Jony Ive and OpenAI
Sam Altman has OpenAI problems and AI problems.
He has to turn a science lab with weird governance and capital structures into a company, and manage an associated spoiler lawsuit from Elon Musk. He should probably move away from dependence on Microsoft for infrastructure, and so he flies around the world drumming up capital for ‘Project Stargate’ (last week’s good idea was trading this for oil money and getting Trump to drop the export restrictions on the Gulf). He has to worry about AGI, or at least manage the people who still do. He has to work out which politicians to lobby, how and in what direction. OpenAI still sets the agenda in AI research up to a point, but it’s no longer a clear leader and Google in particular is frequently ahead in the benchmarks. And given how much he has going on and given OpenAI’s talent retention issues, it was a good idea to hire Instacart’s CEO as COO.
Then there are the AI problems. What is this, and what will it become? Everyone in Silicon Valley is using chatbots all the time (and this is already transforming software development and marketing), but it’s not actually clear what the product is for everyone else. How can you make the chatbot into a product that more than a small fraction of people can think of ways to use? Does that need a device? A new paradigm? Better design? More talent?
And of course, frequently these questions merge. If the models themselves are commodities, does that mean distribution is the most important thing? The Microsoft partnership brings some of that (presuming it lasts), but Microsoft has no mobile, search or social. Meanwhile, incumbents always try to make the new thing a feature, and we saw a lot of that from Google this week: the elephants have all woken up now, even if Apple has stumbled badly. So how can OpenAI muscle its way through that and up into ‘platform company’ status?
That’s a lot of chess pieces and a lot of places to store up option value, and paying a few percentage points to get a ready-made rock-star hardware product team, led by the greatest product rock-star of tech, might be a good chess piece to add to the board.
Yes, but.
Apple needed Jony Ive, but Jony Ive needed Tim Cook and the chips team and the hardware engineering to turn the beautiful thing into reality at 200m units a year with 45% gross margins, and it needed the software people to light it up. (That’s not even thinking about Steve). Jony Ive made one part of the thing, not the thing itself, and though his new team has many people who did do great work in interaction, building outside the mothership can be very different (as many ex-Apple and ex-Google people have discovered).
And then, is the way to take generative AI from promise touniversal reality getting all of us to buy a new device (that’s not glasses)? Or is it to make the software behave and present itself in fundamentally different ways? Is that a new device, or an app or a website on your phone (and whatever else happens, Apple will still have the best hardware), or reworking the phone software (which still means Apple or Google, despite all the recent antitrust unlocking)? Or is that not a real problem and LLMs will take over everything anyway?
I don’t know, and I doubt Sam Altman or Jony Ive know either. But if you were Sam Altman, why wouldn’t you buy the option, and if you were Jony Ive and you’d retired becasue you were bored of designing beautiful cases for glowing rectangles, what else could get you out of retirement if not trying to redefine computing again?
The trouble is, Sam Altman seems to be much better at getting brilliant people to work for him than at keeping them. A lot of people pointed out that the acquisition announcement looked a lot like a rather sweet wedding announcement. But all Sam Altman’s business relationships seem to end the same way.