2026-05-12 20:55:31
My god, it's full of quotes. Between the testimony and all the discovery in the Elon Musk vs. OpenAI trial, as you might expect, there are a lot of juicy tidbits. But the direct quotes are truly impressive. So far, my favorite has to be Microsoft CEO Satya Nadella, on the witness stand, giving his assessment of the OpenAI board when they decided to remove Sam Altman as CEO (aka "The Blip"): "It was amateur city as far as I’m concerned."
Not amateur hour, mind you.1 That would be just a brief moment in time. This was a whole metropolis of amateurs running amok. Mucking up Microsoft's investment.
To me, it's sort of a perfect encapsulation of the situation and it perhaps speaks to the broader one in Silicon Valley. Because these startups are now valued at billions, or tens of billions, or hundreds of billions – or even potentially trillions – there's an assumption from the outside looking in that these are well-oiled machines of industry being run by professionals that themselves are execution machines.
Yeah, no. That's not how it works. Anyone who has lived and/or worked in that world knows this all too well, but this trial is exposing such sausage to all.
It is, indeed, amateur city.
Not across the board, of course. Certainly the mature companies often do run like well-oiled machines that keep printing profits even if and when hiccups occur. Just look at all of Big Tech for examples of that. Apple flubs AI to start? No matter, the iPhone will just keep selling. Google too? All good, their myriad other businesses will quite literally buy them time. Amazon needs longer to get Alexa+ fully baked? You're going to keep shopping and businesses will keep using AWS. Meta quite literally can't buy a hit any longer? No matter, the ads will just keep being served. Even Microsoft itself keeps switching Copilots trying to find one to steer the AI business. But it doesn't matter to the actual top and bottom line. At least not so far.
But startups are a different beast, of course. They're most often going to be immature from both a company and leadership perspective. That's not necessarily a knock on the individuals – though sometimes it is! – it's just the nature of the business. Again, such imperfections can be masked by the massive valuations placed on the companies by investors. And in the Age of AI, such numbers not only can surpass those of actually mature companies, they oftendwarf them. This again leads to a natural assumption that they're more mature than they actually are.
The truth is that it's hard to grow up in a period of intense growth, as paradoxical as that may sound. Because everything is moving so fast and constantly evolving, it's unrealistic, if not impossible, for a company's roots to take hold. Anything that appears settled can be uprooted at any moment. Experience helps, and perhaps matters most when it comes to a company maturing faster. But clearly OpenAI was growing at such an unprecedented rate that immaturity ruled the day and the company.
That all came to a head in "The Blip". And it clearly wasn't just the OpenAI board, as Nadella is suggesting. As the texting, emails, testimony, and um, journal entries, make clear, everyone was operating on the fly. From Sam Altman to Greg Brockman to Ilya Sutskever to Mira Murati and seemingly everyone else on down – and up, to the board. (And yes, the whole non-profit element probably didn't help matters here!) Honestly, even the exchanges within Microsoft in the early days of their partnership with OpenAI betray a fairly humorous lack of understanding of what they were all dealing with – though yes, with at least a bit more corporate maturity!
And even Elon Musk, an entrepreneur with perhaps more experience than anyone when it comes to starting and running companies, was clearly bowled over by the immaturity of the operation. And yes, that included some of his own immaturity. Perhaps a lot.
In a way, this trial brings to mind my favorite part of Steve Jobs' famous 2005 Stanford commencement speech: "Everything around you that you call life was made up by people that were no smarter than you."
Now, "smarter" is perhaps too loaded a term when it comes to AI given both the nature of the technology and the expertise required to build it. But as with all things in life, there are trade-offs.2 Jobs' point was simply that everything out there that you see and read about and perhaps admire is not built by infallible gods, but by people. Individuals full of flaws with hampers full of dirty laundry. And this trial highlights that.
People can be immature. People can be insecure. People can be jealous. People can be deceptive. People can be messy. People can be complicated. And it's people that start and run companies. At least until the AI gets good enough.
So yeah, OpenAI was "amateur city" – as are most startups. The difference is that most startups haven't historically been given billions upon billions of dollars with the assumption that such money would instantly make them more professional. It doesn't work that way. At least not at first. Such things take time, and mistakes, and headaches.3
In that way, it is Microsoft who may have actually misread the situation. And while it's hard to argue with the result of their investment – at least on paper – there are other results of that partnership that they've clearly grown less keen about and have moved to distance themselves from, professionally.
Let's end with another Nadella quote, this one from an internal note to his executive team in 2022 ahead of a fresh $10B investment into OpenAI – their last major one: "I don’t want to be IBM and OpenAI to be Microsoft."
Spoken like a mature company and leader operating in a professional city...
One more thing: the other thought that immediately popped into my head upon reading Nadella's quote was actually a song. Quite naturally, Guns N' Roses' 1987 "Paradise City". Did you know it was written while the band was together on a tour bus back from... the Bay Area? Fun lyrics too:
Rags and riches, or so they say, you gotta
Keep pushing for the fortune and fame
You know it's all a gamble when it's just a game
You treat it like a capital crime
Everybody's doing their time
1 Though yes, my best guess would be that Nadella slightly flubbed the common phrase – to the point where many stories misquoted him assuming he had said that version and not actually "amateur city" which both AI and a web search will tell you is best known as a "seminal lesbian mystery novel by Katherine V. Forrest" published in 1984. I'm going to assume that's not what Nadella was referring to... ↩
2 My own belief remains that "smarts" matters less than determination with startups. Which I know sounds like a "winning thing" to say, but I actually think it often goes quite dark. Those willing to be the most ruthless in business often win. You have to be okay with being ruthless, which many are not... But many are smart. That's not enough. ↩
3 It's honestly sort of surprising that the company not only hasn't come apart during the endless turmoil, but has thrived. Perhaps that just speaks to the opportunity here... ↩
2026-05-11 22:44:41
Wrapping up my trifecta of podcast appearances in the past week...
M.G. Siegler
Inklings is a newsletter featuring links and commentary from M.G. Siegler on timely topics found around the web.
💰 Microsoft's Defensive Early OpenAI Dealings – Leading up to Satya Nadella taking the stand this week at the Elon Musk vs. OpenAI trial, this is a fun read looking back to the time of the initial interactions between Microsoft and OpenAI (which is why they're roped into this trial). Notably, about 18 months before their first massive investment (there was just a cloud credit deal at that point), basically the entire executive team at Microsoft seemed super skeptical of OpenAI's prospects and was far more interested in ensuring they didn't "storm off to Amazon in a huff and shit-talk us and Azure on the way out," as CTO Kevin Scott put it in one email. Nadella kept seeking feedback about a deeper partnership and everyone either seemed to think they could do this all themselves (typical big company talk) or really just seemed worried it would be a boondoggle at best and money pit at worst – but again, noted the PR value of a partnership and at the very least, ensuring Amazon didn't get the same. Not exactly inspiring insight about the future of AI and more just cynical business dealings. To be fair, it was undoubtedly hard to see where AI would go from there, and certainly how fast it would evolve. And yes, the OpenAI deal did end up as a huge money pit – but ultimately one that has given Microsoft billions in returns, at least on paper... [Wired]
🤝 Apple & Intel Have a Deal... For Something – While the two sides reportedly have a "preliminary agreement" for Intel to manufacture some chips – as previously discussed – it's still not clear what those chips are and when they might be ready. Still, that hasn't slowed Intel's continued stock surge, as they're not only well past their all-time highs now, they're also a $630B company now, breaking into the Top 20 most valuable companies in the world, just ahead of ASML and catching up with bitter rival AMD, fast. The report gives a lot of credit to the Trump administration and the President in particular for making this happen with Tim Cook directly – which, of course, has hugely boosted the government's 10% stake in Intel. And NVIDIA's. And SoftBank's. Really, shouldn't Apple have one too? What a wild world we live in. A year ago, approaching a market cap of $100B from the wrong way, everyone was writing off Intel as dead. (Well, not everyone...) [WSJ 🔒]
📚 The Barnes & Noble Comeback – I've been tracking this for a while, mainly because I'm a big fan of James Daunt, both because of the small bookstores in London that bear his name, but also what he's done with Waterstones. Basically, he took a tired chain and made it more like his own stores. And now he has done the same again with B&N. To the point where Elliot is setting up the packaged companies to go public in London. Yes, bookstore chains owned by a hedge fund. It's clearly all Daunt and this piece delves into why: while the store personalization aspect is key, it's the behind-the-scenes logistics that makes the business now sing. Daunt's inventory management reads a lot like Tim Cook's at Apple – and I swear I'm not just saying that as the two look similar and are nearly the same age. By shrinking the stores and the number of books ordered, he's been able to compete with Amazon and get back to growth. By year-end, B&N should have 740 stores – more than they had in 2019, which is pretty incredible. [WSJ 🔒]
🤨 RIP "The Mouth of the South" – While the NYT obit of Ted Turner is a bit more robust at 4k words, it seems fitting to link to the CNN one, which has a smoother story arc. It's a wild one. From taking over his father's struggling billboard business (after he committed suicide) to becoming the largest land owner in the US (at the time of his death last week at age 87, he had fallen to fourth). As he himself noted, CNN was the ultimate crown jewel of his legacy as it completely changed media, ushering in the 24/7 news cycle, but there was so much else too. The Atlanta Braves (and putting them on the map by putting them on his networks around the country for all 162 games), TBS, TNT, TCM, the Cartoon Network, buying MGM, merging with Time Warner (then merging that with AOL – yikes), winning the America's Cup, donating $1B to the UN (which took a long time to pay due in part to the disastrous AOL merger dragging down his net worth), Captain Planet (!), Jane Fonda (which the CNN piece goes deeper on), etc. Highly controversial and problematic at points, but seemingly calmer as he aged. His dealing with debt and hugely risky business moves have echoes in our current times with people like Masa Son and even the Paramount/Warner Bros deal. But yeah, talk about right place/right time when the Gulf War broke out... [CNN]
"I hope that 80-times growth doesn’t continue because that’s just crazy and it’s too hard to handle. I’m hoping for some more normal numbers."
– Dario Amodei, speaking at Anthropic's developer conference about the recent growth they're seeing, and explaining why they needed to write the SpaceX deal (as well as a range of others), fast.
Below, members of The Inner Ring will find thoughts on:
• Elon Musk's 'Colossus' Strategy
• OpenAI's Next Microsoft Fight
• Berkshire's Cash Pile
2026-05-09 22:04:39
This month's discussion between Alex Kantrowitz and I on his Big Technology Podcast was all about money. I mean, I think it always technically is on some level, but this one was all about CapEx, "The Clause", and Stargate.
Specifically, while overall Big Tech CapEx spend may be on the verge of hitting $1T combined soon, Apple... stays the same at their roughly $10B a quarter. And actually, they might be down a bit this year versus last. They are ramping R&D spend, but so are all their competitors. It's just such a binary bet that they don't need to fully control AI – at least right now.
And it could pay off in a few ways. If this plays out like Apple vs. Google Maps, where Apple had to rip off the band-aid and then try to catch up, as painful as it was for Maps, it seems like they might not be able to do that at all with AI. But if it's more like Google Search, obviously that has worked out extremely well for Apple – to the point where Google is paying them billions to use it. Meanwhile, Microsoft spent billions to try to compete and, well, Bing is not Google!
That's sort of another way of framing the notion that owning the iPhone (the distribution and eventually edge compute platform) may matter more than owning the models. The reality will undoubtedly be more nuanced, but it's an interesting, if insanely risky, bet by Apple when you just look at what their peers are doing.
Further, there is a way to look at this through an even simpler lens. Perhaps Apple realized they were behind but also realized that in order to try to catch up, they'd have to spend billions – likely hundreds of billions – and while xAI and Meta have done that, it hasn't really worked out for them. At least not yet. So maybe Apple, in a moment of corporate self-reflection, simply realized that wasn't a smart play. And perhaps they'll focus on the future of the industry with robots and what not. Again, we'll see!
They are clearly signaling they're about to start ramping spend on something. Might it be more CapEx spend, or might it be M&A? (Sadly, Anthropic may be a bridge too far now, but Disney?!) Could it be going deeper on chips with Johny Srouji, maybe even further down the AI path to eventually compete with NVIDIA in ways? Perhaps only John Ternus now knows...
WWDC in a month should be fun though!
Speaking of fun, "The Clause" is dead, long live some new clauses in an agreement between OpenAI and Microsoft. Is it as simple as the latter realizing that their massive ownership stake in the former will be far more valuable if they're actually able to get their models on all clouds? Perhaps. But that's obviously also somewhat risky for Microsoft given that those other clouds compete with them.
But perhaps those new clauses which give Microsoft first-look rights at OpenAI's newest tech is good enough. Are we entering a world with movie-like windowing for AI – "See it first in Azure, coming soon to AWS"?
At the very least, OpenAI and Microsoft get to avoid more lawsuits – with one another no less - just as the trial in which they're both defendants against Elon Musk kicks off...
Finally, the Stargate situation remains a sort of fascinating encapsulation of the AI data center strategy overall. Certainly for OpenAI, which keeps moving the goal posts ever since they announced it at the White House.
It was a great PR moment to announce something which... basically hasn't happened. At least not as it was laid out. And while OpenAI may be getting gaslight-y about this, clearly the strategy has shifted. Owning and controlling data centers may have sounded good – or even necessary, to combat Google – 18 months ago. But now it just sounds insanely expensive, slow, and risky. Better to offload all of that to partners. At least for now.
Perhaps if and when OpenAI is public, they can revisit. As presumably they'll have more avenues to raise the needed debt, versus relying on SoftBank, Oracle, and NVIDIA (before the latter just tried to quietly get out of doing that). Regardless, CFO Sarah Friar is probably happy not to have all of this on OpenAI's balance sheet right now...
At the same time, you could certainly argue that OpenAI spending like "drunken sailors" on data center deals over the past couple of years has given them a real advantage over Anthropic at the moment. And now we're seeing Anthropic have to take their shots and break out their pocketbook to spend under pressure. Money wins.
2026-05-09 00:58:11
Is such a deal going to happen? Not anytime soon. But you can make a case (both for and against) it happening at some point. Especially as Apple keeps growing and Disney keeps trying to grow... Have I mentioned that both companies have new CEOs in place? Interesting times and timing. Worth at least thinking through...
M.G. Siegler
Inklings is a newsletter featuring links and commentary from M.G. Siegler on timely topics found around the web.
🥦 Bleaching Our Broccoli in a Cloth Mask – Not the first to draw the parallel between the early days of the pandemic and the early days of AI – and, of course, far fewer people are dying, but it's also not zero, sadly – but I think Mat Honan captures the angst many are probably feeling, well. Everyone is constantly being told that everything is fine or that everything is not fine. But the reason for both, AI, still isn't being used, let alone understood, by most people on a regular basis. They hear they should be using it. Or that they should not be using it. But when they try to use it, they're just not sure what to do with it. Or that it's doing anything. It's both a constant promise and a constant fear existing at the same time, in the same space. It's the Heisenberg Uncertainty Principle for everyday life. "The 21st-century average American lies in bed staring at their phone. They should be sleeping. They should read a book. They should take a melatonin. Instead they are deep in conversation with a math equation." [MIT Technology Review]
📈 Samsung Hits $1T – What's wild is that the smartphone business isn't nearly as hot as it used to be. And some of their other electronics businesses, led by television, actually seem like a mess at the moment. And then... All of a sudden... Their stock has 5x'd in the past year alone. They're on the verge of passing Meta as the 10th most valuable company in the world. And again, it's not the businesses they've been historically known for, but thanks to their chips – a division which itself was struggling in the face of TSMC and SK Hynix until quite recently. Now it's so dominant within Samsung that workers are threatening walkouts if they don't get a higher share of profits. And that one group now accounts for so much of the profits that there's talk of spinning it out so the rest of "One Samsung" can continue to operate in peace. All of this just reminds me of my what-if: imagine if Apple used their chip expertise to sell silicon into the AI boom? While we're all constantly looking for that Next Big Thing™ from Apple, what if it's already there, in-house? Google is now selling TPUs to others. If nothing else, Wall Street would love that narrative. Apple would immediately shoot past $5T, one imagines. I mean, just look at Samsung! [FT 🔒]
🍎 Supreme Court Rejects Apple's Stay – Their 30% cut remains in serious jeopardy after Justice Elena Kagan sent Apple back to U.S. District Judge Yvonne Gonzalez Rogers – who is a bit busy at the moment with that other high-profile tech case – hat in hand, to try to figure out what a "fair" commission should be after their farcical "27%" (which, with other fees taken into account, ends up as more than 30% out of developers' pockets) failed to fly. To be clear, this is for transactions done outside of the App Store, but the entire system now feels on the brink as this ruling is going to embolden further attacks on the App Store fees all around the world. That plus Google teaming up with Epic (after losing their own case) to kill their own 30% cut, just has Apple looking increasingly isolated. You know what would be great? New CEO John Ternus stepping on stage at this Fall's iPhone event to announce a "new deal" with developers. Much like Satya Nadella sent a signal at the start of his era at Microsoft by immediately announcing Office for iPad. Of course, such a change would be better suited for WWDC in a month, perhaps it could be a great "one more thing" from Tim Cook? (I know I'm dreaming with this, but still, the writing is not just on the wall here, it's in neon.) This rejection of the stay request perhaps also signals that the Supreme Court may reject Apple's eventual overall appeal. [Reuters]
M.G. Siegler
M.G. Siegler
"She was waiting to see which way the wind would blow and she didn’t realize that she was the wind."
– Helen Toner, the former OpenAI board member, in her deposition about the role Mira Murati played in the ouster of Sam Altman back in late 2023 (aka "The Blip"). Just an all-time quote right there.
The FT made a chart showing what the CapEx ramp is doing to Big Tech's free cash flow – which is now at its lowest levels since 2014.
Well, aside from you-know-who... Will it bounce back as quickly as the others are projecting? We'll see..
Below, members of The Inner Ring will find thoughts on:
• OpenAI's Aim to Own Vocal Computing
• Google Gunning for OpenClaw
• Anthropic's Colossal Compromise
• and more...
2026-05-08 17:57:43
We may not have to wait much longer for Apple's first AI wearable, it seems:
Apple Inc. has reached the late stages of development for new AirPods with built-in cameras, a significant milestone for what will likely be its first wearable device designed for the artificial intelligence era.
The project has entered a phase where prototypes feature a near-final design and capabilities, according to people with knowledge of the matter. The earbuds, which rely on cameras to see the space surrounding a user and provide information, are in advanced testing, said the people, who asked not to be identified because the work is still under wraps.
This is perhaps yet another promising sign that Apple believes their deal with Google will provide an actually viable and perhaps even impressive Siri this time. FAMOUS LAST WORDS, yes. But I remain cautiously optimistic here.
Of course, Gurman later couches the report noting that Apple could push out any launch further if the AI to power such features isn't up to snuff yet (and it sounds like they had initially targeted this device for the first half of this year, but well, the Siri situation is creating headaches for a lot of groups at Apple). Anyway, unless Apple has somehow managed to muck up Gemini with their own distillation, we should be good to go. Gemini can do what it sounds like Apple would like these AirPods with cameras to do right now. And actually has been able to for years, dating back to Google Lens.
Also, Apple already has similar capabilities built into iOS with "Visual Intelligence" which leverages, yes, Google. But that's their Image Search API, this is different. It's more similar to leveraging ChatGPT as they also do right now, but again, this is now going to be Siri itself, powered by Gemini under-the-hood, doing this, it seems. Oh yes, and from your AirPods, not your iPhone camera.
The cameras essentially act as eyes for the Siri digital assistant and aren’t designed to take photos or video. These components — located in both the right and left earbuds — allow the device to capture visual information in low resolution. Other than longer stems to accommodate the cameras, the product will resemble the AirPods Pro 3.
This makes sense since trying to take pictures from your ears would undoubtedly result in shitty pictures. So it's more like having eyes looking out from your jawline, which is still a bit odd, but close enough to your actual eyes that it should make for an interesting feature. As a man who rocks a beard that can grow quite robust at times, I have long been worried about it getting in the way of such a rumored feature, but presumably the AI can sort that out? Or Apple's design prowess – hence the stems on this version of the AirPods getting a bit longer again to accommodate the cameras. Or I guess I can just shave?1
The idea is to let users ask questions about an item they might be looking at. For instance, they could be facing food ingredients and ask what they should cook for dinner. It’s a similar experience to what someone gets from uploading photos in AI services like OpenAI’s ChatGPT or the iPhone’s own Visual Intelligence function.
While AirPods with cameras to take pictures made no sense to me (just as the Apple Watch with cameras made no sense to me), the Visual Intelligence context actually makes a lot of sense to me. Clearly, Apple knows that they have a unique advantage here thanks to their devices being in billions of hands, which is why they're revamping the feature in the iPhone as well to be more prominent. While Apple may be behind in the current state of AI, if they can start ingesting real time imagery from hundreds of millions of devices around the world well... that's a data set that perhaps only Samsung (and by extension, Google) can match. But those brands won't be as trusted as Apple is here to have cameras on your face.
Speaking of:
Apple also aims to address privacy concerns from people who don’t want to be filmed by gadgets — an issue for smart glasses as well. The company has built a small LED light into the earbuds that will turn on when visual data is being fed into the cloud. Given the small size of earbuds, it’s unclear how visible the light actually will be.
AirPods are ubiquitous enough that most people at first won't think twice about seeing a slightly different version. But that could change fast if this version becomes ubiquitous and people start to realize that these are cameras. There's been surprisingly little backlash against the Ray-Ban Meta smartglasses to date – though there's some, and some growing concerns – especially relative to the "glasshole" days of old. But all of this feels one incident away from becoming a problem. And it sounds like Apple could soon be bucketed into this group as well soon. It's a risk, but clearly worth it for the functionality.
One more thing: It sounds like these AirPods with cameras specifically will not be used to add more/new gesture controls into Apple's device ecosystem. That's a mild surprise as there had been previous reports about such functionality (which made the camera system in AirPods make more sense than again, taking pictures). But perhaps Apple is just focused on one thing at a time here.
M.G. Siegler
M.G. Siegler
M.G. Siegler
M.G. Siegler
M.G. Siegler
1 Maybe "you're trimming your facial hair wrong" will be the new "you're holding it wrong"? ↩
2026-05-07 21:51:54
It's that time of year again. Spend Apple's money, which they never spend, but boy it would be fun if they did, time. But this year does actually bring a new twist. A few of them, actually.
During their earnings call last week, CFO Kevan Parekh made an interesting disclosure that going forward, Apple would stop their long-standing policy of trying to be "net cash neutral". During Tim Cook's tenure, this policy led Apple to returning some $1T – yes, $1 trillion – in the form of both dividends and stock buybacks. Seemingly, Apple will continue to do some of that under new CEO John Ternus as well, but as the comment makes clear, there are no longer any promises. Many took this to mean that Apple might start ramping up some level of spend – perhaps even on CapEx, finally. But it could also mean they're looking to build up their cash reserves again. And an obvious reason to do that would be for an acquisition.
But of what? Well, HBO, sadly, now looks to be off the menu with Paramount's purchase of Warner Bros Discovery. It would have made sense – and clearly Netflix agreed! – but alas, it wasn't to be. Anthropic remains the most obvious need and potential fit and fix – if it were about 1/10th the current price. Ideally, 1/100th. Obviously, Apple won't be paying $1T+ to solve their AI woes, even if you could make somewhat of a case. So how about one of the oldest M&A ideas in the books – quite literally. Apple + Disney.
Come wish upon a star with me...
