Latest / Bloomberg Intelligence / Meta Introduces Palm-Sized Device to Use Muse AI

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Meta Introduces Palm-Sized Device to Use Muse AI · Bloomberg Intelligence

• 0:02
  Speaker 1: Bloomberg Audio Studios.
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  Speaker 2: Podcasts.
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  Speaker 3: Radio.
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  Speaker 2: News.
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  Speaker 4: You're listening to the Bloomberg Intelligence Podcast. Catch us live
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  Speaker 4: you get your podcasts or watch us live on YouTube.
• 0:23
  Speaker 1: All right, this is how it works here.
• 0:25
  Speaker 5: Mandeep Singh walks in the door, and I just say,
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  Speaker 5: I got a whole list of things to talk about, Mandeep,
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  Speaker 5: but I'm just like, what do you want to talk
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  Speaker 5: about it? Mandeep Singh, global tech reporter, I'm sorry, research
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  Speaker 5: head for Bloomberg Intelligence joins us here in studio here.
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  Speaker 5: Everybody's talking about this Muse thing. Now there's a Muse
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  Speaker 5: charm from Meta. I just downloaded the Muse app on
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  Speaker 5: my phone, so I feel like I'm technically on the
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  Speaker 5: cutting edge here. What's this charm thing? I know that's
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  Speaker 5: not usually your belly wick. That's the kids.
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  Speaker 6: Well, they are launching a new device now.
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  Speaker 1: A device.
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  Speaker 7: A device where you can interface with their Muse agent
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  Speaker 7: using this device. And everything still runs on the cloud.
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  Speaker 7: Nothing is on the device. But it's an easier way
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  Speaker 7: for you to interact using voice. And instead of opening
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  Speaker 7: your app on the smartphone... This device is listening to
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  Speaker 7: you all the time, and you're pretty much talking to
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  Speaker 7: it as if it's your agent.
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  Speaker 5: Do I put it on my keychain? Do I put
• 1:27
  Speaker 5: it on my Bloomberg lanyard? What do I do with
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  Speaker 5: this thing?
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  Speaker 6: Either is fine. He's going to lose this thing in
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  Speaker 6: about five minutes, by the way.
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  Speaker 5: Yeah, I'm still looking for an earbud down here in
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  Speaker 5: this radio studio.
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  Speaker 7: But the good thing is the device can figure out
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  Speaker 7: if it's lost and, you know, send you some sort of.
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  Speaker 6: A message that, hey, Paul, you may have left the device.
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  Speaker 5: He's got like a million engineering degrees and he's talking
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  Speaker 5: about like losing a device.
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  Speaker 1: I mean, is this the 2026 version of the Tamagotchi?
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  Speaker 7: Well, that's what I think some people are comparing it to.
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  Speaker 7: But at the end of the day, they're saying this
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  Speaker 7: is a persistent agent that is running 24-7. Whether you
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  Speaker 7: initiate the agent through the app on your smartphone or
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  Speaker 7: through this device, it's going to work behind the scenes 24-7.
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  Speaker 7: You don't have to constantly prompt it or, you know,
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  Speaker 7: engage with it. Once you give it a command, organize
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  Speaker 7: my calendar.
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  Speaker 6: It's persistent.
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  Speaker 7: It's going to do that 24-7 without you having to
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  Speaker 7: keep prompting it.
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  Speaker 6: And that's the promise. That's why people are so excited here.
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  Speaker 3: Is Mark Zuckerberg aware that people are very upset about
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  Speaker 3: AI and how it poses an existential crisis? They don't
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  Speaker 3: want data centers near them. This is the time to
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  Speaker 3: introduce something like this? I'm going to put this thing
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  Speaker 3: in my pocket.
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  Speaker 7: Well, what he's trying to, I think, sell is the functionality,
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  Speaker 7: the fact that it can really make you super productive
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  Speaker 7: by doing your mundane tasks like organizing your calendar or,
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  Speaker 7: you know, cleaning up your emails, basic tasks, ordering stuff
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  Speaker 7: from the Internet.
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  Speaker 6: Obviously, it's not Amazon anymore.
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  Speaker 7: But they added a few more partners, Walmart, Best Buy.
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  Speaker 7: So it sounds like he wants to develop an ecosystem
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  Speaker 7: around it, but it's still early days. And I expect
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  Speaker 7: Google and Apple to definitely launch something along these lines because.
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  Speaker 6: It's their turf.
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  Speaker 1: It's the new streaming wars.
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  Speaker 6: Yeah.
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  Speaker 5: This stock market, like, it stocks up 3.2% today. It's
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  Speaker 5: at a 52-week high. It's not at an all-time high,
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  Speaker 5: but darn, within a couple of bucks of an all-time high.
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  Speaker 5: So to the extent they ever lost their mojo, which...
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  Speaker 5: I don't think they really ever did. They kind of
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  Speaker 5: got it back a little bit here.
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  Speaker 7: I mean, I'm thinking what the 2027 CapEx number is
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  Speaker 7: going to be given what has transpired. Come 3Q earnings
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  Speaker 7: call for Meta, I expect them to raise their capex
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  Speaker 7: at least 60, 70 percent.
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  Speaker 6: If not higher.
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  Speaker 7: And they are right up there in terms of justifying
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  Speaker 7: that capex, even though I'm not very clear on the
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  Speaker 7: monetization model here, because everything that they are giving to
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  Speaker 7: the consumer is free. And Mark Zuckerberg said last night
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  Speaker 7: they will take a cut of all the transactions they
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  Speaker 7: will facilitate. So one to two percent cut or even higher.
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  Speaker 1: And they take your data. I mean, even more than
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  Speaker 1: they already have.
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  Speaker 7: Yes, well, that's part of the ads that they show
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  Speaker 7: on the 3.5 billion users they have across their family
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  Speaker 7: of apps. So all that is a given, but they
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  Speaker 7: seem to be very excited about using all the data
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  Speaker 7: center capacity internally. Remember, Google rents out 50% of their
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  Speaker 7: capacity on cloud. 50% they use on their apps, 50%
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  Speaker 7: rented on cloud. Amazon rents everything on cloud. They use
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  Speaker 7: a little portion of it internally. Microsoft rents everything on cloud.
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  Speaker 7: Meta was the only one who was betting big on
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  Speaker 7: using everything internally. They found that use case where they
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  Speaker 7: can deploy a lot of that capacity internally.
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  Speaker 6: I just feel, is it.
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  Speaker 7: Going to be worth $ 150 billion plus in CapEx and
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  Speaker 7: their ROI on that? That is not clear because they
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  Speaker 7: haven't given us a monetization model. But with Meta, we
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  Speaker 7: know if something is sticky, they will find a way
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  Speaker 7: to monetize it eventually.
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  Speaker 5: I know everybody's getting in their Christmas stocking this Christmas.
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  Speaker 5: A little muse charm there. How much is that going
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  Speaker 5: to set me back?
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  Speaker 7: Well, they subsidize all their devices. They launch a lot of,
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  Speaker 7: you know, audio AR glasses, VR glasses. Everything is way
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  Speaker 7: below the Apple price point for Vision Pro. So Meta
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  Speaker 7: believes in subsidizing the hardware because they really want to
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  Speaker 7: own that device. They don't want to be reliant on
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  Speaker 7: Apple or Google.
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  Speaker 3: A hard time believing that parents are going to get
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  Speaker 3: this for their kids, especially after all the Instagram stuff.
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  Speaker 3: Do you really want to embed your child's life even
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  Speaker 3: further into the meta suite of products?
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  Speaker 1: Everyone's trying to break that link.
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  Speaker 5: I know I'm getting John Tucker for Christmas this year.
• 6:08
  Speaker 6: That's a good gift. I'll be bringing it back.
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  Speaker 5: Just for what it's worth here, CapEx for meta in 2023,
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  Speaker 5: $ 27 billion. This year, $ 140 billion.
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  Speaker 6: Next year forecast, $ 200 billion.
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  Speaker 5: So that is a different company, a different stock than
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  Speaker 5: people have historically owned.
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  Speaker 1: Stay with us. More from Bloomberg Intelligence coming up after this.
• 6:32
  Speaker 4: You're listening to the Bloomberg Intelligence podcast. Catch us live
• 6:36
  Speaker 4: weekdays at 10 a.m. Eastern on Apple CarPlay and Android
• 6:39
  Speaker 4: Auto with the Bloomberg Business app. Listen on demand wherever
• 6:42
  Speaker 4: you get your podcasts or watch us live on YouTube.
• 6:46
  Speaker 6: We've been talking about private equity.
• 6:48
  Speaker 5: Actually, we've been talking about higher interest rates and the
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  Speaker 5: impact it's having on stocks, bonds, commodities.
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  Speaker 1: The economy. The economy. How about deal flow?
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  Speaker 5: And for our private equity friends that have just been
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  Speaker 5: rolling in it for 20 years.
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  Speaker 3: Well, they really made their bones when interest rates were
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  Speaker 3: super low. What happens now that interest rates are higher
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  Speaker 3: and will likely stay higher? And it turns out a
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  Speaker 3: lot of people who had been working in the private
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  Speaker 3: equity industry are now looking at the investment banking industry
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  Speaker 3: and saying, oh, maybe I'll go back there.
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  Speaker 5: All right. Allison McNeely joins us here, Bloomberg private equity reporter.
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  Speaker 5: The story, private equity's path to riches is getting harder
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  Speaker 5: to follow. Allison, thanks so much for joining us here.
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  Speaker 5: Talk to us about your story. What's going on in
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  Speaker 5: the world of private equity? What are those folks doing
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  Speaker 5: these days?
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  Speaker 8: I think what we're seeing in the industry is some
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  Speaker 8: folks reevaluating whether private equity is really the.
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  Speaker 9: Best bet for them long term, you know.
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  Speaker 8: As Scott was saying, it was kind of like where
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  Speaker 8: everyone wanted to go for a long time.
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  Speaker 9: There was a lot of money that was made.
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  Speaker 8: But in the past few years, as dealmaking has become
• 7:48
  Speaker 8: harder with interest rates higher, there are less exits. And
• 7:52
  Speaker 8: when there's less exits, there's less carried interest or sort
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  Speaker 8: of the slice of profits to.
• 7:56
  Speaker 9: Dealmakers being paid out.
• 7:57
  Speaker 8: And some folks are looking at entrepreneurship as an option.
• 8:02
  Speaker 9: Some people are actually going.
• 8:03
  Speaker 8: Back to banking, which is really interesting because I think
• 8:06
  Speaker 8: for a while there, Banking was sort of perceived in
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  Speaker 8: the industry as this two-year slog you had to endure
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  Speaker 8: before you could go to the buy side and make
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  Speaker 8: real money.
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  Speaker 3: And now people are looking at the investment banking slog as, oh,
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  Speaker 3: you know, it's stable. And I mean, there's a lot
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  Speaker 3: of deals taking place, you know, just with M & A,
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  Speaker 3: for instance. It's just that the M & A does
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  Speaker 3: not include private equity firms exiting their investments.
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  Speaker 8: Yeah, I mean, you could go make money on IPOs, essentially,
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  Speaker 8: for a lot of the tech companies and the AI
• 8:35
  Speaker 8: boom and that sort of thing. Johnson & Associates, the
• 8:39
  Speaker 8: consulting firm, put out a report that said that Investment
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  Speaker 8: banking compensation is expected to rise 10 to 15 percent
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  Speaker 8: this year, flat for middle market private equity and I
• 8:49
  Speaker 8: believe two and a half to seven and a half percent.
• 8:51
  Speaker 8: Don't quote me exactly on that, but that ballpark for
• 8:54
  Speaker 8: large buyout. So, you know, you can kind of see
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  Speaker 8: it coming through in the data right there.
• 8:58
  Speaker 5: What are the firms, the private equity firms saying in general?
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  Speaker 5: Are they OK with the attrition because maybe the deal
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  Speaker 5: flow is not there or are they trying to retain
• 9:06
  Speaker 5: these people?
• 9:07
  Speaker 6: What are they saying?
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  Speaker 8: I think, generally speaking, private equity firms, when you ask
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  Speaker 8: them about this topic, they say, yes, it is a
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  Speaker 8: problem in the industry, but it is not a problem
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  Speaker 8: for us.
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  Speaker 1: It's the other guys.
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  Speaker 6: Yeah, it's the other guys.
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  Speaker 9: Don't worry about us.
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  Speaker 8: Scott Nuttall, the co-CEO of KKR, refers to a K-shaped
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  Speaker 8: industry where some folks are starting to see a recovery
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  Speaker 8: in exits.
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  Speaker 9: His firm.
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  Speaker 8: in the most recent quarter, reported the best quarter ever
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  Speaker 8: for exits. So they're definitely seeing a rebound. Then other folks,
• 9:43
  Speaker 8: you know, are kind of quietly saying, yeah, you know,
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  Speaker 8: it might take a little longer than we expected, but,
• 9:48
  Speaker 8: you know, don't worry.
• 9:49
  Speaker 1: Don't worry.
• 9:49
  Speaker 9: It's going to happen. But they've been saying, don't worry.
• 9:52
  Speaker 9: It's going to happen for several years now.
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  Speaker 7: Okay.
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  Speaker 3: So you mentioned carried interest, the slice of profits that
• 9:58
  Speaker 3: folks in private equity have get paid when an investment
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  Speaker 3: goes really well. If you leave the private equity industry,
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  Speaker 3: even though you brought some of these deals to the firm,
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  Speaker 3: then that's it. You don't get any of that carried interest, right?
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  Speaker 3: Like you've given up your rights to any of that.
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  Speaker 8: It depends on whether or not it's vested, and it
• 10:16
  Speaker 8: depends on sort of the different firms. So yes, sometimes
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  Speaker 8: you will abandon carry, but- You might make the calculation
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  Speaker 8: that that's fine because you don't actually believe it's going
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  Speaker 8: to come through and it's not going to be worth what.
• 10:32
  Speaker 9: The model says it will pay.
• 10:35
  Speaker 8: But also you could leave the industry with that carry
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  Speaker 8: already vested. And so that will actually come to you
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  Speaker 8: when the time comes. It just depends on where the
• 10:45
  Speaker 8: fund's at.
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  Speaker 6: That's exactly right.
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  Speaker 5: When I left Wall Street, I was approached by a
• 10:48
  Speaker 5: couple of private equity shops that I knew pretty well.
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  Speaker 1: And that was all good.
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  Speaker 6: Great stuff, great people.
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  Speaker 5: But the problem is you can't get the carried interest
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  Speaker 5: until you participate in a fundraising. They're not going to
• 10:58
  Speaker 5: put you in an existing fund. So if you're like, OK,
• 11:01
  Speaker 5: so I'm going to get a salary, maybe a little
• 11:04
  Speaker 5: bonus for working, but I'm not going to get the
• 11:06
  Speaker 5: outsized compensation from a fund that performs well until I
• 11:11
  Speaker 5: participate in one fundraising. And that was could be years
• 11:14
  Speaker 5: away or could be six months. You don't really have
• 11:17
  Speaker 5: a good.
• 11:17
  Speaker 4: Right.
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  Speaker 8: And it also depends on how senior you are, right?
• 11:21
  Speaker 8: So carried interest is allocated on a points basis, like
• 11:23
  Speaker 8: basis points in a fund.
• 11:25
  Speaker 9: They basically take the pie out of 100.
• 11:27
  Speaker 8: And you, managing director, get 20 points.
• 11:31
  Speaker 9: And you, brand new VP, get two. I'm just making
• 11:35
  Speaker 9: numbers up. But you get the idea.
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  Speaker 8: So if you're a more senior dealmaker at a firm,
• 11:40
  Speaker 8: you've got points. You've got more points than the junior folks.
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  Speaker 8: And you've got points off of Multiple funds.
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  Speaker 2: Right.
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  Speaker 8: So maybe you've got points in the 2018 fund that
• 11:50
  Speaker 8: just did gangbusters because it was still in the low
• 11:53
  Speaker 8: interest era. You've sold a bunch of stuff for 3X
• 11:56
  Speaker 8: and you're happy as a clam. If you're a junior
• 12:00
  Speaker 8: person who maybe started in the industry in 2018, 2019.
• 12:06
  Speaker 8: And now in 2026, you're you know, you've got some carry,
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  Speaker 8: but you've got carry in funds that really haven't started
• 12:15
  Speaker 8: paying out yet. And so you're not you're not seeing
• 12:19
  Speaker 8: a lot right now.
• 12:19
  Speaker 9: And that's tough.
• 12:20
  Speaker 8: Because like people in their 30s, you know, they're they're
• 12:23
  Speaker 8: having families. They want to buy houses. They want to
• 12:25
  Speaker 8: like do stuff. And they don't have that money. They
• 12:29
  Speaker 8: don't have those prior gains to lean on that the
• 12:32
  Speaker 8: senior folks do.
• 12:33
  Speaker 1: Stay with us. More from Bloomberg Intelligence coming up after this.
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  Speaker 4: You're listening to Bloomberg Intelligence with Scarlett Fu and Paul
• 12:44
  Speaker 4: Sweeney on Bloomberg Radio.
• 12:47
  Speaker 5: All right, Scarlett Fu and Paul Sweeney. We're live here
• 12:49
  Speaker 5: in our Bloomberg Interactive Broker Studio in New York City.
• 12:51
  Speaker 5: We are streaming live on YouTube as well. I think
• 12:54
  Speaker 5: where we are with this AI narrative in the marketplace
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  Speaker 5: is Okay, we know who's spending money.
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  Speaker 1: It's big.
• 13:02
  Speaker 5: We know who's financing the money, debt, and equity markets.
• 13:06
  Speaker 5: Now the question is becoming, all right, what's the ROI
• 13:09
  Speaker 5: on this spend? What's the return on this investment here?
• 13:12
  Speaker 5: I think our next guest can help us out a
• 13:13
  Speaker 5: little bit here. Garima Kapoor joins us. She's a co-CEO
• 13:17
  Speaker 5: and co-founder of a private company called Minio out there
• 13:20
  Speaker 5: in Redwood City, California. Garima, thanks so much for joining
• 13:24
  Speaker 5: us here.
• 13:25
  Speaker 1: How do you talk to people about.
• 13:28
  Speaker 5: enterprises adapting AI and what type of returns they should
• 13:33
  Speaker 5: be expecting.
• 13:33
  Speaker 1: How do you think about that?
• 13:36
  Speaker 10: Thank you for having me, first of all. And enterprises,
• 13:40
  Speaker 10: everyone is excited about AI and for all the right reasons.
• 13:44
  Speaker 10: For enterprises, they are in different stages of the journey
• 13:48
  Speaker 10: when it comes to AI. There are certain applications like
• 13:52
  Speaker 10: software engineering or customer success where AI is getting heavily
• 13:55
  Speaker 10: leveraged on, and that is definitely increasing the productivity of
• 13:59
  Speaker 10: the employees. But how much of that productivity is translating into.
• 14:03
  Speaker 2: The actual ROI?
• 14:04
  Speaker 10: For example, if you're using AI to build your software,
• 14:08
  Speaker 10: is it having a meaningful impact in resulting in the
• 14:11
  Speaker 10: time for shipment of your product? Or is it resulting
• 14:15
  Speaker 10: in less bugs in the software?
• 14:17
  Speaker 2: All those things.
• 14:17
  Speaker 10: So that journey from productivity to ROI, the data is
• 14:20
  Speaker 10: still not clear on that, but enterprises are definitely increasingly
• 14:25
  Speaker 10: adopting the AI for making their lives easier and more productive.
• 14:31
  Speaker 5: Grima, let me rewind a little bit and ask you
• 14:33
  Speaker 5: to just describe what you guys do at Minio in
• 14:37
  Speaker 5: the AI space.
• 14:38
  Speaker 10: Yeah, so Minayo provides the data and memory foundation for
• 14:43
  Speaker 10: enterprise AI. As I was discussing earlier, the models are
• 14:47
  Speaker 10: getting extremely commoditized. So for any enterprise to be successful
• 14:51
  Speaker 10: in their AI journey, they need to start bringing all
• 14:55
  Speaker 10: their organization together, organization data together in a secured and
• 14:59
  Speaker 10: a governed way, and then expose it to the AI
• 15:02
  Speaker 10: or the agents, building the right kind of context to
• 15:05
  Speaker 10: expose for the reasoning engines, because last thing you want
• 15:08
  Speaker 10: is expose all your raw data for cloud or open
• 15:12
  Speaker 10: AI to leverage on it and take all the intelligence away.
• 15:15
  Speaker 10: So Minaya provides that infrastructure software for providing data, memory,
• 15:21
  Speaker 10: and context without burning a hole in your pockets when
• 15:24
  Speaker 10: it comes to tokens.
• 15:26
  Speaker 5: Enterprises, where are enterprises broadly defined in terms of adopting AI?
• 15:31
  Speaker 5: I mean, just from the consumer level, just yesterday from Meta,
• 15:34
  Speaker 5: we got the Meta Muse. So, I mean, that's a
• 15:37
  Speaker 5: couple of days ago with that announcement. So we know
• 15:40
  Speaker 5: consumers are adopting AI. How about enterprises?
• 15:45
  Speaker 2: Enterprises are adopting AI.
• 15:47
  Speaker 10: And like I said, it's in very well-defined use cases
• 15:50
  Speaker 10: like for software engineering, because you can see the productivity
• 15:53
  Speaker 10: like Claude Opus is able to, or Fable is able
• 15:57
  Speaker 10: to do a really great job. And even in our organization,
• 16:00
  Speaker 10: we have mandated that it is AI first and all
• 16:03
  Speaker 10: the engineers first. need to stop writing handwritten codes. It
• 16:06
  Speaker 10: needs to be generated by AI. And that's the direction
• 16:09
  Speaker 10: which I see a lot of the other enterprises also
• 16:12
  Speaker 10: adopting internally. So we do see that adoption, but it's
• 16:15
  Speaker 10: on very specific use cases, not across the board. Customer
• 16:19
  Speaker 10: success is another use case where we see adoption of
• 16:23
  Speaker 10: AI getting increasingly used so that the tickets for the
• 16:26
  Speaker 10: customers who are reaching out to the enterprises for any
• 16:29
  Speaker 10: kind of issues, those tickets can get managed effectively and
• 16:32
  Speaker 10: so on and so forth. So we do see adoption
• 16:34
  Speaker 10: of AI, but in a very specific use cases.
• 16:38
  Speaker 5: There's been a lot of talk, I guess, just recently
• 16:41
  Speaker 5: from some of the leaders of these AI companies talking
• 16:45
  Speaker 5: about maybe putting some guardrails on this technology. And there's
• 16:49
  Speaker 5: been a lot of pushback, most notably from President Trump
• 16:53
  Speaker 5: on that. What's the feeling out in the could play out,
• 16:57
  Speaker 5: should play out?
• 16:59
  Speaker 2: Yeah, I think guardrails are important.
• 17:01
  Speaker 10: If you see all the innovation that is coming out
• 17:03
  Speaker 10: in AIs, either by Frontier Labs, which is OpenAI and Anthropic,
• 17:07
  Speaker 10: or with open source models, which is Alibaba deep seek models, right?
• 17:12
  Speaker 10: And as private companies, as they should, they're motivated by
• 17:16
  Speaker 10: their own personal gains and rightly so. So an AI
• 17:20
  Speaker 10: is a public good that is going to impact everyone.
• 17:22
  Speaker 2: All of our lives are going to be meaningfully impacted.
• 17:25
  Speaker 10: So government has to step in and build at least
• 17:29
  Speaker 10: a regulatory security framework and validate that this is the
• 17:33
  Speaker 10: security framework that looks like, and every model needs to
• 17:36
  Speaker 10: pass through that security framework to be safely be adopted.
• 17:39
  Speaker 2: By consumers and by enterprise.
• 17:40
  Speaker 10: So I'm absolutely in favor of having government, have an
• 17:45
  Speaker 10: independent regulatory authority that can keep the frontier labs, that
• 17:48
  Speaker 10: can keep the open source models in checks when it
• 17:51
  Speaker 10: comes to the security.
• 17:52
  Speaker 5: It's a little different than historically out in the Valley.
• 17:55
  Speaker 5: Most folks kind of appreciated the light government touch, but
• 17:58
  Speaker 5: you think this time could be different?
• 18:01
  Speaker 2: It has to be.
• 18:03
  Speaker 10: It has to be right because it's going to impact
• 18:05
  Speaker 10: everyone meaningfully and nobody knows the extent of the impact.
• 18:09
  Speaker 2: Right.
• 18:09
  Speaker 10: The problem that happens is that in any kind of
• 18:13
  Speaker 10: whenever there is exponential technological innovation, it always happens that
• 18:18
  Speaker 10: you don't have all the information to make the right decisions.
• 18:22
  Speaker 2: For the customers.
• 18:23
  Speaker 10: And I do feel government is the right authority and
• 18:26
  Speaker 10: the place to get started, especially in a democratic setup.
• 18:29
  Speaker 10: So yeah, unlike before, there is nothing like the world
• 18:34
  Speaker 10: has seen what AI is exposing us all to.
• 18:36
  Speaker 2: So I do feel government regulation is important.
• 18:38
  Speaker 4: This is the Bloomberg Intelligence Podcast, available on Apple, Spotify,
• 18:43
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• 18:47
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• 18:53
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• 18:56
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