Anthropic IPO前のパニック、OpenAIのスパイ事件、AI料理画像論争

Anthropic is growing fast, but its growth rate is slowing, leading some investors to panic ahead of its IPO. Was there a spy at OpenAI and it's time to end food slop, or is it? That's coming up on a Big Technology Podcast Friday edition right after this. This episode is brought to you by Cribble. Quick question, is your IT budget growing 30% a year? Because your data is. And now AI agents are piling on, running investigations around the clock, and running up three meters at once. storage, queries, and tokens. Cribble, the AI platform for telemetry, was built for exactly this. Own all your data, query it wherever it lives, and let Cribble route every AI request to the right model at the right price. The best part, AI inference for workloads on Cribble is included. Models will change, agents will change. Your data is the asset that lasts. Own it with Cribble. Visit CRIBL.io. It's never been more challenging to get Frontier Compute.

How do you know where to look, who to trust, or how much to pay? Akash is an open cloud that provides easy access, flexibility, and peace of mind. That's how companies like Razer were able to cut their inference costs by 15 times. Visit akash.network.com for a free consultation. That's akash.network.com for a free consultation. Welcome to Big Technology Podcast Friday Edition. where we break down the news in our traditional cool-headed and nuanced fashion. We have a great show for you today. We have the latest Anthropik numbers ahead of its IPO. Finally, some 2026 revenue. It looks good, but is it good enough to avoid a full-blown panic as the market digests the numbers? We're also going to talk about the reported incident of corporate espionage within OpenAI, what it means and whether there's more afoot. And then finally, Ranjan and I are going to debate whether all these AI-generated images on restaurant menus and signage are good for humanity or the end of us.

And that will be fun. Wait for that at the end. So joining us, as always, on Fridays is Ranjan Roy of Margins. Ranjan, it's good to see you. Welcome back. Good to see you. I believe AI-generated food swap images represent the American dream better than anything else. But we'll get to that. Oh, my God. Please, please, please do not seriously back this belief. I can't stand the AI science. But, okay, we'll hold the debate until the end because right now, finally, what you've been asking for, the Anthropic 2026 numbers are here. They're very impressive, but I think expectations have been set so high that no matter what Anthropic showed, potentially, there would have been some panic, and we are indeed seeing some panic today. So let me read the story. This is from the information. Anthropics' rapid but slowing growth could weigh on its IPO valuation. Anthropics reported rapid but slowing revenue growth. In a meeting with potential investors, the company said revenue hit $16.8 billion in the third quarter. That was a jump of about 45% from the second quarter.

The figure was more than 3.6 times the company's revenue for all of 2025. However, and now there's a big but here, but it also represents a slower growth rate than Anthropics' second quarter. when fever demand for its Claude Code product drove up revenue by more than 140% from the first three months of the year. So here's the interesting thing. So Anthropics revenue, we know it was in the $4 billion range for all of 2025. It grew 140% from the first quarter of the second quarter this year, but then only grew 45% from the second quarter to the third quarter, reaching $16.8 billion. That's not enough for a lot of people. And we're already starting to see some of these tweets come through saying it's over, some worry that anthropics growth rate is slowing, which, of course, like law of large numbers, it was eventually going to. and the party seems like it might be not over but more muted than initially anticipated.

People are saying that this shouldn't be a $2 trillion IPO. It's probably going to be closer to $1.5 trillion. And, of course, there could be a ripple effect to all of those that were expecting Anthropic to be bigger. So what's your read on the numbers, Rajan? My read on the numbers is release the damn S1. This is getting so frustrating. Again, and we're going to get into some confusion around Reuters report, but overall, it's just a Rorschach test right now. I mean, everything we see, it's clear. I mean, 45% off of that base is incredible growth. But when you start to extrapolate it out, they would have to re-accelerate growth to get to that $100 billion number, even an $80 billion number. Basically, if they take, I think it was like it was around a 7% month-on-month growth. If you extrapolate that out, they get to about $75 billion in revenue. Again, any of these numbers on their own in any other context would be remarkable, fantastic, unprecedented.

But to get to that $2 trillion valuation, it's not enough. But then, I mean, there's a lot of questions around it. The distillation is fascinating. when it's 5% to 7% of total revenue. Okay, you've got to introduce that. Talk about the distillation. Okay, okay. So distillation, again, external companies basically accessing Anthropic to ask billions of questions probably in order to actually understand what the answers are and use that to train their own models. Now, which companies exactly are doing that is not official, but lots of companies are, And I think that's probably why we saw an equivalent explosion in terms of open weight models from a lot of companies. So when you think about 5% to 7% of revenue, it's interesting how – Wait, wait. So just to say, the Anthropic told investors that distillation is 5% to 7% of its revenue. And it's working to rein in that distillation, right? So companies trying to use its answers to train their own models.

It's trying to rein that in. And so there's going to be a revenue slowdown from that. I think that's important to state. Yes, yes. There will definitely be some type of revenue. That revenue goes away because Anthropic is cracking down on that kind of behavior. What's interesting to me is it still fits so perfectly that 140% quarter one to quarter two growth. I've said this over and over on the show. I mean, I felt it. I saw it being in the industry. Those spring months, that's all anyone could talk about, Claude Code completely exploded. Every CIO is bragging about how much money they're spending. But also then you have this extra headwind of foreign companies actually, or maybe even domestic companies, distilling anthropics models. So that definitely contributed to that absolutely explosive growth. If it's 5% to 7% of total revenue, it was probably concentrated during that period, which you can imagine actually for that growth period, it contributes even more.

So I think it is a really interesting dynamic. I don't think it fundamentally changes the story. Maybe it does. I mean, that's still a pretty dramatic impact overall. It's not marginal. But it also, when you think back, that growth is what got them all the hype, additional funding that they can then pour into more marketing and training and model building. So I think that is a pretty important dynamic that can change the story. Okay, and I think this is important to take a step back and say what we're saying is, is this growth slowdown, is it a story of the numbers being too big, or is it a cool down from this period of everybody vibe coding, everybody cloud coding, everybody cloud working, co-working? And what you're saying is, yeah, there was this surge of interest. That has cooled off. And so the growth, even though it's impressive and the numbers are very big, Again, I don't want to diminish the fact that a company that made $4 billion in 2025 made $16.8 billion in the third quarter.

In the quarter. Right? So 3.6x the entire company's revenue in one quarter. But the thing is, it's all about expectations and where people sit in terms of their expectation. I think there was this expectation that that moment, the Claude Cohn moment in the second quarter, was effectively a permanent moment. That was not a spike. That was a moment along the exponential. But the numbers are showing that maybe it wasn't. And there were people who hit me in the comments when we talked about anthropics numbers initially about this Actopia data that I brought into the conversation. saying it's not representative. And, you know, of course, we talked about it also. We caveat it also, right? But I'm going to just read it again. Claude's monthly U.S. downloads went from nearly 670,000 in January to a peak of 7.42 million in March, but it dropped to 3.26 million in September.

Yes, it's an app. Yes, it's a proxy. But we take these numbers as signals, right? Not the full story. And it turns out that signal might have actually been telling you something. I actually, I think that's fair. It's a signal. I was going to push back and I still think, again, this is a company that last year, 25% of the revenue came from two customers. Like everyone kind of knows like Claude is not everyday use. It's hardcore, concentrated use, very expensive use, a lot of enterprise use. So app downloads, I generally wouldn't think, but I think that's fair that it is yet another signal. I think the most important part of this conversation, again, going back to that, I just keep seeing the Rorschach test side of this of everyone who has been bearish, this is a clear signal that it's not going to go well and you're not getting your $2 trillion valuation. Everyone who has been bullish is like, are you kidding me? 45% growth at that base. That is, again, unprecedented. So to me, the most important

thing is just give us the actual numbers. Again, do you realize how crazy this process is? Like, in terms of unprecedented, to have a large institutional investor meeting where you disclose some financials that is not part of the official IPO process, this is not a traditional testing the waters process where it is assumed information is going to get distributed in some kind of way like this is just not healthy and then that literally the entire global economy rests on this south korea's stock market is down eight percent on this kind of news i don't know i this has been killing me i actually saw imran khan who's a very long-time investment banker chief business officer at Snap for a while. He actually said, he's like, I still don't understand the point of a large institutional investor meeting while Anthropic is in confidential filing. And he even says, given their S1 leak to the news media,

I've never seen another in my 26-year career the company should have been more sensitive. So honestly, that's the more frustrating part of this whole thing for me. Right, and for our non-financial listeners and viewers, the S1 is the document that a company files with the SEC. with all the numbers ahead of going public. But Ranjan, let me take a different angle here, which is that maybe the S1 doesn't matter so much and maybe what matters more is the expectations that the company is setting, again, through the press or through leaks, right? Because we had talked about it. The Times reported the expectation was Anthropic was going to do $100 million in ARR, or sorry, annualized revenue by the end of the year, right? So that is the number that everybody has been looking toward, and that is where their expectations are set. And so what we saw with the numbers that have leaked is, and I think you put this very well, is that unless the growth rate accelerates substantially, getting to that 100 billion – sorry, if I said million, I meant billion.

100 billion ARR is going to take a market acceleration and growth rate of revenue as opposed to the deceleration that we've seen. Well, but this is where it gets so confusing because 100 billion – it's not 100 billion ARR, right? Or is it? Is the expectation $100 billion ARR, meaning in December you're showing like $8.5 billion in a month or something like that, versus what is the expectation for the total revenue for 2026? That's the more important thing, and that's where it gets so muddied because they're not getting $100 billion revenue in 2026. that there's no – I don't think anyone's talking about that. But it just – I don't know. There was even Reuters reported, and this – and listeners might sense my frustration at all this. Oh, we can sense it.

Yeah, Reuters had this reporting that then said there was $110 billion ARR from, like, investors who attended the event. Then they clarified – I mean, so obviously then everyone who is bullish which is like, wait, 110 billion ARR is projected. Then the reporter clarified that that was actually from sell-side analysts who did their own calculations based on guidance. This is, again, the economy, entire nation's stock markets are resting on these leaks, and we're all just going in so haphazardly into this, just stay quiet and then release the S1 as every other company has done. Can I ask you a question? Is there an argument to be made that basically no matter what they release, this sort of volatile vibes based AI trade is going to remain that until all these companies get bigger I mean if you think about it you know we talk I mean even if you look at the numbers coming out now you know

16.8 billion, 16.8 billion in a quarter, they're still trying to get to a 2 trillion or 1.5 trillion dollar IPO. And, you know, so much of this is based on a story. It's based on this idea that, you know, remember they haven't even figured out the products yet. How many product shifts have we seen in the past year. Chatbot, vibe coding, co-work, agents, right? So the final form of this technology is still not found. And so to expect any sensible trade, right? So we're talking about the IPO panic. To expect there to be a lack of panic and a lack of these big shifts whenever you see a number. My question is basically, isn't it the case that no matter how much financial information we're going to see. That is just going to be a feature of this until it either gets to maturity and achieves its potential or doesn't. I think that's a good question. I think anything that gives more of a reflection on what are the economics of the business.

Because, again, they said, I mean, sorry, they didn't say it was reported. And after that Reuters mishap, I want to be extra cautious on this, that they were adjusting profit, adjusted profitable, whatever that can mean. And we know, I'm guessing, probably Anthropic does not remove partner expenses from partner marketplace expenses like OpenAI does, which caused confusion with the FT recently. Whether they're going to include training costs as an R&D expense or as part of the cost of goods sold, that's going to be another element of this that will fundamentally change that story. They said they were cash flow positive. Like to me, I think you're right though that we don't know what the end product is. We don't even know what the end business is. Is it going to be frontier models that are expensive driving the majority of their business? Is it going to be the cheaper models? Are they going to compete against the open weight models? Like we don't know the product.

We don't know where the actual like business model will go. So, yes, I think I agree that it is all going to be vibe Z, but some kind of disclosure should give us a better picture of that. Hopefully. Maybe it won't. Well, the question is, like, when is the IPO actually going to happen now? Because there was some talk that it was going to happen in October. Then people started talking about it's November. Now I'm starting to see in stories. Well, that's subject to change. So I don't know, Ranjan, you might be waiting for a while. I was going to say this stuff should be imminent, but I think this conversation with these bankers suggests that we might be waiting much longer. Watch the S1 drop as soon as I say this. But it doesn't seem like they're rushing, and especially now that the market is really showing this sort of uncertainty about the AI trade. Of course, we saw the market movement that we talked about last week in terms of OpenAI getting punished for a FT report that talked about its revenue, but actually the revenue didn't change.

It was just some people measuring it differently, according to reports. But now we're also seeing this uncertainty around the neoclubs. And not much has changed on the ground this week in terms of companies like Corweave and Ebius and Iren. but the market is punishing them pretty intensely right now, and it's hard to really find the compelling event. So let me just read a little bit of the story here. It's from CNBC. Traders pile into bubble puts on CoreWeave as Neocloud's stocks plunge. Gotta love the term bubble puts. I've never heard that before, but here we go. Here's a story. A key corner of the artificial intelligence trade is taking a beating, and traders are betting that it could get even worse. Shares of Neocloud companies plunged after debt yields for NVIDIA-backed CoreWeave continued to reach new highs. Meanwhile, Social Capital founder Chamath Paliapathia raised questions about a private credit bubble alongside a screen grab showing CoreWeave's bonds hitting a 15% yield.

Elon Musk replied, yikes, CoreWeave's stock plunged 15%. Nebius Group and ERIN popular trades connected to the data center buildouts also fell as much as 10%. And now options volume in CoreWeave is surging to more than seven times the 30-day average. It had the most bearish action of all of the neoclouds. Traders bought 200,000 puts compared to 106,000 calls, which means that they are basically two-to-one betting that the stock has even further to drop. So, Ranjan, I want to turn this to you. Why do you think this is happening? People are saying that its interest rates are rising, which means their debt costs will go up, which means maybe the project is not really sustainable. What do you think? And is this another example of how the vibes are poor around these companies and we're starting to see the impact? I think on the NeoCloud side, the vibes are even poorer because, again, Anthropic still showed us they are building a gigantic business.

Like, again, as we've recognized over and over, and it's fair, like $16.8 billion in a quarter when you're four and a half last year is insane. But on the NeoCloud side, you have all these companies. I actually – my favorite story from this week, which is crazy to me that it's not bigger, is there's a company, Firmus, in Australia. They were supposed to – NeoCloud, NVIDIA, and others are big investors in it. They're supposed to go IPO at a $44 billion valuation. There was actually these really interesting dynamics around it where their investors had such kind of favorable investing terms that basically they were able to kind of stop the IPO and pull out because if it wasn't going to reach a certain valuation, they would have to be issued a lot more shares and receive financial benefits. This was a company that was founded in 29 – like I had never – have you heard of Firmus in the past or paid attention? I can't say I have. I have not either. I mean, like, perhaps that is out of ignorance, but like, this is a company that was a neocloud that was going to go public in Australia at $44 billion.

This was also a company that in 2019 was founded as a Bitcoin mining company, which CoreWeave was as well. And I understand the pivot to AI infrastructure. It was also founded by two people, one of whom was in jail for insider trading for a year in 2015. his co-founder is his cousin who had no previous technology experience other than running a family laundry business and no hate on coming from a dorm in victoria secret no hate on yeah yeah exactly a tech focused laundry business but you know what i still recognize i should not be building an ai cloud infrastructure business i say it and i work in ai don't trust me with 30 $15 billion of debt to build a data center. No one ever will. I mean, sorry, sorry. I'm just, you know, preventing future opportunity for myself. But the main thing is, like, it's such a ridiculous story, and it's not even the headline.

Like, again, former convicted insider trader who spent time in jail, started a business with their cousin, Bitcoin mining has not actually delivered any infrastructure yet. It's just taking on more and more debt, was trying to turn that into an IPO. Like this is the neocloud side of things I think is dangerous, and I think the market is definitely starting to recognize it. Right. And, you know, I said maybe vibes-based, but maybe there's a non-vives-based part of this that I want to run by you, given your financial background, which is that, you know, we have seen borrowing costs go up. Interest rates are on the rise as inflation fears seem to be settling in. And we have more predicted rate raises in the future. And we've talked about how these companies really need a lot of debt in order to grow. And when their debt becomes more expensive, I wonder if that changes their ability to provide the computing, because that's a pretty big hit in their margins, don't you think?

So what do you think about this? So I actually love – this is like the one part of the entire financial market infrastructure that appears to be efficient at the moment. It's that the massive amount of debt that is being raised increases the demand for capital, which should increase the cost of capital, which is the interest rate, and interest rates are rising. now when we see the 10-year I think it what it is hit like 520 maybe before 530 5.3 percent and step back down around 5.05 as we speak but like that is what's supposed to happen the more people that are trying to raise debt it should increase the cost of that debt and it's happening and it's funny because that's not good for them in the long run but that's also just a reminder that capital is finite. A lot of this has run off the idea that capital is infinite

and there is going to be an increasing cost to it. Again, CoreWeave, it's pretty crazy because the bonds that are issued at 9.625%. They're currently trading at a 15% or I think it hit a 16% yield. CoreWeave is paying 15 cents on every dollar it borrows right now. Well, that's what investors That's what investors are trading the bonds at, assuming that that's what they're worth because of the implied default risk. Oh, okay. So they're not – because they already issued the bonds. They already got that money at 9.6 percent. But now the market is assuming that there is risk of default implied in that or not like some kind of default. So for me to buy that bond, I'm going to charge you more – you should charge me a higher interest rate or a higher yield. basically it's not good. It's effectively distressed territory. And, I mean, I think, again, I think, you know what?

This makes me happy. We got some efficient markets left. You know what? The bond market is not even as liquid as the equity market, but even the bond market, and a lot of people always say this, that, like, the bond market is ahead and smarter, and they clearly are trading like things are supposed to trade. So there's some hope for the market yet. get ranch on talking about interest rates which is actually ranch on how we began our conversations like four years ago you got a happy man on the other end here i know i never i didn't lie when there was zero interest rates that caused some issues and i'm actually saying now rising interest rates and i say that and recognizing it's not good in many ways but at least in this case it just shows someone is paying some attention and trying to be rational uh look before we move on i I just want you to sort of explain again the 15 percent. So the 15 percent yield on the bond, who's paying who and for what? That's what the bond is trading at in a secondary market.

So the most price is inverse to yield. So bonds are – it's actually – there's a price associated with that. So if it was like 97.5 before, the higher the yield shows, it's actually trading. There's like actual 96, 95, whatever it is. So it's actually – the way to think about the bond market is those higher yields, it basically means someone is actually paying a lower price for that asset. So it's just showing people are paying lower and lower prices. It is kind of weird and counterintuitive, but it's how everyone kind of looks at it. But basically price is going down whenever you see yields going up. And it should be – So the Corweave bonds that were issued to pay for the infrastructure that they're building, if Corweave sold you those bonds and you want to resell them, then you have to pay a premium. Or you're selling them actually for less than you paid.

You're selling them for less than you paid. That's it. You're taking a haircut on Corweave debt right now. It's basically – Exactly. And so the higher the yield, the lower the price you're going to get. Exactly. Yeah. It is funny now that, I mean, it's literally, with equities, it's always simpler. If it's at 100 and then it's trading at 90, we all know the price went down. But that is effectively what it is. Okay. Let's end this segment. Do you think this is an overreaction and Anthropic is just going to be fine? My take on all this is there's so much vested interest that they go out successfully and energy. I still think they're going to go out okay. I don't know. I think it's still going to take a lot to really derail this. But I don't know. What do you think? You know, we've talked about all the risks that Anthropoc has, honestly. We've talked about the fact that the frontier is commoditizing to some degree.

We've talked about the fact that there's competition now on the enterprise side with a place like OpenAI. We've talked about how some of the big customers are pulling back from all the token spending, customers like Meta and Microsoft. And we've also talked about how the enthusiasm around the cloud code and the cloud co-work moment, which led to a lot of revenue for Anthropic, has dulled a bit. So, you know, I still think this is a strong company, But to think that this is an inevitable company or that it will sustain the success it's had to the same degree in an industry where we've seen companies, you know, take the lead and then go to the back of the pack in a matter of months. I don think you can say that necessarily Anthropik will be able to sustain it And so with so much on the line I don think it really an overreaction at all I think yeah I was just thinking about this for Elon His greatest gift, I still, is the storytelling and the timing. Because, like, to go out at a trillion plus with $19 billion in revenue, which is what Anthropic made in the last quarter.

But he did it early. And also, like, Mars and stuff is such a better story where there's no competition in the future of humanoid robots or whatever else it is versus Anthropic is in the biggest dogfight imaginable. And it's the most competitive environment imaginable. So, yeah, there's a lot of risk. But this is – I hope there's some resolution to this that we just know or don't know in the next month or two. But I don't know. Do you think they go up by the end of the year? Definitely. I definitely do. I was going to say, when you were saying, I hope there's some resolution. Ranjan, we will see that resolution for sure. All right. You've heard it here. You've heard it here. The Cantrell Woods guarantee. The Cantrell Woods guarantee. I'll put the stamp on it. All right. We've got to talk about this reported case of espionage within OpenAI. An employee took a recording device and put it in an executive conference room. And we'll talk a little bit about what happened, the implications, and whether there might be more such incidents within companies in Silicon Valley.

That's coming up right after this. This episode is brought to you by AppPoint. Everyone's racing to roll out AI right now. Co-pilots, chatbots, agents doing real work. But here's the part nobody loves talking about. All that AI runs on your data. And most teams have no single way to see it, secure it, and prove it's under control. That's exactly what AppPoint does. For 25 years, they've been the trusted layer beneath the world's most demanding data, now extended across your entire AI estate. Your data, your cloud, and the agents acting on your behalf. It's how more than 28,000 organizations deploy AI with confidence. So innovation scales without scaling risk. Avpoint, the unifying trust layer for AI. Head to avpoint.com to see how enterprises deploy AI with confidence. Learn more at avpt.co slash bigtechnologypodcast. That's avpt.co slash bigtechnologypodcast.

And we're back here on Big Technology Podcast Friday edition, talking with Ranjan Roy of Margins. Ranjan, very interesting story in Silicon Valley this week coming out of OpenAI. This is from the Wall Street Journal. OpenAI engineer allegedly hid toilet paper wrap mic in a conference room. As someone who is proficient in the use of microphones, I will tell you, you always want to wrap them in toilet paper to hide them. Should we do that? Should that be the new thing? It's the new green screen. All right, let's talk about it. Here's the story. An OpenAI engineer visited a familiar conference room in one of the company's San Francisco office buildings last week and peered behind a television set mounted to a wall. Abdulrahman Al-Fozan had spent weeks scoping out the room, which could only be reserved by executives at the Artificial Intelligence Company and their assistants. The conference room was often used for leadership meetings, briefings with government officials and business partners, as well as top-secret research and product discussions.

Al-Fozan, who had worked on OpenAI's product team for more than a year, planned to intercept what was said within its walls, the Justice Department said. He was charged with using or endeavoring to use a device to intercept oral communications. He's a 35-year-old Saudi, and he's accused of wrapping the thumb-sized circuit board and microphone and toilet paper and inserting the device into the USB port on the back of the wall-mounted TV in late September. He's been arrested. So I just want to say we don't fully know whether – look, the speculation has been that this guy was working on behalf of the Saudi government. We don't know that. I think it would be irresponsible to speculate that that's the case. It could have just been a curious employee who wanted to know what was going on in the executive room. This stuff happens. But ultimately, I think this – it has awakened people to this idea that, you know, regardless of whether he was working on – or some entity connected with the Saudi government,

that this stuff is quite possible within companies in Silicon Valley, whether it's individuals or whether it's nations. So, Ranjan, what do you think about this story, and what was your reaction when you saw it? I mean, this was a fascinating story. I agree, though, that what the geopolitical implications are are very unclear right now, and whether we ever find out or not, I'm hoping we learn a bit more. But I got to say, I was kind of like really interested in what he actually did because someone had actually – there was reporting that the device was a Seed with three E's is the name of the company, Xiao ESP32 S3 Sense little chipboard. It's like $8, and then you add a little microphone to it. And my favorite part of the story is part of how they caught him is he actually was asking ChatGPT how to build this, which is amazing that he actually asked.

He was Gemini there, man. Or maybe Gemini can't do it. Allegedly. He allegedly did this. Sorry, allegedly. But just because I'll admit, like, when I went on that company's website and started looking at these devices, I literally was like, oh, this is interesting. This would be a fun weekend hacky project to do just to, again, run actual recording off this tiny chip. But I don't know. I mean, it is crazy to wonder how much of this is going on at these companies. Again, where secrecy is paramount, where they're moving so fast. I mean, the hiring numbers, the turnover, like all this is so crazy that – and it is a reminder. the advancing technology that you don't have to be like a spy to be able to put together something like that. You can just use a chatbot is pretty amazing too. Yeah, I did love the, there was a tweet from OpenAI. We used our models to understand the device and where it had come from, identifying

that a specific employee had planted it a few days earlier. And then somebody quote tweeted that with the image of Dario Amode in a wig and a fake mustache and a big smile. Well, my favorite part of that tweet from OpenAI is like, are they saying, when they say we used our models to understand, like do they just take a picture and it's like, yo, ChachiBT, what this? What this, yeah. No, no, because I mean I do that all the time with all different AIs, like use it to try to understand some kind of device or some kind of electronics and like we used our models is it literally hey chat what am i looking at here you are looking at the and this was the person who did it because i have their chat gpt history and i will tell you all about it right now yeah i mean i this is one of the things when the details of this came out it's like you didn't really need a sophisticated you didn't need mythos or you didn't need to ask for

6.1 to figure out what was going on. In fact, like, and again, this is all reported and alleged. This is from the Wall Street Journal story about what happened. The small device had been in place for about two days. Open AI reviewed footage from its surveillance cameras and saw that Alphozan had been near the conference room where it had been hidden several times before the bug was found, despite having no reason to access the room. In the weeks beforehand, prosecutors allege, Alphozan had used an AI tool to query meeting rooms and locations of leadership and exec meetings. The federal complaint also says a chatbot associated with a spouse asked multiple questions related to audio recording, remotely accessing a device, and encrypting a data card. Last week, prosecutors say that he left a bag unattended in a different part of OpenAI's offices, and inside the bag, they discovered his wallet and a similar recording device to the one they found in the executive conference room. He was arrested on Friday. It's like, man, you're going to leave your bag with your wallet and a recording device?

You might as well, on the toilet paper, write your name. That's what I love about this story and is so fascinating that the actual technology involved would have in the past required – what was the James Bond guy who always has the Q or whatever? You know what I'm talking about, right? Yeah, that guy. not a big Bond guy, but you know I'm talking about listeners, the person who presents James Bond with all the gadgets, that in the past this kind of like mini listening device that's actually able to record over a long period of time and like that would have been really difficult or required like being like a spy. And now it's just someone on ChatGPT asking these questions and it's a reminder that they're not a spy. and they're going to make some really dumb mistakes when they're doing this. So good and bad. Yeah, I mean, the District of California, so the U.S. attorney,

seems to indicate that this was a national security issue. The arrest highlights our relentless efforts in partnership with the FBI to identify and prosecute those who seek to steal our technology. For us, it's a matter of national security. I don't think you would say that unless you thought that there was something, you know, international going on. But the lawyer representing this guy, Al-Fozan, said his client was charged with violating a federal recording statute, not stealing trade secrets or working with a foreign agent, and asked everyone to withhold judgment until the full effects become known. I think that's a fair request. But, you know, what this thing has done is it's woken up people's imagination to, like, how many countries, you know, whether or not this guy was doing this, you know, in cahoots with the Saudi government. It's woken up people to, like, how many countries have people placed within these labs. And I remember I wrote this story a number of years ago about actually two people, two Saudi nationals within Twitter. Oh, yeah. I remember that. Yes.

I'll just give the outlines of it. They had worked with somebody associated with the Saudi royal family. And one of them, I think, well, anyway, they had allegedly worked with the Saudi royal family, This is according to the prosecutor's documents to access the information of Saudi dissidents and pass that along, which, of course, if you have an anonymized account and you unmask them to the Saudi government, that's not going to be a good time for the protester, put it that way. And I remember in my reporting for this story, I had spoken with somebody within one of these companies, and they were like, without any hesitation, that there are nation-state actors. So people with ties to intelligence agencies inside every company in Silicon Valley doing stuff like this. And it does make you wonder in such a high-stakes case or such a high-stakes technology how much of that stuff is going on everywhere within the labs, within the tech giants.

Interestingly, the recording device, in this case, and again, we don't know if it's tied to national intelligence, but it wasn't there to exfiltrate the weights. It was there seemingly to listen to what was going on in high-stakes conversation among leadership about research, future research, and other important partnerships. Very interesting case. No, I know. I think it was about understanding the strategy, direction, concerns, but I keep wishing that they set this entire thing up and then in reality it was a bunch of open-eyed executives worried about Muse, talking about Dots, looking at Alexander Wang's Twitter feed and being like, he sexualized the labubu. He's posting his way to a 20% increase in the meta. He's calling himself an Asian lesbian, which he did today. I can't believe he put Muse's bot on Maine once again. So whoever has put him up to this is sitting there waiting for this deep corporate strategy.

Or himself wants to exfiltrate that kind of information. And it's just a bunch of people scrolling Alexander Wang trying to figure out what they need to do with dots. Yeah, I mean, you imagine you're doing the briefing, you've got the PowerPoint there, you have all the OpenAI's leadership team assembled. You don't know you're being recorded, and you put up the PowerPoint, and you say, all right, I'm going to turn your attention to slide five. This is another instance of Alexander Wang sexualizing the Muse Labubu. We must sexualize the dot. How can we do this with dots? Do we have a counter? Okay, so interestingly enough, companies within Silicon Valley seemingly are prepared for this. And there's another Wall Street Journal article talking a little bit about it. It says, AI companies play cat and mouse with secret-stealing spies. At a San Francisco playground, a stranger tried to befriend an OpenAI employee who was there with their child.

The stranger also regularly showed up with the child and, in the process of making small talk, asked the OpenAI employee questions about their work. It was not idle curiosity. The stranger was a spy. That is one of the scenarios employees of the artificial intelligence company have been presented with in attempts to raise their vigilance against attempts to steal corporate secrets. And that was before federal authorities arrested an employee for planting listening devices. In training sessions, OpenAI has warned employees that outsiders, including competitors and state-sponsored actors, could try to get access to company information. The leaders have said that this could take the form of people offering money, listening in cafes, are even trying to seduce OpenAI employees employees that other AI heavyweights including Anthropic and Google have received similar warnings So I guess it a good thing that they are getting ahead of this I mean, the honeypot tale is old as time. Talk about the honeypot example.

So what's a honeypot and talk a little bit about this. what uh honey pots are scenarios where agents offer sex or romance to get close to a target according to the wall street journal but also for anyone who's watched probably james bond style spy movie it's also meta strategy with muse but anyway oh my god we're all getting honey potted give us your data dear oh my god okay but actually hold on i gotta get back to this so So one of the stories, according to the Wall Street Journal, one of the stories OpenAI tells employees to illustrate the risk. A case where a U.S. diplomat in Russia, there's a foreign espyage operation where at first they sent a blonde woman to his hotel room with champagne. He declined. Then they sent a redhead woman, and then they next sent a young man. And then OpenAI warns employees, this could happen to you. I don't know. That is the official order, by the way, blonde, redhead, young man.

The blonde redhead. It's in the Honeypot guidebook. It's the Honeypot guidebook. But I mean, it did make me like, yeah, how much of this is happening at how many levels? There is potentially so much value to little bits of information and you can move quickly. I was thinking about like, I mean, Apple and their tradition of like secrecy is famous for this. But in the past, like if you find out what they're doing, that's going to change your three year roadmap. Maybe you're not going to like massively change your supply chain and launch a new product. Whereas now you get a bit of information. You can do something with it tomorrow in the next week or month. So it has to be honeypots have to be plentiful right now. Well, listen, I mean, I don't know if I should say this or not. Having spent some time in the San Francisco dating scene, I could see why the honeypots work.

It can be tough out there. As a New Yorker, I'll refrain from commentary on that one. Okay. I mean, it's funny. I moved to New York, and I thought, okay, I was like, I don't know. It'll be nice to be outside of the SF dating scene. And then I met my wife four months later in Central America. So go figure. One thing to note, the honeypots are not – there's actually a big soft bank, Wall Street Journal Investigation 2020, I remember, where someone – they tried to honeypot former soft bank President Nikesh Arora. And he was on to it. He didn't fall for it. Man, Nikesh knows. I know. Well, actually, I mean, I'm trying to get Nikesh on the show, so maybe I can get him to tell the full Honeypot story. You and I should do that interview together. It's like we bonded over this topic now.

Nikesh, I know you're here to talk about cybersecurity, but we really want to learn about honeypots, which is, I guess, it is a part of cybersecurity. And how to beat that. Which is a cyber – actually, that is the best interview. Why should you be the chairman of Palo Alto Networks? Guys, I didn't fall for the honeypot. I beat the honeypot. But in general, Stings, they say they find somebody on Tinder and then they start revealing the secrets to them. And you see this in some of these undercover videos. And I always felt like, man, if you're on a date with somebody and they immediately start telling you your secrets from – asking you to tell them your secrets from work, maybe you shouldn't. That's a weird date to me. Don't. I feel like they're purple fall for it. I don't know. I like to think if you are a trained honeypotter, you're probably pretty good and savvy at how to extract that information. You're not just saying, tell me your secrets from work. You'd start with, how was your day?

Oh, what was wrong? What did your boss do? I think you're, I mean, unsettingly good at this, Ron John. I know. This is making me uncomfortable. This makes me uncomfortable too. But that is okay. That's how it works. All right. Briefly, let's talk about HomeView. So Apple has this new device called the HomeView. It's basically a tabletop Siri, kind of like the Echo Show or the Google Nest Hub. I think that was what it was called. They haven't made a new one since 2021. $299. $99. It seems like it's a good place for Apple to play, right? Get its voice assistant on people's tabletops. And then over time, as the capabilities increase, you could just update the screen and the thing does more for you and you don't lose that space to Amazon's or Google's. What do you think? I actually, I have both HomePods and Alexa's in my apartment. I just wasn't, this wasn't

interesting to me i'm gonna be honest like i don't get it for turnus's first big release just let the duo hype come in and just run with it but like it's just so like you can't operate apps it apparently operates like carplay effectively i think there's like some number of a very small number of apps that would be kind of native to the platform but otherwise you can hand off your iphone good you can facetime that's nice even the thing that killed me was in one of the demos they did it's for cooking but you have to keep touching the device to actually like switch around and scroll a carousel the whole point of cooking ai is to be able to just speak to it so i don't know this was like very underwhelming and again at the core of it if siri doesn't work well this could be so much more valuable if Siri worked. And it still does it, really. Yeah, the Wall Street Journal actually did this story about it.

They said, basically, we've tested Siri. Siri's AI still stumbles over basic requests, such as playing songs and placing calls, according to Wall Street Journal tests, which I think was just Rolf Winkler yelling at his phone. But, yeah, it's got to get better at that. But I think it will get better at that. Remember, standard models are making everything better. I don't know the market seems like it Apple is above 5 trillion now for the first time I know the amount of money they charge me in services that I don't even know what I'm spending on I get the valuation I'm waiting for the duo I'm interested it's in 8 days I might pull the trigger and again which is ridiculous for as much shit as I talk on Apple I'm about to give them $2,300 or whatever it is for that phone But home view, not interested. Okay. Before we go with the debate I've been waiting to have with you for a while, let me introduce it. The New York Times says why AI food slop looks so gross.

And then the story art is awfully disgusting. Let's see, like artificial cream with dots all over it. All right. But anyway, let me just read the story and I'll give you a chance to respond. Fast food businesses in London, New York, and elsewhere have increasingly turned gender-to-AI to promote their dishes. turned to gender-to-ag to promote their dishes. These images often have an uncanny, unrealistic quality, and it is turning many hungry customers off. People have been flooding social media with examples. Pastas covered in inexplicable black dots, shapes and forms that are supposed to add up in a sandwich, a grayish burrito that would trigger anybody's tripophobia, the fear of looking at clusters of repeating patterns of small holes, conjuring the demogorgon in Stranger Things. Ranjan, I think it's time for you to admit that this is a plague on our society, and we need to have some, if we're going to have any AI regulation, I think it should begin with the AI food science.

Bandom, what do you think? Vehemently disagree. To me, around me, I remember, is right at the corner of where I live in here in New York City. There's a halal cart. probably a year ago, I see these absurd AI images. But he actually named his burgers and named the different chicken and lamb dishes. And they had, I forget what they were, but they were these kind of like absurd names, like the Texan cowboy something, big AI, very clearly AI-generated images. And it was beautiful to me. It was beautiful. This was, you know, like someone working at the halal cart that if they ever imagined them having to go find a graphic designer in the past and imagine them some – and I say this like I've worked with a lot of graphic designers, especially when I ran a startup, freelancers, like them going back, charging them a lot of money. It was something they were never able to achieve before. And now, with the click of a button, with just a prompt,

they can actually be creative and unleash creativity in ways that they never could have done before. And you know what? It might look a little sloppy. Most of these are probably done on older image models where it's gotten a lot better, and it will get better. But now they are empowered that no longer are they limited to not be able to talk to a graphic designer. Now they themselves can. actually be empowered to print food photos. I think that's beautiful. I don't know. Maybe you hate America. Maybe you hate America and the American dream. Well, listen, I hadn't heard the Ranjan Roy explanation here. I hadn't gotten the Ranjan guarantee on AI food science. And now I might be swayed. Honestly, that was a beautiful speech, Ranjan. I love it. I am now almost on board with your viewpoint here. And the one thing I would say is what we should see from the AI companies is a prompt. And the prompt would say, hey, Halal car owner, it looks like you're printing a food sign.

Since our AI model generator makes every food sign look the same, maybe you can hit a randomizer button and it can look a little different than the rest. And then I think we would get to a much better place because all these chat GPT signs look exactly the same. I need a little variation. he's a character do you know what like ai industry has a pr problem you just set them up alex you just that is the easiest thing to kind of build a tool in there like someone is saying i need to i mean let's just let's be real like uh chicken and rice anytime that prompt comes in send it to the randomizer and try to add a little variation and again if especially if they're saying this needs to be print quality. Help guide a little bit. People will love you. People will love you forever. You're going to be empowering and enabling the American dream. I want to call guys. Yes. And I want to end with this because, you know, talking about how the prompt matters, this is the most beautiful example of that. So somebody at a spa must have prompted

the model, make a sign for my spa that includes things like full body massage, neck and shoulder massage, foot massage, et cetera. The model, make an image of a sign. The model must have taken that super literally because instead of making the image of the sign, it made an image of a sign outside a spa. So it's this picture of a sign in front of a spa that has all the treatments, but in this sign image is the actual spa and it's a picture of a sign standing up on a sidewalk. This person said, good enough. They printed it out, and they put it in another sign, in an actual sign. So what you see as you walk past this spa on the sidewalk is a sign on the sidewalk with a sign of a sign in front of a spa. Did you actually see this? No, I found this on – I didn't see this in real life. I wish I would have been so lucky to see this in real life. This is beautiful. Again, I love this.

This is so ridiculous. I love this. It's attention. What is the purpose of kind of sidewalk signage to grab your attention? And do you know what this just did? This grabbed people's attention like nothing else. This would – there would be some creative agency that would charge you like 250K, and there would be a grand Don Draper-style pitch, and they'd be like, listen, the ultimate sidewalk signage, a sign of a sign in a sign. And everyone would just be like, holy shit. You're amazing. Yeah. This stuff is beautiful. Well, Ranjan, this was one of my strongest held AI opinions, and you've totally reversed it. So I'm on board. Keep the AI food signage coming. Just use a newer model, everyone. That's all. Yeah. Get the prompt right. Or just put it in the context window. Make it a little bit more random. All right. Well, that's a fun way to end it, Ranjan.

I might go get a hit up the whole all cart for lunch today. I might go. If I ever see a spa with a sign of a sign in front, I'm going right in for a massage. I'm right in. And it's like, oh, man, I just walked into another honeypot. Always get you with the sign of a sign. Always get you. That's actually the ultimate honeypot. That's how they do it. All right, Ron John, have a good weekend. Thanks so much. All right. Have a good week. All right, everybody. Thank you so much for listening and watching. Stay tuned for Wednesday. We have a special interview coming, most likely. So very excited to share it with you. And we'll have to keep you in suspense as to who it might be. All right. Thanks for listening and watching. And we'll see you next time on Big Technology Podcast.