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Sharp Tech · · 65 min

OpenAI Enters the Hardware Business, The Challenges and Opportunities for Jony Ive, Takeaways from Google I/O 2025

Andrew SharpBen Thompson

Podcast
TL;DR
  • OpenAI’s nearly $6.5 billion all-stock purchase of Jony Ive’s io is its clearest bid to own the consumer AI interface rather than remain an app on someone else’s platform. Ben says an acquisition makes more sense than a loose partnership and fits OpenAI’s broader effort to become “the interface for AI.” His strategic framing: with Google certain to compete through models and Android, OpenAI sees an opening to become “the Apple of this space.”

  • The deal forces OpenAI toward a consequential choice between Apple-like integration and Google-like service ubiquity. Owning hardware could capture the full experience and economics if AI retains meaningful marginal costs, but it will also turn potential distribution partners into competitors and bias OpenAI’s services toward its devices. Ben’s warning from Google’s Android history: “The tail started wagging the dog.”

  • The $6.5 billion headline buys a concentrated Apple hardware organization, but not Apple’s supply-chain leverage. The operation has recruited former Apple leaders including Evans Hankey and Tong Tong, along with specialists spanning industrial design, manufacturing design, and operations; Ben says they have “plucked the best people.” Yet those veterans are accustomed to Apple dictating supplier terms, while OpenAI must build a smaller organization and perhaps a family of products amid supply-chain decoupling: “Hardware is really hard.”

  • The product opportunity is real, but neither host believes a new interface automatically displaces phones or chat. Altman called today’s interaction model the “terminal phase” preceding AI’s graphical interface; Ben counters that asynchronous text already mirrors how humans prefer to communicate and keeps users connected to the physical world. Glasses offer an outward camera, with audio potentially handled in the ears—though Ben notes that wearing devices in the ears for hours is problematic—and Andrew doubts any product could persuade non-wearers to adopt them daily.

  • Ive’s record supplies credibility and a warning that world-class design still needs a ruthless editor. His teams produced the colorful iMac, iPod, MacBooks, iPhone, and iPad, but Ben faults late-era Apple for elevating form over function through products such as the butterfly-keyboard MacBook Pro and $17,000 gold Apple Watch. Steve Jobs was “the world’s greatest editor in chief”; the nearly ten-minute, self-congratulatory launch film suggested that io still needs somebody willing to cut.

  • Google I/O showed industry-leading AI capability and a persistent inability to turn that capability into standalone consumer products outside Search. Ben praised Google’s models, image generation, and Veo 3, yet struggled to identify how ordinary users would discover the demos; even Google lacks a Gemini app for Mac, while its Flow interface felt rough. His concise diagnosis: Google remains “a one-product company, and that product is search.”

  • Google’s defensible plan is to use AI Mode as a proving ground, then “graduate” winning features into Search and Android at roughly six-billion-user scale. Real-time data connections, generated visualizations, AI Overviews, Lens, defaults, and existing habits give Google distribution that OpenAI must persuade users to seek out. That scale is simultaneously the moat and constraint: advanced features cannot reach main Search until they are reliable and cheap enough, while the $250 plan primarily attracts highly switchable enthusiasts.

  • Veo 3’s coherent eight-second clips with audio are already astonishing, and current cost and model capability are the immediate constraints on longer mass-market video. Ben described generation costs as “astronomical,” with each clip consuming substantial credits; as a Gemini Ultra customer, he now has about $550 per month in free APIs. As costs fall, his optimistic response to synthetic-media chaos is that people may finally assume “everything online is fake,” trust physical reality, and “go and touch grass”—a future Andrew hopes for but does not confidently expect.

Digest · the substance, structured for research

1. The io acquisition turns OpenAI’s interface ambition into a company

  • Andrew opened with Bloomberg’s report that OpenAI would acquire io, the secretive startup co-founded by Jony Ive, for nearly $6.5 billion in stock—its largest acquisition in OpenAI’s history. The deal creates a dedicated AI-device unit and brings in former Apple designers; Ive described it as the culmination of 30 years and predicted “products and products and products.”

  • Ben’s immediate resolution was organizational: partnering indefinitely to build tightly integrated hardware would be awkward, whereas acquisition makes io unambiguously part of OpenAI. It also complements the previously discussed Windsurf deal because both serve the same ambition—OpenAI wants to control “the interface for AI.”

  • Ben added a pointed corporate-structure observation: OpenAI is transitioning from nonprofit toward for-profit status while the nonprofit board retains control. In his framing, issuing stock to businesses such as Windsurf and io is also “a good way to diminish” how much of the eventual company belongs to the nonprofit.

  • Hardware matters because consumer capabilities need a tangible route to adoption: “You go to the store, you buy this thing, this thing lets you do things.” ChatGPT’s emergence through a website and app is itself extraordinary—Andrew marveled that, in 2025, so many people voluntarily type chatgpt.com—but new AI demos increasingly need a product that makes them coherent and easy.

2. OpenAI is choosing whether to be AI’s Apple or everybody’s service

  • Ben treats Google’s presence in AI as inevitable. Its business-model conflict is obvious, but so are “unmatched” infrastructure and an elite research team; he recalled OpenAI’s founding emails in which Elon Musk and Sam Altman argued that Google would capture the field unless somebody acted.

  • Ben imagined Altman’s systems-level choice this way: Android will be deeply integrated with Google’s models, leaving OpenAI as merely another app—the same position Meta resents on iOS. The alternative is to assume Google owns the broad platform and pursue “the opportunity to be the Apple of this space.”

  • Full integration may also make economic sense if serving AI never becomes marginally negligible in the way consumer web services are treated. OpenAI could own hardware, models, and experience as an “integrated all-up player,” capturing more value instead of absorbing inference costs while another platform controls the customer.

  • Andrew’s pushback was that OpenAI appears to want Google and Apple inside one company. Listener Robert preferred advertising and commoditized complements—“become the next Google, not the next Apple.” Ben called that the correct objection: devices make potential partners defensive and cause service development to favor owned hardware, as Google once became so focused on Android versus Apple that “the tail started wagging the dog.”

3. Apple talent travels, but Apple’s supplier power does not

  • The personnel make this more than a famous designer’s retirement project. Ben highlighted Evans Hankey, Tong Tong, and recruits covering industrial design, the intermediate work of making designs manufacturable, and operations. The team knows Apple’s internal talent map and has systematically “plucked the best people.”

  • That expertise matters because modern phones are extraordinarily dense systems, not sculptures. A credible device must look good while integrating extensive capability, battery life, reliability, annual iteration, quality assurance, and mass production; this is why Ben rejected easy comparisons with failed projects assembled from former Apple employees. “This isn’t a fly-by-night hardware operation picking up the scraps.”

  • Starting now gives OpenAI one advantage: it can design its supply chain for the current uncertainty around China rather than unwind an entrenched system. The disadvantage is cultural experience—these employees are used to operating inside the Apple machine, where suppliers accommodate extraordinary volumes and Apple can finance a competitor when it dislikes one vendor’s price.

  • Andrew stressed that io remains far smaller than Apple’s organization even while discussing a “family” of products. Ben thinks the team may underrate how different its supplier leverage will be, although Apple veterans may be better equipped to navigate those problems than complete newcomers. The balanced call: the pedigree is real, but “hardware is really hard.”

4. Ive’s résumé is unmatched, and his late Apple years remain a warning

  • Ben’s CliffsNotes version of Ive’s career began before Steve Jobs returned, when the disillusioned designer was close to leaving. Jobs elevated him into a right-hand role, and Ive’s teams produced the colorful teardrop iMac that helped revive Apple, then the iPod, MacBooks, iPhone, and iPad—making him, in Ben’s view, history’s most impactful product designer.

  • Ben nevertheless remains critical of Ive’s later tenure. Apple’s 2010s Mac design often elevated form over function, culminating in excessively thin machines and the butterfly-keyboard fiasco, although Ben cannot know how responsible Ive was while “halfway out the door.” The $17,000 gold Apple Watch felt overly precious, even though its fundamental design endured and the broader Watch line became successful.

  • Ive’s essential partnership was with Jobs, whom Ben called “the world’s greatest editor in chief”—the person who knew what to push, pull, improve, or discard. Ive once told Apple interns that withholding criticism is selfish rather than caring because “true care is being honest”; like Gregg Popovich yelling at Tim Duncan, visible coaching of the star gives everyone else permission to demand better work.

5. AI may need a new form factor, but chat has not been displaced

  • Altman promised consumer-hardware quality that “has never happened before,” prompting Ben’s eyes to roll: Apple deserves respect for delivering remarkable quality at global scale every year. OpenAI can instead compete through superior AI, freedom from cannibalizing an incumbent product, and experiences an established phone maker might hesitate to ship.

  • The positive interpretation of a new form factor is that OpenAI will not waste time reinventing the phone; beginning as a differentiated phone accessory would be acceptable. The negative interpretation follows Ive’s unease about what smartphones did to society: excessive control designed to prevent bad uses might also eliminate the product’s upside until it is “just not used at all.”

  • Altman’s “terminal phase of AI interactions” meant text-command terminal, not terminal illness. Ben explained that terminals provide expansive control while graphical interfaces constrain users to whatever controls designers anticipated; generative UI might resolve that tradeoff by creating interfaces dynamically, which is why Altman says AI’s equivalent to the graphical user interface has not yet been found.

  • Ben still thinks chat is underrated because asynchronous text matches ordinary human communication: ask, leave, and return when the answer is ready. He finds glasses difficult to beat as a form factor because they provide an outward camera, while audio can be delivered through the ears—though he notes that wearing devices in the ears for hours is problematic. Andrew’s pushback was personal but consequential—any device would need to be spectacular before a non-glasses wearer accepts it every day.

6. The launch film exposed the danger of design without an editor

  • Listener Alex captured the announcement’s backlash: Altman and Ive appeared to be “adopting me against my will from an orphanage,” while the self-flattering, seemingly staged film approached the discomfort of Apple’s hydraulic-press advertisement. Details such as clinking espresso cups and San Francisco streets reportedly closed for filming made the performance of authenticity feel even more engineered.

  • Ben’s verdict on the roughly nine-minute-and-50-second film was that it should have been three minutes. Andrew found the announcement page equally uncomfortable, while Ben compared its typeface to a wedding invitation. The irony was hard to miss: a partnership centered on elite taste launched with material that appeared to lack precisely the forceful editor Ive once valued.

  • Ben connected that preciousness to product policy. If Ive remains tortured by the iPhone’s harms, the team may constrain useful behavior until the device lacks appeal; “good and bad are a package,” and individuals ultimately decide how tools are used. He distinguished efforts to ensure AI does not “kill everyone” from a paternalistic “people can’t handle the truth” strain that he finds oppressive.

7. Google won the capability demo and still left a product gap

  • Ben’s reaction to Google I/O was deliberately split. The keynote offered a “cornucopia of outcomes” downstream from extraordinary teams and infrastructure: he judged Google’s current model the best, called its image and video generation “crazy,” and highlighted the newly convincing ability to render text inside generated media.

  • Yet the only presentation he found easy to anchor on was Search, because people understand a product they can immediately use. Google can still ship compelling Search features; outside that franchise, Ben saw “this vast gulf” between technical capability and productization. His distilled assessment: “Google is a one-product company, and that product is search.”

  • The NotebookLM example captured both sides. Bill Bishop used it to summarize a Sharp China episode in fewer than 2,000 words and, Andrew said, “it hit all the right beats.” The unresolved commercial question is how many ordinary consumers will deliberately find NotebookLM, learn the workflow, and repeat it rather than default to something already embedded in their daily behavior.

  • Ben contrasted OpenAI’s underrated, functional apps with Google’s missing Gemini app for Mac and a rough Flow experience. Apple looked worse still: Whisper made transcription broadly available long ago, yet Apple’s own transcription remains weak. After another account of Apple’s AI failures, Ben encouraged OpenAI to attack.

8. Search and Android give Google a credible AI distribution funnel

  • Google’s most coherent strategy was what Ben called the AI or Google funnel. Experimental capabilities enter AI Mode, where the interface can resemble ChatGPT and Google can refine them; the best features then “graduate to regular Search” once quality, reliability, and economics permit deployment at mainstream scale.

  • Google’s data connections make that funnel unusually powerful. A user can ask a sports-related question, receive the answer, and see a visualization generated on demand. Ben called AI Overviews the world’s most-used generative-AI product and framed Google’s race as making Search good enough that people reserve ChatGPT for special work but continue Googling everything else automatically.

  • Habit is the consumer moat. Google pays for default placement because it can ride Apple’s device dominance without requiring initiative; ChatGPT’s success despite that friction is therefore “a miracle.” Android offers Google the corresponding path for new AI behavior—put Lens and visual search directly on phones, then let users adopt them without hunting for separate products.

  • Scale is simultaneously Google’s advantage and constraint. Andrew suggested features must become cheap enough for two billion daily users; Ben corrected him to “more like six billion.” He compared all foldable phones sold globally with roughly one day of Apple phone volume. The $250 Google tier can expose frontier capabilities, but its subscribers are enthusiasts likely to switch whenever Anthropic, Gemini, or another model becomes fashionable.

9. Veo 3 makes synthetic video likely to expand before society is ready

  • Andrew described Twitter filling with nine-second Veo 3 clips; Ben emphasized the almost unbelievable achievement of coherent eight-second video with audio. A year or two earlier, virtually nobody expected this capability, yet reactions already shifted from astonishment to asking why the clips cannot be longer—a pattern he thinks makes confident long-range AI forecasting unreliable.

  • The immediate constraints are cost and current model capability. Ben called video-generation expense “astronomical”: generating a clip consumes a lot of a Gemini Ultra customer’s credits, and he now has about $550 per month in free APIs. The model is operating near the edge of present capability because it must generate and assemble the entire audiovisual sequence coherently.

  • Ben nevertheless expects duration to increase and costs to fall through the normal course of technology. Andrew fears an environment where anyone can instantly produce convincing three-minute fabrications; Ben agreed that cheap, broadly available generation deserves concern, even while insisting that today’s eight seconds are already an extraordinary technical result.

  • Ben’s Formula Fakers example showed the social transition underway: a plausible fake post about Jack Doohan, who had recently lost his seat to Franco Colapinto, made fun of Doohan’s crash and generated a real controversy. His hopeful endpoint is that synthetic media accelerates until everyone assumes “everything online is fake,” trusts physical experience, and goes outside to “touch grass.” Andrew left room for that outcome while calling it an optimistic spin on a potentially dystopian future.

Andrew Sharp

Hello, and welcome back to another episode of Sharp Tech. I'm Andrew Sharp, and on the other line, Ben Thompson. Ben, how are you doing?

Ben Thompson

Cool, calm, and collected, Andrew.

Andrew Sharp

Yeah?

Ben Thompson

I've gotten feedback that I'm not sure it's always productive to come out guns a-blazing, so I'm just relaxed, waiting for you to lead the conversation.

Andrew Sharp

Oh, wow. Okay. Guns blazing. You've been guns blazing on Twitter for the last 96 hours. I feel like I'm talking to a celebrity right now.

Ben Thompson

Oh, it's been all month. I've gone viral four times this month, totally by accident. I don't know what happened. Apparently, I've unlocked the code recently. So, yeah.

Andrew Sharp

Oh, my God.

Ben Thompson

I guess I'm back on board with the Twitter algorithm as of late.

Andrew Sharp

Yes.

Ben Thompson

Actually, no, that's not true. Going viral stinks. It's not fun at all.

Andrew Sharp

Honestly, I would tweet more if I could tweet without having 1,000 likes and then having people pop up in my mentions all day long, because I also went viral.

Ben Thompson

This is the worst. People hate this. No one wants to hear about how difficult it is to be so popular on Twitter.

Andrew Sharp

The pains.

Ben Thompson

To be so popular on Twitter, yeah.

Andrew Sharp

Yes. Just to be clear for the audience, we're talking about Ben's alt account, No Tech Ben, which has a combined 100,000 likes as you've been trolling half the NBA for the last 4 or 5 days. It's been great, but we'll talk NBA at the end of the podcast.

Ben Thompson

Wow, 24,000 for my tweet yesterday. Geez.

Andrew Sharp

I looked at it and was like, “Geez. I don't know what Ben's mentions look like.”

Ben Thompson

The funny thing about that—and this is the reality of going viral on Twitter—is there was a group-chat discussion going on about the fouling situation in the game yesterday. I was in the car going to work out with my wife, and I just pulled up and dashed off a tweet. I didn't pay any attention to it.

Andrew Sharp

Mm-hmm.

Ben Thompson

It wasn't until 2 hours later that it was already at 4,000 likes. I was like, “Oh, geez. I wasn't expecting that.”

Andrew Sharp

The other day, you came on to record Sharp Tech and said, “Well, it's my burden to fight for Giannis.” I had no idea that you had woken up. You didn't even watch Game 7 of Nuggets-Thunder, and then immediately took a shot at Jokić after that. It was perfect. So here we are. I hope you muted all of those tweets—

Ben Thompson

I did.

Andrew Sharp

—for your own sanity.

Ben Thompson

It's really important. You have to mute them as soon as possible.

Andrew Sharp

Yes. Speaking of news on the internet, we had some news break on Wednesday, and I'm going to read from Bloomberg. They write:

“OpenAI will acquire the AI device startup co-founded by Apple veteran Jony Ive in a nearly $6.5 billion all-stock deal, joining forces with the legendary designer to make a push into hardware. The purchase, the largest in OpenAI's history, will provide the company with a dedicated unit for developing AI-powered devices. Acquiring the secretive startup, named io in all lowercase, also will secure the services of Ive and other former Apple designers who were behind iconic products such as the iPhone.”

“I have a growing sense that everything I've learned over the last 30 years has led me to this place and to this moment,” Ive said in a joint interview with OpenAI Chief Executive Officer Sam Altman. “It's a relationship and a way of working together that I think is going to yield products and products and products.”

So, Ben, there have been rumors surrounding this partnership for a good 2 years now. What do you think of the news that emerged on Wednesday?

Ben Thompson

It's certainly a big deal. It's pretty interesting. I didn't know that this announcement was coming. I think it's been reported that they're working together. What's the line between rumor and something everyone kind of knows to be true?

Andrew Sharp

There have been drips and drabs for about a year and a half.

Ben Thompson

Right. One thing that has been a hang-up for me has been this concept of how you do a partnership for building this product. An acquisition makes a lot more sense. This is now sort of an OpenAI company.

OpenAI is, by the way, in this weird transition from a nonprofit to a for-profit, with the nonprofit board still in control. A good way to diminish the amount of stock that, in the final transaction, goes to the nonprofit is to be handing out stock willy-nilly for entities like Windsurf and io. But both products—we talked about Windsurf last week—fit the general thesis of OpenAI seeking to be the interface for AI.

Andrew Sharp

Yeah.

Ben Thompson

It was totally by chance that I wrote this yesterday in the context of Google I/O. One of my takeaways—and I know we'll get to Google I/O later—is that it was overwhelming in many respects, with all the stuff that they showed.

A lot of it is: How are customers actually going to use this and get to it? There are these fanciful demos that we speak positively of, like, “Oh, AI is amazing if you take agency,” and a lot of them are like, “No one's actually going to do this.”

Andrew Sharp

Right.

Ben Thompson

One of my takeaways was that this is reinforcing to me why, for consumer companies, the hardware layer is so important.

Andrew Sharp

You need a product that makes it easy and ties it all together.

Ben Thompson

That's right.

Andrew Sharp

Right?

Ben Thompson

It was very tangible. You go to the store, you buy this thing, and this thing lets you do things. The idea—and that's part of what makes ChatGPT pretty incredible, actually—is that, for most consumers, it started out as a website—

Andrew Sharp

It's a website, yeah.

Ben Thompson

—and then an app. To build that way is actually weird because it feels easier. It's just an app, right? It's just a website. It's just code. But in many respects, it's actually much more difficult than getting—

Andrew Sharp

In 2025, it's unbelievable that there are this many people typing chatgpt.com into their browser and accessing it that way. Yeah.

Ben Thompson

That was another OpenAI deal. They bought chat.com ages ago, and then I think they realized, “No, we have to stick with ChatGPT. That is the brand.” But if you type chat.com, you will go to chatgpt.com.

So, it makes sense in a certain dimension if this is going to be a consumer tech company, which I think it clearly is going to be.

What's interesting is this eternal tension between being a hardware company versus being a services company. I've talked about this for years and years in Stratechery. To go back to Google, where I think they erred—and I think Google itself realizes they erred—we're repeating ourselves. I guess this is a good sign. I think we've been on the right path.

When they were focused on differentiating Android from the iPhone—

Andrew Sharp

Right.

Ben Thompson

—the reality is they also needed to serve iPhone customers. So here's the question: Is this a case where this is a distraction? Do they actually need to be a service that's on other devices? They have this partnership with Apple. Is that more in the direction of where they're going? Or is this a signal of a direction where they're saying, “No, we're going to be fully integrated. You're going to come to us for everything”?

Andrew Sharp

That's what I'm wondering. Are they not picking a direction here? If you step back, it sort of looks like they're trying to become Google and Apple in one company, and I don't know whether that's a bad thing. For now, as we all wait to see what this technology turns into and how people are accessing it, maybe it makes sense to keep all your options open. But I wonder whether there are drawbacks to this approach.

Ben Thompson

Let's think about the hardware layer. It's always been the case that when you think about the hardware layer, there's Apple over there. Apple does what they do, and you're not going to compete with them or get their customers because they love Apple.

So what do you do outside of that? You think about this in the context of Meta, right? There's an assumption that Apple is going to be there, but Mark Zuckerberg has said explicitly, “We want to be the Android to Apple.” Embedded in that is the assumption that Apple is going to have a headset, it's going to be compelling, and they're going to have their customers. Sure, Facebook will be on there. But realistically, there's also going to be an alternative—a quote-unquote open platform—and that's the opportunity that we're going to seize.

If you're OpenAI, though, and you're looking forward, setting aside that this is sort of a statement in many respects that we know Google is going to be there—

Andrew Sharp

Hmm.

Ben Thompson

—I think Google I/O was a good articulation of that. The fact of the matter is, the reason why Google has always been such an interesting player when it comes to AI is that the business-model challenges are obvious, but equally obvious is that their infrastructure is unmatched.

They have the best team. You go back to the original OpenAI founding and those emails between Elon Musk and Sam Altman basically saying, “Look, Google is going to take this whole thing—”

Andrew Sharp

Oh, yeah.

Ben Thompson

…unless someone steps up now. And you can definitely see a world in which Sam Altman is sitting there. Say what you will about Sam Altman, but he is very good at thinking in systems, structured thinking about what’s going to happen in the future, and looking forward and saying, “The opportunity is to be the Apple of this space.”

Andrew Sharp

Hmm.

Ben Thompson

“They’re not going to be anywhere. Google is going to be there. Do we want to compete with them head-on, or do we want to assume they’re going to be in the market? Android is going to be deeply integrated with their models. We’re just going to be an app on Android,” just like Meta complains about just being an app on iOS.

Andrew Sharp

Yeah.

Ben Thompson

“And if we want to fully compete and deliver an experience”—and, by the way, maybe we do think there’s going to be significant cost to AI on a marginal basis. Is it ever going to get to the cost structure of web services, where you basically treat servicing every user as free, even though the costs are astronomical? But that’s how you operate, and actually the opportunity is to be the integrated, all-up player.”

Andrew Sharp

Hardware winner. Yeah.

Ben Thompson

The hardware winner. Exactly. That’s how I would be thinking about this.

Andrew Sharp

Yeah, and it’s a good callback to those emails about Google eight years ago, when they were just starting out. The other thing that amused me with this news on Wednesday—we’ve joked about this at various points over the last 2 years—but there’s now a long-running tradition of OpenAI timing its biggest announcements to upstage Google, and this appears to be—

Ben Thompson

And literally be called io the week of Google I/O.

Andrew Sharp

It’s so good. It’s so good across the board. Last year, I believe, it was OpenAI debuting Voice Mode.

Ben Thompson

I mean, did they name it io a long time ago just in anticipation of this week? It really is.

Andrew Sharp

It could be. They’ve been talking for a while, according to the 9-minute video I watched, which we could get to.

Ben Thompson

Well, the other thing about this is Jony Ive is the headliner. I can’t remember if I said this on this podcast—I definitely said it on Dithering—but you go back to that interview Jony Ive did with Patrick Collison a week or 2 ago. A great interview, definitely worth watching. It was one of the all-time condemnations of sports analytics without mentioning sports analytics, which I appreciated.

What came across is that he’s locked in. He’s a live player. This wasn’t an elder statesman looking back at his career and reflecting on where they’re at. Probably the most interesting bit here—and it came across in this 10-minute video, which we will get to—

Andrew Sharp

Mm-hmm.

Ben Thompson

…was the real angst he felt about the smartphone—

Andrew Sharp

Yeah.

Ben Thompson

…and this sense that, “I created this monster that I’m not sure is good, and I want to go in and fix things.” So that’s the Jony Ive angle. But what has perked up my ears, and I think other Apple observers’, is that it’s one thing if it’s Jony Ive, rich beyond belief, uber-successful, the ultimate made man, dinking around in San Francisco making the King’s Crest, and saying, “Oh, now let’s… What would a hardware device look like?”

Andrew Sharp

Yeah, I mean, I saw a year or 2 back that he designed a $2,500 coat for Moncler, so that’s sort of what I assumed he had been doing for the last several years—

Ben Thompson

Yeah, I’ve been more of a Canada—

Andrew Sharp

…until this news.

Ben Thompson

…Canada Goose man myself, unless I go to Washington, DC.

Andrew Sharp

Yeah.

Ben Thompson

But yes, the—

Andrew Sharp

Just fun side projects for a guy who’s rich and has nothing left to prove.

Ben Thompson

Right. Exactly. But what has happened over the last couple of years is the talent they are taking from Apple has been pretty extraordinary.

Andrew Sharp

Mm-hmm.

Ben Thompson

Evans Hankey is very well known. She’s the one who succeeded Jony, and then she left a couple of years later. And also, like, the head of design for the iPhone. There are different roles: there’s the actual industrial design and figuring things out, and then there’s the actual design for manufacturing, and then—

Andrew Sharp

Yep.

Ben Thompson

…and—

Andrew Sharp

Operations.

Ben Thompson

Well, there’s this middle piece where you’re bringing those two parts together, but then they’re also hiring operations people. This has been a real operation, and everything you hear is that they know everyone at Apple, they know everyone who’s good, and they have been running quite the operation for the last few months in particular, but over the last year or 2, to basically say, “Who are the people at Apple that we know are excellent? And we’re going to go get them.”

Andrew Sharp

Mm-hmm.

Ben Thompson

And this is very much an Apple operation in that it is Apple people. Now, that could be a plus and a minus, right? It’s people who’ve already succeeded who maybe don’t have the fire in the belly, you know, that comes from—

Andrew Sharp

Right.

Ben Thompson

…that’s Jony Ive circa 1995. On the other hand, they’re very good at what they do. They know what they’re doing. This isn’t a fly-by-night hardware operation picking up the scraps. They’ve gone into Apple and plucked the best people.

Andrew Sharp

Yeah.

Ben Thompson

And they are approaching this with incredible—

Andrew Sharp

Intent and—

Ben Thompson

Intent.

Andrew Sharp

…yeah.

Ben Thompson

Yeah, maybe that’s the word. And so it’s going to be interesting to see how this turns out. You can imagine people immediately going, like, the Humane pain or whatever, some other former Apple people, and saying, “Are they going to be high on the smell of their own farts?” Or something along those lines. Is this a world where you need the startup mentality and you need to be scrappy?

Andrew Sharp

Yeah.

Ben Thompson

The alternative is that hardware is really hard.

Andrew Sharp

Well, I mean, that’s the thing. They’re talking about designing a family of products, and the team right now—the team that OpenAI is buying—is much smaller than the team that exists at Apple. So I assume they’ll be building that out. But it’s a real challenge to do even 1 product and make it compelling enough, and a family seems more ambitious. I don’t know what the timeline for any of that looks like.

For anyone who’s an outsider in tech and unclear on why this news is such a big deal, can you just give me a CliffsNotes on Jony Ive’s legacy at Apple? I’m actually familiar with Jony Ive, but for anybody who’s not, why is he such a legendary figure within tech?

Ben Thompson

Well, Jony Ive was this industrial designer who actually started at Apple before Steve Jobs came back and was incredibly disillusioned and ready to leave. Jobs shows up as, like, “Who is this guy?”

Andrew Sharp

Hmm.

Ben Thompson

And then basically elevates him to be, in many respects, his right-hand man. Jony Ive led the team that created the most seminal, most important consumer electronic devices in history, devices that basically everyone has followed, like—

Andrew Sharp

Yeah.

Ben Thompson

…the iPod. Actually, his first probably most famous product was the teardrop iMacs, the colorful ones.

Andrew Sharp

Hmm.

That helped revive the Mac, yeah.

Ben Thompson

…the product that really revived Apple and gave them the cash flow they needed to get to something like the iPod. You have the MacBooks, and then obviously you have the iPhone and the iPad. What else are you going to say? The most famous and most impactful product designer in history.

Andrew Sharp

This is what we need. Nothing left to prove. Yeah, no, exactly.

Ben Thompson

I’ve been fairly critical of Ive for the tail end of his tenure. I think 2010s design at Apple was pretty disappointing, particularly in terms of the Macs. I think they started to elevate form over function, and particularly with the MacBook Pros, it was a really dark period. I actually had to get a desktop computer because I thought the MacBooks were so terrible. A very hard, trying time for me, to be clear.

Andrew Sharp

Mm-hmm.

Ben Thompson

But, you know, there’s this whole butterfly keyboard fiasco, where it was too thin. How much of that was Jony Ive? How much was he already halfway out the door? Who knows.

Andrew Sharp

Yeah.

Ben Thompson

That’s sort of TBD. I place a lot of it on the whole Apple Watch thing, where they were doing $17,000 gold Apple Watches that didn’t feel like… They felt a little too precious and a little too much like doing stuff—

Andrew Sharp

A little—

Ben Thompson

…because we can.

Andrew Sharp

Yeah.

Ben Thompson

That’s a great example of people who are high on their own supply and smelling their own farts. But the watch matured and has turned into a success in its own right.

Andrew Sharp

It has, and the fundamental concept of the watch and the overall design has endured and is incredibly—

Ben Thompson

useful or popular product. Useful, I guess, to some people. You know, I’m well known to not be a real Apple Watch person.

Andrew Sharp

I’m a Garmin guy—

Ben Thompson

Yeah.

Andrew Sharp

—as has been established on this podcast. But, yeah, the smartwatch has its utilities. I don’t want text messages on my watch and never will, but I know a lot of happy Apple Watch owners, so the line has been successful.

Ben Thompson

But again, the key thing here, it’s not just Jony Ive. There is—oh, Tong Tong, that’s the other person I was thinking of—a legend inside of Apple in terms of what Apple does. They do these new phones every year. And designing, it’s not just about the industrial design. These products are so dense. The amount of—

Andrew Sharp

Yeah.

Ben Thompson

—capabilities they have in this package. You want them to look great. You want them to work well. They need to have long battery life. They need to have high reliability. Things around quality assurance are all big challenges. And then one thing that they’re going to have to build a hardware company in this world of decoupling with China or not, or what’s happening there—there are lots of interesting challenges facing them.

Andrew Sharp

Mm-hmm.

Ben Thompson

They will have the advantage that they’re starting in this world. It’s not like Apple, where they have an entire setup, supply chain, and now they need to unwind it. But at the same time, this is also a group of folks who are used to operating within the Apple machine, where Apple gets to tell its suppliers what to do and dictate things. That is, I think, going to be maybe the biggest challenge. It’s not that these people aren’t very good. It’s not that they don’t know what to do. It’s that their leverage relative to the supply chain that’s going to be necessary to build these devices is going to be very different than what they’re used to coming from being the big behemoth that says, “I don’t like your prices. I’m going to go into China and set up a competitor for you and give them all the money to get started, and tough luck—you’re screwed after.”

Andrew Sharp

Hit you against each other.

Ben Thompson

That’s right.

Andrew Sharp

Yeah.

Ben Thompson

So all that, they’re probably underrating those challenges. Best of luck to the team that they’re building out to do that. It’s going to be a big challenge for sure. But again, are Apple folks going to be better at figuring this out than folks who have never dealt with China? I guess we’ll see. So, it’s definitely exciting. It’s very interesting to see what they’re going to do.

Andrew Sharp

Great pedigree up and down the roster in terms of the names we know and the names who have been reported publicly, so that’s encouraging. As far as what the device will be, I would be remiss if I didn’t read a couple of these quotes here from the rollout. OpenAI is going to create a product at a level of quality that, quote, “Has never happened before in consumer hardware.”

Ben Thompson

Yeah, my eyes rolled so far back in my head. I’d be like, come on. Give Apple a little respect. It is remarkable the quality that Apple delivers at scale, and they do it every single year. You could compete with Apple on lots of angles. You could compete on Apple in that our AI is going to be drastically better, and we can deliver experiences. And by the way, they have a similar disruptive angle to Apple that they do to Google in that it’s all upside. They don’t need to worry about cannibalizing an existing product. All these things are true, but when you say you’re going to deliver quality that’s never happened before—

Andrew Sharp

Something that has never happened before in consumer hardware.

Ben Thompson

Yeah.

Andrew Sharp

“Yes. AI is such a big leap forward in terms of what people can do that it needs a new kind of computing form factor to get the maximum potential out of it,” Sam Altman said. Jony Ive says, “People have an appetite for something new, which is a reflection on a sort of unease with where we currently are.” Both of those quotes ring true.

Ben Thompson

Well, it does ring true, and it’s interesting because on one hand you can spin this as a positive where they’re not going to try to reinvent the phone, which you should not do. Apple and Android have won that space. Don’t get sucked into trying to compete in an area that you can’t compete on. Lean into what you can do. Be highly differentiated. Even if that means you start out as a phone accessory, that’s fine. You don’t want to get stuck on that path. That’s the positive spin. The negative spin is that, Jony, I’m sorry you’re upset about the impact of the iPhone on society. That impact is part and parcel of the iPhone’s success.

Andrew Sharp

Mm-hmm.

Ben Thompson

And are you going to be so precious and controlling about this not being used in bad ways that you end up cutting off the potential of what it can be?

Andrew Sharp

Could just be not used at all—

Ben Thompson

That’s right.

Andrew Sharp

—if you’re going too hard in that direction.

Ben Thompson

Exactly. Exactly. So this sort of cuts in both directions.

Andrew Sharp

Yes. Well, Sam Altman continues and says, “We are obviously still in the terminal phase of AI interactions. We have not yet figured out what the equivalent of the graphical user interface is going to be, but we will.” And then elsewhere Sam Altman says—

Ben Thompson

And just to be clear for the listeners, by terminal this is an ultimate mistranslation, or potential mistranslation, of tech people talking to the world. He does not mean terminal like terminal disease, as in AI’s about to die.

Andrew Sharp

Uh-huh.

Ben Thompson

He means terminal like there’s a terminal application on your computer that I imagine you have never opened up, which is the oldest way to interact with computers, where you actually type commands—

Andrew Sharp

It’s like a throwback to DOS?

Ben Thompson

—to the computer. Yeah. No, well, DOS was a bastardized version of the terminal that was meant for Windows. But yes, it is like DOS. It is text-based control of your computer. You have massively more control of your computer because you can define far more things if you’re just using text. To create a graphical interface actually constrains what you can do because you’re limited in how much UI you create. This, by the way—

Andrew Sharp

Mm-hmm.

Ben Thompson

—is an interesting angle why generative UI is really interesting, because you could have a graphical interface for everything because the AI can just create it on the fly.

Andrew Sharp

It changes on the fly, yep.

Ben Thompson

At least in theory. Yep. But the idea is when PCs came along, people used them with the DOS prompt or in the terminal, to go back to Unix back in the day, and that all still exists. There are still things you can do. I use the terminal all the time. I was just using it because my internet connection was terrible, and I’m trying to figure out where’s the problem. Did a cable get cut or something like that?

Andrew Sharp

This is a nerd cred for you.

Ben Thompson

Yeah, so I was doing—

Andrew Sharp

Love it.

Ben Thompson

—a traceroute back to my computer in Wisconsin—

Andrew Sharp

Let me get down to the root.

Ben Thompson

—to see where the problem was happening.

Andrew Sharp

Figure out the problem here.

Ben Thompson

Yeah. But that’s just sort of—I’m sure there are UIs now for it. I can find something that will do a traceroute, but I can just do the terminal. It’s very easy.

Andrew Sharp

I have not accessed the terminal in, like, 30 years on a computer.

Ben Thompson

Yeah.

Andrew Sharp

But—

Ben Thompson

We’re going to make it—

Andrew Sharp

That is a helpful explainer. Thank you so much.

Ben Thompson

Yes, good.

Andrew Sharp

BenGPT chiming in there.

Ben Thompson

So what he’s referring to is being in the terminal phase: we are in the typing-commands phase, and we don’t know what the GUI is going to be.

Andrew Sharp

Yes.

Ben Thompson

Now, I think the chat interface is very underrated. Again, I think this is a point that everyone underrates. This is the—

Andrew Sharp

Text works.

Ben Thompson

That’s—well, it’s not just text.

Andrew Sharp

Text works all over the world in any language.

Ben Thompson

It’s asynchronous text. This idea of talking to someone and being able to go do something else and come back and it’s there, that’s how we talk to other humans, right? That’s a pretty good—

Andrew Sharp

Mm-hmm.

Ben Thompson

—indicator that this is pretty positive. We have FaceTime, and most of the time we don’t want to use it.

Andrew Sharp

I hate using FaceTime.

Ben Thompson

That’s right. We just—

Andrew Sharp

Oh, my God.

Ben Thompson

Texting is great.

Andrew Sharp

If I’m not FaceTiming with my kids, I don’t want to FaceTime with you. Anybody who’s calling me trying to FaceTime, I never want to FaceTime unless it’s Charles or Rose.

Ben Thompson

Right. And so do we want to be talking to an AI? If Jony’s worried about smartphones and their effect, do we want a device that’s taking us out of the physical world and touching grass? It’s kind of great that I can pick it up and dash off a question and have the answer there.

Andrew Sharp

There you go. That’s been my take for about a year and a half. Keep text, and text has worked wonders for everybody for the last 20 years.

Ben Thompson

It is notable that io is also going to be in charge of the apps, including the design of the apps. We'll see how that goes. I think OpenAI's product expertise is underrated. I think it's a big deal. They have very good apps that work well.

Andrew Sharp

It is.

Ben Thompson

And relative to their competition, it's embarrassing.

Andrew Sharp

It's wild. I can't believe some of the competition hasn't developed better apps, specifically Google. But ChatGPT—

Ben Thompson

There's no Gemini app for the Mac. Yeah, I was thinking about that yesterday. It's like, you're Google. It's very straightforward.

Andrew Sharp

It's not a resource problem at Google.

Ben Thompson

We'll get to Google later, though.

Andrew Sharp

I would love a better explanation for why there's no app. But Sam Altman says, “I think it is the coolest piece of technology that the world has ever seen.” In honor of all those quotes, this is entirely speculative. Do you have any guesses at what the form factor might look like here?

Ben Thompson

I don't know. I'm not a product designer. This is why Jony Ive gets paid the big bucks. The obvious—

Andrew Sharp

Mm-hmm.

Ben Thompson

The glasses angle is, I think, pretty compelling. It's pretty hard to beat. It's easy to get a camera on the outside world. You get audio because it's in your ears. Putting things in your ears is actually problematic when it comes to hours and hours.

Andrew Sharp

Okay.

Ben Thompson

That form factor is sort of an obvious one that makes sense. Obviously, Humane did the pin sort of idea. Home speakers are a possibility. But all this is vaguely uninspiring and unexciting, but I guess we'll see. It's hard to beat—

Andrew Sharp

We will see.

Ben Thompson

Glasses for the form factor.

Andrew Sharp

Yeah. I have no idea, but reading that quote, “It is the coolest piece of technology that the world has ever seen,” I felt a great sense of relief when I saw it because no one would ever say that about a pair of mixed-reality glasses. I hope that they're not going with mixed-reality glasses, and—

Ben Thompson

What are you talking about?

Andrew Sharp

It'll be something a little sleeker, less intrusive.

Ben Thompson

No, I am mad at myself. I'm mad at Google. If I knew they were doing these glasses—they did do glasses. Dude, the glasses are awesome. No, I'm serious.

Andrew Sharp

No, they're not. No, they are not. You're biased because you've worn glasses your entire life. Do you know how amazing a product would have to be to make me wear glasses every day of my life? I honestly don't think there's a product that's cool enough for me to make that leap, but maybe I'll be proven wrong by Google or Meta in the next 10 years. I don't know.

Ben Thompson

It would truly be a triumph, given you refuse to even wear AirPods. So I—

Andrew Sharp

That's right. I got my wired earbuds here live on the pod. All right.

Ben Thompson

I don't even want to get into this argument because I know I'm going to lose. So what the heck did I say?

Andrew Sharp

That's right. I promise you I'm going to be stubborn for the next 25 years. But in honor of my mixed-reality hate, there—

Ben Thompson

Maybe in 25 years you'll use the terminal for the first time. It seems to be a very slow process.

Andrew Sharp

I have a vague memory of entering prompts into my desktop computer 30 years ago. So at some point I've probably encountered a terminal somewhere along the way. But in honor of my mixed-reality hate, we're going to Hater's Corner here before we shift to Google.

Ben Thompson

Is this going to be a new segment, or is this a one-time thing?

Andrew Sharp

No. Look, in the wake of the OpenAI announcement, we did get a flood of emails. Like, 10 or 15 people emailed in.

Ben Thompson

Look, the video was in many respects a 10-minute invitation to Hater's Corner, so—

Andrew Sharp

Indeed.

Ben Thompson

Fire away.

Andrew Sharp

So here is Robert. We're only going to read two haters here. Robert and Alex are speaking for the audience. Robert says, “Call me a certified hater, but I'm deeply skeptical about this collaboration. I think Sam Altman suffers from the same disease as Brian Chesky. They both want to be Apple and/or Steve Jobs so badly, they end up missing what their business really is. Like Chesky, Sam Altman continues to push for a bespoke premium service with high value on design. Advertising is viewed overly negatively. I'm nervous this work with Jony Ive is further in that direction. They should lean into advertising and making their core offering available to more people.

“Could a product help the proliferation of OpenAI? I'll concede it's possible, but I'm concerned that Sam and his team are also taking on significant risk building these products in-house. They should commoditize their complements, become the next Google, not the next Apple. Any thoughts, Ben?”

Ben Thompson

Yeah, I think this is the exact right angle to push back on. We already addressed it a bit earlier.

Andrew Sharp

Mm-hmm.

Ben Thompson

And again, maybe it's hard not to escape wanting to be the next Steve Jobs when you're putting out a 10-minute video that basically shows you palling up with Jony Ive. What other message are you really going for there?

But then again, if you're—what's the phrase? You don't have to be the fastest runner, you just have to be faster, faster than the slowest one or the bear who's chasing you. My God, I just butchered that. Need some haters for a takedown of that description.

Andrew Sharp

You're conflating phrases.

Ben Thompson

But—

Andrew Sharp

Yeah.

Ben Thompson

But there—

Andrew Sharp

Well, I hear you.

Ben Thompson

Look, hey—

Andrew Sharp

I mean, I think so. I actually don't know what you meant.

Ben Thompson

If you want to be in the consumer tech company, who's more vulnerable, Apple or Google? Maybe that's a reason to go for it.

Andrew Sharp

That's fair.

Ben Thompson

This is why the Google thing is so fascinating. No one questions their technology. It's just, number one, the business model problems, and number two, can they actually build compelling products? Maybe that's a reason to go after Google as well. Their options are still open to an extent, but this—

Andrew Sharp

Yeah.

Ben Thompson

This does feel like a statement of intent, and you do kind of have to choose at some point. If you're putting products out there, you're going to, number one, inspire opposition from other product makers who could theoretically be your partners.

Andrew Sharp

Mm-hmm.

Ben Thompson

And number two, your services capabilities are going to become biased towards your own devices. That's what happened to Google, right? The tail started—

Andrew Sharp

Yeah.

Ben Thompson

The tail started wagging the dog. They got so caught up in competing with Apple that they forgot what they were, and it cost them. Now, again—

Andrew Sharp

Mm-hmm.

Ben Thompson

I think they circled around and came to a better equilibrium. They basically palled up with Apple in the long run, decided to split the market between them, and we'll have good apps on Apple and things on those lines. But yeah, it's—

Andrew Sharp

There are risks here.

Ben Thompson

Robert's—

Andrew Sharp

Absolutely.

Ben Thompson

Yeah, Robert's points are totally fair and may be correct.

Andrew Sharp

Yes. Well, and as far as skepticism is concerned, someone in tech tweeted today, “This is like when LeBron joined the Lakers, but for nerds.” I just want to tell that person that LeBron joining the Lakers has been kind of a mess over the last 5 years. They did get a title out of it, but I'm not sure it's a compliment to anyone involved here to use that analogy.

Ben Thompson

Sam Altman has a history of forming incredible partnerships and having them end in very odd—

Andrew Sharp

On horrible terms.

Ben Thompson

Silent acrimony that no one really knows what happened.

Andrew Sharp

So Jony Ive could be the next AD here. Is that a possibility?

Ben Thompson

I don't know.

Andrew Sharp

I guess he's LeBron in this analogy.

Ben Thompson

Jony seems like a very sweet guy.

Andrew Sharp

Terrific podcast guest.

Ben Thompson

Really just heartbroken over the impact phones—the negative impact they might have had. I'm not sure Sam cares about that, so—

Andrew Sharp

Mm.

Yeah. Well, fair enough. Alex says, “Ben and Andrew, holy smokes.” Again, we got about 5 emails about the video, so Alex is speaking for everybody. “Holy smokes. From the 9-minute weirdly non-AI yet seemingly AI-generated video full of self-congratulations and absurd flattery to the photo on the OpenAI announcement post where Sam and Jony are looking directly into my eyes as though they are adopting me against my will from an orphanage, I can't be the only one raising eyebrows at all the PR on this announcement. I think this might be approaching Apple hydraulic press levels of discomfort” for anybody who remembers the iPad commercial from about a year ago.

“If they were unable to design a press release that doesn't make my skin crawl, my expectations for any future OpenAI hardware are now a bit lower.” Ben, do you have any takes on the rollout, the announcement post, or the video? Hit me with whatever you got.

Ben Thompson

I think—

Andrew Sharp

Long pregnant pause.

Ben Thompson

Nine minutes and 50 seconds or whatever it was—that's a tough look.

Andrew Sharp

Yep.

Ben Thompson

Here was my critique of Jony.

Andrew Sharp

A staged conversation—

Ben Thompson

Here was my critique of—

Andrew Sharp

…to seem authentic. Yeah.

Ben Thompson

There was a little clinking of the espresso cups that were kind of tipped over for me in the café.

Andrew Sharp

Yeah.

Ben Thompson

Apparently, one of the credits went to the city of San Francisco because they were blocking off entire streets to film this. I would say my critique of Jony Ive at Apple is that he brought tremendous creativity to Apple, and he also benefited tremendously from working with what I consider the greatest editor of all time.

Andrew Sharp

Mm.

Ben Thompson

Steve Jobs—

Andrew Sharp

Steve.

Ben Thompson

Yes, he's on lots of patents and had ideas and created things. His true gift was that he was the world's greatest editor-in-chief of all time.

Andrew Sharp

Yeah.

Ben Thompson

And knowing what had to be pushed, what had to be pulled, what had to be cut, what had to be enhanced, and what had to be changed, Jony shared that. The way that manifested was in appreciating the role of someone who pushes back and yells at you and says, “Something has to be better,” or, “This sucks. Get rid of it.”

He was sort of like Tim Duncan. What was one of the greatest praises that was given to Tim Duncan in terms of the Spurs and Gregg Popovich—

Andrew Sharp

He was coachable.

Ben Thompson

Yeah. Pop gets to yell at Tim Duncan, and everyone looks at that and says, “I guess I get to get yelled at, too.”

Andrew Sharp

Yeah.

Ben Thompson

Right? Jony Ive gave one of the best intern talks. I've talked about the series of intern talks at Apple that I went to. Jony gave one of the best ones, and he's like, “What does care actually mean?” A lot of people think they're being caring when they hold back on criticism.

Andrew Sharp

Mm-hmm.

Ben Thompson

And he's like, “Actually, that's selfishness. You just don't want the other person to be mad at you. You don't want them to think badly of you because you told them that their work stunk.” He's like, “Actually, true care is being honest and being super clear and straightforward.”

I think that's a useful sentiment in the world broadly. I would say we've swung too far in the other direction. Yes, I get the critique of Steve Jobs being mean, but in many cases, we've swung too far in the other direction. Jony Ive was someone who understood that and valued that, and when Steve Jobs was a jerk—

Andrew Sharp

Could have used that on this announcement.

Ben Thompson

Well, I think he could have used that in his later stages at Apple.

Andrew Sharp

Yeah.

Ben Thompson

He could have used that with the $17,000 gold Apple Watch, and I think this video could have been 3 minutes.

Andrew Sharp

Yeah. I mean, look, it wasn't just the video. The announcement post also made my skin crawl. I want to be supportive of what's happening here because it makes the tech world more interesting. I don't want to be stuck—

Ben Thompson

The font on the—

Andrew Sharp

…talking about the same hardware.

Ben Thompson

The font on the announcement page is like a wedding-invitation font.

Andrew Sharp

Oh, it was really tough. It was really tough. All I'm asking for is normal aesthetics from OpenAI announcements in the future. The aesthetics that they've been working with for the last year or 2 are so sterile and bloodless. It really does make my skin crawl. It's like a transmission from a dystopian future.

Ben Thompson

Is this sterile and bloodless, or is it too far in the other direction?

Andrew Sharp

It feels pretty sterile—

Ben Thompson

Or is it a sterile—

Andrew Sharp

…and precious.

Ben Thompson

…and bloodless attempt not to be sterile and bloodless?

Andrew Sharp

Exactly, yes. Exactly. It's like a dystopian future where no one has sex, no one gets mad at each other, everything's just perfect and just so, and I hate it. I've hated some of the announcements they've made over the last couple of years.

Ben Thompson

Well, that taps into the concern that I put forward, right? If you're so precious about what you're doing and so tortured by what the iPhone became, unfortunately, the reality of the world is that good and bad are a package.

Andrew Sharp

Yeah.

Ben Thompson

It is ultimately up to the individual using those devices as to what they are used for. The whole problem with the AI movement in general has been parts of the safety movement. There are different aspects of so-called “safety.” Some of it is truly about, “Let's make sure we don't sort of kill everyone.” But a lot of it is this very precious “people can't handle the truth” angle that is really galling, really annoying, really oppressive, and feels like part and parcel—

Andrew Sharp

And there's a millennial-chic aesthetic to it all. It makes me want to die.

Ben Thompson

Well, you're the millennial on the podcast.

Andrew Sharp

It's terrible.

Ben Thompson

You gotta own it. You're like Jony Ive right now trying to disown the iPhone. Sorry, you're a millennial. You gotta own it.

Andrew Sharp

Just backpedaling away from my generation and what it has wrought here. Yes, well, out of respect for Sir Jony Ive, who I do like, we're not gonna read some of the more cringe-inducing quotes from that 9-minute video. I wish them all the best of luck because, again, it will make the tech world more interesting the more credible a threat they can mount to Apple and Google going forward, and it made Wednesday more interesting.

Ben Thompson

How do we feel? Going back to Robert's point, do we want OpenAI slotting neatly into its appropriate strategic opportunity, or do we want them coming out guns a-blazing, saying, “We're actually taking on literally everyone”?

Andrew Sharp

Guns blazing—

Ben Thompson

Yeah.

Andrew Sharp

…every day, just like @notechben up there.

Ben Thompson

Sharp Tech endorsement. Ultimately, look, we gotta think about our incentives. We are a content-creation entity. So, big two thumbs up.

Andrew Sharp

That's ultimately where I land. This will make for some fun content over the next couple of years at worst.

Speaking of content, there was a lot to keep track of at Google I/O this week. Brandon says, “Andrew, did you catch Giannis at Google I/O helping launch their new XR glasses? Will this be what finally pushes Ben to ditch the iPhone for Android? We can only hope that Jokic shows up at Apple's WWDC to keep the rivalry going.”

I saw Giannis up there, and my heart sank. We really need a trade this summer. The conference finals are in full swing, and watching Giannis hawking random Google products is too depressing for me to bear in the midst of the NBA playoffs.

Ben Thompson

Giannis has been a Pixel sponsor—

Andrew Sharp

For a while now.

Ben Thompson

For years. Of course it—

Andrew Sharp

But he hasn't been—

Ben Thompson

Of course it—

Andrew Sharp

…at Google I/O.

Ben Thompson

Of course it made me want to switch over. What are you talking about?

Andrew Sharp

Good.

Ben Thompson

No, I have decided that when I do get another Android device, for some reason, I've just never gotten the Samsung one. Everyone's like, “Look, they're the best ones. Just get that one.”

A big reason why I'm considering it is some of your quibbles. For example, with the Pixel, I had an issue with the cellular modem. They're like, “Just get a Samsung phone. They're the best ones.”

Andrew Sharp

Mm-hmm.

Ben Thompson

So, sorry, Giannis. My next Android phone is gonna be a Samsung phone.

Andrew Sharp

Gonna be a Samsung.

Ben Thompson

So—

Andrew Sharp

Well, on the glasses front, though, because I felt like you've wanted to talk about the glasses for about 35 minutes here: The final section of Wednesday's daily update on Google I/O was about Google's various AI features, and you were talking about how Android is probably gonna be the most important canvas for shipping a lot of those capabilities. Expound on what you mean there and how you think this might play out for Google.

Ben Thompson

I had such a weird reaction, and I tried to capture this in the daily update. I'm not sure how well I did, but on one hand, this I/O was amazing, and everyone in tech is like, “Oh my God, Google's back,” X, Y, Z.

It was amazing. It's this cornucopia of outcomes that is basically downstream from their incredible team and their incredible infrastructure. They have the best model now. Their image-generation model and their video-generation model are crazy. You can put text in it now.

Andrew Sharp

Mm-hmm.

Ben Thompson

It's amazing. They're doing the best stuff in a world where everyone uses ChatGPT, right?

Andrew Sharp

Yeah.

Ben Thompson

What was interesting about that is it was so hard to even anchor on anything from this keynote because what do we anchor on? We anchor on products.

Andrew Sharp

Mm-hmm.

Ben Thompson

An actual thing you can go to and use. To me, by far, the most cogent and anchorable presentation—the one that made the most sense—was about search.

Andrew Sharp

Yeah.

Ben Thompson

And you feel this sense where Google is a one-product company, and that product is search.

Search, despite the fact that they're facing this disruptive potential in terms of the impact on advertising. And that's the part of Google that still can ship products.

Andrew Sharp

Mm-hmm.

Ben Thompson

And not only can they ship products, they actually presented this really compelling—I think I called it the AI funnel, or the Google funnel—where, okay, we're just going to create all these crazy things. The ones that make sense for this are going to ship in this new AI mode. And the most interesting part of AI mode is not that it's a tab on the page. That is interesting in its own right. It kind of looks a lot like ChatGPT, where it's much more of a chat interface. And some of the stuff they can do—

Andrew Sharp

Yeah.

Ben Thompson

Google has all these data connections, because everyone's known for years you want to get your stuff on data. So they have, by far, the best real-time stuff. This idea that you can ask a question about some sports-related thing and not just get the answer, but then get data visualization that's generated on the fly—that's really cool. And—

Andrew Sharp

Mm-hmm.

Ben Thompson

But what's going to happen to the best of those features? They're going to—and this was their word—graduate to regular search. And I've made the point before: AI Overviews is the most-used generative AI product in the world. And there's a bit where Google's in this race to make search so good that you keep using it and you don't go to ChatGPT.

Andrew Sharp

So that they don't leave users.

Ben Thompson

Right.

Andrew Sharp

Yeah.

Ben Thompson

You're like, “Oh, I use ChatGPT for my homework, but I use Google for everything else,” and you don't even think about it. And they're trying to do that before OpenAI gets to the—

This is why, by the way, ChatGPT is such a miracle. That's why Google pays the money for the defaults, right? By paying Apple, they get to ride on Apple's dominance of devices such that they're just used without anyone thinking about it, because that's how the consumer market works. It's about habits. It's about what people do. To get people to actually take the initiative to go do something new is incredibly difficult. And again, it's why ChatGPT is a miracle that it's gotten as far and as big as it is.

There's this Google—it's like you have search, a clear output. You have this incredible capability to create these things, and there's just this vast gulf of productizing them, that it doesn't feel like Google has any real capability to do outside of search. And—

Andrew Sharp

Right.

Ben Thompson

That's why I'm very pro-Google Cloud.

Andrew Sharp

So you're watching all the demos sitting there and thinking, “Wow, this is really cool. This is jaw-dropping. This is mind-blowing,” but regular people—

Ben Thompson

I'm thinking—

Andrew Sharp

Aren't going to—

Ben Thompson

How in the world is Andrew Sharp going to use this—

Andrew Sharp

Yeah.

Ben Thompson

Use this capability, right? I mean, maybe I'm being overly—

Andrew Sharp

I mean, you should. You should ask that. I should be there by your side watching some of these keynotes, man. I will say Bill Bishop used NotebookLM to summarize a Sharp China episode this week, and it did a fantastic job. In less than 2,000 words, it hit all the right beats. But how many people are going to be seeking out NotebookLM on a day-to-day basis is a fair question.

Ben Thompson

All the AI stuff is so productivity-oriented. Maybe that's why I'm so excited about it, right? I'm always big on productivity, productivity apps, X, Y, Z. My whole initial series on the App Store was about productivity apps. Apple should enable them more. And then you get to the Epic trial, and Apple's like, “Yeah, we make 90% of our revenue—”

Andrew Sharp

Games.

Ben Thompson

“—from people buying gems in games,” right? It's kind of discouraging in a certain respect. But, yeah, this capability is so good.

This is such a condemnation of Apple, by the way. I was talking to a friend who was complaining about Siri transcription. Transcription is a solved problem. It's trivial at this point. OpenAI open-sourced Whisper ages ago. It's widely available. I use apps on the Mac where I have to go and download the Whisper model for the app to do the transcription because it's not built in, because Apple—I don't know what they're doing.

Andrew Sharp

Right.

Ben Thompson

The Apple angle this week: you had the latest Mark Gurman exposé on their AI failures.

Andrew Sharp

Mm-hmm.

Ben Thompson

People are so asleep at the wheel, just not seeing the potential here and dismissing it.

Andrew Sharp

Shockingly negligent, yeah.

Ben Thompson

And then combined with this week, “Oh, maybe we'll let developers use some of our models.” It's like, man, I don't know. Now I'm back on charger. Look, OpenAI, look. Go—

Andrew Sharp

Go after it.

Ben Thompson

Let me go after it, yeah.

Andrew Sharp

Exactly. A good target right now.

Ben Thompson

But for Google, yeah. So realistically, how is a customer going to actually use this stuff? I think realistically, it's on Android. It's on their phone. It's sort of front and center, and then they start picking it up. They talk about a lot of pickup on Google Lens, which is visual search, basically. They've been very enthusiastic about it for a few quarters, so it makes sense. It's compelling.

Andrew Sharp

Well, and isn't that the goal with search and AI mode? Ultimately, it's sort of like Instagram and Snapchat all over again.

Ben Thompson

Right. Exactly.

Andrew Sharp

Try to integrate as many of these features into search as you possibly can, and make it so that Google Search is sticky and you retain as much of the user base as you possibly can. And with AI mode, what they're going to do, if I understood the presentation correctly, is they'll refine these features and optimize them in AI mode. Then, like you said, once it's good enough or optimized enough, and potentially cheap enough to run for 2 billion people every day, that's when it graduates to main search.

Ben Thompson

I think more like 6 billion people every day. I mean, the scale is kind of amazing. But, yeah, I think that's exactly right, and it's a very cogent strategy. I think it's easy to poo-poo AI mode, or ask, “Why is it off to the side?” That's why it's off to the side.

And that's both the opportunity, which is they already have all this usage and they can make it better. It's also the challenge because they can't—

Andrew Sharp

Well, and they can also find out—

Ben Thompson

Give them the best experiences until it's possible to serve that many people. It's hard to serve a lot of people. This is like Apple's problem. There can be—

Andrew Sharp

Yeah.

Ben Thompson

New things. To actually put it in an iPhone is, like—the people are talking about the foldable-screen thing. Are we going to get a foldable-screen iPhone? I would imagine so at some point. Also, the number of foldable-screen phones sold in the world is like the number of phones Apple sells in a day, right?

Andrew Sharp

Mm-hmm.

Ben Thompson

The scale of these companies is their biggest advantage and their biggest disadvantage. That will always be the case.

Andrew Sharp

Yeah. Well, and it reminds me of when they started rolling out AI answers to general search queries, and it was a mess because the AI answers were kind of spitting out—

Ben Thompson

Right, glue on pizza—

Andrew Sharp

Weird feedback—

Ben Thompson

Or whatever it might be. Yep.

Andrew Sharp

Yeah, exactly. So it makes sense to refine it, and also, in that scenario, you find out what is most compelling to people and what is actually worth investing in and graduating to the main search.

Ben Thompson

Yeah, and a lot of people were giving Google a hard time. They had the $250 plan. More leadership from Google: “You think $200 is good? Well, let's show you a real price point.”

Andrew Sharp

Hmm.

Ben Thompson

And people are like, “Look, they should just be making this free, and they have the best stuff. Get it out there.”

Andrew Sharp

Yeah.

Ben Thompson

And it's an easy thing to say. There are billions and billions of dollars at stake. The audience that's paying that much money is a highly switchable audience. They're just going to go back and forth. Everyone was like, “Anthropic is amazing.” Now everyone's like, “Oh, actually, Gemini is the best.” And we'll see. It's like dropping the toy.

Andrew Sharp

It's nerds like you that are trying new LLMs every other week here. Yeah.

Ben Thompson

Yeah. I wish, again, the products were better. I wish they had an app. The Flow thing they use with VO was really rough.

Andrew Sharp

Mm-hmm.

Ben Thompson

Again, their product capabilities—I have serious questions about them—but I'm glad these capabilities are available. It was a lot of fun to go out and use Veo 3 and make some fun videos and stuff like that. So I don't hate it. Maybe we'll look back and they got totally disrupted, and you could argue they should've built this interface from scratch, but the whole thing about disruption is you face really hard constraints when you're a large company with a big business.

Andrew Sharp

Mm-hmm.

Ben Thompson

I give more grace to companies facing that than some other folks, even if it does end badly. We'll see.

Andrew Sharp

One question on Veo 3, the generative AI video tool that they displayed this week. Veo 3 is currently living through its Studio Ghibli viral cycle here. Twitter is awash with 9-second videos being generated by Veo 3. I'm curious: What is gating the mainstream availability of generative AI capabilities, like something that would create videos longer than 10 seconds? Is it a question of cost and computing costs, or is it more a question of computing capability as the videos get more elaborate?

Andrew Sharp

And I’m rooting for these to be delayed for as long as humanly possible here. I don’t want to live in a world—

Ben Thompson

This is a great example of why people who forecast the future, like a lot of the AI doomers and people along those lines, get it so fundamentally wrong. It's unbelievable, mind-blowing, incredible, awe-inspiring, shocking, and impossible to believe that you can create coherent 8-second videos with audio. No one in the world thought this was remotely possible 1 year ago or 2 years ago. Definitely not 5 years ago or 6 years ago. And you're sitting here saying, “Why can't everyone do this?”

Andrew Sharp

I'm not sitting here tapping my foot. So I forget all the adjectives: unbelievable, jaw-dropping, mind-blowing. To be perfectly honest with you, all the AI-generated videos are a bit annoying to me. That's why I invoked Studio Ghibli. Everybody's sitting there on Twitter saying, “Can you believe that you can do this? I just typed in some text, and here we are.” They're not really moving the needle for me personally, but I do watch those videos and think, “Well, hey, this is pretty impressive. This is pretty good.”

I worry what the world is going to look like when everybody can, at the drop of a hat, generate 3-minute fake videos. I want to delay that future for as long as we possibly can. So I'm wondering whether it's a cost issue or just a coherence issue—

Ben Thompson

The costs are—

Andrew Sharp

—with some of the videos.

Ben Thompson

—are astronomical. Like, the—

Andrew Sharp

Yeah.

Ben Thompson

—like, right now, you could actually track how many credits you have as a Gemini Ultra customer, which I now am. So now I have, like, $550 a month in—

Andrew Sharp

Monthly AI expenses.

Ben Thompson

—free APIs.

Andrew Sharp

The costs of being a nerd, yeah.

Ben Thompson

There's a lot of credits that go into generating those videos. It has to generate the whole thing, and it has to put it all together. It's on the edges of capabilities. The fact that—

Andrew Sharp

Yeah.

Ben Thompson

—that it's 8 seconds is amazing. Of course it will extend in the long run. That's sort of the course of technology. This stuff gets cheaper, so you do have to look out: What does it mean when these are cheap and broadly available? And yes, you probably should be concerned.

Then again, right now I'd be like, Formula 1—one thing that amuses me about F1 and Twitter is—

Andrew Sharp

Mm-hmm.

Ben Thompson

—it's this world of newbies and novices that have just been dropped into it. They take Twitter way too seriously. They always have. People get all worked up about abuse on social media. It's like, my God, have you been online at any point in the last 25 years?

Andrew Sharp

Well, have you figured out that a lot of the most popular accounts on Formula 1 Twitter are 19-year-old women from Italy? So maybe it is—

Ben Thompson

Maybe that's why.

Andrew Sharp

—more of a foreign environment to people.

Ben Thompson

Right. But there is another problem: F1 is super ridiculous. There's this Formula Fakers Twitter account that has gotten me a couple of times because it will post something that's plausible.

Andrew Sharp

I don't like it.

Ben Thompson

No, it's—

Andrew Sharp

Yeah.

Ben Thompson

—actually too good. NBA Centel is one of the originals on this. In the NBA, number 1, they're mostly ridiculous, so you know it's ridiculous.

Andrew Sharp

Mm-hmm.

Ben Thompson

Also, NBA Twitter is very mean, very hardcore.

Andrew Sharp

Yeah.

Ben Thompson

We're living in the muck. We've been in the muck for a very long time. If you can't handle abuse, you cannot handle NBA Twitter.

Andrew Sharp

It gets more negative and more abusive every single year. At this point, I'm not sure Twitter likes a single player in the NBA.

Ben Thompson

Right.

Andrew Sharp

Exactly.

Ben Thompson

No, exactly. It's the frog-boiling sort of analogy. The water has long since evaporated, and there's a charred carcass at the bottom of the pot that's somehow still tweeting.

So you have this thing with F1. Formula Fakers puts out this tweet joking about Jack Doohan, who recently lost his seat to Franco Colapinto, making fun of the fact that he crashed last week.

Andrew Sharp

Mm-hmm.

Ben Thompson

It was a fake post that generated this massive controversy, and everyone was freaking out. The long and short of it is we just all need to get to a world where we assume everything online is fake and that it's all—

Andrew Sharp

Yeah.

Ben Thompson

—so maybe it's actually a good thing. Actually, we need to accelerate fake videos so people stop believing what they see and realize that we all need to go and touch grass and get back to the real world. Trust your own eyes when they see physical things—

Andrew Sharp

That has long been your take.

Ben Thompson

—and not when they see screens.

Andrew Sharp

I hope with all my heart that you're right. I'm definitely leaving room for the possibility that you're right, because you're right about most things in tech.

Ben Thompson

To be clear, this is an optimistic and hopeful take.

Andrew Sharp

It's a glass-half-full—

Ben Thompson

I'm not sure.

Andrew Sharp

—optimistic spin on the dystopian hell that awaits us, but we'll see.

For now, let me close with 2 emails related to your appearance on The Bill Simmons Podcast this week. First, we have Jonathan, who says:

“Goats. Ben's recent appearance on The Bill Simmons Podcast was incredible. I've been a Simmons fan for nearly 2 decades, but very few people challenge his takes. I absolutely loved Ben's heat and the way he laid into some of Bill's takes. Russillo, Zach, and House, they all roll with it. Ben did a fantastic job calling Bill out for his Giannis slander, and the coup de grâce was referring to Jayson Tatum and Jaylen Brown as 2 number 2 players. I cackled out loud. A-plus content.”

Then we have @tacokennedy66, who tweeted at me as part of this:

“Don't ever go on a sports podcast again. You clearly don't watch any NBA if you think, 1, Giannis is underrated; 2, Amen Thompson and Evan Mobley are overrated; and 3, you think Tatum isn't close to Giannis. Can Giannis do anything on offense but just drive to the basket and pray?”

So there you go, Ben: 2 ends of the spectrum. Do you have any final thoughts?

Ben Thompson

Well, this @tacokennedy66 guy—the reason he replied to you is, so first off, I’m annoyed at The Ringer because they said, “Oh, Bill on with @benthompson” instead of @notechben. Look, I want—no, you were not appearing—

Andrew Sharp

@notben appearing as @benthompson.

Ben Thompson

Exactly. That’s right. NoTechBen exists to drop takes, go viral, and receive abuse, okay? Ben Thompson—

Andrew Sharp

Yeah.

Ben Thompson

—is out here trying to do a good job, okay? Just to be—

Andrew Sharp

Promote a product, yes.

Ben Thompson

Right. So that's number 1. But number 2, he responded to my pinned tweet, which is like, “I've watched a new podcast called Sharp Tech.”

Andrew Sharp

Ah.

Ben Thompson

And he's dropping—

Andrew Sharp

The first tweet he saw.

Ben Thompson

Right. I don't mind the response, but I did have to hide his reply because I'm like, “This is the wrong place.” Respond to The Ringer tweet. Don't drag down Sharp Tech. Drag—again, I'm putting myself in this position. I accept responsibility, but sorry, @tacokennedy66, who I'm pretty sure is not listening. I did have to hide your reply.

I also know he's not listening because no one who listens to Sharp Tech would have such bad takes as he does. Obviously—

Andrew Sharp

There you go.

Ben Thompson

—those 3 assertions by me were correct. For the record, I was very early on being pro-Amen Thompson. I've liked his game a lot.

Andrew Sharp

No, he's gotten a little bit overrated.

Ben Thompson

Right. My point was—

Andrew Sharp

We're still pro-Amen Thompson on this tech podcast.

Ben Thompson

You still trade Amen Thompson for Giannis Antetokounmpo. That's the point. Whereas Rockets fans are like, “No, he's guaranteed to be a Giannis-level player, therefore we should not trade him.” That is an overrating in my estimation.

That said, it's a possibility. So if the Bucks trade for him, obviously I'm buying a Thompson Bucks jersey on day 1, so I'm not going to complain about it from that perspective. I stand by the take. In isolation, I felt bad. It could be misinterpreted because I am Team Amen ultimately.

Andrew Sharp

Ultimately pro Amen, yes.

Ben Thompson

That's right.

Andrew Sharp

And I agree with you that Amen has at least a version of his future where he is somebody you can run the offense through.

Ben Thompson

That's right. I think the chances of him becoming that player are just as good as rolling the dice for a top pick, right?

Andrew Sharp

Yeah.

Ben Thompson

That would be a replacement for taking a top pick.

Andrew Sharp

Whereas Evan Mobley, the chances of Evan Mobley becoming that player are—

Ben Thompson

Zero.

Andrew Sharp

—just about zero at this point in his career.

Ben Thompson

No, they're zero. There's—

Andrew Sharp

Yeah.

Ben Thompson

Yeah, great role player.

Andrew Sharp

Second banana, perhaps, at some point.

Ben Thompson

When you're scouting Evan Mobley, while watching a Cavs game, you have to remind yourself to pay attention to him because you go long stretches of forgetting that he's even in the game. Sorry, that's not star material. You don't forget Giannis is in the game at any moment, ever. So, anyhow.

Andrew Sharp

Well—

Ben Thompson

But whatever.

Andrew Sharp

Well, great work for you.

Ben Thompson

I already made these takes.

Andrew Sharp

It was a very enjoyable appearance.

Ben Thompson

Well, it's very funny. Bill's great. He's a professional, but he also gets really annoyed when you challenge him. We have messaging fights all the time about this, but in the context of a podcast, I sent the audio once of a previous appearance because someone wanted to hear it, and it wasn't coming out for a couple of days. They're like, “Oh, wow, you and Bill talk totally differently when you're recording or not.” I'm like—

Andrew Sharp

You're playing a character at Sharp Tech Pit.

Ben Thompson

I am on there to play a character. I am the Bucks fan to give Bill grief.

Andrew Sharp

You're playing a character who nevertheless does sincerely believe everything he said on the podcast this week. I can attest to that.

Ben Thompson

Absolutely.

Andrew Sharp

I really identified with Bill because he led off by asking about trade ideas, and you launched into a 4-minute monologue that wasn't really even about trade ideas. It was about years of Giannis grievances. I've been there as a host sharing the podcast with you. When Bill said, “That's just Bucks bullshit,” I've wanted to say that to you for years and years. So thank you to Bill Simmons.

Ben Thompson

No, it was the second time I was on with Bill. The first time I was on, we just did tech stuff.

Andrew Sharp

Yeah.

Ben Thompson

So, the second time, we did tech stuff, and at the end he's like, “Okay, you have 30 seconds to talk about Jason Kidd.” I dropped, like, a 5-minute rant without breathing because I'm like, “I have my one chance to get it out here.” So it was a bit of a full circle in that regard.

Andrew Sharp

Well, it's good. He knows what he's getting when he asks you to come on the Bill Simmons podcast.

Ben Thompson

It worked because, basically, ever since then I've been on mostly to talk about the Bucks, not to talk about tech.

Andrew Sharp

Yeah. Let's not waste our time with tech.

Ben Thompson

That's right.

Andrew Sharp

We'll be back next week. It's a holiday weekend, so one episode next week, but people can continue emailing us, email at sharptech.fm. I hope you have a great couple of days. I will talk to you on the other side.

Ben Thompson

Thank you. Happy Memorial Day. See you in a week.

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