Anthropic has made a new, powerful friend – SpaceX | Bytes: Week in Review | Marketplace Tech

0:01 [music]

0:06 Welcome to Marketplace Tech Bites, our weekly review of some of the biggest

0:09 stories making headlines across the industry.

0:11 I'm Stephanie Hughes.

0:13 This week, Anthropic and SpaceX announce a new computing deal.

0:17 Apple to pay $250 million over exaggerated AI capabilities.

0:22 And GameStop makes a surprising bid to buy eBay.

0:26 I'm joined by Caroline O'Donovan,

0:28 a senior reporter at the San [music] Francisco Standard.

0:30 Caroline, thanks so much for talking with me.

0:32 Thanks for having me.

0:33 So, we are going to start with our bite of the week.

0:35 This is one number that gives a hint

0:37 about something that happened this week in tech.

0:40 Uh Caroline, what is your bite?

0:42 Uh my bite is $29 billion, which is the amount of money that Elon Musk's

0:48 lawyer repeatedly told OpenAI co-founder Greg Brockman uh during

0:53 the trial this week that he should donate back

0:56 to OpenAI uh because in in evidence presented in court,

1:01 Brockman had said he would be happy if he made just $1 billion,

1:05 and it seems at this point his stake is worth somewhere around $30 billion.

1:08 So, uh as I was covering the trial,

1:11 the Musk versus OpenAI and Sam Altman trial in Oakland,

1:14 California this week, uh over and over again,

1:16 the this um lawyer for Elon Musk kept saying, "Well,

1:19 why don't you just donate $29 billion,

1:21 Greg Brockman?" So, that's my number of the week.

1:23 That is such a good number and such an interesting trial.

1:25 Thanks for taking a break from it to to talk with us,

1:27 and we'll touch on it a little bit, too.

1:29 Um we're going to talk about our first story, which is kind of related.

1:32 So, Anthro Anthropic and SpaceX, um one of Elon Musk's companies,

1:36 announced a new computing deal this week.

1:38 So, Anthropic is the maker of Claude,

1:39 and it now has access to SpaceX's Colossus 1 data center,

1:44 which is in Memphis, Tennessee.

1:45 Anthropic says this will allow it to increase usage limits for Claude.

1:49 SpaceX said the companies may also end up

1:50 working together to develop orbital AI compute capacity.

1:54 So, Caroline, Tom Brown of Anthropic wrote on X that he was

1:58 grateful for the partnership writing {quote} "We are going to need a lot

2:01 need to move a lot more atoms in order to keep up

2:04 with AI demand." Tell me more about what Anthropic is getting here.

2:09 Uh I think the obvious thing that Anthropic is getting here is more compute.

2:13 A colleague of mine, uh Emily Sugarman,

2:15 was at a um Anthropic event yesterday where the CEO,

2:20 Dario Amodei, was on stage and he was talking about, you know,

2:22 over the last year we know that we've had blackouts, we've had service issues,

2:26 because we grew faster than they were intending to and the problem is compute.

2:29 And so, the obvious problem that this solves for Anthropic is compute.

2:34 The surprising thing is that over the last, um you know,

2:37 weeks and and months Anthropic has really positioned itself,

2:39 right, as the company most concerned with the future

2:44 of humanity and and, you know, societal values.

2:47 that made it sort of eyebrow-raising that they're

2:48 now deciding to get their compute from Elon Musk.

2:52 Yeah, let's talk about that a little bit.

2:54 You know, this deal is happening in a week where, as you talked about,

2:56 one of SpaceX's leaders is in the middle of a trial against OpenAI.

3:00 I know you've been at that trial.

3:01 With that in mind, what did you think when you first heard about this deal?

3:06 I was very surprised.

3:07 I mean, for the reason I just mentioned, it just seems like odd bedfellows.

3:10 Um if you were on Tech Twitter at all yesterday,

3:13 you would have seen many memes about sort of, you know,

3:15 the enemy of my friend of me is my friend of me, I guess, you know.

3:19 And [laughter] the general thinking there

3:21 is that Anthropic is OpenAI's biggest competitor.

3:24 Musk is in the middle of this trial that he brought, a case that he's bringing,

3:27 which everyone is sort of questioning, you know,

3:29 why did he put himself in this position?

3:31 And it seems like not necessarily meant to gain

3:33 him anything as much as to punish OpenAI.

3:36 And then in the midst of that trial, he seals this incredible,

3:40 you know, surprising deal with Anthropic, which is their biggest competitor.

3:44 So, you saw a lot of people saying sort of, "Wow, this is a huge, you know,

3:48 rude gesture towards Sam Altman." And something I I think I noted

3:52 is that I thought was really interesting is that um Musk himself

3:55 seemed to say that he had come to the decision to make

3:58 this deal after spending time with executives at M Product this week,

4:01 which made me someone who was, you know,

4:03 in the room with him for a lot of last week.

4:04 I was like, is that where he went when

4:06 the judge dismissed [laughter] the, you know, trial for the day?

4:09 Where is he going?

4:10 Yeah, one of my colleagues likes to say that the AI economy kind of eats itself,

4:14 and I feel like this is maybe an example of that.

4:17 Um, do you have any other thoughts on why SpaceX, which has its own AI division,

4:22 now SpaceX AI, uh, decided to lend its computing power to a competitor?

4:28 Well, I mean, I assume they're getting something

4:29 financial out of their side of the deal.

4:31 Um, one thing I would like to sort of, uh,

4:34 prod a little bit more this weekend maybe

4:35 into next is I saw a few people saying, well, does this mean that Grok is dead?

4:39 Does this mean that xAI is dead?

4:41 Does that mean that, you know, Elon and whatever his, um, you know,

4:45 menagerie of companies are no longer trying

4:47 to build a competing AI model because they're they're,

4:49 you know, selling their compute to a competitor instead.

4:52 But during the trial this week,

4:54 Elon actually was asked on the stand whether Grok was a competitor for ChatGPT,

4:59 and he said, you know, under oath that it's catching up.

5:02 So, it didn't make it seem like it was a product he's not working on anymore.

5:05 So, that's another thing I'll be keeping an eye on.

5:07 Such a good word, menagerie of companies.

5:09 Okay, so let's move to our next story.

5:12 Apple is going to pay $250 million over exaggerated AI capabilities.

5:17 So, back in June 2024,

5:19 Apple announced it had a new AI system, Apple Intelligence.

5:22 Here's the beginning of a promotional video released around that time.

5:25 Siri, play that one song Diego sent me.

5:29 Okay.

5:31 Oh, how did you do that?

5:35 With Apple Intelligence, it's AI that gets you on your Apple products.

5:41 So, this week Apple agreed to pay $250 million as part

5:44 of a settlement over claims it over-promised what Apple Intelligence could do.

5:48 An Apple spokesperson told us, quote,

5:50 "We resolved this matter to stay focused on doing what we do best,

5:53 delivering the most innovative products and services to our users." Caroline,

5:57 what do you make of all this?

5:59 Well, first of all, I wasn't actually aware that you could, you know,

6:02 file a class action lawsuit against a tech company for telling

6:05 you it could do something it really couldn't and actually win.

6:07 So, that was pretty big news to me.

6:09 Yeah.

6:10 Um I I mean, I think that the saga of Apple

6:13 and what they've been doing with AI is pretty interesting.

6:16 Um you know, Apple has a reputation

6:18 in Silicon Valley for having extremely high standards.

6:21 They want their products to be perfect,

6:23 and that's not really what we've seen with the way

6:25 that um AI chatbots and LLMs have been rolled out, right?

6:29 There's a lot of iteration, there's a lot of problems,

6:31 there's a lot of public apology, there's a lot of, you know,

6:34 we're changing its personality, and oh,

6:36 now we've decided to release its constitutions,

6:38 and that's not how Apple does business.

6:40 So, in a way, it makes sense that they've sort of um not lagged behind,

6:45 but been a little bit more cautious in the rollout.

6:47 But, it's interesting, obviously,

6:48 that they did they they fumbled it in this way of, you know,

6:50 advertising the product and then not releasing it.

6:53 Um I I was an Amazon reporter before my current role,

6:57 and I wrote a lot about Alexa,

6:59 and I think that Alexa and Siri um as uh you know,

7:02 um uh voice assistants have a lot in common,

7:06 which is that they had a different sort of, you know,

7:08 prior generation technology that is difficult.

7:11 You can't just, you know, delete that and replace it with an AI.

7:14 And when you have an existing brand that has value, you can't just,

7:17 you know, totally change what that is, or consumers are going to be very upset.

7:20 So, I do understand why this was a challenging rollout for Apple,

7:24 and I think it's really interesting that consumers are actually

7:26 going to see some amount of money out of it.

7:28 Yeah, and you know, just to get specific, you know,

7:30 people who bought an iPhone 16 and some models of the iPhone 15 between

7:34 summer 2024 and early spring of 25

7:36 are reportedly eligible to get some money back.

7:39 What does all all say to you about how

7:41 hard it is [laughter] to make AI features actually work.

7:47 [snorts] Yeah, I mean I think like I said,

7:48 when you have a Siri or an Alexa type product that's a little bit more scripted,

7:52 it can be really difficult on the back end.

7:54 It's not the same fundamental technology.

7:57 And once the consumer is used to talking to ChatGPT

8:00 or used to talking to Claude in a different way, right,

8:02 where it's having a more generative response on its own,

8:06 the Siri and Alexa products are going to start to look really old-fashioned.

8:09 But at the same time, those those are existing products that have been

8:12 around in Alexa's case for a decade, right?

8:14 We We have a strong The consumer has

8:17 a strong sense of what those are going to be.

8:19 So, you can't just change them overnight,

8:20 and you definitely can't change them overnight to something

8:23 that's going to spread misinformation or make other mistakes.

8:25 So, it does it is a a challenge for Apple.

8:28 Yeah, they're our AI buddies.

8:29 We don't want them to change too much or right away at least.

8:33 [laughter] Okay, let's get to our final story.

8:34 GameStop makes a surprising bid to buy eBay.

8:38 So, the video game retailer announced this week it was making an unsolicited

8:41 unsolicited unsolicited offer to buy the e-commerce

8:44 company eBay for about $56 billion.

8:47 eBay said it's reviewing the offer.

8:49 Carolyn, GameStop is mostly a brick-and-mortar retailer,

8:52 gained a lot of notoriety a few years

8:54 back during the meme stock craze meme stock craze.

8:57 Why do you think we're seeing it try to buy a big e-commerce retailer?

9:03 To be honest, I mean it's it's very difficult to say

9:06 exactly why this particular person is making the bid he's making.

9:10 I think it's a lot of people Ryan Cohen, the CEO of GameStop.

9:12 Yes, yes, Ryan's Ryan's Cohen, the CEO of GameStop.

9:16 Obviously, you know, he enjoys being on social media.

9:19 He has a sense of humor, and he has previously made the point

9:23 in his career in finance and e-commerce and tech

9:26 that you can sort of harness the power

9:28 of social media to create very interesting outcomes,

9:31 and that's something that he seems to take great pleasure in doing.

9:35 Um, I think he's, you know,

9:36 made some points about how eBay has been managed and uh

9:39 um uh his own ability to find efficiencies within you know,

9:42 different e-commerce and um tech platform businesses.

9:45 Uh but there's been a lot of skepticism including um

9:48 from some investors in GameStop about his actual ability to find

9:52 the money he would need to fund this deal because eBay

9:54 is worth a lot more money than GameStop is right now.

9:57 Yeah, let's you know, there's actually in an interview with Andrew

10:00 Ross Sorkin this week on CNBC, you know,

10:03 um Ro- uh Andrew asked him about that and Cohen did not have

10:06 a great answer about how GameStop would come up with the money to buy eBay.

10:11 I'm just trying to understand where the the rest of the money would come from.

10:16 Half cash, half stock.

10:20 I I I'm I hear you.

10:22 I'm just saying that that math doesn't get

10:25 you to the to the price that you're offering.

10:32 Right, and that's a pretty straightforward question.

10:34 I don't get it.

10:37 The interview is in general just really awkward and sort of telling.

10:41 Do you have any sense of what the plan is here?

10:43 It's okay if you do not.

10:46 [laughter] I mean, I don't All I can [clears throat] say

10:48 is that I'm a I'm a big thrift store shopper,

10:51 estate sale attendee, and long-time fan of eBay.

10:54 So, I'll be keeping my eye on it.

10:55 I won't be spending $5,000 on a GameStop hat,

10:59 which I think is one of the items Cohen currently has listed.

11:02 Um and that clip is so funny, you know,

11:04 it's almost like I wish my my dad could be I guess

11:07 next to me on the show because I'm on Twitter all day,

11:09 so I understand sort of what Cohen is is doing.

11:12 He's trolling.

11:13 He's doing what he does, right?

11:14 He He tries to get the attention of his um

11:17 day trading fanboys to make an interesting outcome happen.

11:20 And my my dad, who watches financial news all the time,

11:23 would be like, "This is an embarrassment.

11:24 What's going on?" So,

11:25 I think you're definitely seeing an interesting intersection

11:27 of e-commerce and social media and then um you know,

11:30 the kind of like play with markets that people who really

11:33 think prediction markets are exciting sort of enjoy watching and observing.

11:36 So definitely you know, will be interesting to see what happens next.

11:40 He is back on eBay by the way.

11:41 They temporarily removed his account, but he's back.

11:44 Yeah, yeah, just to like explain that a little bit more.

11:46 Basically Ryan Cohen as I understand it listed a bunch of personal items

11:50 including a pair of socks for extremely high prices on his eBay account.

11:54 There were reports that his account had been suspended.

11:55 Now I guess it's back.

11:56 That's great.

11:57 We can buy the socks.

11:58 Well, you know, on eBay you can list them at whatever

12:00 price you want and then people can bid them up.

12:01 So that's the fun.

12:03 You got to see what happens.

12:04 I'm quite a big eBay user and I like had a moment where I was like,

12:06 do not accidentally like touch anything here, Stephanie.

12:11 [laughter] It'll be interesting to see what happens with this.

12:13 Um Carolina Donavan at the San Francisco Standard.

12:15 Thank you so [music] much for talking with me.

12:17 Thanks for having me.

12:18 And thanks to all of you for joining

12:19 us for Marketplace Tech Bites weekend review.

12:21 Daniel Shin produced this episode.

12:23 I'm Stephanie Hughes.

12:36 This is APM.