Visions: On Our Month-End "Virtual Route 66" As June 2023 is Before Us

It is the dawn of a new month as we present a snapshot of the month with the rise of Artificial Intelligence, an implosion of Twitter, and the challenge of Social Media in General and disinformation. We present a snapshot of the month that was with thoughts courtesy of The Economist, the Information, INisde, and & other leading thinkers:

Artificial intelligence

Yuval Noah Harari argues that AI has hacked the operating system of human civilisation

Storytelling computers will change the course of human history, says the historian and philosopher

ChatGPT has the fastest growing customer base of any technology in history, gaining 100 million users in just two months. And all signs suggest that business adoption will be equally swift. The new technology is top of mind for every CEO I talk with these days.

But while all are impressed by the power of these new tools, many are still perplexed about where to start. Unlike previous generations of A.I., which focused on relatively narrow tasks—predicting customer churn, for instance, or targeting supply chain issues—generative A.I. models can tackle a wide variety of creative tasks. And while the amazing breadth of these models makes them impressive, it also makes them daunting. Our recent polling shows the vast majority of Fortune 500 CEOs are still at the experimental stage, or planning their first step.

Accenture CTO Paul Daugherty has a new piece for Fortune that may help light the path. He highlights five core ways that people can work with generative A.I. to create value. McKinsey also has a paper out this morning that is a primer for businesses exploring generative A.I., and provides helpful use cases. McKinsey’s Lareina Yee, one of the authors, told me their analysis “of the apparel, fashion and luxury sectors found that GenAI has the potential to add $150 billion in operating profits.” Hard to overlook.

Both Daugherty’s article and the McKinsey paper highlight writing software code as one of the areas where generative A.I. can make a huge difference—increasing productivity by 50%, McKinsey says. Which raises another interesting issue: For the last decade, the surest route to a good job was to learn to write code. But now that machines do that, what’s the new formula for job security? Microsoft provided some guidance this week in its Work Trend Index Annual Report. The skills needed to survive are those that will help humans manage the machines: analytical judgement, ability to work flexibly, emotional intelligence, creative evaluation and curiosity.

To sum it up: generative A.I. is likely to have the most profound impact on the business world of any technology since the PC. And the best way to remain relevant will be to learn how to use it smartly. What’s coming, says Daugherty, is a reinvention “of the way work is done, dramatically amplifying what people can achieve.” And the companies and people that get there fastest “will gain a big leg up on less innovative competitors.”

What happened: SoftBank Group's chip design firm, Arm Ltd, has filed for a stock market listing, setting up for what could be this year's biggest initial public offering in the U.S.

Details: Despite unfavorable market conditions, the Japanese conglomerate is moving forward with its plan to list Arm on the Nasdaq, suggesting a thawing IPO market and a potential ice breaker for future firms to go public. SoftBank acquired Arm, whose technology powers almost all smartphones, for over $32B in 2016. It's been targeting a listing for Arm since last year, when its $40B deal to sell the chip maker to Nvidia collapsed.

Why it matters: Reuters reports that the U.K.-based chip maker seeks to raise $8B to $10B. SoftBank is currently working to revitalize its giant Vision Fund, which has suffered significant losses due to the plummeting valuations of its holdings in tech startups. Arm's upcoming IPO could provide a boost to SoftBank's financial prospects and more.

What the numbers say: According to Dealogic, many potential IPO candidates have been dissuaded by economic uncertainty, leading to a 22% decline in U.S. IPOs year-to-date, excluding special purpose acquisition company (SPAC) listings. As a result, the total raised from IPOs this year has been only $2.35B. In the tech sector, IPOs fell from 631 in 2021 to 328 in 2022, while proceeds decreased from $149.1B to $37.4B, according to EY.

Still: Sources say the size, price range, and timing of Arm's IPO remain subject to market conditions.

Apple is revamping the user interface of the Apple Watch, with a focus on widgets, in what is being touted as the most significant software overhaul to watchOS in recent times. Users will be able to set up the interactive, iOS-like widgets from their phones, adding basic apps such as weather, calendar, maps, and stocks to the Apple Watch.

More:

Watch users will be able to scroll through the widgets instead of clicking on them to launch apps.
Apple previously experimented with a widgets-like feature, called Glances, when the Apple Watch came out in 2015.
According to Gurman, Apple plans to combine the old Glances with widget styles from iOS 14.
He claims the new interface will be "reminiscent" of the Siri watch face that came out with watchOS 4 in 2017.

Zoom Out:

The new widgets will release as part of the watchOS 10 update, the next-gen version of the Apple Watch's operating system.
Apple is expected to unveil watchOS 10 alongside iOS 17 and macOS 14 at WWDC in June.

BLOOMBERG

Despite the recent setback in its acquisition of Activision Blizzard, Microsoft is still making plans for the deal and has announced a 10-year agreement with cloud gaming provider Nware. The announcement comes days after Britain's antitrust regulator blocked Microsoft's $68.7B purchase of Activision Blizzard, saying it could harm the cloud gaming market.

More:

Under the newly announced deal, Microsoft will stream PC games on Nware’s platform, including any Activision Blizzard games should the deal eventually go through.
Microsoft has made similar deals with other gaming companies, including one to bring Xbox PC games to Nvidia’s cloud gaming service.
The deals are aimed at alleviating regulators' concerns that Microsoft could exclude Activision Blizzard games from competing services.
However, it appears to have not been enough for the U.K. Competition and Markets Authority, which recently determined that, if the deal went through, Microsoft would find it commercially beneficial to make Activision Blizzard games, such as "Call of Duty" and "Overwatch," exclusive to its own cloud gaming service.
Microsoft says it will appeal the decision.

VENTUREBEAT

Apple is dropping a lawsuit against a former chip executive who it accused of poaching employees while still working at the company. Gerard Williams III was a senior director at Apple before he left in 2019 to form the chip design firm Nuvia, which was later acquired by Qualcomm for $1.4B.

More:

Shortly after his departure, Apple sued Williams, claiming a breach of contract related to a non-compete agreement.
The company accused Williams of developing and recruiting for Nuvia while he was still at Apple.
In his defense, Williams accused Apple of spying on his text messages.
While the case was set to go to trial this year, Apple has now filed a request to dismiss the suit “with prejudice,” which would bar the company from filing the same claims again.
While not confirmed, the filing also indicates that the two parties may have reached a settlement.

Zoom Out:

According to his LinkedIn, Williams is now a senior engineering VP at Qualcomm.
The semiconductor company has announced its next-generation "Oryon" processors that derive from the Nuvia acquisition. The Oryon cores are due out in 2024 and are expected to compete against Apple's M2 chip.

ENGADGET

Microsoft has released an AI-powered graphic design tool to the public in a free preview. The Designer web application utilizes OpenAI's DALL-E 2 along with user-generated content to generate designs for presentations, work projects, and more.

More:

The Canva-like app was previously only available through a waitlist.
It's now available to the general public to try out in preview for free, along with new features such as animated visuals, caption generations, and hashtags for social media.
The tool relies on AI and user input to generate layouts that are customizable via text editing.
Microsoft says it will add more editing features in future updates, including fill, erase, expand background, and replace background.
The tool is currently free at designer.microsoft.com and in the sidebar of Microsoft's Edge browser.
Once generally available, it will be included as part of Microsoft 365 subscriptions.

IBM to Pause Hiring for Jobs That AI Could Do

Until late 2022, Krishna said he believed the US could avoid a recession. Now, he sees the potential for a “shallow and short” recession toward the end of this year. Though the company’s strong software portfolio, including acquired unit Red Hat, should help it maintain steady growth despite worsening macroeconomic concerns, wrote Bloomberg Intelligence’s Anurag Rana last week.

Chegg Shares Plunge 38% After ChatGPT Warning

By Amir Efrati | Source: The Information

Online education firm Chegg told investors it believes OpenAI’s ChatGPT is “having an impact on our new customer growth rate” as student customers embraced the chatbot as a studying tool. In after-hours trading, Chegg shares fell 38%. It didn’t help that the firm reported a 7% decline in revenues year over year after reporting a 1% decline in the fourth quarter.

Chegg, which had a market capitalization of $2.1 billion on Monday, before the after-hours plunge, said it was embracing artificial intelligence by launching its own study aide powered by ChatGPT. The company is hardly the only software firm roiled by OpenAI’s software. The Information reported last week about 13 companies including Grammarly that now face the prospect of competing against a cheaper product—ChatGPT.

• How ChatGPT is Roiling 13 Software Companies

Prospects of Vice Media Bankruptcy Rises as Sale Process Drags On

By Aidan Ryan and Sahil Patel | Source: The Information

The prospects of a Vice Media bankruptcy are rising, as the media company’s sale process drags on with few bidders showing much interest, say people close to the situation.

The New York Times reported earlier that Vice was preparing to file for bankruptcy in a few weeks, but was still looking for a buyer to avoid such a filing. A person familiar with the situation denied Vice was preparing for a filing but said it was a possibility.

A bankruptcy filing would be an ignominious end for the media company, the owner of Vice News, Refinery29, the Virtue ad agency and a video production business which was once valued as high as $5.7 billion. Vice has lately faced an anemic digital ad market and a weak market for video programming.

Photo-Sharing App Poparazzi Is Shutting Down

By Isabelle Sarraf | Source: The Information

Poparazzi, the photo-sharing app that invited users to only share photos of their friends, announced in a Monday blog post it was shutting down. Users can download their content in the app by June 30, CEO and co-founder Alex Ma said.

An overnight sensation during the pandemic, Poparazzi hit the top of the free category in Apple’s App Store in May 2021. The app challenged Instagram’s culture of posting edited glamor shots, prompting users to take authentic photos of their friends and not themselves.

Poparazzi did not explain why it was shutting down in the blog post. The startup raised $15 million in a Series A funding round led by Benchmark last year.

AI Pioneer Geoffrey Hinton Quits Google

By Jon Victor | Source: The New York Times

Geoffrey Hinton, an intellectual giant in the field of artificial intelligence, has left Google in order to speak freely about the risks of AI, according to The New York Times.

While Hinton, who joined Google in 2013, had been working there part-time in recent months, his departure is symbolic given his stature in the field. Decades ago, he advocated for using a “neural network,” or a system modeled after the human brain, as a method for developing artificial intelligence, at a time when few researchers were willing to embrace the idea. The framework later helped Google supercharge its advertising business and became the foundation for the current AI revolution.

Hinton joins a group of prominent scientists and technologists who have been sounding the alarm about the potential harms of AI. In the near term, people might “not be able to know what is true anymore” because of AI-generated images, videos and text, he said. Longer term, he said, the race for AI supremacy among Google, Microsoft and others could spiral out of control in the absence of regulation and upend the labor market by putting humans out of work. In a tweet on Monday, he said Google has acted “very responsibly” in its approach to AI so far.

Alibaba Founder Jack Ma Takes Up Visiting Professor Role in Japan

By Juro Osawa | Source: The Information

Jack Ma, the billionaire founder of Chinese e-commerce giant Alibaba, has just taken up a new role at a university in Japan. The University of Tokyo, the country’s most prestigious university, said its Tokyo College has appointed Ma a visiting professor effective May 1.

Ma’s whereabouts and what he is doing have become a subject of controversy and speculation, ever since he largely disappeared from public view a few years ago. In late 2020, after Ma publicly criticized China’s financial regulators in a speech, the Chinese government cancelled the initial public offering of financial technology firm Ant Group, which was controlled by Ma at the time. Since then, Ma, who used to be outspoken and flamboyant, has kept a low profile. Last month, the South China Morning Post, a newspaper owned by Alibaba, reported that Ma had returned to China for a visit after living abroad for a year in Japan, Europe and Thailand.

The University of Tokyo said in a statement Monday that it expects Ma to share his knowledge of entrepreneurship, management and innovation with students and faculty members. It also said Ma would work on projects with the university’s researchers in the area of sustainable agriculture and food production.

10 Healthcare x Fintech Builders
Challenging the Status Quo

“It just can't be that people don’t go to the doctor because they’re afraid of how much something will cost.”

Wanting to take a road trip and being told you have to track down the car parts and build it yourself. Sitting down at a restaurant and realizing everyone’s menu has wildly different prices—and you won’t get your bill for six weeks. Having to buy a single, exact size and style of shoe to fit dozens of people.

Those are just some of the analogies founders used to describe the current state of U.S. healthcare. It’s a confusing, costly, and inefficient system for patients, providers, and payers alike. These builders are tackling this challenge from all angles: helping clinics get paid faster and more accurately, opening up access to mental health care through insurance, providing patients with the price of their treatment up front, expanding virtual and value-based care, and much more. The key to revamping our broken healthcare system, according to them, is modernizing the financial layer—what one founder calls “the secret sauce.”

Read the Interviews

What happened: Chinese smartphone manufacturer Oppo has abruptly shut down its Zeku chip design unit as it deals with the ongoing slump in the smartphone market.

Details: Oppo formed Zeku in 2019 to design chips for its own devices. The move was intended in part to boost Oppo's self-reliance and curb its dependence on U.S. suppliers amid ongoing chip export restrictions.

By the numbers: However, an uncertain economy and smartphone market have prompted it to abandon the unit. According to Canalys, the global smartphone market fell by 13% YoY in Q1 2023, the fifth consecutive quarter of decline. Oppo has seen its smartphone shipments plummet from 37.5 million in Q4 2020 to 25.8 million in Q3 2022.

What it means: The move suggests that Oppo is confident in its ability to source components, either by avoiding sanctions or securing supplies within China.

Popular NFT Marketplace Blur Launches Lending Service

By Akash Pasricha | Source: The Information

Blur, an NFT marketplace that in recent months has overtaken OpenSea as the most popular venue for trading the digital artwork collectibles, said Monday on Twitter that it is launching an NFT lending service. Customers can use the service, called Blend, to borrow cryptocurrency by posting NFTs as collateral, the company said.

Blend won’t have any fees, Blur said, taking from the same playbook that helped the company become so popular with NFT traders in the first place. Blur said it developed the new lending service with employees from crypto venture capital firm Paradigm.

For Blur to launch a lending product is surprising given that several cryptocurrency lending companies have collapsed in the past year, including Genesis, Celsius and BlockFi, and regulators have gone after firms offering crypto lending by alleging that these products are unregistered securities. Several other startups like Arcade and NFTfi also let customers borrow crypto using NFTs as collateral.

• NFT Wars: How a Zero-Fee Upstart Is Roiling Big Marketplaces Like OpenSea

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ENTERTAINMENT

Musk Installs NBCU’s Linda Yaccarino to Be His Adult in the Room

By Sahil Patel, Erin Woo and Becky Peterson

At SpaceX, Elon Musk’s top lieutenant Gwynne Shotwell has won a reputation as the adult in the room, able to turn Musk’s visionary ideas into commercial reality. Ad executives are hoping that former NBCUniversal ad sales chief Linda Yaccarino will play the same role at Twitter, where she was named Friday as CEO.

People who know Musk and ad executives who know Yaccarino—a 30-year veteran of both Comcast’s NBCUniversal and the Turner cable channels that are now part of Warner Bros. Discovery—are skeptical. While Yaccarino is praised as a sales executive and for her extensive relationships with advertisers, people who know one or the other question whether she’ll have enough control over how Twitter is run. Musk’s famously mercurial nature is another factor: One ad executive questioned whether Musk’s commitment to Yaccarino would last the six weeks before she actually starts work.

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