Google goes back to the top of the leaderboards
I’m old enough to remember when Google was doomed, search ads were doomed, and Sundar Pichai was the new Steve Balmer. Not any more. Gemini 3 is SOTA and the new version of the ‘Nano Banana’ image generator has gone viral. I struggle to get particularly excited beyond that: there will be another SOTA model in a month or two, and one of these is really changing the trajectory. What does interest me is that the images going viral aren’t the usual cheesy stock images - instead, people are feeding in videos, audio or slides, or just asking questions, and getting detailed diagrams and infographics. How long will it be before you ask for a recipe or instructions and the chatbot will make you an interactive animation or video explainer? GEMINI, NANO BANANA
OpenAI Ads coming soon
OpenAI is getting a bit more forthcoming about ads. It has intent, and wants to have commerce flows (see the app platform announced recently, and now there’s a deal with Target): once it has that, ads are inevitable. Note that while it claims 800m weekly active users, apparently only about 5% are paying. LINK
Nvidia keeps doing it
Nvidia’s latest quarterly results show demand isn’t slowing down yet: revenue was $57bn versus $35bn a year ago. The stock is still down: the markets are getting more worried about bubbles and circular trades. See this week’s column. LINK
The FTC loses again
The FTC has lost yet another big tech breakup case, this time against Meta, failing to undo the acquisitions of Instagram and WhatsApp.
This is the cast that the judge originally threw out because the FTC just forgot to say what market it was claiming Meta has a monopoly of or what share it claimed it had of that: he allowed it to refile, and the FTC then claimed that Meta does not compete with TikTok, YouTube, or iMessage, but does compete with something called MeWe, which no one has ever heard of. Market definition is the basis of any competition case, and this was laughable - gerrymandering, not analysis. Now the judge has agreed, saying that events in the market since the WhatsApp a decade ago show how dynamic and competitive it remains.
It would be easy but also true to say that the antitrust crusade against Big Tech, spearheaded by Lina Khan, now looks like a failure. I have a lot of sympathy with the ‘neo-Brandeis’ idea that US competition law, unlike the UK or EU, was too narrowly focused on consumer prices as the only measure of harm: a free monopoly could also be bad. But this wasn’t accompanied by rigorous analysis of the actual market structures they wanted to change, nor a clear sense of what a good remedy would be (the problem in the Google search case). So, the ‘landmark’ 2020 House Antitrust Committee report was riddled with basic errors: for example, it claims there had been a ‘sharp decline’ in startup creation and funding, citing as source a report that uses data ending in 2011 - after which the US experienced the hottest market in startup creation in its history. Meanwhile, Lina Khan’s famous and career-making paper on Amazon did not contain the word ‘cash’ once. The more interesting problem, though, might be that revising price as the only test is not enough - current models of market definition and ‘dominance’ might also be too narrow. COVERAGE, RULING
The week in AI
Filling in the boxes: last week Anthropic announced a plan to build $50bn of its own infrastructure; this week, it’s done a deal to buy $30bn of compute plus one GW from Azure, while Nvidia and Microsoft will invest up to $10bn and $5bn. LINK
As reported last week, Yann LeCun confirmed that he will leave Meta and do a startup focused on his projects to move AI research beyond LLMs. LINK
The White House is still looking at trying to ban US states from passing their own AI acts, on the basis that any U AI company would have to spend a lot of time and money complying with dozens of slightly different rules, instead of one set of national rules (which, however, do not yet exist). LINK
Adobe is acquiring SEMrush, a hot company in the world of trying to work out where your brand shows up in ChatGPT, for $1.9bn. LINK
Google hired a former CTO of Boston Robotics, the famous robot dog company. LINK
Google’s head of AI infrastructure said that the company needs to think in terms of doubling compute capacity every six months, and 100x over the next five years, without increasing cost or power budgets. LINK
Death to cookie banners?
The EU has a new bill aiming to rationalise and simplify all the digital regulation it’s introduced recently, resolving overlaps, trying to add more certainty to outcomes, and (more controversially) relaxing rules around things like cookies (by expanding the allowable use cases and allowing automated consent at the browser level). You can tell this is a good thing by seeing who gets angry about it. LINK
WhatsApp’s oops
A security researcher discovered that WhatsApp wasn’t rate-limiting the feature that matches phone numbers in your address book against accounts, allowing anyone to scrape a couple of billion profile names. This is public data, but still not ideal. LINK
Foreign actors
Twitter turned on a feature letting you see where an account is based (derived from the IP address used to post), and unsurprisingly a lot of high-profile pro-Trump influencer accounts are not based in the USA - they’re in Pakistan or Nigeria, and probably only in it for the revenue shares. (This is a general problem, but Twitter fired most of its platform integrity team). LINK
RIP Ocado?
Ocado pioneered online grocery delivery, creating and building cutting-edge robotic fulfilment centres, then pivoted to selling the technology. But this week Kroger said it will put down three of its eight facilities that use the tech (it shut another three last year), taking a $2.6bn charge. The question was always to work out where the economics and density supported picking in-store versus ‘dark stores’ versus robot warehouses, and the robots are hardest. Ocado has a market cap of $2bn today versus Instacart’s $10bn - another tough model. LINK
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