Good morning. I’ve got Elon Musk on my mind, and not for reasons you might suspect.
It’s because of his never-boring Boring Company, which presently has a bit of a trespasser problem in Las Vegas. (Read more below from Fortune’s Jessica Mathews.)
Only a few years ago Musk promised to alleviate traffic in notoriously clogged Los Angeles; today, he’s relocated to Texas and left a literal tunnel of broken promises.
And I’m still stuck in, well, you know. —Andrew Nusca
P.S. We goofed the other day by implying that Google did not pay for news in Canada. The company struck a deal with the federal government almost a year ago. Thanks to eagle-eyed reader Benoît for the catch. —Andrew Nusca
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And the Nobel goes to…AI
Two artificial intelligence pioneers yesterday won a Nobel Prize—and two of Google's brightest minds separately won another today.
The first honor went to “godfather of AI” Geoffrey Hinton—you know, the one who dramatically quit Google last year so he could warn the world of AI’s risks—and to John Hopfield, whose work in the early 1980s helped lay the foundation for today’s machine learning technology.
Both men significantly advanced the concept of the artificial neural network, though neither invented it as such.
Hinton and Hopfield were awarded the Nobel physics prize, which has proven to be a controversial decision. There is no Nobel prize category that maps clearly to computer science, and some physicists have complained that the award should have gone to someone working in “proper physics” instead. (One wonders what HAL 9000 would say about that.)
Then, this morning, Google DeepMind CEO Demis Hassabis and DeepMind director John Jumper won the Nobel chemistry prize, for their work on the AlphaFold2 AI model that stunned the scientific community with its ability to predict the structure of almost all known proteins.
This is a breakthrough year for AI's recognition as a scientific tool, and more will surely follow. —David Meyer
Foxconn hooks up with Nvidia to build an AI supercomputer
Foxconn is famous for assembling Apple’s iPhones, but it may soon be known for its own technology marvel: a massive AI supercomputer, built in partnership with Nvidia, that it says will be the fastest in Taiwan.
The Hon Hai Kaohsiung Super Computing Center, announced Tuesday, will boast more than 4,600 of Nvidia’s new, and super-scarce, Blackwell GPUs, as well as thousands of CPUs, delivering a promised 90 exaflops of AI performance (a feat Foxconn claims will eclipse anything else in Taiwan).
Once this beast is operational–the first phase is due to be completed by mid-2025, with full deployment in 2026–Foxconn will use it for AI-driven cancer research, to develop new LLMs, and to focus on smart city innovations.
Foxconn and Nvidia are also teaming up for a project in Mexico. The two companies announced that Foxconn will build the world’s largest factory for Nvidia’s GB200 chips in Guadalajara. ¡Orale! —Sharon Goldman
The TikTok hits keep on coming
TikTok is facing a new set of lawsuits from 13 states attorneys general, including New York, California, and Washington D.C.
The suits accuse the popular video social media app of violating consumer protection laws by “intentionally” targeting young users and hooking them to a platform that is harmful to their health. (It’s worth noting that Meta was sued by four times as many state AGs almost exactly a year ago; the cases are pending.) The lawsuits seek product changes and financial penalties.
As of last year, TikTok said it had 150 million users in the U.S., and studies have shown that a vast majority of those users are under 35 years old. While it is not public exactly how many of those users are under 18, a few years ago one-third of TikTok’s user base was reportedly under 14 years old. TikTok’s CEO said last year the platform’s average user was “well past college age.”
At any rate, add these lawsuits to the pile of legal troubles facing TikTok, which is owned by China’s ByteDance. The platform has ongoing legal challenges from The Department of Justice, and it's fighting at the Supreme Court an executive order requiring ByteDance to sell it or be banned in the U.S. —Kali Hays
Elon Musk has tunnel intruders
Elon Musk has a trespassing problem in the subterranean transit system that one of his companies, Boring Co., has built and operates under the Las Vegas Convention Center.
A skateboarder got into a tunnel and had to be ejected. A pedestrian wandered around taking pictures. Then there are the cars that accidentally drive onto the transit system’s property by tailing close behind the Teslas that are used to chauffeur passengers underground.
There have been at least 67 trespassing episodes since 2022, according to documents seen by Fortune, obtained via a Freedom of Information Act request. And, since the beginning of last year, 22 vehicles have followed the Teslas into the stations or tunnels.
Musk’s first operational tunnel system—with its funky pink, blue, and green lighting—may not be the high-speed hyperloop he was raving about when he started the Las Vegas project. But it has still managed to capture the public’s attention—and that includes people who aren’t supposed to be in the tunnels, but end up in them anyway. —Jessica Mathews
Roblox fudged its user data, investor says
Hindenburg Research, a short-selling investment firm, has accused Roblox of inflating key metrics.
In a new report disclosing a short position in Roblox, Hindenburg estimates the U.S. game developer inflated the number of users of its namesake gaming platform anywhere between 25% and 42% by not being transparent about the number of alternate accounts or bots contributing to its daily active users, or DAU.
Roblox measures this distinction through a process called “de-alting,” former employees reportedly told Hindenburg. Roblox also inflated engagement hours by roughly 100%, the firm claims.
In recent years Roblox—which turned 20 this year—has touted a growing user base while setting a lofty goal of 1 billion users. The company, which is publicly traded on Nasdaq, has told investors that it’s not profitable and might not be for a while. (In its most recent quarter, Roblox generated $893 million in revenue and a $206 million loss.)
Hindenburg also calls Roblox a “hellscape” for children’s safety, pointing to a Bloomberg Businessweek investigation, published in July, detailing how leadership failed to curb child abuse on the platform.
Roblox told the Wall Street Journal the Hindenburg report is misleading and motivated by an agenda. At some $40 per share, its stock is down 15% in the last two weeks. —Jenn Brice
More data
—Amazon antitrust watch begins. There must be something in the water.
—Anduril wins a $250 million Pentagon contract to intercept unmanned drones.
—Saudi Arabia’s sovereign wealth fund cuts its Nintendo stake. Even bullish investors can’t escape the gaming slowdown.
—The next Instagram ad you see may be edited by AI. So where’s the beef?
—The UK is creating a "Regulatory Innovation Office." To innovate around all that, uh, regulation.
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