The Awkward Key to AI Going Forward: the iPhone
OpenAI's Device • Xbox Shakeup • Perplexity's Pivot • NVIDIA's OpenAI Investment • OpenAI's Financials • WaPo Shitshow • Seedance v. Hollywood • Meta v. Reality • More...
Just back from a week in Dubai — hence sending on a Sunday. Below, find some things that I read and wrote while on the road…
One narrative that I feel like will become clear over the next year or so is just how crucial the iPhone will become for a lot of AI. First and foremost when Apple gets its AI act together (thanks to Google), it will be the device that once again introduces many people to the technology (thanks simply to its scale), but also how it’s likely still be the main hub for all of the newfangled AI-enabled devices coming to market. Including those from, yes, Apple. This all could shift the AI narrative around Apple in a hurry…
📲 Apple’s Next Big Thing: the iPhone
A rush of AI devices – including from Apple – may end up as a reminder of which company is in control here...
🗣️ Can OpenAI Build Alexa Before Amazon Can Build ChatGPT?
Actually, their impending partnership may start to make more sense...
I Note…
🕹️ Ex Marks the Box
Phil Spencer is out — a move which seemed to be written on the wall last year, as I wrote at the time. And, sure enough, Microsoft’s and Spencer’s stance is now that the wheels have been in motion for the move since last year — though that may contradict some other statements and actions at the time… read into that what you will. Same with the fact that President Sarah Bond isn’t the one succeeding him, but instead is also leaving the company. Instead, Asha Sharma, who is relatively new to Microsoft and, notably, has no gaming experience/background is taking over. There are, a number of weird flags here obviously. But that’s also not too surprising as Xbox and Microsoft’s broader gaming strategy has seemingly been a mess for a few years now. So while the gaming world hates this move, perhaps a fresh set of eyes will be a good thing. Can it really be worse? As it stands, Microsoft was clearly on a course to shut down/spin-off Xbox and Activision, so this at least buys some time. Maybe one more "generation", as those now take forever to cycle through — Spencer technically only oversaw one such Xbox release himself, the Series S/E/X, or whatever it was called. I did appreciate Sharma’s use of "soulless AI slop" in her memo, but she also sort of had to say that as she is coming from… Microsoft’s "CoreAI" team. [IGN]
🔍 Perplexity’s Perplexing Pivot
Remember when ads were going to fuel Perplexity’s entire business? You should, it was just a few months ago. Well, so much for that. Look, they’re in a tough spot with Google having effectively outflanked them in AI Search and the actual model makers having further grabbed control of the chatbot market. So they’re clearly going to try to cut more Samsung-like partnerships and perhaps try to be a unified layer to query all AI services and get the user the best result. But it’s a tough road forward from here. And the cracks seem to be starting to show. Maybe there’s some window on mobile, given that — oddly — no one else is really going after this with mobile AI browsers yet. Still, I suspect they’ll be scooped up in 2026. [Wired 🔒]
💰 $30B is a Shit Ton of Money, But Also Not $100B
With NVIDIA finalizing their $30B investment into OpenAI’s latest round, we can probably put the "mystery" to bed. Maybe they’ll invest more down the line, but they’re very decidedly not saying that — in fact, they’re saying "no, no nothing like that" — which is weird when they not only previously said exactly that, but did a whole press tour around it. Anyway, it sure seems like Jensen got the message that such a deal — seemingly struck on a trip with Sam Altman as part of a Trump tour — was a bit rich for NVIDIA investors’ tastes. At first, it looked ingenious, as it helped propel the stock to $5T. But things quickly turned south and this suddenly looked like the marquee "circular deal" that everyone was pointing to for AI Bubble evidence. A nice, round $100B number will do that! But a $30B check as a mere part of a larger $100B round (with Amazon perhaps doing $50B)? That seems fine, I guess… [FT 🔒]
💸 OpenAI is Gonna Need that $100B — And a Lot More
The latest leaked forecasts put burn at $665B through 2030, when the company still expects to reach cash flow positive. That’s more than $100B up from their previous burn estimates. Yes, revenue is rising in those forecasts as well, but at what cost? Quite literally. The key thing to watch, obviously, will be if and when inference costs start to turn. Because right now they’re destroying margins. OpenAI had $40B in the bank at the end of 2025 which is… a lot less than $665B. As is even $140B. And so at some point — I’m still skeptical of 2026 — OpenAI is going to have to go public. But if Anthropic really does get to cash flow positivity two years earlier, it’s going to be rough optically, depending on the macro environment. Also, let’s just recognize that none of these numbers are going to be accurate in a couple of years — I mean, just look at these from not even 18 months ago. There are so many variables in all of this, but clearly OpenAI needs to get more control over their costs… [Information 🔒]
📰 Democracy Dies in a Money Pit
Tina Brown rightfully eviscerates Jeff Bezos for his handling of The Washington Post. In particular because it started so strong (albeit boosted by the chaos of the first Trump administration) and then seemingly fell off a cliff as his own vibe shifted. Regardless, I still just don’t see how they possibly got to the point of losing updward of $100M a year. The entire strategy, at least viewed from the outside, made Microsoft’s aforementioned Xbox strategy look positively coherent in contrast. Bad hires. Bad fires. No direction. No leadership. To quote the new Bezos buddy, "sad." To quote Brown, "…the stark truth that Bezos doesn’t understand how to run a news organization any more than Woodward and Bernstein could figure out how to deliver dog kibble to your door by drone." See also: Books section editor John Williams’ thoughts on how the paper has gone astray in the Bezos era. [Fresh Hell]
I Wrote…
🎬 DeepSeek 2: The Movie
The Seedance “End of Hollywood” likely points to the paths forward...
🥸 I Am the Great Glassholio!
Things are going well for Ray-Ban Metas... time to meddle!
I Quote…
"All of the people I love hate this stuff, and all the people I hate love it. And yet, likely because of the same personality flaws that drew me to technology in the first place, I am annoyingly excited."
— Paul Ford, writing about his love/hate relationship with AI in a NYT op-ed.
I Also Wrote…
🏔️ Netflix Calls Paramount’s Bluff
One week for both sides to show the actual cards here...
💻 Little? Yellow? Different?
A non-cutting-edge, but fun, affordable MacBook...
Asides…
Sounds like Amazon is suffering from a real bout of not-built-here-itis, which inflicts every large company and is always stupid — but especially stupid when it’s trying to stop teams from using Claude Code (in favor of their in-house Kiro) and you’re the largest investor in Anthropic. [BI]
Speaking of, an ode to Claude Code as it turns one year old. [Bloomberg 🔒]
Is Blue Owl Capital really a canary (in the coal mine) of data center debt? [NYT]
With the new low-cost MacBook seemingly imminent, I had been wondering what might become of the deal Apple has had with Walmart to sell the M1 MacBook Air? Well, supplies are dwindling fast, so… Unless there’s an M2 (or more likely M3) refresh coming, Apple may have effectively outsourced some R&D for the market to Walmart. [MacRumors]
Hadn’t really thought about it this way but sure seems like the new Studio Displays will have faster chips than these new MacBooks?! [Macworld]
Seemingly another damning indictment of Meta’s (new) AI strategy that Zuck couldn’t land the OpenClaw guy despite offering more money... [Sources 🔒]
Time to put your latest deal Manus to work! [Manus]
OpenAI also seemingly poached a key to Instagram in Charles Porch. Is this about getting Hollywood more comfortable with Sora? [Vanity Fair]
With all the F1/Apple news, I had forgotten that they opened the full MLS package to all Apple TV subscribers. With the season kicking off yesterday, it will be interesting to see if it moves any needles in terms of popularity. Since it’s now "free" I might turn some games on in the background? [MacRumors]
Speaking of F1, a new deal between Apple and IMAX will bring some of the races to the really big screen this year. Might this also be related to work being done for viewing the races in the Vision Pro? [THR]
A Game of Thrones (Mad King-focused) prequel to be staged at Stratford-upon-Avon? I mean, I didn’t move to England for nothing, right? [BBC]
We’re now one step away from a GoT claymation series so that GRRM can avoid finishing the actual books, right?
I kid, I kid. Have I mentioned how great A Knight of the Seven Kingdoms is? At first, it seemed a bit too cute for this universe. But now I think it’s the perfect mixture of whimsy and ultra violence. I also don’t mind how relatively short the episodes are! Though the season being only 6 episodes, with the finale tonight, seems cruel. But it also appears that we may actually get one new season a year — as opposed to every few years, cough House of the Dragon cough — thanks to that?
I Spy…
Speaking of Amazon and Walmart… It’s official, Amazon is a bigger business than Walmart. BUT. That’s in no small part because Amazon has AWS, a huge — and hugely profitable — cloud service which Walmart, of course, does not. "Without AWS, Amazon’s 2025 revenue would have been $588 billion." Still. A big moment. With Walmart having just passed $1T in market cap (though slightly below it now), Amazon has a roughly 2x lead there.
