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- [00:01]
Deloitte Narrator
The right technology can strengthen human judgment. That's why Deloitte brings together AI and data analytics with multidisciplinary teams who can help you connect the dots across your enterprise, from risk to operations to customer needs. So opportunities don't slip by and surprises don't spread. Because the smarter your systems, the sharper your instincts. That's how technology makes people better at what they do best. Deloitte Together makes progress. Learn more@deloitte.com TogetherMakesProgress Small businesses are the
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Chase Narrator
pulse of every community. They bring people together, create opportunities and drive growth. Chase for Business helps business owners like you with personalized guidance and convenient digital tools all in one place. With that guidance and your determination, you can take your business farther and help build a brighter future for your community. Learn more@chase.com business chase for business make more of what's yours the Chase Mobile app is available for select mobile devices. Message and data rates may apply. JPMorgan Chase Bank NA Member FDIC Copyright 2026 JPMorgan Chase Co. Sonesta TravelPass makes
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Adobe Narrator
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Chase Narrator
Bloomberg Audio Studios Podcasts Radio News.
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Riley Griffin
Bloomberg Tech is live from coast to
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Ed Ludlow
coast with Caroline Hyde in New York and Ed Ludlow in San Francisco.
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Caroline Hyde
This is Bloomberg Tech coming up. Google agrees to create an AI cloud business with Blackstone, which will run on Google's homegrown AI chips.
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Ed Ludlow
Plus, the legal battle between Elon Musk and his OpenAI co founders ends with a jury ruling Musk waited too long long to sue. We'll dive into the details of the
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Caroline Hyde
verdict, a matter bets big on Louisiana for the world's biggest AI facility. This as it plans AI related layoffs
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Ed Ludlow
this week I related layoffs a theme for the market, but I lack of exuberance pounding the market once again with actually yields pushing higher. We're still focused on geopolitics said, but we're looking at a third straight day of losses on the NASDAQ 100 by about a percentage point. We're off about 3% in those three trading days as we just get a little bit of worry that we went too far too fast on the hardware side of things. I shine a light on the semiconductor index. The stocks is coming off by 2%. In fact we're down by 8, 9%. We're on the cusp of some sort of well recalibration of where we've been in this run. Up yes it was up about 70% from the end of March but now we on the verge of a correction. We're down almost 8 or 9% as I say but a rotation some money moving into the software stocks. We've got key earnings coming from software and hardware over the next few days.
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Caroline Hyde
NEO clouds down the news. Blackstone and Google forming a new company to be in Neo cloud. Blackstone brings $5 billion. There's debt financing. 500 megawatts is the target. Google's TPU's tensor processing units are the chips. And look at those names that are down. Core, weave, iron, Nebulous in particular. All very in video focused architectures. But Neo clouds all the same competition seems to be coming.
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Ed Ludlow
It does. Let's discuss the impact of Google Blackstone the partnership. Ed Bloomberg Intelligence says this pact could be a major boost for the tech giants chip space business. Manip Singh who wrote that react joins us now. And what's so interesting is yes the equity comes from Blackstone 5 billion. It could be leveraged up to $25 billion. But this is just another way for Alphabet to get its hardware out there but not have to build the data centers it feels like.
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Mandeep Singh
Yeah. And look when it comes to Nvidia, their ecosystem of new cloud players is pretty big. I mean you had a few of those on the, on your screen. And when it comes to Google, you know you have got terrible cipher mining but there aren't a lot, you know, TPU providers. And that's where you know, when Anthropic says they want to use almost $200 billion of capacity from Google, Google has to find a way to, you know, ramp that up outside of their own cloud. And that's where I think this sort of transaction is quite interesting where Blackstone is putting the money and also has got life capacity that they can bring online by 2027, which is what makes this very attractive from a Google standpoint.
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Caroline Hyde
Mandy, what's the Bloomberg Intelligence thesis on the business model of setting up a NEO cloud for the tpu? Right, because Google cloud, you know, they have capacity that they could give to third party customers. Why set up a new standalone, new
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Mandeep Singh
co. Yeah, so in the case of Google Cloud, you know, they are serving that traffic from Google's data centers. I mean in this case, you know, having a new cloud provider use Google TPU's and then everything else is taken care of by Blackstone in this case, whether it's, you know, the power or the cooling or the, you know, even getting the land for that data center. So from that perspective, having that live capacity is what, you know, makes this different from Google having to do it on their own, which will be a lot more staggered in terms of how much gigawatt they can bring online in 2026, 2027 and beyond. Whereas this would come live much faster given the involvement of Blackstone.
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Caroline Hyde
Mandeep Singh, who leads technology research at Bloomberg Intelligence. Thank you very much. Let's take it today, a look at today's big number. Seven thousand. That's how many workers matters resigning to new jobs related to AI. That's according to an internal memo. This comes on the eve of a 10% staff cut tomorrow to improve efficiency and quote, offset, offset matters. Investments in AI related job cuts are the talk of Wall street right now with Standard Chartered CEO Bill Winters also saying his company plans to cut more than 15% of its support staff by 2030, aiming to replace, quote, lower value human capital with AI. Marta Norton is empowered chief investment strategist. And I'm going to ask you straight up. It's an interesting balancing act, cutting roles and saying that this is not necessarily a trim, a downsize, it's a reallocation of priority to AI as an investor. What signal does that give you?
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Marta Norton
Well, it's not, it's not the only piece of data that we have as companies do that we hear a lot of different announcements of companies making reductions to their workforce related to AI. I think a lot of these are idiosyncratic. When we're looking at the broad economy at the moment. We know that the broad economy added labor upon labor in the wake of the pandemic and now there's a bit of right sizing. And so in some cases I do think companies are adding the AI moniker to make it feel very forward looking to maybe I whitewash it, but not necessarily a sign of the times in terms of very broad layoffs across the economy. In fact, one of the areas that I'm looking more closely for signs of an AI impact is more on the hiring side where people are maybe slower to hire than they otherwise would because of AI. But yes, there are these idiosyncratic reports, ports that suggest we are Seeing a little bit of movement on that front.
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Ed Ludlow
I'm sorry, language matters, lower value, human capital, extraordinary choice of words. But Malta, putting that to one side, there is anxiety out there of labor and people who are affected. When you're thinking about how, how we see actual businesses lean into this moment, are we still seeing adoption taking root in the way you anticipated? Are we seeing the people, the labor that is able to use AI being more productive with it?
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Marta Norton
You know, I think there's early signs that are pretty positive in terms of adoption by current employees. So I think everyone at this point is using the chat bots on a regular basis to do, you know, low value research. But I think the bigger question is this AI agent deployment, what that looks like and you are seeing companies talking about that in real time and beginning to structure workflows around it. I think we're very early obviously on the adoption of that, that, but that is where I think a lot of this AI productivity can stem from.
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Caroline Hyde
Marta the market's trading in part in anticipation of Nvidia. After the closing bell Wednesday yesterday I spoke to Nvidia CEO Jensen Huang. This is how he frames the state
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Jensen Huang
of play with the largest supply chain in the world. Our partners have done a great job securing supply for us. And so all of the pieces go together. The silicon photonics is lined up. Everything is all lined up. It's just that the demand is much greater than the overall capacity of the world.
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Caroline Hyde
The demand is far outpacing this industry's ability to supply. When you go into an earnings, how do you decide therefore the bar in terms of what is positive and what is negative if you're in a supply constraint world?
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Marta Norton
Well, I think you do want to see signs that they are monetizing it, right? If you're in a supply constrained world, that demand should be moving earnings and you want to see some evidence of that. But of course, when we're talking about the supply constraint, we're also talking about supply constraint in areas that would infect the likes of Nvidia. So memory chips, for example, and what does that mean for gross margins and how are they navigating that? I think those are important questions at the moment. But I think the bigger picture, and I caught that that interview yesterday, I think the bigger picture that Jensen Huang pointing to is this massive supply and demand mismatch that will carry through not just this earnings report, but for several quarters years to come as this all plays out. So I really agree with his comment that this is inning one, inning two on the AI build Luckily, we all
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Ed Ludlow
caught that into you. It was a great one with Ed and Martin Norton. We so appreciate having you on the show today of Empower. Thank you for your time. Coming up, a bitter feud, personal grievances, billions of dollars. The decision comes down to timing. We'll discuss the jury's rejection of Elon Musk's claims against his OpenAI co founders and what comes next. This is Bloomberg Tech. The decision in that closely watched legal battle between Elon Musk and his Open Air co founders came down to timing. A jury ruled that Musk waited too long to sue over OpenAI's transition to a for profit business. Bloomberg's Madeleine McClelburg has been following the case every step of the way. Join us now, Madeline, what did the jury decide? What didn't it decide on?
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Dorothy Lund
Right.
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Bloomberg Legal Analyst
It was a bit of an anticlimactic verdict, if I can say that, because the jury didn't actually make a decision on any of the claims that Elon Musk presented over the course of this lawsuit. What they said instead was that he had not proven his case within the statute of limitations set by law for the specific claims that he brought. So essentially they found that he had concerns about this conduct and should have known about this conduct years before he actually filed his lawsuit. And so therefore the case that the jury was hearing should be tossed out, which is what happened.
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Caroline Hyde
We're going to get an appeal, according to Mr. Musk, who posted on X that he would appeal. I believe, like his legal team outside the courtroom said that we would appeal. If that's the case, what do we know about what that appeal would be based on from a legal perspective?
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Dorothy Lund
Right.
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Bloomberg Legal Analyst
It should come as no surprise to anybody who follows Elon Musk as a litigant that he plans to appeal this and fight this vigorously. We saw him celebrating on X afterwards, saying that, you know, just because they decided on the statute of limitations, they never actually touched the merits of the case. I think an appeal on this ground is a lot more narrow than if the jury had actually ruled on the merits of his claims. So I think a lot. It still kind of remains to be seen of how this is going to play out, but it's going to be an issue that the ninth Circuit Court of Appeals is going to have to sort through when he eventually files that.
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Caroline Hyde
Bloomberg's Madeline Meckelburg, thank you very much. Let's dive more into the legal considerations. Dorothy Lund is with us, a professor at Columbia Law School, focused on corporate law, governance and contracts. Returning to the show, there's been covering this trial with us. In our Bloomberg News story, we write that Mr. Musk was too late in his suit. And we later down in the story explain the idea that he had knowledge in 2024 and so basically should have filed his suit sooner. But I've got a lot of sympathy with people around the world that don't understand the legal technicality of that. The statute of limitations seems to play a role here. Is this codified or is this the jury's discretion in deciding that Mr. Musk ran out of time?
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Dorothy Lund
Yeah, the jury. So the jury had to basically answer this question of whether or not the statute of limitations applied to the two claims that were brought here. So the two claims, just to remind everybody, were that there was a violation that OpenAI, Brockman and Altman violated a promise that was made to Musk that it would have a permanent charitable, charitable mission to develop safe, open source AI technology and that they received undeserved benefits because of those broken promises. And so then OpenAI said, well, you waited too long to sue. You know, you brought Your case on August 2024, and the statute of limitations was only three, was three years, which meant you, the things that you're complaining about that took place in 2018, 2019, you, you're too late.
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Caroline Hyde
Where I get it, surely did Elon Musk and his, his team of very expensive lawyers not understand the law or something when they filed the suit?
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Dorothy Lund
No. You know, so Musk, of course, had these fabulous lawyers and, you know, the, the statute of limitations is told if you've concealed if harm's been concealed or you haven't discovered the harm. And so his argument was, well, you know, Sam Altman and OpenAI have been lying to me. They concealed that they were doing all this stuff. It wasn't until 2023 that I really understood what was going on. And so this, and this gets back to your original question, which is why did this go to a jury? Right. The jury had to say, sift through testimony from both parties documents to try to understand this timing question. Okay, so when was it that Musk knew or reasonably should have known about the harm that he was claiming happened?
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Ed Ludlow
And instead we all get consumed with billionaire versus billionaire and how much equity they own in the underlying company and what they're like in terms of managers or how trustworthy they are. At the end of the day, what we miss, misguided to think that when they go back to an appeals court, will it be argued in a different way?
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Dorothy Lund
Yeah. So it's, it's a little disappointing that we didn't get an answer on the big question here. Right. That the, the claims that I was telling you about just now are unaddressed. And in this appeal, we won't get any resolution on this either. So, you know, this is going to be a narrow appeal on this decision of the statute of limitations. And because that statute of limitations question turned on a factual determination, you know, that is going to be really hard to be overturned. Appellate courts rarely overturn a jury's fact intensive findings, especially in this case where the judge also reviewed the evidence and said, I came to the same conclusion. And so the only path forward for Musk is going to be arguing a different set of things about, you know, that argument would have to be some error that proper instructions or improper evidentiary rulings.
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Caroline Hyde
We're having some technical issues, Dorothy, with your zoom, so I'll give the Internet gremlins a second to reset. But my question to you is exactly that. I don't want you to speculate, but what options does Mr. Musk have if he needs to go to the appeals court but argue something completely different to the original case?
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Dorothy Lund
Yeah. His argument is going to have to be that there were significant legal or procedural errors that prejudice the outcome. You know, that there were. The instructions to the jury were improper. Their evidentiary rulings were wrongly decided. There won't be any discussion on the subsequent of this larger question of whether or not OpenAI violated its charitable purpose when it restructured to create a for
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Ed Ludlow
profit affiliate court of public opinion. Therefore, in many ways. Dorothy Lund, professor at Columbia Law School. Fantastic to have you. Thank you. Coming up, parallel is moving past the era of flat fee licensing deals. The CEO paragraph is going to be joining us next. This is BLE Meg Tech.
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Deloitte Narrator
The right technology can strengthen human judgment. That's why Deloitte brings together AI and data analytics with multidisciplinary teams. People with deep industry experience who can challenge assumptions and help you connect the dots across your enterprise. From risk signals to operational pressure points to shifting customer needs, Deloitte helps you see what's coming sooner so opportunities don't slip by and surprises don't spread. It's not just dashboards. It's real clarity in the moments your decisions are made. When models reveal patterns, people can ask better questions. When data and people are connected, leaders can move faster with confidence. And when your teams are aligned, smart choices can scale from the frontline to the C suite. Because the smarter your systems, the sharper your instincts. That's how technology makes people better. At what they do best. Deloitte Together makes progress. Learn more@deloitte.com TogetherMakesProgress support for the show
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Caroline Hyde
Foreign, A Web API purpose built for AI and led by the former CEO of Twitter, is launching Index Today, a new marketplace that pays publishers and data providers based on how much their content actually helps an AI agent complete a task. Joining us is Parallel founder and CEO Parag Agrawal. So in our to the question, what did you get done this week? You launched Index. In this era of agent tech, right? The agents need the web data and the proprietary data sets. You, I guess, saw a gap where the marketplace for that data doesn't exist. And now you think it does.
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Parag Agrawal
Yeah, we've been building towards this content marketplace now for the last two and a half years. We started parallel with the notion that agents will use all of the content on the web,ousand x more than humans ever have. And when that happens, the technology that we've built over the last couple of decades isn't enough. But the business models also break down ads, subscriptions, these Business models no longer work. And that, I think, is the opportunity for us to figure out how to align the end interests of agents doing real work, along with the content owners who are creating valuable content that feeds these agents. And that's what Index is all about.
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Caroline Hyde
To help the Bloomberg Tech audience out, the question, what did you get done this week? Was posed to you by Mr. Musk just before you left Twitter. How do you assign a value then to the data? You've called this index. Very interesting, right? On the one side you have the agent or the entity the agent is acting on behalf of, and then on the other side you have the source of the data who sets a price for a value.
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Parag Agrawal
Yeah. So if you think about other deals that are being done, these deals are typically between a large lab or hyperscaler or Google alongside a large publishing house. And these are flat fee deals where over time, I don't believe content owners get to participate in the growing economy of agents. Now what's really happening with agents is they are starting to do real work, real knowledge work in the enterprise. So if you think about our customers, our customers span people building AI scientists, our customers are building lawyers, customers are building for finance using agents. And all of these agents that our customers build are doing real work when they produce value. Content owners don't get to participate in that economy of the value being created with Index. What we're trying to do is build a system where if very valuable work is done using somebody's data, they get more money.
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Public.com Narrator
Right.
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Parag Agrawal
If someone has very high quality data, they get paid more. And we built a model to figure out what this value is, what this marginal contribution is. And it draws apart from this game theory concept called sharply values.
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Ed Ludlow
Let's talk about the Shapley value, its contribution to the work performed by an agent. So basically, instead of content access crawls or citations, you consider the value. I mean, but where's the monetary number coming from? What are you pegging it against? And, and how, how do you work out what the agent has eventually learned itself off of?
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Parag Agrawal
Well, Shapley values has been my obsession for the last three years as we've been working on this. So just in a sentence, what Shapley Values is, is about, like, if a few people decide to collaborate on building something in a positive some way where the whole is bigger than the sum of parts, the question is, how do you divide up this value? And Shapley value is the concept that tells us the way to divide this value so that everyone is incentivized to participate the net outcome of using this concept to reward content owners, it creates three really nice properties. One, high quality content gets paid more. Number two, content that gets used in high value work gets paid more. And most importantly, as agents do more work and create more more value content owners grow alongside them, which we believe allows content creation on the web to be sustainable.
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Ed Ludlow
There are a lot of content creators out there right now. So how do they sign up to index? How do you make sure that it's not just quite large? Either individuals who are writing, I think of Alex Heath or is actually those that have got a minor substack but with really valuable content that somehow the agent has managed to access.
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Laurie Beer
Access.
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Ed Ludlow
How do they access that?
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Parag Agrawal
Yeah, with Index today we're announcing a collection of launch partners. These span premium news publishers like the Atlantic and Fortune to like really draw factual, amazing content from the PR Newswire, business intelligence and data providers like Pitchbook and Traction and Zoom Info as well as independent creators like Alex Lee, Eat a Z Mazar as several others. The really interesting part about this is that we want everyone, all content owners, big and small to be able to participate in this economy and we want all agents, not just ones built by large providers, to be able to get access to all of this amazing content.
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Caroline Hyde
We just have 60 seconds but ask you about X, the platform formerly known as Twitter. Of course still using it, your view of it and as part of xi, as part of Space X, I'm still
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Parag Agrawal
using it, I'm still calling it Twitter. I think we built a product or a decade that I was there which endures in value forever. And I'm really proud of the platform that we created. It allows the theme of content access and democratizing organization out in the open versus in permissioned groups. And that theme is what carries forward into my current company Parallel, where the goal is to have as much content as possible out in the open for everyone to have access to everyone's agents to have access to instead of just
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Ed Ludlow
a few and be compensated. Parallel CEO Gaggar well, it's great to have some time with you. Thank you for coming on. Now coming up, we dive into matters Mega data center plans in Louisiana and some of the hiccups along the way. From New York, from San Francisco, this is Bloomberg Tech.
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Caroline Hyde
Welcome back to Bloomberg Tech. There's still a semiconductor story in financial markets and looking at the stocks of the Philadelphia Semiconductor Index, we're down for a third straight day. A part of this is kind of a breather after what we were calling the melt up the performance in chip Stocks since the end of March was astonishing. But there's also this element that we are really close to correction territory. In three days, at one point in the session, we're down almost 10%. As Kara pointed out earlier in video is a pass of it. Right. And the idea that post President Trump's visit to China, we don't really have a net conclusion of what's going on, but we get Nvidia earnings on Wednesday. So, fresh off his trip to Beijing, Nvidia CEO Jensen Huang says he's confident the Chinese market will eventually open back up to his company. Dell CEO Michael Dell shared that optimism for economic collaboration as well. Here's what both leaders told me at Dell World in Las Vegas yesterday.
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Jensen Huang
The president wants America to win everywhere, right? The president wants America to lead the revolution. And so H200 are licensed to sell to China, the Chinese. The Chinese government has to decide how much of their local market do they want to protect and how much of their local market do they want to expand with more, more air capacity. My sense is that the demand in China is, is so incredible, just like it is here. Agentic is also making enormous progress there. My sense is that over time, the market will open. President Xi was very clear that he wants China to be an even wider open market. Premier Li Chang was very straightforward and explained very eloquently that that China will be in open markets open. Looking forward to trying to be in a more open.
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Caroline Hyde
To clarify, just you were able to meet with those officials directly to discuss whether or not you can sell to those Chinese tech companies?
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Jensen Huang
I did. I didn't discuss directly with them about H200. I was there to represent the United States and I was honored to do so. I was there to support President Trump and really glad to do so. But that was really the focus of my trip. President Trump had some conversations with, with the leaders, and I'm looking forward to what they decide.
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Caroline Hyde
Michael, you did not go to China, but I think what's interesting is you are a member of the President's Council of Advisers for Science and Technology, as is Jensen. Your net conclusion on whether or not China will become open to American technology companies to do business there.
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Jensen Huang
You know, we have a business in China. Obviously we comply with with all the restrictions and various controls that are in place. But I hope that there's more economic collaboration between the United States and China. That ultimately is what will lead to greater outcomes and prosperity for everyone and a greater likelihood of successful relationship between the countries and around the world.
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Ed Ludlow
Dell CEO Michael Dell, of course, Nvidia CEO Jensen Huang speaking there with Ed yesterday. And let's just revisit today's big number with matter reassigning 7,000 workers to new jobs. Of course, they're related to AI. An internal memo from Chief People Officer Janelle Gale, viewed by Bloomberg, reveals employees will move into one of several new groups focused on AI related products, including agents and apps. The new corporate structure will, quote, be flattering and have smaller teams. Now, this comes as the company is getting ready, of course, to cut 10% of its staff this week as part of an effort to, as they say, improve efficiency.
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Caroline Hyde
Yes, sticking with Met as big plans, Mark Zuckerberg's plan to build the world's biggest AI facility has enmeshed his company deeply in Louisiana's politics and economy. The project's providing an economic boost to one of the nation's poorest regions, but also bringing a host of growing pains. Bloomberg's Riley Griffin joins us more with the big take. And there's big readership on this, a lot of interest. You did what every good beat reporter does. You go there, you see what's happening on the ground. The headline is $200 billion. Right. That's the commitment. What is happening with matter in Louisiana?
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Riley Griffin
Yeah, a really important point here is that $200 billion spend that Meta is thinking about with Richland Parish and its data center there is largely about the chips. This is going to be a 5 gigawatt of compute capacity data center, another 2.5 gigawatts to support the broader campus, which is spanning nearly 4,000 acres. President Donald Trump has said that this is going to be a Manhattan sized project after speaking with Mark Zuckerberg. But a lot of that spend isn't going directly into the community. It's going into the chips inside the facilities. And we still have to ask the question, what does this mean for the people of Richland Parish in the Louisiana Delta, a region that has struggled for decades and where farmers are really losing $400 on every acre of cotton they sell right now.
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Ed Ludlow
Well, let's go to Dustin Morris because you paint a picture of how his economic reality is. Currently he's a soybean, a corn farmer, and he's flying around his own land trying to work out whether it's the right time to be selling out. Right.
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Riley Griffin
Yeah. It's a story of expected land rush. Right. As with all of the data center stories of this size around the United States, many of them shifting into rural regions, particularly in the South. And people are looking around and wondering, you know, Do I trade this history, Do I trade this land? Do I trade this crop for a data center? And it was and I mean it was really an honor to be able to go multiple times to Richland Parrish and hear their concerns and think about the way they're looking at Metta as a lifeline. And I over jump in what a
- [33:16]
Caroline Hyde
matter saying about that like what's matters response to it and what do people genuinely feel about the company even aware it's meta building there?
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Riley Griffin
Well it took some time. Metta hashed out this deal over the course of a year in private Matter is certainly saying they want to be there in the thick of it with the community. They're investing in the schools. There's actually a school at the corner of the data center. There are discussions about whether it should be moved. I have heard that Matter is reviewing plans. So they're there in the trenches. But notably Met is only bringing 500 jobs. This is a community that's looked for 5,000 over the years from an auto manufacturer and have been unable to court that. So will 500 jobs be enough to put provide that economic lifeline long term? I'm not sure.
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Caroline Hyde
Riley Griffin with the big take top of the website and the Bloomberg terminal. Carrie, there's plenty more news out there today.
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Ed Ludlow
There is. It's time now for talking tech. Ed. And first up, Chinese AI pioneer Moonshot is restructuring to secure its path to public markets. Now the developer of the popular Kimmy chatbot has informed investors it will revamp its corporate structure to comply with Beijing's rules and pave the way for a highly anticipated anticipated Hong Kong ipo. Speaking of which, Chinese robotics unicorn Linkabot is exploring a Hong Kong IPO that could launch as early as this year. And the maker of highly dexterous robotic hands is targeting a $6 billion valuation and counts Samsung Tencent among its clients. And China's demographic time clock is triggering an unprecedented automation boom. A new report from Barclays shows humanoid robots could offset offset as much as 60% of that labor decline by 2035, turning what is a structural crisis into a hardware gold rush.
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Caroline Hyde
Ed Coming up, we're going to go live from the JP Morgan Tech Media and Communications Conference. And we'll hear from Laurie Bear, JP Morgan Global cio. That conversation next. This is Bloomberg Tech.
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- [37:05]
Caroline Hyde
Let's get out to the JP Morgan Tech, Media and Communications Conference in Boston, where Bloomberg Surveillance co host Lisa Abramovic is standing by. Lisa,
- [37:15]
Lisa Abramowicz
thank you so much Ed. I am here at the J.P. morgan conference for Technology, Media and Communications and I'm here with Lori Beer, the Chief information officer for J.P. morgan. Laurie, wonderful to speak with you. In many ways you are the woman of the moment because you have to understand how to oversee change. It seems to to be happening at an accelerating pace.
- [37:35]
Laurie Beer
Can you give a sense of just
- [37:36]
Lisa Abramowicz
how quickly it has accelerated from say six months ago, a year ago to right now?
- [37:41]
Laurie Beer
Yeah, I think it's an, it's an amazing moment, first of all, to be in technology and to be in financial services. And we definitely saw the Gen1 tools come out a couple of years ago. The last six months have rapidly accelerated, not only new models getting created, but how we're able to apply apply them. And so it really, you know, ties back to how do we think about driving and adapting change so quickly.
- [38:06]
Lisa Abramowicz
Yeah, one thing it's created a lot of nervousness, a lot of anxiety. There was a story that was out this morning about Standard Charter CEO coming out and saying he was going to cut 50% of staff, support staff, and removing lower value human capital and replacing it with AI tools and investment in AI, what's real, what's not. When it comes to sort of the mass job guys, what's been your experience?
- [38:29]
Laurie Beer
Yeah, so overall we've seen definitely productivity opportunities. So even when we think about technology, we've seen 10 to 20 to 30% improvement just from the initial generation one tools. As you look to Agentic, you're going to see even more. But there's a huge demand, there's a huge demand to create new products and services and experiences, services for our customers. We're using AI to figure out new products to offer. And frankly, when you think about the other side of it, the AI is also creating increased cybersecurity risk. So how do we think about also the accelerating the investments to protect our customers and clients too. So the demand remains, you know, significant and we're able to get a lot more done than we have historically.
- [39:14]
Lisa Abramowicz
How scary is Mythos?
- [39:16]
Laurie Beer
So with Mythos, air in general, but it's really good on both sides of the equation. One, to understand vulnerabilities. And so the key with that and any other AI is how do we capture those, how do we clearinghouse those, how do we update those in a safe and secure way. But on the other side of this, as you apply these models into the software development process, we're going to have safer and more secure software. On the flip side, our cyber teams can use the power of these models to be able to protect, defend, identify fraud, identify issues more quickly. So there's really two sides of this equation to think about based on how
- [39:59]
Lisa Abramowicz
quickly you see technology shifting and what tools are really coming to the fore.
- [40:05]
Marta Norton
How does the mindset have to shift
- [40:06]
Lisa Abramowicz
of the people who are work for you?
- [40:08]
Laurie Beer
Yeah, I think it's a great question. The technology is amazing. I think this is truly a shift, a transformational shift in technology where this is getting embedded and horizontally across all layers of the stack. The harder part is the change management and the leadership and I think really thinking about where, where are things going? We don't know all the answers. So how do you navigate change in an uncertainty still very early innings. So it's really had to shift from how do we help guide our teams, how do we make sure our software engineers understand what's coming? My management team spends a lot of time on the weekends building their own apps. Pick your favorite coding agent coding tool, but it helps them understand what's coming. And I think this is a moment where leaders, in addition to software engineers truly have to understand the change and we have to, to understand, you know, how do we actually create an environment that allows us to pivot and navigate when times are uncertain and really make sure we don't lose track of what's really important? How do we deliver products and services and experience for our customers and clients?
- [41:15]
Lisa Abramowicz
How do you balance innovation with risk and you know, the idea of, you know, the tried and true. You need to do this project versus moonshot projects.
- [41:23]
Laurie Beer
Yeah. You know, I think this is one of the most interesting times when you have to think about the balance of innovation and risk taking. We wouldn't be in business as long as we have been if we haven't driven a lot of innovation historically. But we're also in the business of managing risk. And so I think in this moment you have to really think about going at the appropriate speed of innovation. Some of these moonshots are becoming real and so you have to move aggressively at the innovation front. But we obviously are a business of trust and we have to make sure our customers, our clients, the bank is protected every day. And so finding this balance and actually again using these capabilities to also protect ourselves. And so it's this really interesting time while along with that you don't necessarily know who's going to win in the end. And so making sure we're not locking ourself in to one provider or one scenario and we're test, constantly testing, sandboxing. What's on the horizon in the future?
- [42:24]
Lisa Abramowicz
Does it change your decision whether to build or buy in terms of different software solutions?
- [42:29]
Laurie Beer
You know, it's been interesting because over the last several years we've made sure that we're really focusing our engineering community, and we have a large engineering community on building the things that are competitively differentiating and create value for our customers and clients. And over time you have to balance where that still makes a lot of sense and where we focus our energy on those unique products and services for our customers and clients. And so when you think about the balance of trade and the fact that software engineering overall is increasing in speed and it is more cost effective when you look at the end to end product development lifecycle, you know, there are different tradeoffs you would consider in making those build versus buy decisions. But you're always going to have some of those, you know, enterprise software solutions, frankly, that aren't competitively differentiated that sort of help us run the bank without delivering those unique products and services.
- [43:26]
Lisa Abramowicz
Just 20 seconds.
- [43:28]
Marta Norton
Do you think that we're going to
- [43:29]
Lisa Abramowicz
be able to recognize what banking looks like say in 10 years.
- [43:32]
Laurie Beer
I think we're watching watching it transform as we speak right now. At the end of the day we have to maintain that trust with customers and clients and we have to make sure that their unique needs are served across the over 100 countries we operate in. But how we do it and the products and services will absolutely evolve over the next several years.
- [43:49]
Lisa Abramowicz
Caroline, that is Laurie Beer, the chief information officer at JP Morgan. I'll send it back to you.
- [43:55]
Ed Ludlow
What a great day. What a great set of interviews. Thank you. Bloomberg Surveillance his co host Lisa Abramowicz there and we've got some breaking news in the meantime.
- [44:02]
Caroline Hyde
Yeah it's breaking news on the tunnel about Apple. Apple Chief Hardware Officer Johnny Shrugie is reorganizing hardware development and shifting oversight of key functions such as product design part an effort to speed up work on future devices. Sources say the hardware shakeup is also meant to better integrate teams working on in house silicon with those that are creating products. And of course Bloomberg's Mark Gurman, the one carrier that broke the story. Some other details. Shelley Goldberg, Dave Peculiar are now going to oversee product design. Maybe not names is as familiar to the Bloomberg Tech audience but in this new era for Apple a lot of focus on who's right at the top
- [44:42]
Ed Ludlow
and running the show they'll become known and thanks. Meanwhile coming up we're going to be speaking with Armada CEO Dan Wright as the company raises $230 million in a Series B funding boosting its valuation to $2 billion and some new strategic investors and big projects for the hyperscaler for the edge. This is Bloomberg Tech.
- [45:06]
Caroline Hyde
Some more breaking news crossing the Bloomberg Terminal Open Air founding member Andre Karpathi says he's joined rival Anthropic in a post on X. Karpathi says he will be working on R and D with Anthropic and be focused on helping train new AI models Come with a previously helped lead the team behind Tesla's Autopilot system before then returning to OpenAI. He left the Chat GP maker for a second time last year and had launched a startup focused on AI and education. In that post carry he says that he's still passionate about education, plans to resume his work on that but in the market of AI talent this is a bit of a wow. This is a big story that I don't didn't see coming breaking this morning.
- [45:46]
Ed Ludlow
It certainly is. The wows keep coming. Meanwhile, let's talk about a fundraise now amada just raised $230 million in an oversubscribed Series B round, boosting the company's valuation to a cool $2 billion. The company is also announcing a partnership with Johnson Controls to produce modular data centers. And they're at scale. Joining us now, Amada CEO Dan Wright, also modular data center. How are we going to be making it?
- [46:07]
Dan Wright
Yeah, thanks so much for having me on. A modular data data center is a full stack AI factory that you can deploy anywhere. And we can do it with the three S's. We call it speed, scale and sovereignty. You can deploy these within weeks. You can scale up with demand versus traditional data centers. Sometimes you end up overbuilding or building the wrong thing. And then modular data centers also have the benefit that you can get sovereignty down to the site level. People used to talk about data sovereignty in terms of countries, but with increasingly sophisticated, sophisticated cyber attacks, now you want data sovereignty at the site level.
- [46:39]
Caroline Hyde
This is all about speed, movement, building funding. This is. Helps you move even quicker or what's the plan here?
- [46:47]
Dan Wright
Yeah, so this round was led by co, led by overmatch 8090 industries as well as BlackRock. And really what it allows us to do is scale up to accelerate deployment of the US Stack. As part of this, we're also announcing a global agreement with Johnson Controls, where starting with Galleon Forge one in Arizona, we're going to do continuous manufacturing of these modular data centers. And if you look at them, they kind of look like shipping containers. So they're easily transportable anywhere in the world. You can deploy them wherever you want. And the nice thing is you can use any source of power, and that's obviously important. Power is a big concern when it comes to data centers. Energy is distributed.
- [47:26]
Marta Norton
Distributed.
- [47:26]
Dan Wright
We're saying compute should also be distributed.
- [47:29]
Ed Ludlow
Where's the demand coming from? Exactly. Who wants these?
- [47:33]
Dan Wright
Yes. So energy companies. We're working with many of the largest energy companies in the world. All of them have a hard segregation between IT and ot, meaning that the only way to do anything with AI is to deploy the infrastructure on the rigs, on the refineries, and run those models behind the firewall at the edge. We're enabling that. They're all trying to be fully autonomous over the next few years. You need COMPUTE locally in order to enable that. And then also defense is a huge driver for us. For example, with the conflict in the Middle east, we got a call from an ally. They said, hey, we need one of these, like immediately. We were able to deploy within days. They called back, said, we need More, we were able to ship more out.
- [48:09]
Ed Ludlow
And who are your partners within this data center? I can understand that you're helping with the construction of it all, but still you need the chips from someone, you need the service. How are you bringing this all together and how open are you to different types of partners?
- [48:21]
Dan Wright
Well, I think that's actually part of the magic of Armada, is that we built this ecosystem of amazing partners and it's kind of like actually what the hyperscalers did, you know, 20 years ago is you're bringing all of these different services and you're making them accessible to more people. That's what Armada is doing. For the Edge is the hyperscaler for the Edge. And a good example of this. We just announced a partnership recently with Microsoft to bring Foundry, bring Azure local, allow them to run these customers to run services that they love from Microsoft models that they run from Microsoft at the Edge. Air Gap, same thing. We announced a partnership with OpenAI. We announced one with Nvidia, Dell as well as Palantir, bringing all those capabilities to the edge.
- [49:00]
Caroline Hyde
So Dan, real quick, I was with Michael, Dell and Jensen on yesterday. The bigger theme is on prem people want at the Edge their facility close to them. Is that an addressable market for you? We just have 30 seconds.
- [49:12]
Dan Wright
Yeah, absolutely. I mean that's what I believe is going to happen is you're going to have sovereign AI factories. And really what that means is that every country and every company is going to have its own AI factory. And I know that Michael and Jensen would agree with me on that because they've been saying that publicly. And in order to do that, you need both the chips, you need the servers and then you also need the infrastructure. And that's what Armada is enabling as the hyperscaler for the Edge.
- [49:37]
Caroline Hyde
Dan, right. Amada CEO back on Bloomberg Tech after a big fundraise. Great to have you back. Thank you. Thanks for having me very much. That does it for this edition of Bloomberg Tech. Car.
- [49:46]
Ed Ludlow
Yeah, you don't to forget to check out this podcast. What a rich podcast. We're going to be having all eyes as we build up towards Nvidia's earnings. After the bell tomorrow you can find it on the terminal as well as online on Apple, Spotify and Iheart. Ed, still a phenomenal interview from yesterday. Today as well.
- [50:02]
Caroline Hyde
Yeah. And you know the market is waiting. Anticipation for the Nvidia print Wednesday night post melt up in chip stocks. Wow. This is Bloomberg Tech.
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