OpenAI Builds A Browser, Microsoft Copilot’s Struggles, Jaguar Rebrand

Channel: Alex Kantrowitz

Published at: 2024-11-24

YouTube video id: hMvo6dhanJA

Source: https://www.youtube.com/watch?v=hMvo6dhanJA

open AI is thinking about building a
browser just as the US government
considers making Google spin-off Chrome
anthropic raises $4 billion Microsoft
co-pilot is struggling and jaguar is
rebranding dear Lord all that and more
is coming up on a jam-pack big
technology podcast Friday edition right
after this joining us as always on
Fridays is ronon Roy of margins ronon
welcome to the show I can't believe
you're already teasing me about Siri and
it's promise and that they're going to f
fix it but I mean we're going to get to
it but can you believe that the story
comes out this week that that apple is
like maybe we should put an llm into
Siri I mean come on thank you
now anyway um let's let's talk about
some of our major stories and then we'll
get to the Siri upgrade which I know
you're really looking forward to the
first thing that caught my eye this week
and one of the more interesting stories
here is that open aai is considering
building a browser to compete with
Google this is from the information the
chat GPT owner recently considered
developing a web browser that would
combine with its chatbot and it has
separately discussed or struck deals to
power search features for travel food
real estate and Retail websites uh with
companies like kast redin Eventbrite and
Price Line okay a lot going on here but
I think the idea that open AI is
considering building a browser is
fascinating because now you have
recently recently released search GPT
which I surmised was just a way to get
funding um but if you build a browser
becomes a totally different thing
because the address bar I would say is
the most valuable real estate on the
entire desktop computer if you own the
address bar in the browser you get to
control what the default is Google saw
this it built Chrome by the way project
manager on Chrome Sundar Pai who's now
the CEO of Google and that is what
enabled them to sort of get out of from
under Microsoft's thumb and establish
Google into what it is today and chrome
today on the desktop controls 65% of the
market share if open AI is able to pull
this off and resets that default from
Google to chat GPT and search GPT which
has been more impressive than I thought
it would be since it's come out then
you're talking about a real challenge to
Google as opposed to what we've seen so
far which is something totally different
from search so R I'm curious what you
thought when you saw this news and
whether you think I'm getting it right
here no I think this is you're right on
this and I think it's very interesting
because exactly that point the search
bar and the address bar is exactly where
all activity starts in any kind of web
browsing so if they can cut into that at
all it will be huge for it'll actually
make search GPT a thing because I think
it's still a bit of an unnatural action
within chat GPT to switch from that chat
interface and interaction to really
searching I think that's where
perplexity has gotten is is beating them
right now because I still think of
perplexity more as a search engine than
I do chat GPT but in terms of like the
productization of it that also excites
me because I think open AI could make a
pretty good browser that's where they've
been you know the best in Market
compared to everyone else making really
really good products and it's kind of
nice the idea of a new type of browser
and someone else doing it well rather
than just Chrome so this this could be a
big deal definitely I think that this if
it takes off and it's a big if is a
multi-billion dollar uh product for open
AI maybe even more important than chat
GPT and it's going to need a couple of
those because like we talked about a
thousand times it's losing like six or
no five billion this year and probably
more in years to come it needs these
products and I give credit to opena
for thinking big like this and thinking
literally internet scale as opposed to
chatbot scale but we need to put the
caveat here which is that according to
information openai isn't remotely close
to launching a browser launching a
browser is timely and complicated
because the browser providers need to
ensure people's data doesn't leak to
websites and by God that would be
terrible if it happened because the
entire trust that you put in chat GPT is
sort of being able to share some of your
personal information and have have it
make sense of it well I I have an idea
that I want to put out there if anyone
at open AI is listening buy the browser
company the browser company produces a
browser called Arc which is my absolute
favorite browser it's it's become one of
the most used products on my computer
and it just completely changed the way I
browse the web in save tabs and you can
have it ready to go it's that easy the
company has raised like $20 million
which is probably too much and they
already are having to Pivot their own
product uh road map itself because of
the expectations but if any company
could afford that it would be open AI
what makes you like the arc browser more
than others it it's you can switch
profiles very quickly like just
basically swipe around versus Chrome
it's a little heavier and I have I'm a
browser nerd in a way so I have like
different profiles for different kind of
parts of my work and then the way you
can save tabs the way you can organize
them is amazing with search you can
search a web page but then you can
actually call chat GPT and get like a
web summary or even take an AI chat
action on the web page just in the kind
search bar that's pulled up like it the
way that and it's just a nice product
it's like a beautifully designed
software and there's not a lot of that
out there right now so overall
yeah sorry go ahead no no it's good
product good product but here's the
thing and this is what they've talked
about and I think that it's pretty clear
that it's just really difficult to
challenge Google in the browser space
right now not only has Google built a
ton of the infrastructure uh with its um
browser developer kit but it has um so
many different Services you're talking
about Gmail you're talking about Maps
talking about calendar I mean people and
and Google Docs people are so deep into
their Google Suite of um of web
applications that they work best with
the browser they are they sort of are um
they're all communicating well when
they're on the Google browser and it's
very difficult to um get them out and
Arc has even written about this that
it's really struggling to beat Google
and it's even thinking about different
products because of this and I think any
product from open AI would run into the
same issue and so that's like I'm
excited about this product from open AI
but I also am trying to be realistic
that trying to change the status quo of
browsers is really difficult I mean you
have groups from Mozilla that's their
only job you have groups in Microsoft
that's their only job you have a group
in apple that's their only job is
building browsers and remember we know
that open AI is kind of chaos they're
good at products though but I still
think they're going to be able to they
will run into uh some serious challenges
if you look at all the different ways
that the tech industry has tried to
unseat Google and has failed what makes
you have any confidence that opening ey
could do this themselves because Google
did it to Microsoft like let's not
forget Internet Explorer I think it had
98% market share in the early 2000s when
Google and Google realized this was
going to become one of their biggest
bets in the history of the company and
it was wildly successful that they you
know they launched Chrome I think it was
in 2006 and it it it succeeded and
obviously there was antitrust and like
justice department pressure on Microsoft
at that time so it was an inroad for
them but if they they they showed it can
be done in the power of owning the
browser the I guess the only thing that
I do think about that was the most
successful possible strategic move in
the mid 2000s so maybe what's going to
happen 5 10 years from now is not a
browser like may actually maybe now that
I'm thinking about it because it appears
the most obvious move is there going to
be some other type of interface or
access point to the internet that
actually makes this not look as
interesting the human pin well
yes or the rabbit I'm talking to Rabbit
thinking about having rabbit on the show
are you wearing your PIN right now you
know I lost it I misplaced it but my M
set on fire weren't they setting on fire
I think some risk it so I burned it with
my Aaron Rogers Jersey but the thing is
that with with the other formats it
might be that mobile is the thing that
just ends up being the most important in
that case you know you're still kind of
losing out to Google with Android and
you have to rely on Apple with iOS but
hey look the desktop seems to be the
thing that's most up for grabs so maybe
go for the desktop um and I think it's
there's an interesting historical Point
here to make which is that Google was
able to seize the leadership of desktop
browsers from Microsoft because
Microsoft actually had an incentive and
an interest in making the web slower
when it developed Internet Explorer
because it had Microsoft Word Microsoft
Excel Microsoft PowerPoint right it
wanted the internet to be kind of slow
so that you wouldn't go to the web to
use Google Docs Google Sheets and Google
Slides uh better the internet kind of
works but isn't so great and you use all
of Microsoft's desktop product
after all the number one thing Microsoft
was selling was the desktop uh operating
system in Windows and Google used that
window and that incumbency problem to
try to to actually take away the
leadership of chrome of browsers uh from
Microsoft and it did it with chrome and
maybe I think what you're saying here is
spoton that we might be seeing a
historical analog where we know Google's
done a really good job recently in
catching up with open aai and chat GPT
but it still has that incumbency problem
it still has search and I can't really
reimagine something like the browser and
the address bar the way that someone
like an incumbent chat GPT whose number
one prod or open an incumbent like open
AI whose number one product is
generative Ai and chat GPT can and maybe
that's the window that opens and allows
them to attack no that's exactly what
I'm saying like the arc one of the
things I like when you in when you're
like control when you're trying to find
something on a website like a word and
you try to search for it that's how
search we're used to on a web page
they've integrated chat GPT directly
into that search function so when you
look up a word you can actually ask you
can talk to the website essentially in
real time so it's it's just a completely
different way of what is searching a
page and if that's one tiny thing that
AI has allowed us to do just imagine how
different browsing the web could look if
someone reimagines the browser AB
absolutely and maybe the US government
will reimagine the browser for us
because this came out this week this is
from the AP US Regulators seek to break
up Google forcing Chrome sale as part of
a monopoly punishment I mean this case
was brought initially over the search
defaults that app that Google paid Apple
for and others for to distribute Google
as the you know default the same way
that Google is the default in Chrome
because it owns Chrome it's paying $20
billion a year to Apple uh to be the
default Search tool when you're using
search on the iPhone uh but the
Department of Justice is like all right
you did that guess what uh we don't want
you to have a browser at all anymore um
this is coming from the AP story you us
Regulators want a federal judge to break
up Google to prevent the company from
continuing to squash competition through
its dominant search engine after a court
found it had maintained an abusive
Monopoly over the past decade
um the sale of chrome it said will
permanently stop Google's control of the
critical search access point and allow
rival search engines the ability to
access the browser that for many users
is a gateway to the Internet so here's
the doj basically talking about how
important Chrome is so we all
acknowledge it opening eyes like ah yeah
we we made the right strategic move
trying to go for the browser this is
what the doj is attacking now I had
previously said listen this was a you
know something that was if it was
anti-competitive Google was paying Apple
all that money to be the default in
search just address the default uh on
the iPhone and on mobile and don't go
for anything else within Google I had
some people that wrote to me and said
you're you're missing it Alex the thing
is Google used illegal tactics to
establish itself as a monopoly making it
hard for others to compete you can't
just try to go through the the single
tactics that it was using you got to go
for everything because it's built such a
lead that you need really aggressive
measures to be able to counteract what
Google has done that's the argument I'm
not fully on board with that I still
think this is overly aggressive but I'm
curious what you think Ronan I think you
made the argument about five minutes ago
that should put you fully on board
because you said the Chrome browser
works better with the entire Suite of
tools almost seamlessly Maps Gmail and
all these and then Google search itself
and the whole ecosystem is the power and
we see that and you can't just try to
address one small piece of it and I
think it is a reasonable argument to say
that like to establish this dominance
like and using legal tactics to get
there or what's considered illegal now
you you can't just address a small part
of it you basically explain the case for
the Department of Justice uh on this
segment just a few few minutes ago I did
and now I'm regretting that but I but I
also want to say that I'm Anno now
representing the federal government Alex
cids your honor I want to present a
witness to argue against the prosecution
and that is me again uh prosecutor with
a change of heart because as I'm making
these arguments they sound right but
then again I'm also a user of chrome and
I I am a psycho user because I'm on my
own I'm not an Outlook so I'm all in
Google products I use Google workspace
so for me it's like Chrome is my browser
Gmail is my default uh email service
calendar is what I do all my scheduling
in the drive is where I have all my
documents slides is where I make my
PowerPoint presentation and sheets is
where I do my invoicing and scheduling
and AD management right so and docs is
where I do my writing I as a consumer
want all of this to work seamlessly
together and I would be annoyed if the
government decided to take action that
made that experience worse now the
argument against what I'm saying since
I'm playing all sides today would be no
dummy the fact that Google's been able
to integrate this and make this all work
so well means that you are dealing with
products that don't innovate you'd be
working in a better docs you'd be
working in a better PowerPoint a better
email uh uh service than Gmail and
probably a better browser so you don't
know what you don't know and you're
advocating for a broken system this is
incredible this I love this segment Alex
versus Alex versus Alex so Ron on a week
where I have multiple personalities
running in unison which one is right
help me help myself all right okay all
right so I think you one of those Alex's
made the point per perfectly that Google
sheet Google Sheets and docs I think
they were very highly Innovative
products six seven years ago maybe like
and they did it and they had to to beat
Microsoft and to actually like or cut
into Microsoft Office and remember when
they started Rising the entire what's
now G or Google workspace now I mean it
was these were incredibly groundbreaking
products they haven't changed that much
meanwhile for me notion is a good
example of a tool that redefined what is
a document like it's it's not quite a
document there's tables there's images
you can embed stuff it could be a public
facing website it could be simple note
taking like it's this air table in ways
like there there are these companies
that did try air table redefined what's
a spreadsheet you can click into a cell
and essentially have an entire document
it's somewhere between a database and a
spreadsheet so I think it shows that the
fact that Google did not update and
these tools and evolve them is just
sitting on the dominance of chrome and
if it was truly a competitive market
they would have been pushing they they
should be able to like they had a SC uh
pageless scrolling so there's not actual
page
demarcations that took forever from
Google and it was always the most odd
thing to me that when I'm writing on a
browser and I'm never going to print a
document I don't think in terms of pages
notion and others like push them in that
direction So to that Alex I say
Innovation requires competition and this
would be good well I will also argue
that maybe Microsoft's co-pilot with
generative Ai and all of its products is
going to be good enough to unseat Google
and for the discussion of whether that's
going to happen you all are going to
have to stay tuned for the second
because we will get to that but
continuing on with this the Department
of Justice is also suggesting some other
interesting things which is that Google
has to rip up its uh ex exclusive search
deals and then there's another
interesting thing where it wants Google
to be required to Syndicate its us
search results to other rival search
engines for the next decade
basically I guess saying that Google you
have the best um you have the best tools
and you or you have the best search
results and you are going to um
effectively uh be required to make those
available to competitors which is like
if that's the case I don't know why you
still in business or stuff do you think
any of this is is better than spinning
off chrome no see I I agree that this
one seemed a bit odd to me that uh yeah
like if that's your core business to
Outsource it or make it or make it open
source
didn't or like have to license it like
it be make it mandatory did seem kind of
weird I guess if I was trying to think
through what the logic could be it
almost is Google making search free
slash coming up with one of the greatest
business models of all time with like
intent-based
advertising uh maybe it's like
recognizing that the free product was
always kind of like a ticket to trying
to establish market dominance and and
that maybe that's not the case I don't
think I quite believe that I'm just
trying to uh figure out what the
government might be going for but I
think it's much cleaner spin-off Chrome
spin-off YouTube spin-off Android one of
those options something like that would
just make a lot more sense to me so we
always like to talk about what's
actually going to happen on this show
and I thought mg seagler from spy glass
friend of the show had a terrific story
basically looking at what's going on
here and his view is that this push to
have Google spin off chrome or sell
Chrome is really just the first position
that the government is taking they want
to say let's throw everything at Google
and then hopefully we'll get to some
negotiated settlement he says basically
some of the things that I've brought up
or one of me has brought up which is
that um there's no great alternative you
don't really have a natural acquirer
Google also does a lot for um the
browser world with its chromium uh tool
which by the way Arc is built on top of
this is sort of what I was talking about
the developer kits that it has and this
is what he says anyway the reality of
any of this happening remains fairly
small at the moment and in any sort of
short term it's non-existence appeals
and it's nonexistent appeals and
lawsuits will bog all this down for
years the only way something gets done
faster is if there's an option that
Google calculates is worth negotiating
to make this all go away to me that
still feels like uh the default search
payments in particular because that
probably hurts Apple more than Google so
that maybe Google like puts you know
decides that it doesn't want to do these
default search payments anymore and this
is what he says the government must know
that as well though so round and round
will go whittling down options and
severity in proposals until its final
offer time next year I'm guessing Chrome
isn't on the table by then do you think
that's
reasonable I think we are at that trim
time the lame duck time while as we wait
for the Trump inauguration and not to
move too much into the politics but
trying to predict anything remember who
would have been running the Department
of Justice as of 24 hours ago Matt Gates
is no longer in position to lead that so
I think it is interesting to me to think
about like and remembering why Sundar is
tweeting congratulations to Trump
anything can happen and I think things
could happen quickly like we we have no
idea but one
one kind of inkling from Trump that I
want to do this and screw Google maybe
this could move faster yeah I think
everybody within Google actually I don't
really know but I would imagine they're
all like waiting to say let's wait what
happens until the next Administration
comes because uh we lost against the
last one maybe new people would help us
out but also the case start against
Trump started with the case against
Google started with Trump Y and so now
he's back and I think antitrust is going
to be one of the most interesting things
to see which direction he goes because
that's one of I think complete there's
many wild cards but that definitely is
one where there's absolutely no clear
telegraphing because again on one side
less
regulation better like more open for
business on the other side hating big
Tech with Elon whispering in his ear
it's uh it could definitely go either
way I don't know if he's going to hate
big Tech as much this time around
because he has less of a like Facebook
you know tried to make me lose the
election remember he has Twitter that
was definitely a help to him uh Google I
think you know backed away from a lot of
their sort of restrictions over the 2024
election like big Tech actually wasn't
as big of a factor in the election like
Facebook did no politics it was like we
talked about it was podcasts that really
in terms of tech you know made the
biggest impact and that's like the least
algorithmically filtered medium you can
find I I think maybe he'll support
Spotify over apple and finally uh help
push them in their complaints about
Apple dominance one day all for the
podcast though Theo Von's going to call
him up and uh say help help out Spotify
as much as I love theovon I don't think
he's going to be involved in antitrust
policy that's just my guess big
antitrust guy huge antitrust guy yeah
Sherman Antitrust Act is one of his
favorite things to dig into you never
know so okay talking about incumbents
and products that have sucked for a
while we have an update on Siri so this
is from Bloomberg Apple Rees a more
conversational Siri in a bid to catch up
in AI Mark Gman writes apple is racing
to develop a more conversational version
of Siri its digital assistant aiming to
catch up with open AI chat GPT and other
voice Services the new Siri details of
which haven't yet been reported uses
more advanced large language models or
llms to allow back and forth
conversations um the system can also
handle more sophisticated requests in a
quicker fashion I am somewhat astonished
by this headline because I thought
that's what Apple intelligence was
supposed to be and apple intelligence
has like turned out into basically
nothing it summarizes my messages for me
and that's that's it uh series still is
pretty dumb in there in fact I've seen a
meme recently of people disabling Apple
intelligence because they say it makes
you dumber or it's not really good uh
What what is going on within Apple that
they waited until now and maybe credit
that they they're finally doing it but
they waited until now to try to fix
Siri if you're astonished I just chat
GPT what a word for 10 times the level
of being astonished I got flabbergasted
staggered or dumbfounded and those are
my reactions to the idea of
Apple now coming up with llm Siri and
starting to think about it and uh uh and
regular listeners know exactly how I
feel about Siri it has not gotten any
better Apple intelligence at least what
we have seen so far remains one of the
most half Bak of all AI like hyped AI
products out there so none of this gives
me hope and I don't get it I just don't
get it this is a company that gets
product they have a relationship with
open AI they can have relationship with
any major model provider out there and
these products are claw and Chachi PT
and even like like random AI products I
come across are so
good why why they organizationally still
can't make basic AI products I don't get
it I just don't understand why this
wasn't included in the initial push for
Apple intelligence like did the people
over there think okay we're going to
introduce large language models and
generative AI into our products and
we're going to call it Apple
intelligence and the thing that we're
not going to work on is our intelligent
generative assistant
I well I guess maybe it does represent
where Siri kind of lives in the
organizational hierarchy because you're
right though that they even were kind of
like caveat how integrated Apple
intelligence would be with Siri like it
was more an add-on it wasn't you're
right it wasn't a core part it wasn't
the Siri group that became an AI group
and it still remains separate and the
Apple intelligence group would then
power s like feed into Siri so yeah I
think it shows definitely kind of the
wrong strategic approach to this entire
thing and it does not make me any more
hopeful even though my whole house is
homepods now
that the back and forth of like my wife
and son and stuff going back trying to
get it to do what they're asking it's
like play a song I'm sorry your Apple
music subscription is not powered for
this because I use Spotify like like
there's so many of these moments that
are almost comical but just don't work
the echo isn't much better like I said
in a recent episode it woke me up for a
full week straight with ads for Celsius
energy drink although that's finally
stopped so maybe someone there is
listening but actually on that one thing
I think is going to be really
interesting in the whole voice battle is
Amazon there was a report last week I
think that the attempts to integrate
their llms into Alexa have been Tak
longer than expected because of latency
and I think latency is going to be a
huge Topic in this because Jeff bezos's
family famously on the original Echo
like said he wanted answers in like a
quarter of a second it was something
where the the team said this is
impossible and he said make it happen
and they made it happen and it always
was the speed of answers were critical
in making it a great device and Siri
you're going to hear me say something
nice about Siri it has gotten f fter it
do it might not give the right answer
but it'll confidently do it more quickly
oh my God that is such a great tagline
for Siri faster Dumber Siri
Siri won't give you necessarily the
right answer but it'll be quick um but
but count for something but llm
processing like can be heavy it can be
heavy so and the more complex the
systems are that are it's trying to
query or the it it really can take
longer and consumers have been trained
to want an instantaneous answer again
like chat GPT I've said this a lot the
greatest UI trick of all time was the
kind of typing dots cursor that make you
think it's thinking and like and then
letting the text stream almost like so
it allows the time that it's taken to
generate the answer almost be magical
like there's a brain thinking but what
what do you do if the overall time it
takes to answer a voice query goes from
a quarter second to 1 second or two
seconds then do people stop using it do
they do they can you fill it in somehow
so I think that'll be a big challenge
for everyone in the industry definitely
and one of the things that Apple has
going for it is it still has that
default experience we T we started the
show talking about Market important and
if it gets it act together here it has a
longer lead time to be relevant and
apple intelligence at least the first
version is not it we can say with
certainty now uh maybe this does because
if you think about it just imagine if
Siri was as good as Claude is today it
changes the whole experience on your
phone and can apple get to where Claud
is today eventually it better be able to
I mean we're talking about a long uh
lead time here and that really can
create a pretty impressive product only
if and this is the thing I think was
holding apple back this entire time only
if apple is willing to sacrifice a
little bit of control and say we're
going to allow the large language model
to do the work for us and because it
wasn't willing to do that Apple
intelligence has been the disappointment
it has and if it's deciding that that's
something that it's willing to do then
it could be in much better position I
have a proposal to whomever will be
leading the Department of Justice on
January 20th
2025 Force Apple to spinoff duty at this
point yeah SE separate conversation but
uh Force Apple to spin-off Siri and no
one's going to want to buy it and then
make the ability to be the voice
activation part of the iPhone an open
battle and maybe it'll be the chaty P
voice feature maybe it'll be some other
like enterprising companies and make
voice on the iPhone a competitive space
that that's my platform that's what I'm
running on well Ronan all three of me
agree with you on that front so very
convincing argument it's three votes
already three three votes including
yours that's 4 nothing settled in
unanimous consent
40 Ser to the people be a good campaign
but what does not have unanimous consent
is the quality of Microsoft's co-pilot
exactly so Microsoft had some serious
issues with co-pilot uh we also have
some news that Clara uh Clara's IPO is
coming out and then of course there's
this Jaguar Rebrand and anthropic
funding that we want to get to so why
don't we do that on the other side of
this break and we're back here on big
technology podcast Friday edition
talking about Microsoft hopefully we'll
be able to get Clara in Jaguar Rebrand
for sure and the anthropic funding it's
amazing anthropic raised $4 billion and
everyone's like an open AI raised
slightly more and it was like biggest VC
round of the all time look at them go um
so we'll talk about that but first of
all there's this big story and this is
we're going to spend some time on this
that Microsoft's co-pilot has really not
lived up to expectations with some
incredible quotes from employees and
this is uh all being broken down from
Business Insider so Business Insider
says a year after co-pilots release the
reviews both inside and outside of
Microsoft indicate that the new product
is struggling to live up to the hype
while there is no single measurement of
co-pilot's performance given a wide
array of feature it seeks the wide array
of features it to provide many customers
appear to be dissatisfied with the AI
tool complaining that it is ineffective
costly and not secure and this is
something worth paying attention to
folks because this one kind of blew me
away in October when the Management
Consultant sorry in October when the
management consultancy Gartner published
a survey of 123 it leaders only four
said co-pilot provided significant value
to their companies Ronan what did you
think about when you saw this CU we've
talked about this a little bit on on the
show but I thought this was a story that
felt definitive and it felt pretty bad
for Microsoft and its co-pilot
efforts I agree it's pretty bad four out
of 123 Executives and again remember
like Gartner and other organizations
like this almost they're talking to
people who live and breathe enterprise
software so they're going to get a
pretty good reflection of what people
are actually thinking I think this fits
pretty cleanly into the narrative that
2023 was pure hype the budgets were just
wallets were opening up 20124 people saw
it's not going to be straightforward or
easy and 2025 people are going to ask
hard questions I think to me the biggest
issue is the pricing so co-pilots at $30
a month per user which is essentially
doubling the licensing fee for regular
Microsoft Office 365 so it's basically
saying you're paying 30 bucks a month
for word Excel whatever and whatever
else and now you're going to pay the
same so you should expect as much value
I don't understand why they're pushing
that this early I get the anchoring side
of it long term you are saying like this
is I mean this should provide as much
value as just using Microsoft Word but
it's defin there's no way these tools
are going to deliver that right now
these are still like I don't want to say
hacky tools these are still incredible
tools but people are still figuring out
how to use them to solve specific
problems and most people don't know how
to do that yet so to just shove it into
their whatever app they're using and
then expect them to suddenly magically
understand how to derive equal value as
they get from your entire existing
ecosystem I it doesn't make sense to me
yeah that's a great great point and I
think the pricing right here is really
the problem if Microsoft was giving this
away for free or charging $5 a month per
user we would not have seen the backlash
that I think we starting to see from
people but when you charge 30 bucks a
month for people you better be
delivering some real value and
especially as you're figuring it out
and the Microsoft stock has increased on
the basis of being able to charge this
type of fee and I don't think folks are
seeing the results and some of the
quotes I'm just going to read a few of
them from the story are like remarkable
and I think folks should keep this in
mind like people are thinking about this
with the price it would probably be
different if it was not being charged
the way that it is at 30 a month but
anyway let's just read a couple of these
quotes uh I really feel like I'm living
in a group delusion here at Microsoft
One longtime employee told Business
Insider the company touts that AI is
going to revolutionize everything but
the support isn't there for AI to do 75%
of what Microsoft claims it'll do here's
another one there's a gap between the
ambitious vision and what users are
actually experiencing internally we're
calling it Growing Pains we're building
the plane as we fly it here's another
one one Microsoft executive offered a
blunt assessment of co-pilot's ability
to deliver useful results about one in
10 times it's magic the rest of the time
it's why do we even try here's another
one there is a delusion on our marketing
side where literally everything has been
renamed to have co-pilot in it
everything is co- pilot nothing el else
matters they want a co-pilot tie-in for
everything and lastly everyone wants to
make their impact by jamming a bad
co-pilot chatbot into their tools so now
every time I click on certain links I
get two popups for crappy co-pilot
implementations your
reaction these products could and
probably will be successful but they it
just takes time and like that's on the
actual UI side and how people interact
with them and that's definitely on the
llm side and the information it can take
in and return to you so to again to try
to just roll this out too quickly and
jam it in and double the price of an
existing subscription that again $30 for
an entire Microsoft Office Suite is a
good deal $30 for co-pilot as it is
today is not I think they're really
hurting themselves and I think the but I
guess it doesn't matter cuz the stocks
up it's it's sending the message that uh
to the market that this is like how you
can build out your financial models and
this is how you can value the stock so
for now the strategy has been good I
guess now also I was thinking like $30
when I you think about co-pilot and
double the fee of uh Microsoft Office
sounds like it's too much but 20 bucks
for Chachi BT plus 20 bucks for Claude
I'm totally fine with and I get a t way
more value than that $20 feels like so
maybe it's not the right it's not the
wrong price if it works in the long term
yeah but it is now but it does matter
because you're going to have companies
that are this is their relationship with
Microsoft and it's now going to have
co-pilot everywhere if you have bad
experiences there you may be less
inclined to buy more seats buy more
services you might cancel and not want
to go back in when it is um when it gets
better and then of course and I promise
we're going to stop the piling on in a
moment but this is an important part to
read there's the security concern and
the security concern is massive and I
don't know if this is just cherry-picked
examples or whatever it is but it exists
and it's worth talking about this is
from the article many customers have
deployed Co co-pilot only to discover
that it can can enable employees to read
an Executives inbox or access sensitive
HR documents this is from a Microsoft
employ employ now when Joe logs into an
account and kicks off co-pilot they can
see everything all of a sudden Joe can
see the CEO's emails and a Microsoft a
spokesperson said the company isn't
aware of any examples in which an
employee has been able to see the CEO's
inbox without permission another
Microsoft employee um said the tool
works really darn well at sharing
information that the customer doesn't
want to share or didn't think it had
been made available to its employee such
as salary info the problem is that it
takes years and these are not easy
situation faced with such issues some
customers have paused their deployment
of co-pilot in the Gartner survey 40% of
it managers said their company has
delayed implementing the tool for at
least 3 months citing oversharing and
security concerns I mean s Adella has
said security over everything if you he
said internally if you're faced with a
trade-off between security and another
priority your answer is clear do
security this is part of the Microsoft
Revival it's been security and so then
I'm left wondering what are we doing
here if we're you know the the company
that prioritizes security has ridden
security but is allowing these co-pilot
instances to leak uh important
information they need to better
answer this and again it's a quote from
uh I think yeah it's a Microsoft
employee familiar with customer
complaints but the idea that there has
been any customer complaints that some
lower level employee logged into
co-pilot and could see the CEO's emails
I mean that that breaks the entire
product that's like it's over at that
point so to just say like a Microsoft
spokesperson if their only response is
we are not aware of examples in which an
employee has been able to see a CEO's
email inbox without permission that's
kind of shocking to me like from just
from no not happen like I hope so
because if it does you better address it
if that has happened once you better
address this right now you don't just
say like give a standard PR spokesperson
response or like
non-answer you either it happened and
you addressed it or it didn't happen and
you just go hard back at this I'm
shocked by that definitely and look this
is why this is the highest I expect for
them this is why Satya wants co-pilot
and everything this is why they're
already charging $30 uh per seat is
because it takes a huge capex spend to
make this happen so Microsoft I just
learned this from the story it plans to
amass 1.8 million
gpus uh by the end of the year and it
plans to Triple its data center Capac
capacity which is already at 5 gaw
roughly what it takes to power all of
New York City each day by 27 20 by 20127
it plans to spend more than a 100
billion on gpus and data centers alone
it needs this to work and it has said
and this is the Microsoft defense that
it studied uh it it uh commissioned a
study that said for every $1 a company
devoted to generative AI the return has
been
$370 so Microsoft's response here is
basically we are spending a lot of money
and if you spend a lot of money you are
going to make a lot of money already
today what do you think about that
ronon this is where again like and
regular listeners know that this is my
uh biggest pet peeve with the hype cycle
in generative AI as a profound believer
in the technology is exactly this that
like again that there's the quote of
like they commissioned a study that for
every one every $1 devoted to generative
AI their Roi is
$3.7 like selling the story that already
right now people are going to be
deriving insane amounts of value without
especially for companies that have never
really used generative AI I've been
working with this for almost three years
now when GPD 3 was launched via API 3
years ago and it takes time and it's
hard work and like it everything is
super custom and requires a lot of I
don't know Blood Sweat and Tears so I
think uh they're falling into this trap
again and they're it I think they'll be
okay not I'm say I'm not betting against
Microsoft right now but just tone it
down a bit that's all exactly and
there's some other like pretty
interesting stats in this story this is
is uh also from Gartner and this sort of
like tells us how open AI I mean not
open AI generative Ai and co-pilot are
still a pretty mixed bag but there's
some good things so Gartner said 92% of
folks said co-pilot enhanced employee
satisfaction 62% called it somewhat
value but at the same time 75% said
their employees were struggling to
integrate it into their daily routines
57% said users felt the tool didn't
deliver the value they expected and 53%
reported that it provided too many
inaccurate results I mean basically what
you're seeing here is something that can
be very valuable something that is
useful makes people happier but also
they're still not 100% sure how to use
it and that seems normal for a new
technology that it's just two years on
the scene and always
improving that's kind of throw my hands
up and say okay that's a my hands are in
the air do su it up that's it that's it
that's it so we find out all right let's
rapid fire through some of the things
that we have coming up here oh before we
rapid fire one guy who absolutely loved
this story and is quoted in it is
Salesforce CEO Mark benof and folks
he'll be on uh the show next Wednesday
talking about Ai and agents and
co-pilots and Microsoft and Salesforce
and uh his relationship with Elon Musk
and whether he's going to sell tim in so
that's coming up next week so make sure
to tune in for that on Wednesday maybe
you could listen to it with your family
as you drive to your Thanksgiving um
destination wherever you're going you
know we understand that this is pure in
thear entertainment for the kids big
Tech and turkey just give me give me
Benny off give me you know the family in
the car hand the kids the iPads and
let's get going that's the big
technology
dream all right very quickly anthropic
raised the four billion um lot of money
and my and it came from Amazon uh and
it's going to make
AWS uh let's see it's going to make AWS
the primary Place it'll train its
Flagship generative AI models it is
interesting that anthropic and um and uh
and Amazon have a much cleaner
relationship than open Ai and Microsoft
that's just my observation what
Microsoft gave less than a billion to
the latest open AI round and throp I
mean Amazon gave all four
billion I'm hoping this means that as a
Claud Pro subscriber I don't know if
others out there use it they I've been
hitting the r like the they have pretty
strict chat limits yeah um if you use if
you're a heavy user especially if you're
writing code with it you hit the limit
and if you're on the I'm on the Claud
subreddit and that's all everyone
complains about so I'm hoping this means
that they'll be able to uh boost those
limits a little bit but I mean honestly
Claude is getting better and better this
this is where why like the micros
co-pilot stuff just IRS me cuz there's
great tools out there being built you
should be able to do it cuz CLA is
incredible and I I'm happy for this this
means at least from the open AI versus
the Chachi BT vers Claude battle they'll
both get better which is a good thing
for all of us at least definitely I
think this is going to prove to be one
of Amazon's uh best investments ever
oo I am I think so bigger than Whole
Foods MGM
yes bigger than both and I think maybe
eventually more money than both uh we'll
find out so yeah um and I am going to go
to their reinvent conference coming up
in December so looking forward to doing
a show from there and uh we'll we'll
have more to say about that uh pretty
soon so let's make sure to use the final
eight minutes we have together Ronan
talking about something near and dear to
our hearts which is the jaguar Rebrand
and I logged into to Twitter one day
this week and it was just a stream of
people filled uh filled with rage about
what Jaguar had done to its brand and I
was like ah these people need to get
over their anger at rebrands and then I
took a look and why don't we let the
Wall Street Journal introduce it to us
uh this is from the journal the Jaguar
Rebrand is pink diverse and doesn't
feature any cars luxury automaker Jaguar
is betting that a colorful and Youthful
Rebrand will help it successfully launch
fully into the electric car market
uh critics however are questioning
whether its brand still knows how to
sell cars an Avant guard 32nd spot
released this week shows a diverse group
of expressionless people dressed in
brightly colored sculptural garments as
they stride wordlessly around a fuchsia
landscape and pose with props like a
yellow Sledgehammer it closes with with
a look at the car Maker's new logo
styled as j a capital g u a r the video
displays phrases such as copy nothing
and create exuberant but it doesn't
include any
cars H this is from a marketing
consultant it's unusual to see a stored
brand so radically want to change its
position that's brave but Brave could be
foolish if the customers don't like it
my quick reaction to this was this
Rebrand was terrible it's the opposite
of what you want your company to be
which was basically inaccessible to the
point of
I don't even know it was so off-putting
there was again the expressionless
people walking around and um nothing
about a car and nothing just sort of
what acid trip did this company do to
come up with this type of Rebrand that
was my reaction maybe it's a basic
reaction because it seems like everybody
else felt the same way uh but I know
that you have a perspective ran on it I
haven't heard it yet and I'm very
curious to hear I'm excited to take the
other side on this one no you don't like
this r okay here's why here's why so for
context Jaguar the brand their cars have
been declining in sales especially in
the US and there there was a good post
that was like you know what their
positioning has been they used to be
kind of high-end luxury then they
started moving a bit down market and now
they're a bit lost in terms of where
like where in the price spectrum they
sit so the so the Jaguar the brand
Jaguar the company jlr jaguar and Land
Rover is doing okay like actually
they're doing pretty well and Land
Rovers models have been increasing in
sales significantly so they actually in
North America saw almost 30% growth last
a year over year which is a I mean cars
is huge especially for a legacy brand so
they got to do something now what do you
do this commercial was ridiculous like I
mean I agree it was the stupidest thing
I've ever seen but if the true goal and
I don't know if this is actually but
they started responding in the comments
some pretty funny things like very
online like uh responses and like kind
of they engaged and the fact that they
did that no in these situations like
Brands never do that they always kind of
either the rule is you just don't say
anything and let it pass or you try to
like apologize or say we'll do better
they just went they they owned it and
they were funny about it so if the goal
was to get people to talk like I had not
thought about the brand jaguar in as
long as I can remember I am excited to
see the unveiling right now like maybe
it'll be terrible but maybe it'll be
good but I'm thinking about it and I
think this is the thing in marketing
like what other possible Rebrand would
have been exciting or talked about or
good I don't I I I have no clue I'm not
a car marketer in any ways but I think
this has everyone thinking about it and
remember their goal is probably to move
away from Pure like hardcore car
enthusiasts to more regular consumers
and this at least opens things up where
people are thinking about them maybe
they'll hate it but when they come up
with whatever redesign we're all going
to be
watching that is the most logical
explanation I could possibly have heard
about why this might be good for Jaguar
however I just don't think anybody
watching that commercial is going to be
like yeah I want a Jaguar now did they
get a lot of attention on the internet
sure is that cheap it sure is and no we
haven't seen the car yet we haven't seen
we haven't se have you thought about
jaguar in years or do you ever think
about the brand Jaguar no yeah I did
think about it this week but I'm not
it's not I mean it's not making me want
to buy a Jaguar you going to buy a
Jaguar now maybe the car if the car is
awesome maybe maybe I don't know but the
thing is like I was speaking with RJ
scin from rivan about this this week
your car however however many people
might say it's not true your car is your
identity in some way what you drive says
a lot about you do we like the fact that
that's happened is that an ere extension
of capitalism to the point where like
we've made our vehicles our identity yes
is it kind of gross yes but it is your
identity and so like what is being
Jaguar owner going to say about you if
this is the new Direction yeah but
that's
like a lot of liberal people are still
sitting on Teslas and uh I don't know
what it says about them right now that
might be it I mean that might be their
play saying we're going they're going
all electric right yeah Tesla a big
Market a lot of people want to get rid
of their Teslas maybe this is exactly
what Jaguar is doing maybe it's not even
being subtle about it maybe it's saying
F you Elon Musk and and your association
with with Trump oh wait we are the
liberal car maker we're doing electric
cars RJ scrin from rivan he's like we're
just selling the car makers Jaguar
saying liberals come on in we don't need
to even show you the car we're selling
you an identity hire the hire the agency
cantro and Roy for more incredible
marketing strategy just like this I mean
but we didn't even we didn't even make
the strategy like I think that that is
actually what they're doing if it is
that that is 40 marke from a bus yeah
yeah yeah that would be smart
and how do you get people thinking about
you or talking about you cuz Making a
Splash in today's attention like
landscape is nearly impossible
especially for just like some old brand
they did it try to say this without
being being bad but like liberalism is
kind of a damaged brand right now sort
of they're still there they're
still Trump only won 49.9% of the vote
it's uh there is a large Market of
people I like this that uh own a Tesla
probably right now and were the
environmentalist leaning liberal
Progressive customer that are looking
for an electric and they're looking at
maybe it's the I Hyundai ionic or the
new I think it's like the Honda pre like
it's open none of the other EVS have a
other than rivan which I know in that
interview they said they're going to try
to make more affordable cars but now26
yeah yeah yeah exactly there's an
opening
here just like what made was there
something about the Jaguar ad that made
it liberal was it that it was diverse
like I see I didn't I honestly don't
even remember I just remember some
bright colors and that's it yeah bright
colors a lot of expressionless
people cast of models yeah yeah the logo
redesign I mean I think it was more that
it didn't show any cars and just looked
like just a rid like almost like a
Zoolander esque fashion show like it uh
it was ridiculous but December 2nd at
Miami art week mark your calendars for
the
unveiling are we going I think I think
we have at this point got to take us so
hey we're on board we're hoping we're
rooting for you yeah I'm like looking at
the type of people are that are I'm
still trying to figure out like what
this ad says I'm looking at the type of
people in that ad I'm just like it's not
I don't even know if it's about
diversity but maybe it's just the
demeanor of these people no no I think
it's the looks they're giving the camera
it's the whole thing it's the whole
which again if there AI create me a
video to stir up the internet using
brightly colors and diverse
models they did it they did
it
well I started the segment not saying
that there was any way I could Poss
possibly see the business logic and what
they've done I end this segment saying I
can see the business logic and what
they've
done but this is also one of those
things where we're going to see the
numbers now we have to follow the story
right yeah now this is most important
story of 2025 maybe not but all right
everybody uh thank you for listening
Ronan great to see you thanks for being
here see you next week as I'm driving my
Jaguar Up To Boston to that's right
we'll be in our our new Jags our new
big Tech yeah
exactly I am driving the rivan I'm test
driving the um R1 second generation SUV
this weekend so that'll be oh all right
that'll be fun I'll report back on that
um and yep we got Benny off coming up
next Wednesday and then ronon you and I
are back next Friday next Friday yep all
right we're going to do it so stay tuned
for a holiday week edition of big
technology podcast thanks for listening
and we'll see you next time on big
technology podcast