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The OpenAI Phone is Coming... With an AI Operating System · In the Loop AI

0:00
Ejaaz: Okay, this is pretty insane. OpenAI is launching their own version of the iPhone
0:04
Ejaaz: and it's shipping in less than 12 months.
0:07
Ejaaz: Yesterday, an analyst which has the highest hit rate of any Apple product leak
0:12
Ejaaz: dropped a report that revealed that OpenAI is building their own phone and it's
0:16
Ejaaz: been designed by the very guy that designed the original iPhone, Johnny Ive.
0:21
Ejaaz: They're targeting around 40 to 50 million units for year one,
0:25
Ejaaz: which is larger than the opening sales of the iPhone itself.
0:28
Ejaaz: Now, this is a very convincing rumor, but we wanted to investigate one,
0:32
Ejaaz: whether this was real, and it led us down the craziest rabbit hole ever.
0:36
Ejaaz: We pulled up Anthropic and OpenAI's job postings, and it revealed a hidden product
0:41
Ejaaz: roadmap that we're gonna talk about on this show.
0:44
Ejaaz: There's over 750 open roles between them, and it revealed a 24-month,
0:49
Ejaaz: two-year product roadmap that no one else is talking about.
0:52
Ejaaz: It didn't only confirm that OpenAI is building a phone, but it also tells us
0:56
Ejaaz: how the companies themselves are actually building in a very different strategic path from each other.
1:02
Josh: Yeah, I didn't believe this and I still don't believe it, but every single rumor
1:06
Josh: is pointing towards the fact that OpenAI is building an OpenAI phone and it
1:10
Josh: is going to be designed by the same person who is building an iPhone.
1:14
Josh: And we kind of have a brief of generally what we can expect.
1:17
Josh: I think most noteworthy of this most recently because that they've expedited timelines.
1:20
Josh: So there's a high probability that one year from now, we will be holding an
1:25
Josh: OpenAI smartphone in our hands. Now, what is it going to look like?
1:29
Josh: What is it going to feel like? we have some loose ideas of that
1:31
Josh: starting with the form factor it seems like they're going for the traditional
1:34
Josh: smartphone not the screenless johnny ive device
1:37
Josh: this isn't a pendant it's not glasses they're going for like a proper phone
1:41
Josh: replacer so i would expect it to look like the iphone the big idea is that they're
1:45
Josh: going to replace the operating system with an ai first operating system and
1:49
Josh: we've always talked about how open ai is trying to build the ai first os but
1:54
Josh: this is going to be the actual hardware in which it could be integrated on traditionally
1:57
Josh: iPhones, you have that grid system where all your apps live.
2:00
Josh: Yeah, we have a great, great rendering on screen. This will be fully predictive.
2:04
Josh: So this is pending on a few things. One is that OpenAI is able to figure out
2:07
Josh: the software stack in time, which I mean, 12 months seems like an eternity.
2:11
Josh: I'm sure they'll be able to figure it out.
2:12
Josh: And the other is that they'll be able to actually convince people to go and
2:15
Josh: use this device instead of an iPhone.
2:16
Josh: Now, this is separate from the product suite that we've mentioned in the past, where Johnny,
2:20
Josh: I was developing earbuds or a pendant or a little puck
2:23
Josh: that sits on your desk this is a full-blown display with
2:26
Josh: a screen and a smartphone all integrated it seems like it's going to be built
2:30
Josh: on top of open as cloud so i would expect memory and a lot of the graphical
2:35
Josh: processing power to not be as important because a lot of it is going to be offload
2:39
Josh: to open as cloud and i think this is really interesting news this isn't what i was expecting.
2:43
Josh: I thought they were going to be the third device, like your computer,
2:48
Josh: your phone, your maybe earbuds, but they're going for that phone slot.
2:51
Josh: And this was really surprising for me to hear.
2:52
Josh: But this analyst who was reporting on it, he is the most accurate Apple supply
2:56
Josh: chain analyst in history.
2:58
Josh: And he also seems to have a lot of other people backing him up as well.
3:02
Ejaaz: Here's the thing. I do think OpenAI is building the third device.
3:06
Ejaaz: They're pitching it as a phone, but it's going to act very and maybe even look
3:10
Ejaaz: very different to an actual phone. So a few differences I want to point out from the off.
3:14
Ejaaz: This phone is rumored to not have any apps on it at all.
3:18
Ejaaz: You will interact directly with an AI, presumably chat GPT, and you will feed it your data,
3:25
Ejaaz: your thoughts, your intentions, and it'll either generate apps or user interfaces
3:29
Ejaaz: on the fly, or it'll interact with other AI agents that will conduct the research process,
3:34
Ejaaz: information retrieval, whatever you might need for you on your behalf.
3:37
Ejaaz: So I'm describing here two different things.
3:40
Ejaaz: One, a completely different operating system that is more engineered towards
3:44
Ejaaz: the AI future or AI centric world.
3:46
Ejaaz: And the other thing is a completely different hardware component system.
3:50
Ejaaz: If you want to start serving this, you can imagine a few different things off
3:53
Ejaaz: the back, which is normal phones are oriented around, you know,
3:57
Ejaaz: running video, pictures, making sure apps can run optimally.
4:01
Ejaaz: This one is going to be oriented around inference and making sure prompts are
4:04
Ejaaz: processed and AI agents can run locally, that your data can remain private and
4:08
Ejaaz: a bunch of other things around that. So I've written a summary here.
4:12
Ejaaz: It's meant to allow OpenAI to win at the operating system level.
4:15
Ejaaz: And what I like about this is there's no other frontier AI lab,
4:19
Ejaaz: Namely Anthropic, that is going after the vertically integrated layer.
4:22
Ejaaz: You have Google, which plays on every single layer of the stack for AI.
4:27
Ejaaz: You have Apple that kind of fumbled the model building layer,
4:31
Ejaaz: but has all the distribution through their hardware components.
4:34
Ejaaz: And OpenAI has realized that probably quite early, actually.
4:37
Ejaaz: I have to give Sam credit for this.
4:39
Ejaaz: About a year and a half ago, he said in a very weird tweet that now,
4:43
Ejaaz: in hindsight, makes a lot of sense.
4:44
Ejaaz: I am not competing or OpenAI isn't competing with other AI labs.
4:48
Ejaaz: We're competing directly with Apple.
4:50
Ejaaz: And that is like an OG tweet. I need to find that. But it's making a lot more sense now.
4:54
Ejaaz: Not only is he trying to produce an iPhone competitor or a killer,
4:58
Ejaaz: but he's trying to create a range of different devices that can ingest your
5:02
Ejaaz: data either passively or unintentionally,
5:05
Ejaaz: feed it to ShadGPT and make it the greatest product experience vector that he can do.
5:10
Ejaaz: Now, a few other things, because I had an immediate question around this, right?
5:14
Ejaaz: How on earth are they going to deliver this in the first half of 2027?
5:19
Ejaaz: OpenAI does not have the supply chain prowess that the likes of Google and Apple already have.
5:24
Ejaaz: Well, the answer is they're going to be outsourcing this to a bunch of third-party users.
5:28
Ejaaz: I believe it's LockShare, which also happens to be the packaging and assembler of Meta's Ray-Bans.
5:36
Ejaaz: Now, if that's anything to go by, I'm not feeling quite confident at this point.
5:40
Ejaaz: But there's also MediaTek and Qualcomm. MediaTek does a lot of the high processing
5:45
Ejaaz: packaging for a lot of the GPU and NeoCloud assemblers.
5:50
Ejaaz: And Qualcomm has had a lot of favor in the mobile phone market.
5:54
Ejaaz: They have like Snapdragon, which runs in a bunch of Chinese phones specifically,
5:58
Ejaaz: but they have the scale to help OpenAI operate this at a larger extent or to match with iPhone.
6:05
Ejaaz: And the final thing is, what gives me hope, is Johnny Ive being in the mix here.
6:10
Ejaaz: Josh, I know you probably have some strong thoughts about this,
6:11
Ejaaz: but I think his design touch on top of this kind of like hardware scaling bet
6:17
Ejaaz: will give them the best shot at, you know, at least competing with the iPhone
6:21
Ejaaz: or whatever the next iPhone is going to be later this year.
6:23
Josh: Yeah, it's so hard to imagine I would want to put another phone in my pocket
6:26
Josh: that's not an iPhone. But if anyone's going to design it, it's going to be the
6:30
Josh: guy who designed the iPhone.
6:32
Josh: And I think this post says 2028. We actually have an update today from Ming,
6:37
Josh: the analyst who is pushing these timelines up to 2027.
6:40
Josh: In fact, it also gives us a few leaks of kind of the specs that we could expect
6:45
Josh: inside of this phone. And this is something that's interesting too, because,
6:48
Josh: we already know what's going to be in this thing. And it's amazing the supply
6:51
Josh: chain and the leaks that are able to get out and stuff.
6:53
Josh: But basically what this is saying is that it's going to be running on all of
6:56
Josh: the cutting edge technology that you'd expect a Frontier iPhone 19 model this year to be running on.
7:02
Josh: They have a deal with TSMC to create those two nanometer class transistors.
7:06
Josh: That is the current state of the art. There is nothing better.
7:09
Josh: They're using a lot of low power components. So I think one of the more important
7:13
Josh: things for this phone, because ambient capture is going to be so important is
7:16
Josh: energy efficiency over raw power.
7:18
Josh: So it seems like some of these design choices they're using are for extended
7:22
Josh: battery life. So it can be on all the time, constantly listening,
7:24
Josh: constantly taking information. And you have to imagine this form factor.
7:28
Josh: The reason they decided to go with it is because it's the only one that makes
7:31
Josh: sense to be a true assistant throughout your day to day.
7:35
Josh: It has the suite of cameras, the microphones, it has the accelerometers,
7:40
Josh: it has the GPS baked into it.
7:41
Josh: That's really difficult to include in this like suite of devices like the earbuds
7:45
Josh: with a small puck so we have a lot of information on that we also have like
7:50
Josh: you were mentioning the suppliers who they're going to be building with i mean
7:52
Josh: these two nanometer chips are allegedly going in production in the second quarter of this year.
7:58
Josh: That means these are going to start being made in the next couple of months.
8:01
Josh: And we have deals with MediaTek, Qualcomm, TSMC, and Luxshare.
8:05
Josh: And like you said with Luxshare, they do make Metis glasses,
8:08
Josh: but they are also Apple's number two assembler behind Foxconn.
8:12
Josh: They've built AirPods, the Apple Watch, and an increasing share of the iPhone.
8:17
Josh: So they're using people who are basically the best in the world.
8:20
Josh: They're using best-in-class components. And it's hard to imagine that this device
8:24
Josh: isn't going to be excellent.
8:25
Josh: It seems like foxconn is also involved which i didn't realize and foxconn currently
8:31
Josh: they build open ai stargate services and for those who don't know foxconn has
8:34
Josh: basically built every apple device you've used like foxconn makes all of the
8:37
Josh: iphones a bunch of ipads macbooks the whole thing,
8:40
Josh: foxconn has been building stargate service but now they're also going to be building those.
8:45
Josh: Johnny i've designed devices while lux share takes the smartphone build so it's
8:49
Josh: this crazy assembly manufacturing setup that they have where like i think it's
8:54
Josh: actually going to work If any
8:55
Josh: company is going to build a product like this, it's going to be OpenAI.
8:58
Josh: They have the right people in place. They have the cutting-edge products.
9:02
Josh: I guess the question is, are you actually going to want to put an OpenAI phone
9:06
Josh: in your pocket instead of your iPhone?
9:08
Ejaaz: That's an easy answer for me. Absolutely, yes. But I'm also a sucker for some of the new devices.
9:13
Ejaaz: I'm not going to replace my iPhone, but I'm going to have it next to it.
9:17
Ejaaz: Because I want to see what this new operating system is going to look like.
9:20
Ejaaz: And to be honest, I don't think current mobile phones are built for what the
9:23
Ejaaz: future of AI is going to look like or function as.
9:26
Ejaaz: Yeah, if I'm going to be interactive, like look at Siri. Do you use Siri?
9:29
Ejaaz: I sure as hell don't. And I want to be able to use a Siri-enabled,
9:32
Ejaaz: I don't know, chat GPT that can do things for me and access all my apps so that
9:35
Ejaaz: I don't have to scroll and tap into them, right?
9:38
Ejaaz: Anyway, to your question around this has to work, I'm probably not as confident
9:45
Ejaaz: that it can work or not as sure that it can work.
9:48
Ejaaz: Because if you look at like this stack that they're building,
9:51
Ejaaz: there's a lot of new things here, right? So OpenAI, ChatGPT is known for
9:56
Ejaaz: Absolutely nailing the large language model architecture, right?
9:59
Ejaaz: That's what they've made their bread and butter on.
10:01
Ejaaz: What they haven't proven is that they can get it to function optimally on a small enough device.
10:06
Ejaaz: Now, if there's one thing that Apple has all the experience on is hardware optimization.
10:10
Ejaaz: So if anyone's going to know how to run locally run models, either on device
10:13
Ejaaz: or through private cloud, because obviously there's a lot of data encryption
10:16
Ejaaz: stuff that needs to happen there.
10:18
Ejaaz: Apple has all the historical knowledge and expertise
10:21
Ejaaz: to be able to potentially pull that off open air i'm not
10:23
Ejaaz: entirely sure number two um open ai really
10:26
Ejaaz: is trying to define like a new uh ai stack
10:29
Ejaaz: here like an operating system um that's not only
10:32
Ejaaz: going to be large language models that's going to be images and
10:35
Ejaaz: image gen now they have the world's leading image
10:38
Ejaaz: model which is great news right so they're going to combine these two things i
10:41
Ejaaz: think um their dual architecture allows for like a vision language
10:43
Ejaaz: model to work with an alarm which is going to be very cool but i'm
10:46
Ejaaz: also curious like how are they going to function with the
10:49
Ejaaz: camera ingestion in live time like like we're gonna
10:52
Ejaaz: use this camera very differently with maybe it's not to like take pictures but
10:55
Ejaaz: maybe it's like to show the llm what we're doing or what we're seeing and then
10:58
Ejaaz: it can kind of address things there's a lot of newness is what i'm i guess i'm
11:02
Ejaaz: trying to say at and i'm not entirely sure they can pull it off but i'm hoping
11:05
Ejaaz: with johnny ive at the helm and again i'm a johnny i fan that he'll be able
11:09
Ejaaz: to figure it out and pull it off
11:11
Josh: Yeah. And I think I like to, the next thing I'm looking for with these leaks
11:14
Josh: is confirmation that Johnny's actually going to be designing this phone.
11:17
Josh: It seems like he is. I don't understand why they wouldn't put him and the Love
11:21
Josh: From team, I guess the IO team in charge of designing this, but I want to make
11:24
Josh: sure it's actually him or if this is actually a hedge against his screenless device is not working.
11:29
Josh: So that's going to be an important thing to follow as we get more information.
11:32
Josh: A lot of the next questions that I was asking myself is why are they doing this
11:37
Josh: and why are they doing it so quickly?
11:39
Josh: And I think there's a few reasons for this, right? Because when you think about
11:42
Josh: the amount that they're going to be able to actually build, you said 30 million
11:46
Josh: units is what they're kind of aiming for.
11:47
Josh: 30 to 40 billion. So assume these costs, $1,000 a piece, which is kind of like a high end phone price.
11:53
Josh: That's 30 to $40 billion of revenue over two years.
11:57
Josh: Anthropic just made $25 billion of revenue in like the last few months.
12:01
Josh: So I'm not sure how much is going to move the needle. And I have to assume this is probably for.
12:06
Josh: The beginning of that hardware mode, but also the timing is funny because this
12:09
Josh: is rumored to be when they want to IPO.
12:11
Josh: And what better catalyst for getting people excited about your company than
12:15
Josh: to build a new suite of hardware that can compete with Apple?
12:19
Josh: Whether or not it actually does a good job, that is TBD.
12:21
Josh: But I assume this is probably a nice, really big catalyst for them as they go into IPO season as well.
12:27
Josh: And I just can't help but think that that has to play some sort of a role in it.
12:30
Josh: And then there's also the business side where you could bundle subscriptions
12:33
Josh: with it and they get developer ecosystems for the hardware and you get that hardware moat.
12:37
Josh: But man, like Apple's got the hardware moat. And the problem is just a skill
12:41
Josh: issue with software. They just can't build the software.
12:43
Josh: OpenAI is approaching it from the other direction. Can they do it?
12:45
Josh: I don't know. We'll be buying it. We'll certainly be trying to promise you that.
12:49
Ejaaz: If it's around, we'll be buying it. But of course, like I want to take the bull
12:53
Ejaaz: hat off for a second and talk about like some of the challenges here.
12:55
Ejaaz: Like number one, we need to make sure that it actually ships in 2027.
12:58
Ejaaz: Number two, we actually need to figure out whether people actually want this
13:01
Ejaaz: thing. I know I do, but I'm a fan of AI in general.
13:04
Ejaaz: Will the averages, will my mom and sister even be interested in this?
13:07
Ejaaz: I think the allure of ChatGPT is good enough. You mentioned bundle subscriptions earlier.
13:11
Ejaaz: I do think that is a good enough selling point versus like, hey,
13:14
Ejaaz: we're launching a phone and we don't really know what to do with it.
13:17
Ejaaz: And then I'm also thinking about Apple's response specifically,
13:20
Ejaaz: because I know Apple is undergoing a very aggressive transition now to orient
13:24
Ejaaz: themselves around the new AI world.
13:26
Ejaaz: They've launched their new M5 chips, which is probably the best consumer device
13:31
Ejaaz: components that can run AI on device.
13:34
Ejaaz: And they've got a new guy at the helm, John Ternus, which is a hardware expert.
13:38
Ejaaz: He's spent the last 35 years building Apple's hardware.
13:41
Ejaaz: He should be the perfect person to build whatever that new device is.
13:44
Ejaaz: So they're going up, it's David versus Goliath. And I don't know whether David's
13:48
Ejaaz: going to win this particular battle, but it's interesting.
13:52
Ejaaz: I think OpenAI will be able to pull something off. They have,
13:54
Ejaaz: heck, they have enough in financing.
13:57
Ejaaz: I think they're going to be raising how much in the IPO? I think it's like 70
13:59
Ejaaz: to 80 billion, maybe even more at a $1.3 trillion valuation is the last that
14:04
Ejaaz: I've heard on the rumor mill.
14:05
Ejaaz: So if anyone's going to pull it off, it might be done.
14:08
Josh: I hope they do. I think if I'm giving my personal take on this,
14:12
Josh: I'm pretty bearish and pretty pessimistic on the phone.
14:14
Josh: I can't imagine, like the amount of love and addiction that everyone has for
14:21
Josh: their iPhone is so strong.
14:23
Josh: And for open AI to come, especially when I'm flip-flopping, people are flip-flopping between Anthropic.
14:27
Josh: We just filmed an episode on Codex when a month ago, we were saying Codex kind of stinks.
14:31
Josh: The amount that people are flip-flopping between these services,
14:34
Josh: the amount of kind of buy-in that's required to not only commit to open AI,
14:39
Josh: but then transfer your phone that you've had for the last 15 years away from
14:43
Josh: that with all of your iMessages and your social apps, that is going to be incredibly hard to do.
14:48
Josh: And the auxiliary device pathway, the one that Johnny was making,
14:51
Josh: the screenless devices, the accessories to the phone, that made sense.
14:54
Josh: Compete directly with the phone.
14:56
Josh: I feel confident they'll be able to bring it to market.
14:58
Josh: Will people be able to buy it? Will people want it? I don't know.
15:02
Josh: I don't think that's the case, But we'll see.
15:04
Josh: We'll see. And that is one of many things that we are going to be kind of discussing
15:08
Josh: as we uncover this roadmap as detectives.
15:11
Josh: EJS, you's had your magnifying glass out recently, going through the job board
15:14
Josh: listing, seeing what these companies have been up to. What have you found?
15:17
Josh: What is in the roadmap for these companies as we progress, I guess,
15:21
Josh: towards the OpenAI iPhone early next year?
15:24
Ejaaz: Okay. So just to explain my logic, I was curious by, my curiosity was piqued
15:29
Ejaaz: by this new phone, right?
15:31
Ejaaz: And I was like, how can I convince myself that this is actually going to be
15:34
Ejaaz: the thing? So I was like, well, let me look at the job postings.
15:37
Ejaaz: If they're hiring for like, you know, a mobile phone engineer or whatever you
15:40
Ejaaz: want to call it directly, then, you know, it's hint, hint, that's probably what they're working on.
15:44
Ejaaz: But I ended up discovering a whole other goldmine, which is their entire product
15:49
Ejaaz: roadmap, OpenAI specifically.
15:50
Ejaaz: And I did the same with Anthropics over the next 24 months.
15:53
Ejaaz: And what surprised me the most is both of these companies I thought would be
15:57
Ejaaz: very similarly aligned in their strategy.
15:59
Ejaaz: They're not. They're actually doing two very different things.
16:01
Ejaaz: And I want to kind of like tell that story over the next couple of minutes.
16:05
Ejaaz: So I looked at OpenAI and I have it displayed up here. I'm not going to walk
16:08
Ejaaz: through the specifics, but I'll give you the general idea of what I found.
16:11
Ejaaz: So there's around 330 job postings currently live as of today.
16:16
Ejaaz: 100 got posted in the last week and a half. So OpenAI is really ramping this up.
16:20
Ejaaz: Now, as you'd probably expect, 25 to 30 percent of these roles are roughly sitting
16:25
Ejaaz: at the point where it's directly for AI-forward engineers.
16:29
Ejaaz: So we're talking about researchers, engineers that can actually build and train
16:32
Ejaaz: the model and make this thing actually useful for them.
16:36
Ejaaz: 12 to 15% of the roles are specifically around infrastructure and engineering roles.
16:40
Ejaaz: And this is where you see a subset of hardware-specific engineers that are focused
16:45
Ejaaz: on devices specifically.
16:47
Ejaaz: So one could assume that if OpenAI is building a mobile phone or a suite of
16:52
Ejaaz: different devices, this is where the roles are being hired for.
16:56
Ejaaz: And it takes up a non-trivial percentage of the available roles.
16:59
Ejaaz: Now, when I look at a setback from this, right, this seems, I guess,
17:03
Ejaaz: kind of surprising, but pretty obvious.
17:05
Ejaaz: OpenAI underwent a code red over the last...
17:09
Ejaaz: I was going to say six months, but it's literally only been like three or four
17:12
Ejaaz: months. And it's crazy that they flipped the script with Anthropik so quickly.
17:15
Ejaaz: But they've been able to undergo this process of change where they're hiring
17:19
Ejaaz: for very compute intense research heavy things.
17:22
Ejaaz: They've trimmed a bunch of their other efforts to focus on building the best
17:25
Ejaaz: model, specifically the coding model.
17:26
Ejaaz: And that is represented in what I'm seeing right now.
17:29
Ejaaz: But there's a strategic move that I want to call out here, which is Sam made
17:34
Ejaaz: a very big bet about a year ago, which is to go all in on compute.
17:38
Ejaaz: Stargate specifically.
17:39
Ejaaz: He also made a very big bet three months ago to go all in on coding AI specifically.
17:45
Ejaaz: He's treating this like a warlord empire where
17:49
Ejaaz: his entire like ancestral lineage depends
17:52
Ejaaz: on this so he's not treating this like an enterprise company he's
17:55
Ejaaz: not really treating this like he has an IPO coming up in a
17:58
Ejaaz: few months he's like going all in it kind of reminds me of Larry Page where
18:02
Ejaaz: he was quoted saying we're going to go all in and I'm willing to go bankrupt
18:06
Ejaaz: losing this race but I can't afford to lose the race um Sam is approaching this
18:10
Ejaaz: in a very similar manner um I don't know if you have any thoughts on OpenAI
18:14
Ejaaz: specifically before I move to Anthropik,
18:15
Ejaaz: Josh, but like this was like pretty revealing for me.
18:18
Josh: Yeah, it seems like as they move forward, their focus is on Stargate and building
18:22
Josh: like actual data centers.
18:24
Josh: Their focus is on building more efficient code. And then their focus is on these hardware devices.
18:29
Josh: And I guess these Johnny Ive devices, the IO devices that are shipping in parallel,
18:32
Josh: seems like the timelines are pretty tight.
18:35
Josh: And we might even get these before the end of this year. So I think those are
18:38
Josh: probably the three pillars, right? It's just like the core software,
18:41
Josh: the hardware, and then the infrastructure.
18:44
Josh: And notably, missing from this is roles for alignment and safety,
18:49
Josh: which seem to be in the minority here, if I'm correct.
18:52
Josh: But that's not the case for Anthropic. Is that a correct assessment?
18:56
Ejaaz: That is correct. But before we move on to Anthropic, Josh, there is 12% of job
19:02
Ejaaz: postings are in another sector.
19:05
Ejaaz: Can you guess which sector that is in OpenAI?
19:08
Josh: Huh. Hopefully marketing.
19:11
Ejaaz: They got to work on that. Think about a recent alliance or agreement that they
19:15
Ejaaz: had to sign with a big government entity.
19:18
Josh: Oh, is this government work?
19:20
Ejaaz: Yeah, 12%. Whoa, interesting. Do you want to know where their second largest employee base is?
19:25
Josh: Where? Is this the Pentagon?
19:27
Ejaaz: Washington, D.C., dude. Oh, my God. Yeah.
19:30
Josh: Wait, that's kind of crazy. Interesting.
19:31
Ejaaz: Yeah, they've aggressively hired on the D.C. side, which kind of makes sense
19:35
Ejaaz: because Sam has been a huge fan of kind of trying to lobby government entities
19:39
Ejaaz: or just trying to lobby AI policies in general to become more favorable or AI favorable.
19:45
Ejaaz: So it makes sense that he has the largest presence out there.
19:48
Ejaaz: And Anthropic specifically doesn't. But yeah, we can move into Anthropic now.
19:52
Josh: Okay, yeah, that's interesting. I had no idea. What is Anthropic working on?
19:55
Ejaaz: Okay, so Anthropic has, thankfully, a much more well-laid-out website,
19:59
Ejaaz: which can kind of fall through.
20:01
Josh: And a lot of open roles. Everyone's saying AI is killing jobs,
20:04
Josh: but man, these companies are hiring.
20:06
Ejaaz: Did you hear the news? So some of the folks listening, Joshua and I are based on the East Coast.
20:10
Ejaaz: And in New York specifically, Anthropik is currently about to buy one of the
20:15
Ejaaz: largest office spaces that any tech company has ever bought in the most recent couple of years.
20:21
Ejaaz: They're about to have a huge presence out here, and they're going to be focusing
20:24
Ejaaz: on three specific roles.
20:26
Ejaaz: Number one is go-to-market, obviously sales.
20:29
Ejaaz: Number two, enterprise-specific. And number three, the finance bros.
20:34
Ejaaz: They are going wholeheartedly into the financial services sector,
20:37
Ejaaz: and they want every analyst, MD, and fund manager to be using Claude to direct
20:43
Ejaaz: all their different workflows.
20:45
Ejaaz: I don't know if you saw the news yesterday, Josh, but they just signed a $1.5
20:49
Ejaaz: billion joint venture with Goldman Sachs, Blackstone, and I think it's Hellman
20:54
Ejaaz: and Freed to basically integrate Claude into every single one of their portfolio companies.
20:59
Ejaaz: We're talking about like 250 plus portfolio companies for Blackstone alone.
21:03
Ejaaz: And the idea is Anthropics is going to shove a bunch of Anthropic engineers.
21:07
Ejaaz: These are costly people, the most valuable people into these enterprises to
21:11
Ejaaz: build custom workflows just so that they get hooked on Claude,
21:15
Ejaaz: just so they get addicted on the LLMs.
21:17
Ejaaz: And then the rest kind of like pays for itself, I guess.
21:20
Josh: Okay first where is this building that they're buying i'm so curious i think it's the google.
21:24
Ejaaz: Office in chelsea it's like a massive space
21:27
Josh: Yeah nice and i definitely see i noticed the shift to move to financial services
21:32
Josh: i've seen this a lot with claude recently yes in fact as we were recording this
21:35
Josh: they just released an update to a finance for claude basically where they're
21:40
Josh: releasing a series of different templates that can do a lot of different things
21:43
Josh: as it relates to financial analysis.
21:45
Josh: So it does models, it does spreadsheets, it does financial projections,
21:50
Josh: it does all the things that you would hope a analyst would do.
21:54
Josh: Claude is building these as kind of pre-templatized workflows that are built
21:58
Josh: directly into co-work and Claude code.
22:00
Josh: So if you want to get evaluation, if you want to get trajectories of pipelines
22:04
Josh: or revenues, all that is now done within Claude.
22:06
Josh: And I like the shift that we're kind of seeing into the financial services business.
22:10
Josh: It's mostly been open since now.
22:12
Josh: Perplexity is really the only one that's moved into financial services.
22:16
Josh: They've tried that Bloomberg alternative. It's pretty good. But Claude moving
22:19
Josh: into this. Yeah, here's the post right here of all the things that they're doing.
22:21
Josh: KYC screener, statement and auditor. It's got all the tools, one click plug in,
22:26
Josh: So it makes sense that they move to New York, get a little bit closer to Wall
22:29
Josh: Street, and start moving into financials. This is, I mean, this is exciting.
22:32
Josh: This is really cool, particularly when the market is ripping the way it is.
22:35
Ejaaz: Yeah, it's so interesting that, like, both companies, probably at the same time,
22:41
Ejaaz: have gone into becoming kind of like a sales and BD-driven business.
22:47
Ejaaz: I thought the LLMs would just speak for themselves. But the truth is,
22:50
Ejaaz: the technology and power is here. It's just not well enough dispersed,
22:54
Ejaaz: and it's not going to diffuse until you handhold the people.
22:58
Ejaaz: The blocker right now are humans.
23:00
Ejaaz: The blocker is siloed data sets in all of these top enterprises and companies
23:04
Ejaaz: that don't really know how to integrate the thing with AI.
23:07
Ejaaz: And the AI is not smart enough to know how to integrate itself into it.
23:10
Ejaaz: So it's kind of like a chicken and an egg problem, and Anthropic is taking the first step here.
23:14
Ejaaz: OpenAI as well, they've signed a similar joint venture with similar companies
23:16
Ejaaz: to basically put both of their products at the helm here.
23:20
Ejaaz: If we go back to Anthropik in general, the point I want to make around these
23:23
Ejaaz: roles is, listen, they have around the similar amount of roles that OpenAI is
23:26
Ejaaz: hiring for, but the strategy that they're pursuing here is a bit different.
23:30
Ejaaz: They are treating their company as an enterprise services company.
23:34
Ejaaz: So they famously or infamously have not bought as much compute as OpenAI.
23:40
Ejaaz: As I mentioned, Sam is like the conqueror. He's like, I need all the compute.
23:43
Ejaaz: I'll lever it all up. And if it pays off, it pays off. and it is paying off
23:47
Ejaaz: because now he can serve his Claude Mythos competitor, GBT 5.5,
23:50
Ejaaz: to anyone and everyone. Claude Mythos is still restricted on the Anthropic side.
23:54
Ejaaz: Anthropic is being more strategic. Their bread and butter, the majority of the
23:57
Ejaaz: money that they have made so far and still,
23:59
Ejaaz: I think it's something crazy like 70%, sorry, 60% of their revenue recently
24:04
Ejaaz: comes purely from enterprise and they want to clearly seed that reputation and wrap it up even more.
24:10
Ejaaz: They are focusing primarily on enterprises, which is why we don't see more of a consumer base.
24:15
Ejaaz: You know, We've seen all the crazy social media spread around restrictions on
24:19
Ejaaz: rate limits and stuff like that.
24:21
Ejaaz: I think that's because they're just focusing wholeheartedly on enterprise customers.
24:24
Ejaaz: They don't want to restrict them. I think they have like...
24:28
Ejaaz: As of two weeks ago, they have like 500 to 1,000 clients that pay them well
24:32
Ejaaz: over one to five million dollars per year.
24:34
Ejaaz: If they can ramp that up, that's a lot of ARR, basically.
24:37
Ejaaz: And they recently hit, what is it, 44 billion ARR?
24:40
Josh: Yeah, pretty good business. And you could start to see the clear divide between
24:43
Josh: these two companies as we go through these job boards and the rumor mills where
24:46
Josh: OpenAI, they currently have the best image model. They're working on consumer hardware.
24:50
Josh: They're building a lot for consumer, although they're working on their kind
24:53
Josh: of commercial enterprise segment as well. But Anthropic is all in on enterprise,
24:57
Josh: on financial services, on selling to businesses.
24:59
Josh: And I think that's why we've seen their ARR go completely nuclear,
25:02
Josh: because they're selling much larger ticket items to much more sticky customers
25:06
Josh: that are going to stick around and endure 12, 24-month contracts with these
25:10
Josh: companies. So it's interesting. It's fascinating.
25:13
Josh: The hardware story to me is the most exciting. I cannot wait to get AI-first
25:16
Josh: hardware. I hope it's good.
25:18
Josh: I hope it's good. Like WWDC from Apple is happening next month,
25:22
Josh: where hopefully Siri doesn't suck.
25:24
Josh: The first AI first devices are going to be from OpenAI.
25:28
Josh: And now the timeline might have moved up a little bit sooner.
25:31
Josh: So that news at least is very exciting.
25:33
Josh: This has been an investigative review of what is in store.
25:37
Josh: I think the prompt for you guys is one, will you use an OpenAI phone?
25:40
Josh: Like, will you swap your iPhone for this phone?
25:42
Josh: And I know it's tough to tell without actually having it in your hands to see.
25:45
Josh: But it seems like such a stretch.
25:48
Josh: You just, what about you? Any final parting thoughts before we head out for the day?
25:51
Ejaaz: I want to see the device. I want to see some visuals. You know why I feel this way?
25:55
Ejaaz: Like, don't even give me the device. It's that dime advert with Alexander Skarsgård
25:59
Ejaaz: or whatever, which, I don't know, turned out to be a fake or a dud or a Chinese pair of earbuds.
26:04
Ejaaz: I need something from OpenAI. And they're the only ones that are leading it.
26:08
Josh: So bad. Well, hopefully we get that before we get... Will we get a better Siri
26:13
Josh: before we get an OpenAI hardware device? That's the question.
26:15
Ejaaz: Who knows? Probably not.
26:18
Josh: Probably not. But that is the episode for today. Ejos, thank you for all this
26:21
Josh: investigative journalism and to the job boards here for giving us some guidance
26:25
Josh: on all things OpenAI, all things Anthropic.
26:28
Josh: If you enjoyed this video, don't forget to share it with a friend who might
26:31
Josh: also enjoy this, who might also be interested in the crazy cool new hardware
26:34
Josh: leaks that are coming. If you enjoyed, leave a comment down below.
26:37
Josh: Subscribe on YouTube. Leave us a five-star review on wherever you listen to
26:40
Josh: your podcast. And as always, thank you so much for watching.
26:42
Josh: And we'll see you guys in the next episode.