not. It doesn't really matter that way. Trying to poopoo the Chinese stuff. He's vulnerable and open, the eyes vulnerable. And Google's Google's a little less vulnerable because they integrated with their services.

00:29:43:17 - 00:30:07:29
Unknown
But the pure AI companies could really hurt. And if China wants to go after us for geopolitical reasons, they can do that. And by the way, if they read what does grew us, now is the time to take Taiwan. Just as chips are in dire supply and almost all of our supplies, especially the high end chips, comes from Taiwan.

00:30:08:01 - 00:30:52:09
Unknown
If China wants to move and turn this into a true cyber war, I'm not saying they're going to, but they've got cards to play, as the administration would say. Yeah, yeah, right. Lots of them. Yeah. There's another another bit of news today that gave me a slight pang of all birds when I was talking with Tom Merritt about this on Daily Tech news show earlier, which is me, Tuan, I'm probably mispronouncing this, which is a food delivery company, a massive food delivery company in China released its own open source model, long Cat 2.0.

00:30:52:11 - 00:31:20:03
Unknown
They say that it's the world's first trillion parameter model, trained on A5000 chip local cluster. I write no vedere. This is all happening inside of the country. We've got these export controls that were meant to make sure that China doesn't get this and that. Well, guess what that does? That makes them even more likely to become self-sufficient and to build out a very competitive, you know, competitor to what we have.

00:31:20:04 - 00:31:45:07
Unknown
And that's exactly what's happening here and meets Wan. Yeah. Is a food delivery company is releasing an LLM that is incredibly, you know, that is doing things that we haven't seen before. And if Meatwad can do it, you better believe Alibaba, ByteDance, deep seek there. You know, there's a lot more coming from from this direction. And it's all it's all related to everything we've just been talking about.

00:31:45:07 - 00:32:05:09
Unknown
It's so interesting. And then once the models get here, wherever they come from, as we've said often on the show, they're meant for anyone to use anyone. Yeah. Because yeah. So so open technological expertise, the value of technological expertise keeps on dropping as well. Yeah. You still need it to make these high end models. But you know, a food delivery company can make it.

00:32:05:11 - 00:32:30:28
Unknown
Yeah I know right. So it's so interesting. Like I said I read that and I was like, oh that kind of it's kind of like all birds. And I think the joke on Daily New Show is like, it's not entirely. It's like some birds, but not all. It's sort of the way there. But anyways, so that is that the mythos slash GPT slash China segment, it is all related.

00:32:30:28 - 00:33:01:25
Unknown
It's very interesting to see where it's all headed. And then we got Google and apparently Google Capt Meta's of Meta's use of its model. Financial times reported this week that Google told meta back in March that it could not supply all of the Gemini capacity that meta wanted. And so it's yeah, it's capped the capacity, the restriction, it has a restriction in place right now.

00:33:01:26 - 00:33:23:22
Unknown
Meta was using Gemini for content moderation and meta was using Google's models, basically because Gemini was better at these tasks than Meta's own open source models. And so now suddenly, you know that competitor cut off. They don't get to do that. We don't. And I think part of this is kind of goes back to what we're talking about earlier.

00:33:23:23 - 00:33:44:05
Unknown
There's so much pressure and kind of emphasis on the compute that they just don't have enough compute to, to, to go around. So they gotta siphon it off. There's two angles to the story. One is that there's the shortage. Story continues here. It's not just shortage memory chips. It's shortage of processing of compute as they say. Yeah. And so short that you're going to cut off a customer.

00:33:44:05 - 00:34:08:09
Unknown
That's 0.1.2 is Meta's investing freaking fortunes in their own AI. And you'd think that their own AI would be able to do these internal tasks. And Gemini does it better. That's a little embarrassing. Yeah. You back Lama was lama was the earlier days of all of this. Lama was right up there with all of them was competitive.

00:34:08:11 - 00:34:30:07
Unknown
That's true. I mean it wasn't that long ago. Yeah. It's just so funny how fast this stuff moves but yeah Lama we were, we were talking lama up the, the open source and just the sheer facts or maybe belief that meta was committed to this, like open source or OpenSSH thing and I don't know, not really hear much about that anymore.

00:34:30:08 - 00:35:03:23
Unknown
Right. Like exactly. So not quite. So glasses ain't going to do it. Mark. Yeah, yeah. That is meta has been shifting towards its internal workloads, towards its muse spark, which is kind of the internal model that it's been developing inside of the Superintelligence Labs division, which is another thing that we heard a lot about and then has gotten really quiet now that I'm very curious about, like, what?

00:35:03:23 - 00:35:44:08
Unknown
What the heck is going on in that? I keep seeing stories about, you know, people just not be like, you know, Bosworth saying morale is really well, yeah. I saw a story today about meta meta hiring contractors to go into competitors llms like OpenAI, like Gemini, like, you know, Claude and whatever, posing as team like under 18 users and then doing searches about drugs and suicide and sex and all these things, and then basically collecting information based on how they're responding and filling up a database, I don't know.

00:35:44:11 - 00:36:01:04
Unknown
Yeah. It was, it was what was what they were plan to do with that. But and I think there were the implication was this was scandalous because it involved kids. But as I thought about it, I thought, well, no, we want them to be doing this all around. Yeah. If they become better, you know, maybe doing it secretly.

00:36:01:04 - 00:36:22:08
Unknown
So the companies that are targeted don't know it. Maybe it's kind of blackmail against the companies. That's a different that's what that's that might be the reason that it was one looks at this and goes you know like so. So what is the purpose here. Are you like loading up your, your ammunition to be like yeah. And so there and like then or are you going to be the best because you have so many children who use your service?

00:36:22:08 - 00:36:43:11
Unknown
Are you going to be the best of breed at avoiding these problems? And I'm always trained. Yeah. That's true. Yeah. That's a good thing. You should, you know, I think that that's another kind of red teaming is red team. Everybody to figure out. Imagine how they all respond. And whoever responds best steal that. Fine. It's good for children.

00:36:43:11 - 00:37:07:21
Unknown
Yes. Is it against the term of service to go on to like a model, like someone's model and pose as someone else and do these searches? No, I don't know. Because. Because all the time. Don't you tell the model, you are a financial analyst, right? You are my tax advisor. You are a wise professor. No, that's that's part of prompting, I think.

00:37:07:23 - 00:37:29:21
Unknown
Yeah. You know, it's so interesting related to that, but totally not related to what we're talking about right now. But that just reminded me I was I can't remember what I was reading this weekend, but it was a it was definitely a forum discussion around prompting and how it's evolved over the last couple of years. And someone brought up that the oh, you are a so-and-so.

00:37:29:22 - 00:37:52:11
Unknown
You know, you are a assigning like a identity to the AI and so to the LM in order for it to, to kind of narrow in. And the response to that was swift, like from the perspective of, oh my God, that's like outdated. Oh, that's outdated at this point. That was that was what you needed to do two years ago or even a year and a half ago with these things.

00:37:52:11 - 00:38:09:19
Unknown
But now they're so good, you don't even need to assign it roles. They just, they, they just kind of fall into line. I was like, oh, that's so interesting. We're getting to these like generational times. But, but, but I've had some success with it. Yeah. You're still going to say explain this to me like for five years old.

00:38:09:21 - 00:38:29:27
Unknown
Yeah. Right. Or I want to I want to explain this to my kid or I'm a teacher and I want to explain this. No, I think that's snoopy duty. Yeah, I wondered about that, too. I was like, well, what did they know that I don't like? I don't use that technique a lot, but sometimes I do, and I feel like what I get out of it feels feels okay.

00:38:29:27 - 00:38:50:29
Unknown
Sometimes it seems like the right way to align. You know what? What I'm looking for, by the way? Meta stock. Just because I know that the market has any brains but its 52 week high is 796 and right now it's 560. Oh wow. Oh, he's not doing so well.

00:38:51:02 - 00:39:24:08
Unknown
Halesowen Nightmare says my bigger concern is that smaller companies that are more focused on customers will get wiped out, because they won't be able to survive all of this. Yeah. But I think I think that's that's a concern. You're right. But I also think that's a differentiation that if you are really who was it? Was it meta? One of the I think it was meta that said, I saw this story passing that there was some effort to if your account if you need to activate your account because it gets deactivated, you're only going to deal with the I now.

00:39:24:10 - 00:39:42:16
Unknown
And if companies start, more companies start doing that and you can't get to a human being, you're going to gravitate to the companies where you can get to a human being who has the authority to get something reasonable done. Oh, you mean like in a customer service? Yes. Customer service. Yeah. So if I have an account and my account gets deactivated because I did something wrong, right?

00:39:42:17 - 00:40:02:04
Unknown
My only recourse is to deal with the AI bot. Yeah. And I can't remember I saw that I apologize to our listeners. Yeah. Oh, that's interesting though, but I think I think humanity this all increases the value of humanity, I hope. Yeah. That's my ozone dream. Yeah. Yes. I think that continues to be a theme time and time again.

00:40:02:05 - 00:40:29:21
Unknown
I did not put okay, I'm safe to mention it because I didn't put it in safe to mention it. We could talk about whatever we want. Title. There was news around title, the music streaming service basically essentially saying any music that's on that's detected as being generated by AI on the streaming service will be will be allowed to exist.

00:40:29:21 - 00:40:56:02
Unknown
It'll get the AI label, which is what a lot of the streaming services do, but it will not. Zero revenue will be able to be generated off of this. So they're they're kind of going one step further to say that. And the only reason I bring this up in this conversation is because the CEO, I can't remember his name off the top of my head, referred to real like like music not generated as organic creativity.

00:40:56:04 - 00:41:18:07
Unknown
That's a new one, which is kind of similar. You know, it's kind of like that human, the human involvement, the or or truly organic creativity is a carbon created. Yes. I had not heard that one before. I was like, oh, that's a that's an interesting, interesting way to put it. But yeah. Okay. Well there we go, man.

00:41:18:07 - 00:41:38:07
Unknown
We are flying through this rundown. Well, you got volleyball to go to, man. Well, I know, but I got that still, still got some time. But there's more at the bottom. Leave me before I. That's true. Usually I've got a soliloquy for for 20 minutes and then. Yeah. Yeah I know. Right. Okay. Well then let's take a break.

00:41:38:07 - 00:41:51:28
Unknown
We'll come back and we'll do our speed round. And then if there's anything that we if we have time, if there's anything there are some other good to talk about. Yep. There's other things I just might not have done my homework on some of those things. That's okay. I don't want to put them there, so it's on me.

00:41:51:28 - 00:42:06:00
Unknown
I'm not used to this, Jeff. Usually it times out perfectly, but this time, man, we've been cruising, so I don't know what happened. Anyways, let's take a break and we'll come back and we'll do some speed round. And who knows what else coming up here in a moment.

00:42:06:02 - 00:42:29:02
Unknown
All right. A little bit of breaking. I guess. It's breaking news. Right before the show, anthropic announced the release of Claude Sonnet five, which is the. So sonnet, when you're talking about the kind of order of the they're models of. Yeah, please remind me. So confused. There is haiku which is kind of like their fastest, lowest kind of model.

00:42:29:03 - 00:43:01:24
Unknown
You know, there's sonnet, which is like middle of the road, and then there's opus, which is or was their top of the line until fable came along. And then fable was like, you know, one step even further. Sonnet is good for most things. Sonnet four I use for most of what I do, unless I want to do some sort of like deeper kind of structural based analysis or knowledge kind of evaluation or whatever framework.

00:43:01:24 - 00:43:26:19
Unknown
You know, if I'm creating a framework around something, I might use opus, but then I kind of fall back to sonnet for most things. Why? Because it's less expensive and it's it's capable enough. Like, I rarely ever am going, oh, wow, I should have not done that. Well, now sonnet five is the next one, and they are saying that it's close to opus 4.8 on a benchmarks, while also staying at one third of the price.

00:43:26:19 - 00:43:46:08
Unknown
So sound you know, again, I mean, these things change all the time, but probably going forward I'm going to be using this on a five and maybe in some of the ways that I would have used opus 4.8, I don't know, that's I can't imagine most consumers, most users rather becoming sophisticated about about which model to use.

00:43:46:13 - 00:44:13:03
Unknown
Totally. No, I totally get it because yeah, it is confusing. Didn't open AI used to have like an automatic mode? Maybe they still do to try and alleviate that, to be like, oh, you don't know. There's various things that do that. Yeah, yeah, yeah, yeah. I know when I talk to my wife about this, I recognize how how much I've developed my understanding of why I use this for that versus that for that.

00:44:13:03 - 00:44:33:06
Unknown
And I don't think about it much until I'm explaining it to somebody else, like I'm. Oh, no, no, you wouldn't use opus for that, Stacy. You'd use sonnet for that. And she's like, how the hell do you know that? I think I think you're right. Most people just wouldn't track it close enough to really get a sense of understanding around that, you know?

00:44:33:08 - 00:45:02:15
Unknown
But I think Gemini is clearer. Right? I go in there and I'm either using flash, which is pretty obvious, or I'm thinking which solves more problems, or pro, which does advanced math. Yeah, much clearer to me. Yeah. It kind of spells it out a little bit more for you. Like why you might, you know. But but I bet you still probably the everyday user who doesn't, you know, isn't steeped in this stuff, probably just goes there and opens up whatever the default is, throws it in there, you know what I mean?

00:45:02:19 - 00:45:37:26
Unknown
They aren't managing switching that. That is like a level up kind of thing, for a few different reasons. But anyways, Qualcomm is has announced a server CPU called dragonfly C 1000, a whole gaggle of ARM cores, 250 custom ARM cause they're claiming two times performance per watt versus the competition. And speaking of meta, Mark Zuckerberg was there, showed up in person to announce a multi-generational agreement for Qualcomm to supply CPUs for Meta's next gen servers.

00:45:37:26 - 00:46:01:24
Unknown
That's going to start in 2028. So meta relying all the chip companies man. All we're all chips now. I just felt so quiet until Intel which was dying not very long ago you know at all. Just look up today for curiosity. Its stock is up 6.4% today. That's all over. All over the map. Yep. Yeah.

00:46:01:26 - 00:46:25:20
Unknown
Gemini. Speaking of Gemini 3.5 flash getting computer. Actually, there's a few pieces of Google News that didn't end up in here. So since we have the time, I'll just I'll just rattle them off. But computer use coming to Gemini 3.5 flash. So a native as a native built in tool before this you might have needed a separate standalone model in order to do this sort of stuff.

00:46:25:20 - 00:46:50:25
Unknown
Now it's more fully integrated. That agent can do all the things across all the interfaces and everything without switching models, basically so defined computer use. I'm still confused. Computer used to my knowledge, and I use this with Claude, is kind of being able to tap into into like my browser controller stuff and then it can use your computer.

00:46:50:28 - 00:47:19:02
Unknown
Okay. Yeah. But what I don't know about Gemini is does that mean. Let me think about this. The the native built in tool. Does that mean that the Gemini app itself has control over the desktop of the computer that I'm using. Yeah. I'm not. That's that's a good question. I don't have clarity on that. One computer used.

00:47:19:04 - 00:47:36:16
Unknown
Uses computer use to explore the Gemini app and return a categories list of features. Okay, yeah, I'm not quite sure on that one. If it requires the app, like if you're using it in a browser, is it also going to have access to computer use? Because I know with Claude I have to be running the cloud app in order to do that.

00:47:36:16 - 00:47:58:10
Unknown
You can't do that out of the browser. I'm I'm guessing it's the same. Depends what you mean. I'm using only I'm on a Chromebook, so I'm using all Google apps. So yeah, I've had this all along. Google Gmail search sucks. It has for a long time. And now my new use for Gemini is there was this conversation I had about this and that and I can't remember find it and boom, right.

00:47:58:12 - 00:48:26:26
Unknown
It finds it. So I think that. And is that within, is that within a gal or it's Gemini, just a little Gemini thing. Is there in Gmail? Yeah. They're putting it all the different places and their personal intelligence and all that kind of stuff. Yeah. Let's see here the Gmail story. Let's see. Well, they so so basically they brought in Gemini live into Gmail as well.

00:48:26:27 - 00:48:46:22
Unknown
Or at least they're starting to kind of feed Gemini live into the Gmail search box, which is essentially, you know, it's more conversational. Talk about your inbox with, with the agent essentially. And yeah, so I just asked Gemini whether I could ask a question here about my Gmail content. And it's absolutely fire away. Just a quick heads up.

00:48:46:22 - 00:49:14:03
Unknown
I don't have direct live access to your actual Gmail account privacy first, so I can use Gemini in jail, but I can't use Gemini to go to jail. It's a little confusing. Yeah, that can't be a little confusing. Yeah. And then Google also announced that they're bringing nano banana image generation into the Gemini app for for everyone for free used to be limited to plus Pro and Ultra users.

00:49:14:04 - 00:49:31:09
Unknown
This is the personal use you know personalized and yeah, with the with the personal intelligence that personal context so that you don't have to feed it a bunch of information. It kind of ties in. And again, some people are going to have a problem with the privacy implications of something like that, but it is opt in after all.

00:49:31:09 - 00:49:50:08
Unknown
So yep, yep. If you feel comfortable with it. It is pretty interesting. It's interesting to do like image stuff and not to have because I'm very used to like feeding it like, here's five images of me now I want a pose of me with blah blah blah or whatever. And now, because it has access to the Google Photos, it can just kind of like it.

00:49:50:09 - 00:50:29:02
Unknown
It knows what I look like, all my photos and Google photos, you know, it's getting really good. I mean, the representation that I can do is really impressive. There was a new nonprofit called Raise Us that is like a collective backed by Amazon, Anthropic, Microsoft, OpenAI Foundation, Bank of America, GM, IBM, Eli Lilly, probably more. And this is essentially the companies that are building AI that is, well, basically just guilt about their, what they're doing.

00:50:29:04 - 00:50:56:19
Unknown
Yes, exactly. They're like, well, we're putting these people out of out of a job. We should probably do something to, you know, work on a program to retrain them in some way, shape or form so that Gina Raimondo, former former governor, is the head of it? I heard her on Ms.. Now the other day, and it sounds a little nebulous, but still well intentioned and perhaps decent, you know, things like internships and and retraining and stuff like that.

00:50:56:19 - 00:51:21:07
Unknown
I think if it's if it's well focused, good. They should be doing more. Meanwhile, related to this from the bottom of the page. So I'm really amused by the Ford story they used. AI is the excuse to get rid of 350 senior engineers, and then said pretty quickly, and they're trying to hire them back. Oh, no. That that fun story.

00:51:21:08 - 00:51:43:08
Unknown
Yeah, yeah. So before you, you know, retrain people for another job, maybe you still needed for the job they had. Yeah. Be real certain because that's that's not a good look. No not not a good luck to get rid of it. And they realize oh wait a minute. My bad. Would you come back.

00:51:43:10 - 00:52:21:14
Unknown
Let's see here. What else do we have. Oh OpenAI and Broadcom collapsed on a inference chip. This is actually OpenAI's first custom silicon. It's called jalapeno. And yeah they they did the design to manufacturing in nine months OpenAI claims that that's the fastest ASIC delivery sorry development cycle in high performance semiconductors. And they used their models to help develop of course, because yeah, the AI is all helping to create itself at this point.

00:52:21:16 - 00:52:42:10
Unknown
So they're looking to deploy this at the end of at the end of the year. So since we have a few minutes I'll throw in another one of them. Yeah. If you go to line 118. So McKinsey put out a report on how advertisers are using AI. What interested me is the five capability pillars of AI. First, marketing.

00:52:42:10 - 00:53:08:08
Unknown
If you scroll down for a bit of what it can do for you, continuous insights right. You can constantly get data on people tied to always on orchestration. You can change your your campaigns and such immediately. But the other stuff that was more interesting to me was in the middle of this list. First is scaled creativity, right? Which is to say, eliminate the creatives and create 100 different versions of an ad that you can test.

00:53:08:08 - 00:53:32:02
Unknown
And they're clearly doing this now. They're dying to do this. And so it's not just a simple A and B, it's A to Z testing I'll bet. Yeah. Second is hyper personalization that you can now create tremendously personalized versions of ads with very little data and make them more responsive. And then the thing we've talked about a lot in the show is marketing to AI agents.

00:53:32:04 - 00:53:57:14
Unknown
Yes. Which I think is really critical here. It's optimized for large language models and agents, ensuring discoverability, trust and commerce across AI native journeys. To use the McKinsey jargon here. So that's all really interesting. The one thing that drives me bananas here, if you scroll down just a little bit and continuous insights marketing teams can chat with synthetic personas instead of using traditional focus groups.

00:53:57:19 - 00:54:22:09
Unknown
Well, yeah, you can save money, but they're not real people. They're made up. That's not the same as talking to your customers. You have actual customers out there. Talk to them. Go to a store, stand by the shelf, talk to them. Get insight that way. It drives me crazy that we have opinion polling and focus groups, which are enough of a separation from people and it abstracts them, and now they don't even want to talk to people.

00:54:22:12 - 00:55:01:12
Unknown
Your customer becomes this, this abstract notion out there. Maybe with machine stop. It's bad. Yeah, yeah. I mean will will customer service bots ever be good enough to where the human is? Fine with it, you know what I mean? Well, that's that's after you bought the thing. What, what? I'm. Yeah, I've argued for some time since I wrote my early books, that the aim is to move the customer farther up on the chain, that now you only get to the customer, maybe at market research.

00:55:01:14 - 00:55:29:24
Unknown
But if you move the customer up the chain to be part of testing products before you fully commit to them or further up the chain, getting inspired by what products to make because you know them or further up the chain. You enable such personalization that I can get something that's customized. For me, that should be the goal is to move the customer up, but instead they're just so customer human phobic, and that instead they're going to try to keep on saying, well, this is what we want to make.

00:55:29:24 - 00:55:46:15
Unknown
So how do we convince you to buy this? Because that's what ad agencies do. Companies should be reconsidered considering this fundamentally, because it gives them the opportunity now to be more connected with these customers. Instead, they're using it to be less connected.

00:55:46:18 - 00:56:07:13
Unknown
My rant. Love it. So that is the McKinsey and company report will have a link in the show notes for that as well. All right, we did it. I think we did it. Volleyball time. Yep. I'm I'm seeing volleyball player circling. And I'm not entirely sure that she's eating any lunch beforehand. So I need to make sure that.

00:56:07:13 - 00:56:32:03
Unknown
So Jeff Jarvis. Com to preorder your copy. Right. Right of hot type. But you can also find all of Jeff's other work the Gutenberg Parenthesis magazine and the web. We've amazing, amazing stuff. And if you need any advice on or you can answer that next week where that's fine. If you need advice on podcasts and how to make them operate, nobody better.

00:56:32:03 - 00:56:51:09
Unknown
Then there's a guy, Jason. There's a guy I want to invite you to, and it's it's me. So if you go to pontoon up com, you can actually schedule a 30 minute chat with me. I'll chat with you. Hey, let's talk about your podcast. Why not? Yeah. And maybe there's a way that I can help you with it, so let me know.

00:56:51:12 - 00:57:15:03
Unknown
Let's see here AI insight show for all the information you need to know about everything that we're doing, including last week's wonderful interview with Liz Reed from Google. So check that out. AI inside Dot show store for products. Not getting a lot of orders, but that's okay. You know what? This is what you don't want to look for like this I know you want a hat like that.

00:57:15:03 - 00:57:41:18
Unknown
I'm telling you, you do want a hat. So those on audio, you need to go to the store to see what you're missing right now. That's right. AI inside on Patreon, Patreon.com, AI inside show. And we have some amazing patrons who help us each and every week. We we read their names out because they are that tip of the hat to Doctor Do Jeffrey Marikina radio 1 to 3.7 Dante, Saint James, Bono, Derek, Jason I for Jason Brady, Anthony.

00:57:41:19 - 00:58:02:27
Unknown
Downs, Mark. Starker, Karsten. Tip of the hat. Oh, I don't have my hat right next to me like I normally do, but that's okay. You do. You're wearing it, you're wearing it and you're proud of it. And and also just a huge thank you to Daniel. Thank you to Victor who helped us behind the scenes. Every one of the video stuff each and every week.

00:58:02:27 - 00:58:20:12
Unknown
Really appreciate that. And then you'll we're always happy to see you here with us. Thank you very much. Yes, indeed. Yes. Always here for the live show. Love it. All right. Thank you, everybody, for watching and for listening. Thank you for understanding. A day early on the episode. We will be back next Wednesday. Same bat time, same bat channel on AI inside.

00:58:20:14 - 00:58:22:07
Unknown
Take care of everybody by.