OpenAI and Microsoft Tension Boils, Amazon’s Job Automation, Zuck’s Spending Spree

Summary

Big Technology Podcast Summary Host: Alex Kantrowitz
Episode: OpenAI and Microsoft Tension Boils, Amazon’s Job Automation, Zuck’s Spending Spree
Release Date: June 20, 2025

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Introduction

In this episode of the Big Technology Podcast, host Alex Kantrowitz delves into three major tech industry developments: the escalating tensions between OpenAI and Microsoft, Amazon CEO Andy Jassy's strategic memo on AI-driven job automation, and Mark Zuckerberg's aggressive acquisition strategy to bolster Meta's AI capabilities. Joined by Ranjan Roy of Margins, the discussion offers a nuanced exploration of these pivotal events shaping the technology landscape.

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1. OpenAI and Microsoft Tensions Escalate

The episode opens with an in-depth analysis of the strained relationship between OpenAI and Microsoft. Recent reports from The Wall Street Journal indicate that OpenAI seeks greater independence from Microsoft's control over its AI products and computing resources. This friction centers around OpenAI's desire to transition into a for-profit entity, a move that requires Microsoft's approval to secure additional funding and pursue an IPO.

Key Points:

• Profit Conversion: OpenAI's ambition to convert into a for-profit company is stumbling blockged by Microsoft's stringent terms.
• Antitrust Accusations: OpenAI accuses Microsoft of anti-competitive behavior, contemplating federal regulatory reviews and public campaigns as potential "nuclear options" ([02:55] Alex Kantrowitz).
• Financial Projections: OpenAI projects substantial revenue growth, anticipating $10 billion this year and $174 billion by 2030, which would result in Microsoft receiving approximately $35 billion from a 20% profit share ([05:29] Alex Kantrowitz).

Notable Quotes:

• Alex Kantrowitz ([07:10]): "OpenAI needed a partner like Microsoft to be able to get to the place where it is today... it's almost like the company surprised itself with how successful it's been."
• Ranjan Roy ([15:19]): "If anyone somehow could pull that off [changing deal terms], I don't know, Sam Altman's pulled off a lot over the last few years, so who knows."

Discussion Highlights:

• Control Dynamics: OpenAI's reliance on Microsoft for financial and computational support puts it at a disadvantage in renegotiating terms.
• Future Scenarios: Ranjan Roy speculates that despite contractual constraints, OpenAI may navigate through regulatory avenues or continue its trajectory without significant financial shifts ([05:33] Ranjan Roy).

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2. Amazon's Strategic AI-Driven Workforce Transformation

Amazon CEO Andy Jassy issued a memo outlining Amazon's vision for integrating generative AI and AI agents into its operations. Jassy asserts that AI will revolutionize work processes, leading to a reduction in the corporate workforce due to efficiency gains.

Key Points:

• AI Agents: Jassy describes AI agents capable of handling tasks such as web research, code writing, anomaly detection, and task automation ([28:19] Alex Kantrowitz).
• Workforce Implications: The memo suggests a future with fewer employees focusing on repetitive tasks, while new roles will emerge requiring AI proficiency.
• Employee Guidance: Jassy emphasizes the importance of employees becoming adept at using AI tools to remain competitive within the company.

Notable Quotes:

• Ranjan Roy ([33:57]): "If you have an AI-illiterate workforce, you're not gonna see the Technology is not gonna be enough to actually make it successful."
• Andy Jassy (paraphrased from memo): "There will be billions of these agents across every company and in every imaginable field."

Discussion Highlights:

• Efficiency vs. Employment: The conversation touches on the balance between achieving higher efficiency through AI and the potential impact on job security.
• Adoption Challenges: Ranjan Roy and Alex Kantrowitz discuss the realistic timelines for AI integration and its effects on different sectors within Amazon ([31:01] Alex Kantrowitz).

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3. Mark Zuckerberg's Aggressive AI Talent Acquisition

Mark Zuckerberg continues his spree of acquiring top AI talent to strengthen Meta's position in the AI race. This week, Zuckerberg attempted a $32 billion acquisition of AI startup Safe Super Intelligence, which ultimately declined. Nevertheless, Meta is in discussions to hire Daniel Gross, co-founder and CEO of Safe Super Intelligence, alongside former GitHub CEO Nat Friedman.

Key Points:

• Aqua Hire Strategy: Zuckerberg's approach focuses on acquiring exceptional talent rather than just the companies themselves.
• AI Superintelligence Lab: Hiring Gross and Friedman is expected to significantly enhance Meta's AI research and development capabilities.
• Industry Impact: These moves underscore the importance of human expertise in advancing AI technologies, complementing compute and data resources.

Notable Quotes:

• Ranjan Roy ([36:48]): "We’re seeing it again... rather than we're going to buy your customers or your product, it's actually we're just buying the talent and that's all that matters."
• Alex Kantrowitz ([37:44]): "If Meta can get Perplexity, it should do it. I think that would be smart."

Discussion Highlights:

• Talent vs. Technology: The focus shifts to the critical role of top-tier researchers and leaders in driving AI advancements.
• Future Projections: Ranjan Roy speculates on the potential saturation point for talent acquisition and the ensuing strategic directions Meta might pursue ([37:44] Ranjan Roy).

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4. The Impact of AI on Critical Thinking and Education

A significant portion of the episode addresses a recent study from MIT Media Lab, which suggests that excessive use of ChatGPT may be diminishing critical thinking skills. The study indicated that participants using ChatGPT showed lower brain engagement and performed worse in essay writing tasks compared to those using Google Search or not using any aid.

Key Points:

• Study Findings: ChatGPT users were less engaged neurologically and relied more on copy-pasting, leading to diminished performance over time.
• Public Reaction: The study received mixed responses, with some dismissing its validity and others recognizing the potential risks.
• Educational Implications: The conversation explores how AI tools necessitate a reevaluation of teaching methods to ensure robust cognitive development.

Notable Quotes:

• Alex Kantrowitz ([20:15]): "If you marry this style of learning with our current education system, you end up getting a disaster."
• Ranjan Roy ([24:38]): "The most optimistic part of this is the democratization of learning and access to knowledge, learning tools."

Discussion Highlights:

• Adaptive Learning Models: The need for integrating AI with interactive and critical learning approaches, such as the Socratic method, to mitigate negative impacts ([23:50] Alex Kantrowitz).
• Workplace vs. Education: While AI may hinder traditional educational processes, its application in the workplace could enhance productivity and innovation ([24:38] Ranjan Roy).

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5. Future of AI and Autonomous Systems

The episode concludes with speculation on the imminent arrival of Artificial General Intelligence (AGI), marked by milestones like Waymo's autonomous vehicle testing in New York City and Tesla's pilot programs in Austin.

Key Points:

• AGI Benchmarks: The hosts humorously propose the "WIN AGI" benchmark, capturing AGI's arrival through seamless autonomous operations in complex environments.
• Corporate Strategies: The discussions reflect on how companies like OpenAI and Meta are positioning themselves to leverage and lead in the emerging AGI landscape.

Notable Quotes:

• Alex Kantrowitz ([44:41]): "If Waymo starts rolling around New York without any drivers, you and I here on the show will declare AGI."
• Ranjan Roy ([45:07]): "Greatest marketing stunt of all time."

Discussion Highlights:

• Regulatory and Ethical Considerations: Potential scenarios where AGI integration could disrupt existing partnerships and contracts, exemplified by the hypothetical dissolution of the Microsoft-OpenAI agreement ([45:22] Alex Kantrowitz).
• Public Perception and Media: How significant technological milestones will shape public understanding and acceptance of AGI ([43:48] Ranjan Roy).

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Conclusion

This episode of the Big Technology Podcast offers a comprehensive overview of the latest tensions and strategic maneuvers in the AI sector. From the fraught relationship between OpenAI and Microsoft, Amazon's meticulous approach to AI-driven workforce changes, to Zuckerberg's relentless pursuit of AI talent, the discussions highlight the complexities and rapid evolution within the tech industry. Additionally, the conversation underscores the broader societal implications of AI advancements, particularly in education and critical thinking.

Upcoming Episode:
Next Wednesday, the podcast welcomes legendary investment analyst Tom Lee, promising insightful discussions on technology and investment trends.

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Notable Timestamps:

• [00:32] Introduction of main topics.
• [02:55] Discussion on OpenAI's for-profit conversion and tensions with Microsoft.
• [07:10] Insights into the control dynamics between OpenAI and Microsoft.
• [28:19] Analysis of Andy Jassy's AI-driven workforce memo.
• [36:48] Mark Zuckerberg's talent acquisition strategy.
• [20:15] Impact of AI on education systems.
• [44:41] Speculation on the arrival of AGI with autonomous vehicles.

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For listeners interested in the intricate dynamics of the technology sector, this episode provides valuable perspectives and expert analysis, ensuring a well-rounded understanding of current and future trends in AI and beyond.

Transcript

[Kwame Christian]

Hi, I'm Kwame Christian, CEO of the American Negotiation Institute, and I have a quick question for you. When was the last time you had a difficult conversation? These conversations happen all the time. And that's exactly why you should listen to Negotiate Anything, the number one negotiation podcast in the world. We produce episodes every single day to help you lead, persuade and resolve conflicts both at work and at home. So level up your negotiation skills by making Negotiate Anything part of your daily routine.

[Alex Kantrowitz]

Microsoft and OpenAI have some major differences and things are getting heated as OpenAI moves to its next stage. Amazon CEO Andy Jassy says AI will reduce his workforce and Mark Zuckerberg keeps spending for top talent. That's coming up on a Big Technology Podcast Friday Edition, right after this. Welcome to Big Technology Podcast Friday Edition where we break down the news in our traditional cool headed and nuanced format. We have so much to speak with you about this week because the AI news cycle just rolls on with bigger stories each week. We have a fascinating battle between Microsoft and OpenAI that's just really heating up and might eventually prevent OpenAI's for profit conversion. You also have this very interesting memo from Andy Jassy about generative AI and what it might mean for Amazon's workforce. And of course, Mark Zuckerberg is spending that cash and doesn't seem like he's stopping. So we'll pick up that thread from last week. Joining us as always, on Fridays to do this is Ranjan Roy of Margins. Ranjan, good to see you.

[Ranjan Roy]

Good to see you. AI news doesn't sleep another, another week.

[Alex Kantrowitz]

Sure doesn't. Never a dull moment. And leading this week is this really interesting conversation that we've, we've had on the show and we will continue to have because it could influence the future of the AI industry. And that is what's going to happen with OpenAI and Microsoft. This is from the Wall Street Journal. OpenAI and Microsoft tensions are reaching a boiling point. Tensions between OpenAI and Microsoft over the future of their famed AI partnership are flaring up. OpenAI wants Microsoft's grip on its AI products and computing resources to loosen, and it also wants to secure the tech giant's blessing for its conversion into a for profit company. Microsoft's approval of the conversion is key to OpenAI's ability to raise more money and go public. But the negotiations have been so difficult in recent weeks that OpenAI's executives have discussed what they view as a nuclear option, accusing Microsoft of anti competitive behavior during their partnership. That effort could involve seeking federal regulatory review of the terms of the contract for potential violations of antitrust laws as well as a public campaign. Well, what do we call this? The not so gentle singularity. I mean this escalated in a hurry.

[Ranjan Roy]

So a few points on this. I think we'll definitely get into the for profit company conversion which is incredibly complex we've talked about for months and months and months. Like, like let's not even forget, remember Elon Musk sued over this conversion. They're getting hit from many different sides. And the fact that Microsoft is actually kind of acting as a hurdle is definitely a big issue. And that can prevent them from $20 billion of that sweet Masa Sun SoftBank money. So that's going to be a huge issue for OpenAI this year. But the federal regulatory review of anti competitive behavior. I love this. I mean they are saying that the deal that they struck is anti competitive from what I understand. Like what else could it mean? They're saying the money we took from Microsoft and then that whole arrangement is bad for the industry and us. OpenAI as well. But can you read it another way?

[Alex Kantrowitz]

It is bananas. I mean it's one of Those things where OpenAI needed a partner like Microsoft to be able to get to the place where it is today. Because of course the most important ingredient in growing its products up until this point has been compute. And what did Microsoft had had that compute? What was OpenAI? It was a nonprofit. I mean it's interesting because the ambitions were artificial general intelligence. So it wasn't like OpenAI wasn't thinking big. But it's almost like the company surprised itself with how successful it's been. It's almost like it wrote in that clause in the contract that both enter entities wrote in that clause in the contract that OpenAI and Microsoft's deal dissolves once OpenAI hits AGI. Not really thinking that that would ever be possible because now it's really coming into a place where they are going to, they're going to have to work through these issues. And we right now have OpenAI owing I think 20% of its profits to Microsoft. This is coming from the information. OpenAI wants Microsoft to have roughly a 33% stake in the reshaped unit. And in exchange for forgoing its rights to future profits if the companies don't change the 20% cut OpenAI owes to Microsoft, Microsoft could be in line to get 35 billion in payments in 2030 when OpenAI has projected it will generate 174 billion in revenue. Now OpenAI is on track to generate 10 billion in revenue this year. So that's one hell of a projection.

[Ranjan Roy]

It's a good projection, It's a good extrapolation. You got to wait in this.

[Alex Kantrowitz]

Yeah, kudos to the person who put together the spreadsheet and kudos to whichever investor believe the PowerPoint. Yeah, it really does come down to this is like OpenAI again. They made the deal, they needed what Microsoft had. They agreed to like, all right, if we're doing really well, you're going to do really well. I don't see where OpenAI has the wiggle room to back out of this.

[Ranjan Roy]

Well, they certainly have the wiggle room when Waymo comes to New York City and we declare AGI, which we'll get into later. But, but no, no, I agree that from a pure financial standpoint or a pure contractual standpoint, they don't have a lot of wiggle room. They don't even have leverage. Which is why I think that Hail Mary of the, whether it's through the FTC or that anti competitive review, it feels like a Hail Mary. But it is because I don't think OpenAI has much standing in any other direction. But again, I think going back to, as you said, they're on track to make 10 billion. They're losing tons of money. Microsoft's share is in the profit, not revenue. And there's no sign that they're going to be turning a profit even though they're projecting one by 2029. So I think in a certain way a lot of this is moot anyways other than like from a financial standpoint because the money is not going to actually change hands based on any kind of like current trajectory of revenue and profit. So it really is about control and I think like it's telling that they are, they're competing incredibly directly. Like we're seeing it more and more. They're going after the same use cases, customers, audiences.

[Alex Kantrowitz]

I want to talk a little bit about the control part because that is I think crucial. So this is also a new detail that emerged in the reporting this week. The deal with Microsoft is that Microsoft gets the right to use OpenAI's IP through 2030, which by the way, if you do the math is like well beyond a lot of these lab leaders predictions for when we get artificial general intelligence. I don't, I don't, I don't know. I'm, I'm not bought in that AGI is going to be here by 2030. But we'll luckily hopefully we'll be doing the show and if it does, I'LL you know, eat crow on the air and put together my army of millions of agents to shame me on Twitter or whatever it is. But but I'm going to create an.

[Ranjan Roy]

Agentic workflow just to shame Alex for when AGI is declared.

[Alex Kantrowitz]

I really wouldn't be very different from all the bots on Twitter that came after me for my perplexity acquisition take. But anyway, I digress. But there's another this control is important because it's not just OpenAI's IP. The areas that OpenAI is expanding to also will end up competing with Microsoft and also are of interest to Microsoft to control. So here's another detail from the journal story. OpenAI at Microsoft are at a standoff over the terms of the startup's $3 billion acquisition of the coding startup Windsurf. Microsoft currently has access to all of OpenAI's IP, but it offers its own AI coding product, GitHub Copilot that competes with OpenAI. And OpenAI doesn't want Microsoft to have access to Windsurf's intellectual property. I mean if we think that coding is going to be one of the big applications of gen AI in the near term, this is really bad for OpenAI because it effectively the deal that it struck again serves to put it in service of Microsoft and not expand its own offer.

[Ranjan Roy]

You know what, maybe I am starting to feel this anti competitive posturing a little bit because I guess it's true they are competing incredibly directly. Like right now even Microsoft Copilot across The entire like 365 ecosystem competes very directly with ChatGPT Enterprise. Like basically this kind of always on assistant and agent it's a direct competitor and I'm sure in like when salespeople are going in and there's been more reporting that salespeople at Microsoft have been complaining that they charge $30 per user per month ChatGPT Enterprise it's competing directly but they could be discounting it meaning they're trying to undercut Microsoft's pricing, which is kind of hilarious because they're heavily invested and part owned by Microsoft. But I think overall it does present a good amount of problems in terms of they're trying to do the same things, going after the same customers, probably indirect competition with when going through any kind of enterprise sales cycle. So at some point something has to give and one could argue that Microsoft by giving its compute because of its size as this tech giant is acting in an anti competitive bullying fashion. So maybe if Lina Khan was still here she might agree, but she's not.

[Alex Kantrowitz]

And let me point again to the fact that OpenAI signed the deal. This is your deal. You signed it. You wouldn't be here without it.

[Ranjan Roy]

Wait, I want, I'm trying to think of an example where a company ever took a lot of money and then calls that funding or acquisition anti competitive. I mean it actually, how could it happen?

[Alex Kantrowitz]

You know what you call that? It's the, the Sam Altman special.

[Ranjan Roy]

Yeah, the Sam Altman Special. Give me money and then I'm going to go and say that you're bullying me for giving me that money and investment.

[Alex Kantrowitz]

But also if you think about it, Microsoft holds OpenAI's financial future in its hands as well because it's a capital intensive field, shall we say to, to put it lightly, AI you need money to build servers to grow. We have this stargate thing that OpenAI is trying to build. Your funders are not going to really be into giving you all that money if Microsoft really has control over your future or control over your a good chunk of your sizable profits. That's why I think softbank told OpenAI you better convert to a for profit or we're not going to, or we have the right to withdraw our money. So I just want to ask you this, Ranjan. I mean what does OpenAI have to stand on here? Again, funded by Microsoft, really built by Microsoft, competing with Microsoft. Am I crazy that OpenAI shouldn't be able to dictate the terms to Microsoft? Like where in Microsoft interest is it to change this deal?

[Ranjan Roy]

No, no. Okay, I agree. In any normal like flow of logic they would have no right to dictate the terms given they, they took, not only took the deal, they probably pushed the deal themselves to work like this because it basically rather than kind of like traditional venture funding where they would have had to be growing even faster, seeing more returns more immediately. It really was this sweetheart deal where it was just kind of a lot of compute, a lot of like future looking projections and possible financial returns. But I mean it was a pretty sweet deal for them. And to try to say that it was problematic or back out of it now again is ridiculous. The Sam Altman Special. But it is becoming more, I don't want to say existential, but it's becoming more problematic right now the way this is unfolding.

[Alex Kantrowitz]

Do you think Microsoft may just say to OpenAI, sorry, I know this is important to your future, but this is what we agreed upon. So even if you're worth a little less in the future because of your inability to spend the money you need to get bigger. We're just going to keep it as is. Thanks for playing.

[Ranjan Roy]

Yeah, I think they're going to have to. And again, like, there's been a lot of chatter around in terms of like the success of Copilot products and whether they're actually working or how happy people are using them versus ChatGPT Enterprise. And OpenAI on the product side keeps swimming along. So at a certain point maybe Microsoft does start to be a little bit anti competitive and a little bit bullying and they have the deal in the contract to allow them to and OpenAI signed that deal. So I could definitely see it start to explode. I think this, the more I'm thinking about this, this is going to explode in some direction this year.

[Alex Kantrowitz]

And again, like, I don't see how this is anti competitive. I mean it's simply a company trying to hold another company to the deal that it signed. And if you think about it, Microsoft has already been more than generous in allowing OpenAI to go and work with other companies for compute. It's allowed it to work with Oracle for Stargate and there's recently news that it's going to work with Google to build the infrastructure it needs to run.

[Ranjan Roy]

I'm trying, I'm trying here to, to take the other side in the interest of nuanced conversation, trying to figure out what could be anti competitive. But I mean, I don't think it is in this context, in another context where like, like Microsoft, again, Microsoft using its ecosystem to push its own products in a preferential way. In any other context you can start to see how that's kind of like classic anti competitive behavior, but not when it's the company that you funded and gave them all the good terms and sweetheart and like part, I don't know, like it. We will take, you know, projected profits down the road even though you're losing billions of dollars and that's all we're asking in exchange for giving you billions of dollars of compute and, and cash. Like, I mean, yeah, I tried, I tried.

[Alex Kantrowitz]

I'm just imagining the meeting between Sam Alton, Sam Altman and Satya Nadella. Where Sam goes, Satya, you helped OpenAI become what it is today. We owe you billions of dollars. But here is a different idea. How about we owe you less billions of dollars?

[Ranjan Roy]

I mean that is exactly what this is. If anyone somehow could pull that off. I don't know, Sam Altman's pulled off a lot over the last few years, so who knows?

[Alex Kantrowitz]

I can just imagine Satya Nadella just like hating this guy. Right now.

[Ranjan Roy]

Yeah. But also, let's not forget there is a political element of this that could kind of start to filter in if this, if they're serious. And this really starts to kind of move into the realm of like federal review. Let's not forget that Sam Altman and the Stargate announcement got some, got some good press for the administration. I'm not sure at this exact moment where he stands with the administration. But like, overall he's had some good moments. Satya. I don't think Satya was at the inauguration. Right, Correct. Yeah, yeah, yeah, exactly. So like maybe starting to use that as a, as a lever in this negotiation. Could be one way maybe.

[Alex Kantrowitz]

But I think we like, we started the Trump administration with like Zuck and Sundar and Bezos and Musk all behind Trump in the inauguration. But he, you know, as tends to happen in politics, he has bigger things to worry about right now. The tariff stuff, the trade war. I don't think he even remembers who Sam Altman is. And I think that's fair. And now imagine, you know, you mentioned OpenAI and Microsoft selling the same thing, whether it's ChatGPT Enterprise or Copilot. Right. Very similar. Imagine you're open AI and you are going to go into federal court to argue or make some plea that to argue Microsoft is anti competitive and you're doing this. This is from, this is from the information. A software company that has, that had purchased OpenAI models through Microsoft over the past years was in talks to sign a new agreement to spend 8 million on the models over the next three years, according to a Microsoft salesperson involved in the talks. But that firm notified Microsoft that OpenAI had offered it a 20% discount on the same models, reducing the cost over three years by $1 million. Microsoft salespeople asked the company's finance department if they could match the discount, but were rebuffed. As a result, the firm told Microsoft that it was choosing to buy the models through OpenAI instead.

[Ranjan Roy]

I mean, this is exactly, this is exactly what must be happening now and is going to only grow in scale these exact kind of negotiations. And again, Microsoft is a publicly traded company that has to show like certain projected financial metrics. OpenAI can light cash on fire right now. So they can be pretty aggressive and literally undercut at every step of the way using Microsoft's case capital and cash and compute.

[Alex Kantrowitz]

Could you imagine being that salesperson? I mean, that's a pretty nice commission on an $8 million deal, I would imagine. Yeah, have that taken from underneath you Same model from OpenAI, this partnership is, is in trouble. So let's just look ahead. Ranjan, what do you think is going to happen with OpenAI and Microsoft? Like what are your, the scenarios you're thinking about?

[Ranjan Roy]

I, I Somehow still think OpenAI comes out ahead mainly because the product at the consumer level at a, like it's not going to just be crushed by Microsoft in that conventional way anytime soon. I think from like a courtroom, contractual legal standpoint, I think Microsoft certainly has both like standing and like the legal firepower to, you know, hold this over OpenAI. But I don't know, I, I, I don't see how what Microsoft can do to stop this at this moment. Like they can't be like, just shut it down. They can't be like, don't you have a separate salesforce? But you are not allowed to undercut our pricing. So what, what could they do?

[Alex Kantrowitz]

I think that they just say we're not making, we're not going to budge an inch and we're not going to let you get this money, we're not going to let you IPO unless we get some better terms, stuff that like holds to the earlier agreements that we had and maybe they end up owning 40% of the company or something like that and everybody just has to go about their business. But I don't think Microsoft, you know, made the, what some people called like the tech bet of the century in OpenAI only to lose it because OpenAI worked.

[Ranjan Roy]

Oh, that's okay. I can, I can agree with that. I think it's, yeah, I think that's a good way to put it.

[Alex Kantrowitz]

I have an idea why Sam Altman may have thought this would work with Microsoft.

[Ranjan Roy]

Go on, go on.

[Alex Kantrowitz]

That is that he's using ChatGPT too much because there was a study this week and written up in time that ChatGPT may be eroding critical thinking skills. Here's the story. Does CHAT GPT harm critical thinking abilities? A new study from researchers at MIT Media Lab has returned some concerning results. The study divided 54 subjects, 18 to 39 year olds from the Boston area into three groups and asked them to write several Sat Essays using OpenAI's Chat GPT, Google search engine and nothing at all. Researchers used an eeg. I guess that's yeah, it's a machine that records writers Brain activities across 32 regions and found that of the three groups, ChatGPT users had the lowest brain engagement and consistently underperformed at neural, linguistic and behavioral levels. Over the course of several months, ChatGPT users got lazier with each subsequent essay and often resorted to copy and paste. By the end of the study, there were some people on X that were being like, look at the way that these people design this study. They hate AI. They were trying to set traps for people to fall into it. Study's garbage. I, I, my reaction here is totally not surprising. I mean, are we, are we even going to debate that this is happening?

[Ranjan Roy]

Well one, if Microsoft investing in OpenAI was the tech bet of the century, I think you just nailed the segue of the century with that transition right there.

[Alex Kantrowitz]

I'm trying man.

[Ranjan Roy]

But okay, so this study I was thinking about a lot because like how or if generative AI will totally alter our brains is something I have wondered about. Like I always think of maps and I literally, like I grew up in the Boston area and when I was first driving and before any kind of Google Maps, I literally knew how to get all over the city, all around my town, just by memory. I've been in New York for many years now and have a car now and I cannot get to JFK or LaGuardia driving without Google Maps. Like I don't know directions from driving. But I think that's okay. I mean if, if the entire like Internet collapsed, I might be in a little trouble there. But the way I learned kind of location is completely changed. But I can now do it at a scale that was unimaginable before. I can go into a new locate locality and like just move around and navigate. So it's a different way of using the brain. I think this is again writing an SAT essay was already it's such a specific kind of mindless thing. I think like in reality the act of doing it is not actual like intelligence in my mind. And I say this as someone who went through the process, it's like so to use that really specific thing I do think is kind of misleading because taking a very mindless task and then of course the person using ChatGPT, it's not going to trigger the level of brain activity because it was already a mindless task anyways. And it's perfect for generative AI. So for me, I think our brains, the way we learn is going to change. I think that's good. We have to adapt the way like learning is done for generative AI. But I don't think people are going to get dumber. Maybe that's optimistic.

[Alex Kantrowitz]

But I think this is one of the points is a lot of the stuff, let's say you're thinking about using this for Work. A lot of the stuff that you're doing at work will get your brain sort of deep into the material and help you think critically about a broader business activity. I'm just saying this for this sake of argument because I do believe LLMs could be like really useful in the workplace. I don't, I think less of that in education. Like if people are going home not just writing their SATs, but like writing like essays for class, they're not gonna retain anything because you actually, the pain that you endure in that writing is where you retain. But I actually like just to sort of move from education to work. I wonder if this will make better workplaces if people are using more AI and whether it will make more competitive companies if people are using more AI because of the impact that it could have on the brain.

[Ranjan Roy]

Hold on, hold on. Just quickly on the education thing, I think it really is going to demand like rethinking how the classroom works. And I think that's good. Like writing essays. As you said it was the enduring. The pain of writing is where you learned in the past that potentially goes away. But like presenting the essay, having to be able to defend it, like more Socratic learning. Like do, do you think this is going to be net bad for education or do you think we just have to update the way we teach?

[Alex Kantrowitz]

I think we've had this discussion before. I am, I'm hopeful that we can find a way to teach better. But I think if you marry this style of learning with our current education system, you end up getting a disaster.

[Ranjan Roy]

I won't argue with that. I guess the flip side then you also get into. To me, the most optimistic part of this is the democratization of learning and like access to knowledge, learning tools. Like now the fact that anyone in the world can, wherever you are, just with an Internet connection can actually like create entire curriculum tailored to you. Like I think it's going to really be good for, for learning at a large scale. I think in isolated cases, a couple of 18 to 39 year olds in Boston writing an SAT essay. Yes, that format is not going to be good and it's going to be change. Like people will just cheat their way out of it and not actually develop their brain. But I kind of look at this like what YouTube did for learning. This is going to be at like a thousand X scale.

[Alex Kantrowitz]

Yeah. So Dwarkesh, after we turned the cameras off for our conversation on Wednesday was like, yeah, I just basically dropped stuff like papers I'm trying to Learn and have ChatGPT use the Socratic method and help teach me that way. So I think, yeah, hopefully we will develop new modes of learning, but I also think we're living at a time where we've known we need new modes of learning for a long ass time. And we're still doing the rote memorization and spit back stuff that we've been doing forever now. I'm sure they're going to be education professionals who are listening to this, who are going to know much more than me and say that there are areas where this is improving. I don't doubt that, but by and large I think my generalization about the education system really across the globe holds true. So let's talk about work because we have limited time today and we should definitely get it to this Andy Jassy message to Amazon employees about AI in the workplace. He says we have strong convictions that AI agents will change how we all work and live. Agents let you tell them what you want, often a natural language, and do things like scour the web and various data source sources, summarize results, engage in deep research, write code, find anomalies, highlight interesting insights, translate language and code into other variants, and automate a lot of tasks that consume our time. There will be billions of these agents across every company and in every imaginable field. There will also be agents that routinely do things for you outside of work, from shopping to travel to daily chores and tasks. Many of these agents have yet to be built, but make no mistake, they're coming and coming fast. Can I just pause here before we get to the fact that he's going to sort of now, you know, soon pledge to decrease Amazon's workforce to be like, come on, I mean, we've heard this promise for how many years now and it's not there. And what makes him so confident? And of course he's closer to the technology than I am, but what does he make it? What makes him so confident to think that this is going to happen?

[Ranjan Roy]

I would, I would push back. I think the vision that's being presented is going to happen in terms of like timescale. When that happens. I think like again, the same way learning has to change. Work is definitely going to change. A lot of the repetitive things that we've all done over and over again start to be automated in some way. I mean, even thinking about like this podcast, being able to upscale our audio, being able to edit very quickly, getting video clips from Riverside, like this is something that would not have been possible a few years ago, even like two years ago at the scale that we're able and quality we're able to do for our listeners. Little plug there. But you know, like, overall, I think it's definitely going to happen. I think I'll agree that it's in every CEO's interest to say this, especially if you're a publicly traded company. It just is kind of easy to say we're going to be getting efficiency gains and stuff, but, but I do think from a messaging standpoint, it's important because this will force the workforce to actually start learning how to use these tools. And I think, I think that's whoever, whichever companies like, figure that out. And I've thought about this a lot, like, are the winners of the next decade going to be AI first AI native companies or is it going to be giants that actually are able to transform themselves? And right now it feels like it could be AI native AI first companies. So I think the giants gotta get moving a bit more.

[Alex Kantrowitz]

Yeah, you're hitting on it. So here's Jassy's. Another paragraph from me says as we roll out more generative, more generative AI and agents, it should change the way our work is done. We will need fewer people doing some of the jobs that are being done today and more people doing other types of jobs. It's hard to know exactly where this nets out over time, but in the next few years we expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company. Wall Street Journal comments on this. The real message Andy Jassy is sending to employees on AI Jassy's memo likely has another aim. More tech leaders are propagating the view that job security in the age of AI means learning to use it fast. Jassy echoed this belief in his memo to workers this week, imploring them to be curious about the technology. Those who do will be well positioned to have a high impact and help us reinvent the company by effectively threatening a pink slip to those who don't. Jassy at least guaranteed that the AI workshops at Amazon's offices will be humming. Little cynical.

[Ranjan Roy]

Well, actually you, you left out. I was thinking about this when you dropped in this quote. So the quote, you're not going to lose your job to an AI, but you're going to lose your job to someone who uses AI. It's attributed here to Jensen Huang, who's told the Milken Institute in late May I I was saying, I feel I've been hearing that for years now, haven't you?

[Alex Kantrowitz]

Yeah, that's Not a, like a Jensen exclusive.

[Ranjan Roy]

I know. I was trying to figure out, I was actually looking up, like, who the original, like who we can actually give that quote to. But because I feel that if you want to sound smart in AI conversation, just look at someone very seriously and say it's. People aren't going to lose their jobs to an AI. They're going to lose their jobs to somebody who uses AI and you will sound like the smartest person in the room.

[Alex Kantrowitz]

So sounds right to me.

[Ranjan Roy]

It's right. It's brilliant. It's brilliant. It's the future.

[Alex Kantrowitz]

So I guess, like going, let's just tie this section up. Do you think that, do you really feel that Amazon is going to contract because of AI? And if it does, will it be AI in the headquarters or will it be AI sort of in the form of robots in the warehouses? I think he's talking to headquarters employees here. But I think it's still a better chance that you'll get like robots with better dexterity that replace people in the fulfillment centers versus reducing workforce.

[Ranjan Roy]

See, I, I would actually disagree that Amazon, in the front line side of it, had brought AI and automation at such a level that like, is unparalleled versus other companies. So they already got this out into the frontline workers. So I think this, I, I think this is more geared at hq. And maybe he's just telling them to roll out Alexa plus because I bought an Echo show after your episode and I'm still waiting for Alexa Plus. I think you are as well. So maybe that's the real message here.

[Alex Kantrowitz]

I mean, he mentioned Alexa plus in his memo and I was like, well, where is it? Well, but I do think that we're going to see more CEOs with messages like this. And I think this Wall Street Journal writer is totally right that more than a imminent downsizing, it's just going to be like, please use the tools. Because like you meant, you hinted at earlier, it's a lot of these co pilots or whatever are just kind of sitting dormant. And that's why, like I read Jassy's like big like vision setting paragraph about the agent. He also talks about how agents will help work, you know, the work workforce and therefore, you know, you won't need as many people. And I'm just like, I'll believe it when I see it. At this point, it's like Apple Intelligence for me.

[Ranjan Roy]

Ah, okay. See, I'm still gonna, to me, if you have an AI illiterate workforce, you're not gonna see it the Technology is not gonna be enough to actually make it successful. So maybe again, the, like, the, the implicit message in this is just become AI literate because then you'll be able to actually build these agents, build these workflows, do all of this.

[Alex Kantrowitz]

You know, I'm gonna agree with you here. I do think, I think we both agree there's a tremendous amount of power in AI today if you learn how to use it right. And if I was a CEO of a big company like that, I would definitely be imploring the workforce to, you know, get their hands dirty and get using these products. Now, would I say I'm gonna fire you if you don't? Probably not. But I do think that it's a good thing to be like, hey, you should, you should start using these. And there are ways to do it maybe. I mean, if you have to go to the workshop if you need to, but they, they can already help tremendously in certain workflows.

[Ranjan Roy]

Yeah, dude, learn how to use it. Otherwise we're gonna do an Aqua Hire zishion of your biggest enemy and nemesis and. And be wary.

[Alex Kantrowitz]

That's right. All right, so we're gonna go to break and come back and talk about Mark Zuckerberg's latest on his hiring spree. Before we do, I just wanted to say that we've seen some ratings come in and I definitely appreciate everybody rating the show. I know I ask often, but again, it's the only publicly available metric to show our, our size and the fact that we have an engaged listenership. So if you could rate 5 stars on Apple Podcasts or Spotify, that would be much appreciated. I try not to ask too often. Sometimes we get someone that will listen to the show once and come in and drop a one star review. And obviously it's never fun to see that. So we know we have engaged listeners. If you're listening on Apple podcasts or Spotify and can rate us, that would be great. And either way, we appreciate you being here. All right, we'll be back right after this. And we're back here on big technology podcast Friday edition, where we are happy or intrigued to report that Mark Zuckerberg is still spending the money. And this week, last week we had the $14 billion aqua hire edition of Alexander Wang and the scale AI. I don't know. Leadership talent crew. This week the money doubles. Zuckerberg tried to spend 32 billion on Elias its covers AI star startup safe Super Intelligence. So Scever ultimately turned meta down. This is according to the information, but the company is now in talks to hire Safe Super Intelligence's co founder and CEO Daniel Gross. And earlier this week there were also reports that Meta was in talks to hire Gross as well as former GitHub CEO Nat Friedman. Meta is also reportedly talking to taking a stake in Friedman and Gross's joint venture firm and nfdg, which was invested in prominent AI startups such as Perplexity and Character AI. Gross and Friedman could significantly beef up Meta's AI superintelligence lab. So this idea that I brought up last week that it's about the talent, you can now you're getting to the point where compute matters, but talent is starting to matter more. It seems like, you know, this is really coming to fruition and Zuck is just going to spend until he has this team of all stars.

[Ranjan Roy]

I think Aqua Hire Zion, while said in a bit of jest last week by you, is going to go down as one of the bigger trends of the year. We're seeing it again. And I mean in a way, Even like the DeepMind acquisitions of long ago in AI with the big tech giants, maybe Aqua Hire position has been the modus operandi this entire time and is going to continue to be like, rather than we're going to buy your customers your product, it's actually we're just buying the talent and that's all that matters. So yeah, I think we, we could see more of this. It's going to be interesting. But also at a certain point, when do you have enough talent? Like what, what's the inflection point that you're like, okay, we, we got everyone we need. We're, we're like 100 billion down. We have a team of AI Avengers. What do we do now?

[Alex Kantrowitz]

I mean you, you optimize the models and you try to come up with new techniques and all these talented leaders will have people working underneath them that will be able to execute, you would think, the new strategies that they try to pull off. But I think it's kind of notable that he wasn't able to get Ilya. I mean it's a moonshot.

[Ranjan Roy]

32 billion for a pre product startup, right?

[Alex Kantrowitz]

Not a bad moonshot to try to get him because we know that he's definitely, I would say like fairly ideological left goog to go to OpenAI because of the promise of the safety work left OpenAI after some weird stuff happened with Sam. And I think Kevin Ruse from the Times has a pretty interesting take on this. He says the problem with trying to buy your way into the AGI race in 2025 is that top tier AI researchers are already rich. Think we have like one to four years before super intelligence and don't want to spend those years building AI companions. For Instagrams. For Instagram, actually.

[Ranjan Roy]

Okay, that's a good point. I mean, first of all, I think Ilya is worth 32 billion just for the branding of super intelligence and bringing ASI to market and letting us move past AGI. But I think that's fair that, yeah, I mean, if you're already a researcher by like disposition and you are worth a couple hundred mil, you don't want to build like an ad optimizer for Facebook and Instagram. Fake companion, Khloe Kardashian, like Replica, you would like to be getting to your asi. So that makes sense. It's going to be a bit harder, which makes more sense that like Nat Friedman GitHub CEO, that Persona of like a true business builder, they're the ones who actually are going to be more open to this kind of thing. I think.

[Alex Kantrowitz]

Now, in theory there is a separation between the research side of Meta's AI efforts and the product side. And I believe there is. But it's clear that in companies like Meta, like companies like Google, the research and product sides are coming closer together. So it could be like, yeah, you come, come in, like even to the researchers that he's going after, come in and we'll give you money and you can try to build the best AI model. I think there'll probably be some reluctance, at least at the beginning, to, to believe that. I mean, especially. You saw what ads came to WhatsApp after the promise. I think there was a promise never to bring ads onto WhatsApp. They're there now. I'll just say this one thing. The best way to make this work is to build a product that works. If they can really start advancing the status quo, then they'll get more people involved and, you know, it snowballs. But I think, yeah, you have to do that with talent and he's doing, going after the talent. So I believe, I think the strategy is smart.

[Ranjan Roy]

I will agree that they have the distribution in place, so that's not going to be an issue. So maybe it is fair that they have to put their entire bet on just improving the model significantly in the short term and definitely not falling behind, and then they can win solely on distribution. Okay, one quick rant on WhatsApp.

[Alex Kantrowitz]

WhatsApp? Yeah, do the WhatsApp ads thing all over New York.

[Ranjan Roy]

Last, like in the High line in New York There was these huge out of home marketing activation of like, it was just kind of ridiculous. It was like, WhatsApp, we don't read your messages. WhatsApp, we can't see anything. Like there was a kind of these blurred out, I don't know, big, like plastic things that you would stand behind and they would take a picture of you. It was just weird. First of all, anytime you're told over and over, we don't read your messages. I'm just asking, why are you having to shout this repeatedly? Are you reading my messages? My other favorite thing is they also just in the corner had a little waiver that by taking part in this activation, you are releasing the rights to be filmed for marketing purposes, which is classic meta. But what I loved was, so I started seeing this, a number of podcasts, I listened to these ads started showing up. There was like big billboards in Times Square showing this. And then A week later, WhatsApp announces it's going to be launching advertising within the app for the first time in its life.

[Alex Kantrowitz]

So there you go.

[Ranjan Roy]

Yeah, yeah. Never change, Meta. Never change.

[Alex Kantrowitz]

Okay, one more thing I want to talk about. I just saw a report that Meta discussed buying Perplexity before investing in scale AI. Hey, get off Apple's lawn. All right? This is Tim Cook's deal to do, and Tim Cook's alone.

[Ranjan Roy]

You lose your finders fee if Meta gets them.

[Alex Kantrowitz]

That's true. I know. I actually been dming with the chief business officer of Perplexity who told me that the deal is not likely, but the Meta scale deal was so unlikely that I feel we, and I feel we aren't living in a world of likelies. I read that as a. As a maybe. But also he told me that Apple and Perplexity haven't had no M and A discussions. So if this Meta thing is true, Mark Zuckerberg has done more M and A discussions with Perplexity than anybody else. I think if Meta can get Perplexity, it should do it. I think that would be smart.

[Ranjan Roy]

I think it would. I mean, speaking of anti competitive though.

[Alex Kantrowitz]

I mean, Meta doesn't have any search.

[Ranjan Roy]

Actually, that's, that's a fair point. And suddenly search becomes more competitive and this pushes back against Google. All right, approved.

[Alex Kantrowitz]

Okay, thank you. That was a very easy approval process and I expect that it would be the same level of ease as we would see with the federal regulators. Okay, sorry, I said one last thing. One last thing on this. I got a text from someone who listens who said, what is Facebook doing these Assholes couldn't get along at OpenAI as it was. I think they're going to get along thin meta. I mean, of course it's, it's, it's a disparate group, right? It's not exactly all open AI alumni, but there are, you know, that's, that is one of the biggest risks when you bring in big personalities is that they will, they will be too big to like someone on Twitter floated like, wait, Ilya's going to report to Alexander Wang. What's, what's the idea here?

[Ranjan Roy]

Oh my God, I would love to. That's just the reality show and podcast worthy content to give us material alone would be worth the 32 billion.

[Alex Kantrowitz]

Oh yeah. I mean, I, I would love to. I mean, I think our, our numbers would double immediately with weekly reports of how things are going. Do it, Mark, on Insider. Do it please, for the sake of Big Technology listenership. Thank you everybody for listening. All right, let's end here with the closest sign that we're nearing AGI. Waymo is about to start today testing in New York City. We also have Tesla starting to roll out its pilot in Austin. I think that's coming in the coming days. It's going to be with safety drivers and Waymo will also be with drivers in the front seat until they, until they get approval to drive. But like we said, if, if Waymo starts rolling around New York without any drivers, you and I here on the show will declare AGI.

[Ranjan Roy]

Yeah, we said there's, there's currently the ARC AGI benchmark, which is one of the industry standards we've proposed. The WIN AGI w I n Waymo in New York benchmark. You roll through like Broadway and 34th on a. In a driverless wayo. AGI is here. Cancel the Microsoft OpenAI contract. AGI is declared. It's done.

[Alex Kantrowitz]

And what a storyline that would be. If we see Wayos going down fifth Avenue and then second Sam Altman follows along and says, I'm free. See you later, Satya. ChatGPT is half off this week.

[Ranjan Roy]

Greatest marketing stunt of all time.

[Alex Kantrowitz]

I could see it happening. All right, Ranjan, great to speak with you as always. Thanks for coming on.

[Ranjan Roy]

All right, see you next week.

[Alex Kantrowitz]

All right, everybody, thank you for listening. Next week on Wednesday, we should have legendary investment analyst Tom Lee coming on. So stay tuned for that and then Ranjan and I will be back next Friday. Thanks for listening and we'll see you next time on Big Technology podcast.