Good morning. Lean and mean today, like the luggage capacity of Russ Hanneman’s favorite McLaren.
Today’s tech news below. —Andrew Nusca
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Microsoft will use OpenAI custom chip effort to inform its own
OpenAI announced last month that it would partner with Broadcom to build its own custom AI chips.
So it’s fair to ask: Given its special financial relationship with OpenAI, what does Microsoft stand to gain?
A lot, according to Satya Nadella. The Microsoft CEO said in a recent podcast episode that the tech giant plans to use learnings from that experience to build its own custom silicon.
“As they innovate even at the system level, we get access to all of it,” Nadella said. “We first want to instantiate what they build for them, but then we’ll extend it.”
Microsoft and OpenAI reworked their agreement last month as the high-flying AI startup completed a restructuring that allows it to take even more outside investment.
Under its terms, Microsoft gains access to OpenAI’s research through 2030 and AI models through 2032.
Microsoft’s learnings will hopefully help its home-grown AI accelerator efforts, which have complemented the use of chips made by AMD and Nvidia.
Kevin Scott, the company’s CTO, said last month that Microsoft would like to mostly use its own chips in its data centers in the future: “We will literally entertain anything in order to ensure that we’ve got enough capacity to meet this demand.” —AN
Waymo becomes the first robotaxi provider to offer highway rides
The question for this Los Angeles County resident has long been: When will the robotaxi operators dare to drive the freeway?
We finally have an answer.
Waymo—which operates in central L.A.—said Wednesday that it would “offer freeway access to a growing number of public riders” in the San Francisco Bay Area, Phoenix, and Los Angeles, with Austin and Atlanta to follow.
It’s not just the addition of a new transportation modality that’s interesting.
The addition of high-speed roadways necessarily pushes Waymo’s service far deeper into the metropolitan areas in which it operates. As such, Waymo announced that it would offer rides from San Francisco to San Jose and everywhere in between.
And though it hasn’t yet announced an expansion in LA, it’s not hard to imagine the Alphabet-owned company bursting from its Downtown-to-Santa Monica service zone to include densely populated adjacencies like the Beach Cities and the San Gabriel Valley.
Whatever happens, it’s a major technological leap to take the highway. Much as they do for human drivers, the high speeds found there leave robotaxis with precious little time for decision-making and catastrophic consequences for mistakes.
See you at rush hour. —AN
Valve unveils ‘Steam Frame’ VR headset
In addition to reviving its “Steam Machine” gaming PC, the American game developer Valve has unveiled a $999 virtual reality headset it calls “Steam Frame.”
The wireless headset, powered by Qualcomm silicon and due next year, can stream games from a PC or run Windows and Android games locally.
Translation: It can function as a standalone entertainment device.
Valve’s introduction of a new VR headset has been rumored for years after mentions of a device called “Deckard” appeared deep in code libraries in 2021.
The Seattle-area company’s previous production headset, the Index—which also cost $999—arrived in 2019 and required a PC to function.
A lot’s changed in the world of immersive headsets since then.
Though Meta remains the category leader thanks to its (née Oculus) Quest portfolio, Apple has entered the fray (with its Vision Pro) as have Chinese challengers (Xiaomi, XREAL, RayNeo, Huawei).
The Steam Frame should give Meta a run for its money thanks to the device’s ability to natively play a variety of games (Meta uses a closed ecosystem) and its relative plug-and-play nature.
Can Valve’s open-arms approach help it dominate headsets as successfully as digital game distribution? We’ll soon find out. —AN
More tech
—Anthropic unveils $50 billion plan to build out U.S. AI infrastructure, beginning in New York and Texas.
—Coinbase ditches Delaware to reincorporate in Texas.
—FanDuel will launch a prediction market app. FanDuel Predicts, created with the CME Group, is a way to operate in states where gambling is illegal.
—Hyperscalers underestimate depreciation. “One of the more common frauds of the modern era,” says investor Michael Burry of The Big Short fame.
—Visa pilots stablecoin payouts. The program allows businesses to send stablecoins directly to individuals’ crypto wallets.
—Synopsys will lay off 2,000 employees. A 10% workforce cut after its $35 billion acquisition of engineering design firm Ansys.
—Cisco shares rise 5%. Q1 revenue of $14.88 billion beats analyst estimates and Q2 gets a rosy forecast.