An anonymous reader quotes a report from Wired: Security researcher Dor Zvi and his team at the cybersecurity firm he cofounded, RedAccess, analyzed thousands of vibe-coded web applications created using the AI software development tools Lovable, Replit, Base44, and Netlify and found more than 5,000 of them that had virtually no security or authentication of any kind. Many of these web apps allowed anyone who merely finds their web URL to access the apps and their data. Others had only trivial barriers to that access, such as requiring that a visitor sign in with any email address. Around 40 percent of the apps exposed sensitive data, Zvi says, including medical information, financial data, corporate presentations, and strategy documents, as well as detailed logs of customer conversations with chatbots.

"The end result is that organizations are actually leaking private data through vibe-coding applications," says Zvi. "This is one of the biggest events ever where people are exposing corporate or other sensitive information to anyone in the world." Zvi says RedAccess' scouring for vulnerable web apps was surprisingly easy. Lovable, Replit, Base44, and Netlify all allow users to host their web apps on those AI companies' own domains, rather than the users'. So the researchers used straightforward Google and Bing searches for those AI companies' domains combined with other search terms to identify thousands of apps that had been vibe coded with the companies' tools.

Of the 5,000 AI-coded apps that Zvi says were left publicly accessible to anyone who simply typed their URLs into a browser, he found close to 2,000 that, upon closer inspection, seemed to reveal private data: Screenshots of web apps he shared with WIRED -- several of which WIRED verified were still online and exposed -- showed what appeared to be a hospital's work assignments with the personally identifiable information of doctors, a company's detailed ad purchasing information, what appeared to be another firm's go-to-market strategy presentation, a retailer's full logs of its chatbot's conversations with customers, including the customers' full names and contact information, a shipping firm's cargo records, and assorted sales and financial records from a variety of other companies. In some cases, Zvi says, he found that the exposed apps would have allowed him to gain administrative privileges over systems and even remove other administrators. In the case of Lovable, Zvi says he also found numerous examples of phishing sites that impersonated major corporations, including Bank of America, Costco, FedEx, Trader Joe's, and McDonald's, that appeared to have been created with the AI coding tool and hosted on Lovable's domain. "Anyone from your company at any moment can generate an app, and this is not going through any development cycle or any security check," Zvi says. "People can just start using it in production without asking anyone. And they do."

Longtime Slashdot reader couchslug shares a report from That Privacy Guy's Alexander Hanff: Two weeks ago I wrote about Anthropic silently registering a Native Messaging bridge in seven Chromium-based browsers on every machine where Claude Desktop was installed. The pattern was: install on user launch of product A, write configuration into the user's installs of products B, C, D, E, F, G, H without asking. Reach across vendor trust boundaries. No consent dialog. No opt-out UI. Re-installs itself if the user removes it manually, every time Claude Desktop is launched. This week I discovered the same pattern, executed by Google.

Google Chrome is reaching into users' machines and writing a 4GB on-device AI model file to disk without asking. The file is named weights.bin. It lives in OptGuideOnDeviceModel. It is the weights for Gemini Nano, Google's on-device LLM. Chrome did not ask. Chrome does not surface it. If the user deletes it, Chrome re-downloads it. The legal analysis is the same one I gave for the Anthropic case. The environmental analysis is new. At Chrome's scale, the climate bill for one model push, paid in atmospheric CO2 by the entire planet, is between six thousand and sixty thousand tons of CO2-equivalent emissions, depending on how many devices receive the push. That is the environmental cost of one company unilaterally deciding that two billion peoples' default browser will mass-distribute a 4GB binary they did not request.

An anonymous reader quotes a report from Business Insider: As the trial between Elon Musk and OpenAI ended its second week, the Tesla CEO started scoring points against Sam Altman. His witnesses landed three solid punches in testimony about how Altman runs OpenAI as CEO, raising concerns about his dedication to AI safety, the nonprofit's mission, and his honesty as a leader of the organization. [...] This week, Musk's legal team called a parade of witnesses who questioned whether Altman was acting in the interest of the nonprofit. On Thursday, that included a former OpenAI safety researcher, who described a slow erosion of the company's safety teams, which prompted her to leave the company. Witnesses also shared stories about the company launching products without the proper safety reviews -- or the knowledge of the board. Rosie Campbell, a former AI safety researcher at OpenAI, testified that the company became more product-focused during her time there and moved away from the long-term safety work that had initially drawn her in. She said both long-term AI safety teams were eventually eliminated, and that she supported Altman's reinstatement only because she feared OpenAI might otherwise collapse into Microsoft: "It was my understanding at the time that the best way for OpenAI to not disintegrate and fall about would be for Sam to return." Still, Campbell's testimony wasn't entirely favorable to Musk. She also said xAI, Musk's AI company, likely had an inferior approach to safety than OpenAI.

Helen Toner, another former OpenAI board member, also testified about the board's concerns leading up to Altman's removal. She said the board was not primarily worried about ChatGPT's safety, but about Altman's leadership and investor relationships, saying, "The issues that we were concerned about in our decision to fire Sam were exacerbated by relationships with investors." Toner also described concerns that Altman was misrepresenting what others had said, telling the court, "We were concerned that Sam was inserting words into other people's mouths in order to get people to do what he wanted."

Meanwhile, Tasha McCauley, a former OpenAI board member, described a deep loss of trust in Altman and accused him of creating "chaos" and "crisis" inside the company. She said Altman fostered a "culture of lying and culture of deceit," including allegedly misleading others about whether GPT-4 Turbo needed internal safety review before launch.

Musk's lawyers then called to the stand David Schizer, a Columbia Law professor and nonprofit-governance expert, who framed Altman's alleged behavior as a serious governance problem for an organization that was supposed to be mission-driven. Asked about claims that products were launched without full board awareness or safety review, he said, "The board and CEO need to be partnering, working together, to make sure the mission is being followed," adding that "if the CEO is withholding that information, it's a big problem."

The day ended with the start of a Microsoft executive's deposition. Microsoft VP Michael Wetter said Azure had integrated OpenAI technology, that Microsoft saw strategic value in having AI developers build on Azure, and that a 2016 agreement allowed OpenAI to use Microsoft tools for free even though it could mean a loss of up to $15 million for Microsoft. Testimony ended early, with no court on Friday and the trial set to resume Monday.

Recap:
Sam Altman's Management Style Comes Under the Microscope At OpenAI Trial (Day Seven)
Brockman Rebuts Musk's Take On Startup's History, Recounts Secret Work For Tesla (Day Six)
OpenAI President Discloses His Stake In the Company Is Worth $30 Billion (Day Five)
Musk Concludes Testimony At OpenAI Trial (Day Four)
Elon Musk Says OpenAI Betrayed Him, Clashes With Company's Attorney (Day Three)
Musk Testifies OpenAI Was Created As Nonprofit To Counter Google (Day Two)
Elon Musk and OpenAI CEO Sam Altman Head To Court (Day One)

An anonymous reader quotes a report from Ars Technica: Wearables have really come full circle. The early Fitbits didn't have screens, but the move to smartwatches put a screen on everyone's wrist. Now, devices like Whoop and Hume are designed as data trackers first and foremost without so much as a clock. Google's newest wearable jumps on that trend: The Fitbit Air doesn't have a screen, but it does have a suite of health sensors that pipe data into the new Google Health app. And if you want, Google has a new AI-powered health coach in the app ready to tell you what that data means (maybe).

The Fitbit Air itself is a small plastic puck about 1.4 inches long and 0.7 inches wide. It slots into various bands that hold the bottom-mounted sensors against your wrist. There's no display pointing upward, so the entire device is covered by the fabric or plastic of the band. It's a streamlined and potentially stylish look -- in uncharacteristic fashion, Google has plenty of colors and style options available, including a special-edition Steph Curry version. You may have heard chatter about Curry being seen teasing a new screenless Fitbit, and this is it. [...]

The Fitbit app is getting a major makeover and a new name. An update in the coming weeks will transform that app into Google Health, featuring a new interface with a more extensive Material Expressive aesthetic and redesigned menus and tabs. You also won't see Fitbit branding in as many places -- the Fitbit Premium subscription will become Google Health Premium. Without a subscription, the app still does all the basic things, like tracking your health stats, automatically logging workouts, and showing it all in a pretty dashboard. With the Premium subscription, you get all the features from Fitbit Premium plus the new AI Health Coach. It's a chatbot, so you can ask it about any health or wellness topics, and the answers are grounded in your health data. The Fitbit Air launches May 26 for $99.99, includes a Performance Loop band, and comes with three months of the new Google Health Premium that replaces Fitbit Premium and adds Google's AI Health Coach.

Meanwhile, Google Health Premium will cost $10 per month or $100 per year, though it's included with AI Pro or AI Ultra. Non-subscribers can still use basic tracking features. Ars also notes that when Google Fit shuts down later this year, users will need to migrate their data to Google Health.

Sam Altman's management style came under scrutiny on the seventh day of Elon Musk's high-stakes OpenAI trial, as former OpenAI figures Mira Murati, Shivon Zilis, and Helen Toner took the stand to testify about their experiences working with him. Their testimony resurfaced many of the criticisms that first emerged during Altman's brief ouster as CEO in 2023. An anonymous reader quotes a report from Business Insider: The first witness was Mira Murati, OpenAI's former chief technology officer and now founder of her own AI shop, Thinking Machines Lab. Jurors watched a recorded video deposition of Murati, who was also OpenAI's interim CEO after the board briefly ousted Sam Altman. Murati's testimony focused on her concerns about Altman's "difficult and chaotic" management style. She said Altman had trouble "making decisions on big controversial things." He also had a habit of telling people what they wanted to hear.

"My concern was about Sam saying one thing to one person and a completely different thing to another person, and that makes it a very difficult and chaotic environment to work with," said Murati. Murati said that her issue with Altman was not about safety, "it is about Sam creating chaos." She said she supported Altman's return to OpenAI because the company "was at catastrophic risk of falling apart" at the time of his ousting. "I was concerned about the company completely blowing up."

Zilis said she was upset that Altman rolled out ChatGPT without involving the board. "It wasn't just me but the entire board raised concern about that whole thing happening without any board communication," she said. Zilis said she was also concerned about a potential OpenAI deal with a nuclear energy startup called Helion Energy because both Altman and Greg Brockman were investors. Although the executives had disclosed the investment to the board, Zilis said the deal talk made her uneasy. It "felt super out of left field," she said. "How is it the case that we want to place a major bet on a speculative technology?"

In a video deposition, Helen Toner, a former member of OpenAI's board who resigned in 2023, said she first became aware of ChatGPT's release when an OpenAI employee asked another board member whether the board was aware of the development. [...] Toner also elaborated on why the board, including herself, voted to remove Altman as CEO in 2023. "There were a number of things -- the pattern of behavior related to his honesty and candor, his resistance of board oversight, as well as the concerns that two os his inner management team raised to the board about his management practices, his manipulation of board processes," said Toner. Recap:
Brockman Rebuts Musk's Take On Startup's History, Recounts Secret Work For Tesla (Day Six)
OpenAI President Discloses His Stake In the Company Is Worth $30 Billion (Day Five)
Musk Concludes Testimony At OpenAI Trial (Day Four)
Elon Musk Says OpenAI Betrayed Him, Clashes With Company's Attorney (Day Three)
Musk Testifies OpenAI Was Created As Nonprofit To Counter Google (Day Two)
Elon Musk and OpenAI CEO Sam Altman Head To Court (Day One)

Google is updating AI Overviews and AI Mode to more prominently surface "Expert Advice" from public discussions, social platforms, forums, blogs, and Reddit. Engadget reports: Via a new "Expert Advice" section that can appear in AI responses, Google will display "a preview of perspectives from public online discussions, social media and other firsthand sources." In the sample screenshot the company provided, quotes from forums, WordPress blogs and Reddit were arranged above links to their respective sources. Google plans to add more context to these links, too, showing "a creator's name, handle or community name," so you can judge what you might want to click through and read from a glance.

Google will also start recommending in-depth articles at the end of AI responses for further exploration of a given topic, and link to more sources directly in its generated answers rather than just at the end. If you subscribe to any publications, AI responses will also highlight sources from the subscriptions you link to your Google account.

An anonymous reader quotes a report from CNBC: OpenAI President Greg Brockman concluded his testimony on Tuesday, where he largely rebutted Elon Musk's account of the early years of the startup and negotiations that occurred at the company. Brockman testified that he never made any commitments to Musk about the company's corporate structure, and he never heard anyone else make them. He emphasized that OpenAI is still governed by a nonprofit. "This entity remains a nonprofit," Brockman said, referring to the OpenAI foundation. "It is the best-resourced nonprofit in the world." [...] Brockman, who spoke from the witness stand in federal court in Oakland, California, over the course of two days, also revealed that Musk had enlisted several OpenAI employees to do months of free work for him at Tesla, Musk's electric vehicle company. That work mainly included efforts to overhaul the company's approach to developing self-driving technology as part of the Autopilot team there in 2017. During his two days on the stand, Brockman answered questions about his personal financial ambitions, his understanding of OpenAI's structure and Musk's involvement at the company, which they co-founded with other executives in 2015.

In Musk's testimony last week, the Tesla and SpaceX CEO said that the time, money and resources he poured into OpenAI had been integral to the company's success. He repeatedly said that he helped recruit the company's top talent. Brockman said Tuesday that while Musk was helpful in convincing some employees to take the leap to join OpenAI, he was a polarizing figure for others. "Elon had a reputation of being an extremely hard driver," Brockman said. He added that "certain candidates were very attracted" by Musk's involvement at OpenAI, and that "certain candidates were very turned off." Musk testified last week that a former OpenAI researcher named Andrej Karpathy joined Tesla, but only after he had planned to leave the startup already. Brockman said that Musk, after he hired Karpathy, approached him with "an apology and a confession," about the hire, and that neither Musk nor Karpathy had told him the researcher planned to leave OpenAI before that. Musk was generally not very available for meetings and conversations, Brockman said, so he relied on employees, including Sam Teller and former OpenAI board member Shivon Zilis, as proxies. Brockman testified that open sourcing OpenAI's technology was "not a topic of conversation" during Musk's time with the nonprofit, despite Musk's claims that it was supposed to be central to the organization. He also described tense 2017 negotiations over a possible for-profit arm, saying Musk became angry when equity stakes were discussed. "He said Musk declined the proposal during an in-person meeting, then tore a painting of a Tesla Model 3 car off the wall, and began storming out of the room," reports CNBC. He also demanded to know when the cofounders would leave the company.

Brockman further said Musk wanted control of OpenAI because he disliked situations where he lacked control, citing Zip2 and SolarCity as examples Musk had raised. He also testified that Musk partly wanted control to help fund his broader SpaceX ambition of building a "city on Mars."

CNBC notes the trial will resume at 8:30 a.m. PT on Wednesday, with Shivon Zilis expected to testify. She is the mother of four of Musk's children and a former OpenAI board member.

Recap:
OpenAI President Discloses His Stake In the Company Is Worth $30 Billion (Day Five)
Musk Concludes Testimony At OpenAI Trial (Day Four)
Elon Musk Says OpenAI Betrayed Him, Clashes With Company's Attorney (Day Three)
Musk Testifies OpenAI Was Created As Nonprofit To Counter Google (Day Two)
Elon Musk and OpenAI CEO Sam Altman Head To Court (Day One)

An anonymous reader quotes a report from Wired: Employees at Google DeepMind in London have voted to unionize as part of a bid to block the AI lab from providing its technology to the US and Israeli militaries. In a letter addressed to Google's managing director for the UK and Ireland, Debbie Weinstein, the workers asked the company to recognize the Communication Workers Union and Unite the Union as joint representatives for DeepMind employees. "Fundamentally, the push for unionization is about holding Google to its own ethical standards on AI, how they monetize it, what the products do, and who they work with," John Chadfield, national officer for technology at the CWU, tells WIRED. "Through the process of unionization, workers are collectively in a much stronger place to put [demands] to an increasingly deaf management."

[...] The DeepMind employee tells WIRED that if the staff succeeds in unionizing in the UK, they will likely demand that Google pulls out of its long-standing contract with the Israeli military, and seek greater transparency over how its AI products will be used, and some sort of assurance relating to layoffs made possible by automation. If Google does not engage, the letter states, the employees will ask an arbitration committee to compel the company to recognize the unions. Since the turn of the year, both Anthropic and OpenAI have announced large-scale expansions of their operations in London. CWU hopes the unionization effort at DeepMind will spur workers at those labs into similar action. "These conversations are happening," claims Chadfield. "The workers at other frontier labs have seen what Google DeepMind workers have done. They've come to us asking for help as well." The unionization push began in February 2025 after Alphabet removed a pledge from its AI ethics guidelines that had barred uses such as weapons development and surveillance. "A lot of people here bought into the Google DeepMind tagline 'to build AI responsibly to benefit humanity,'" the DeepMind employee told WIRED. "The direction of travel is to further militarization of the AI models we're building here."

OpenAI president Greg Brockman's testimony dominated the fifth day of the trial for Elon Musk's lawsuit against the AI company. Brockman took the witness stand on Monday, disclosing that his stake in OpenAI is worth nearly $30 billion, despite not personally investing money in OpenAI. The judge also declined to admit a pretrial text in which Musk allegedly warned Brockman that he and Altman would become "the most hated men in America." From a report: Brockman's disclosure would put him on the Forbes list of the world's richest people, with wealth comparable to Melinda French Gates. [...] Late Sunday, OpenAI lawyers tried to admit as evidence a text message Musk sent to Brockman two days before the trial began. According to a court filing -- which did not include the actual text exchange -- Musk sent a message to Brockman to gauge interest in settlement.

When Brockman replied that both sides should drop their respective claims, Musk shot back, according to the filing, "By the end of this week, you and Sam will be the most hated men in America. If you insist, so it will be." Judge Yvonne Gonzalez Rogers, who is overseeing the trial, did not admit the text exchange as evidence. Brockman acknowledged that he had promised to personally donate $100,000 to OpenAI's charity but never did. In explaining the delay, Brockman put the onus on Altman: "I asked Sam when I should donate this, and he said he would let me know," reports Business Insider.

The first witness to testify on Monday was Stuart Russell, an artificial intelligence expert who teaches computer science at the University of California, Berkeley. "The most memorable part of Russell's testimony was when he talked about how much Musk's legal team paid him," notes Business Insider. "He received an eye-popping $5,000 per hour for 40 hours of preparatory work. Expert witnesses in high-profile cases typically make between $500 to $1,000 per hour."

Recap:
Musk Concludes Testimony At OpenAI Trial (Day Four)
Elon Musk Says OpenAI Betrayed Him, Clashes With Company's Attorney (Day Three)
Musk Testifies OpenAI Was Created As Nonprofit To Counter Google (Day Two)
Elon Musk and OpenAI CEO Sam Altman Head To Court (Day One)

The Trump administration is reportedly considering an executive order to create a working group that could review advanced AI models before public release. The shift follows concerns over Anthropic's powerful Mythos model and its cyber capabilities, with officials weighing whether the government should get early access to frontier models without necessarily blocking their release. The New York Times reports: In meetings last week, White House officials told executives from Anthropic, Google and OpenAI about some of those plans, people briefed on the conversations said. The working group is likely to consider a number of oversight approaches, officials said. But a review process could be similar to one being developed in Britain, which has assigned several government bodies to ensure that A.I. models meet certain safety standards, people in the tech industry and the administration said.

The discussions signal a stark reversal in the Trump administration's approach to A.I. Since returning to office last year, Mr. Trump has been a major booster of the technology, which he has said is vital to winning the geopolitical contest against China. Among other moves, he swiftly rolled back a Biden administration regulatory process that asked A.I. developers to perform safety evaluations and report on A.I. models with potential military applications. "We're going to make this industry absolutely the top, because right now it's a beautiful baby that's born," Mr. Trump said of A.I. at an event in July. "We have to grow that baby and let that baby thrive. We can't stop it. We can't stop it with politics. We can't stop it with foolish rules and even stupid rules." Mr. Trump left room for some rules, but he added that "they have to be more brilliant than even the technology itself."

The White House wants to avoid any political repercussions if a devastating A.I.-enabled cyberattack were to occur, people in the tech industry and the administration said. The administration is also evaluating whether new A.I. models could yield cyber-capabilities that could be useful to the Pentagon and U.S. intelligence agencies, they said. To get ahead of models like Mythos, some officials are pushing for a review system that would give the government first access to A.I. models, but that would not block their release, people briefed on the talks said.

An anonymous reader quotes a report from 404 Media: A new, bipartisan bill introduced (PDF) by Democratic Senator of California Adam Schiff and endorsed by the biggest AI developers in the world -- including OpenAI, Google, and Microsoft -- would change the K-12 curriculum to shoehorn in "AI literacy," something that young people and teachers alike already hate in schools. The Literacy in Future Technologies Artificial Intelligence, or LIFT AI Act, would empower the new director of the National Science Foundation (NSF) to make grant awards "on a merit-reviewed, competitive basis to institutions of higher education or nonprofit organizations (or a consortium thereof) to support research activities to develop educational curricula, instructional material, teacher professional development, and evaluation methods for AI literacy at the K-12 level," the bill says.

It defines AI literacy as using AI; specifically, "having the age-appropriate knowledge and ability to use artificial intelligence effectively, to critically interpret outputs, to solve problems in an AI-enabled world, and to mitigate potential risks." The bill is endorsed by the American Federation of Teachers, Google, OpenAI, Information Technology Industry Council, Software & Information Industry Association, Microsoft, and HP Inc. [...] The grant would support "AI literacy evaluation tools and resources for educators assessing proficiency in AI literacy," according to the bill. It would also fund "professional development courses and experiences in AI literacy," and the development of "hands-on learning tools to assist in developing and improving AI literacy." Most importantly for real-world implications, it would fund changing the existing curriculum "to incorporate AI literacy where appropriate, including responsible use of AI in learning."

Google's Pixel 11 lineup could see RAM cuts or lower starting configurations because of the global memory shortage, with leaks suggesting the base model may drop from 12GB to 8GB while Pro models could add 12GB versions below the current 16GB tier. The Verge reports: There will be 16GB configurations available for each, but adding a lower-spec model could mean the 16GB version is getting a price hike. However, the silver lining is that the specs from MysticLeaks also include camera upgrades and brighter displays for the Pro models. The RAM shortage is pushing other phone makers, including Samsung, to raise prices, too.

An anonymous reader quotes a report from Ars Technica: In a makeshift demonstration kitchen in Concord, California, cooking oil splatters in and around a frying pan, which catches fire on an unattended gas stove. Within moments, a smoke detector wails. But in this demonstration, something less common happens: An AI-driven sensor activates and wall emitters blast infrasound waves toward the source of the fire in an attempt to put it out. The science of acoustic fire suppression, which has long been known and documented in scientific literature and the press, works by vibrating oxygen molecules away from a fuel source, depriving the fire of a critical component needed for combustion. Indeed, after just a few seconds of infrasound, the tiny kitchen blaze goes out.

"We were able to not just point-and-shoot like a fire extinguisher; we figured out how to run it through ducting and distribute it like a sprinkler system," said Geoff Bruder, co-founder and CEO of Sonic Fire Tech, during the presentation. The company's goal is to replace sprinklers, which are effective at stopping fires but can also do significant water damage to a property. Sonic Fire Tech appears to be the first company trying to commercialize the science of acoustic fire suppression. Its executives have already been touring Southern California; Wednesday's event was the first in the northern half of the state.

The company aims to make this infrasound technique mainstream in both commercial (for instance, a data center, where sprinklers would damage electronics) and in-home installations, given that sprinklers are already required in all new California homes built in 2011 and later. Sonic Fire Tech also hopes to produce a backpack-based system that could be worn by wildland firefighters headed out into the field. "We are making meaningful technological improvements on a monthly basis," Stefan Pollack, a company spokesperson, emailed Ars after the event. But two experts who spoke with Ars raised serious questions about the potential for this technology to supplant traditional sprinklers in a home. They are even more skeptical as to whether the technique can be effective in an uncontrolled wildfire situation, where flames can grow very quickly. Experts are concerned that infrasound may knock down small flames but does not cool hot surfaces or wet fuel like sprinklers do, which raises the risk of re-ignition, smoldering fires, hidden fires, or blocked fires. Sonic Fire Tech has claimed third-party validation and possible NFPA 13D equivalency, but it has not publicly released full testing details.

Fire officials and outside observers also want more information about reliability, maintenance, calibration, and how system failures would be detected and communicated.

A Wall Street Journal opinion piece warns of "a troubling trend" in AI's growth. "Rather than selling software, some AI companies are paying their partners to use it."

It cites OpenAI's $1.5 billion joint venture with private-equity firms, Anthropic's $200 million contribution to a private-equity firm joint venture, and Google's $750 million subsidization of Gemini's adoption by consulting firms. "These agreements muddy the distinction between a company's sound growth trajectory and artificial financial engineering." [T]he scale and structure of the recent AI deals go beyond standard incentive mechanisms... When a seller pays customers to buy its products, it is unclear if its revenue growth reflects vibrant demand or a willingness to accept subsidies.
Slashdot reader destinyland writes: This warning comes from a prominent figure in the investing community. For six years Robert Pozen was chairman of America's oldest mutual fund company, after five years at Fidelity. An advocate for corporate governance, he's currently a lecturer at MIT's business school (and the author of the book Remote Inc.: How to Thrive at Work...Wherever You Are). "As AI companies prepare initial public offerings, investors should scrutinize their numbers closely," Pozner writes, warning about "time-limited financial support".
"In evaluating AI sales figures, analysts should consider the distorted incentives that the recent financing deals create," writes Pozner: Private-equity firms, enticed by promised returns, might demand rapid rollouts of AI products, rather than ensuring their orderly and safe development. Portfolio companies of private-equity firms may embrace AI tools not because they are needed but because adoption is mandated by their owners. Consultants may favor one set of AI models based on the subsidy instead of the merits.

If guarantees and subsidies are major factors in the rapid adoption of AI tools, investors should be skeptical of AI companies' revenue projections. Many of their customers enticed by consultants will stop paying full price when the financial incentives are gone. Many of the portfolio companies of private-equity firms could back away from selected AI tools once these joint ventures expire. The challenge with evaluating these AI financing deals is the lack of transparency. At present, AI vendors don't separate revenue driven by subsidies or joint ventures from standard sales.

The lesson from the telecom debacle is that financial engineering can obscure, for years, the difference between real customer demand and demand driven by incentives. When AI companies begin to finance their own product distribution, guaranteeing returns to investors and subsidizing sales, it's a signal for investors to dig deeper. Investing in an AI company? Ask what percentage of enterprise revenue is coming from subsidized channels or joint ventures, Pozner suggests. And the renewal/retention rate for customers not supported by subsidies or joint ventures...

A 1999 press release bragged "Jeeves" answered 92.3 million questions in just three months. "In the digital wilds of Y2K, we came to him with our most probing questions," remembers the New York Times — whether it was Britney Spears or tamagotchis: We asked, and he answered: Jeeves, the digital butler of information, the online valet who led us into the depths of cyberspace. Now, like so many other relics of yesterday's internet, Jeeves — and his home, Ask.com — are no more. After almost 30 years, the question-and-answer service and former search engine shuttered on Friday. "To you — the millions of users who turned to us for answers in a rapidly changing world — thank you for your endless curiosity, your loyalty, and your trust," the company said in a notice posted on its now-defunct website...

Created in Berkeley, Calif., in the days of the dot-com gold rush, Ask Jeeves first appeared on computer screens in 1996.... Their mascot, Jeeves, was modeled on the clever English butler character from the famed P.G. Wodehouse book series. Its search function was simple — type in a question, get an answer. But the quality of its responses was uneven, and the website was quickly eclipsed by Google and Yahoo as the world's go-to search engines.

The site was bought by InterActive Corp. for more than $1 billion in 2005, and was given an injection of cash to help it compete as a search engine. It rebranded as Ask.com and as part of the reimagining, the site also ditched the character of Jeeves in 2006. Scrappy but inventive, the site was one of the first to introduce hyperlocal map overlays to its searches and incorporate thumbnails of webpages. "They are doing a lot of clever and interesting things," a Google executive noted of Ask.com at the time. Still, Ask.com struggled to compete and returned in 2010 to its bread and butter: question-and-answer style prompts.

Even then, it faltered against newer, crowdsourced iterations like Quora and Google's unyielding march to the internet fore — the platform now dominates search traffic, and the world's general experience of the internet.
A statement at Ask.com ends "by thanking its millions of users, and saying, 'Jeeves' spirit endures'," notes this article from Engadget: As sad as it is to see a relic of the early Internet days fade into obscurity, we still have Ask Jeeves to thank for why some users still punch in full questions when querying Google. On top of that, Jeeves was built to provide detailed answers in natural language, which could have arguably acted as a precursor to today's AI chatbots like ChatGPT.
"Now, Ask.com joins the Internet graveyard that includes competitors like AltaVista, which shut down in 2013," the article points out. "With Ask.com gone, alongside AIM and AOL dial-up services also sunsetting, we're truly coming to an end of a specific era of the Internet." And the New York Times argues the memory of Jeeves now rests somewhere between Limewire and Beanie Babies...

Slashdot reader BrianFagioli calls it "a quiet reminder of how quickly the web moves, and how even widely recognized names can drift into obscurity once the underlying technology leaves them behind."

"Running a Big Tech company during Silicon Valley's AI mania may not necessarily require fewer workers or cost less," writes the Washington Post: Amazon, Google and Meta together have roughly the same number of employees now as they did during an industry-wide hiring binge in 2022, company disclosures show. Growing costs for technical workers and related expenses have often outpaced sales recently. The tech giants' big AI bet hasn't yet paid for itself.

That means AI might be killing jobs not through its labor-saving wizardry but by increasing spending so much that CEOs are pressured to find savings, giving them cover to consciously uncouple from their workforces. Marc Andreessen, a prominent start-up investor and a Meta board director, put it bluntly on a recent podcast. Big company layoffs are a fix for overstaffing and changing economic conditions, he said, but AI provides a convenient scapegoat. "Now they all have the silver bullet excuse: 'Ah, it's AI,'" he said...

"Almost every company that does layoffs is blaming AI, whether or not it really is about AI," Sam Altman, CEO of ChatGPT owner OpenAI, said at a March conference when he listed explanations for AI's unpopularity in the United States.
"Recent history suggests Big Tech companies might not be moving toward a future with fewer workers," the article concludes, "but recalibrating to spend the same, or more, on different people and projects."

So in the end, "AI might soon reduce hiring," the article acknowledges, "But the reluctance or inability of the largest tech firms to cut too deeply so far could also show that the path to making a workforce AI-ready — whatever that means — isn't a predictable straight line charting declining headcount."

The Pentagon says it has reached deals with seven AI companies -- SpaceX, OpenAI, Google, Nvidia, Reflection AI, Microsoft, and AWS -- to deploy their tools on classified Defense Department networks. The odd one out is Anthropic, which remains excluded after being labeled a supply-chain risk amid a dispute over military-use guardrails. Reuters reports: SpaceX, OpenAI, Google, Nvidia, Reflection, Microsoft, and Amazon Web Services (AWS), several of which already work with the Pentagon, will be integrated into its secret and top-secret network environments, providing more military access to their products for use on sensitive topics, the Pentagon said in a statement. The lesser-known Reflection AI, which raised $2 billion in October, is backed by 1789 Capital, a venture capital firm in which Donald Trump Jr. is a partner and investor.

Since the Pentagon deemed Anthropic's products a "supply-chain risk" in March and the two sides became embroiled in a lawsuit, the military has expressed increasing interest in AI startups. Since the blow-up, newer AI entrants have said the military has sped up the process of incorporating them onto secret and top-secret data levels to less than three months. The process previously took 18 months or longer.

By expanding AI services offered to troops, who use it for planning, logistics, targeting and in other ways to streamline huge operations and perform more quickly, the Pentagon said in its statement it will avoid "vendor lock," a likely nod to its overdependence on Anthropic or other dominant service providers. [...] AI has become increasingly important for the U.S. military. The Pentagon's main AI platform, GenAI.mil, has been used by over 1.3 million Defense Department personnel, the agency noted in its release, after five months of operation. Further reading: Google and Pentagon Reportedly Agree On Deal For 'Any Lawful' Use of AI

An anonymous reader quotes a report from CNBC: Elon Musk wrapped up his testimony on Thursday as the trial in his lawsuit against OpenAI CEO Sam Altman continued into its fourth day. OpenAI's attorney, William Savitt, cross-examined Musk in the morning. He asked Musk about the capped nature of Microsoft's investments in OpenAI, his involvement in negotiations about the company's structure, and whether he knew about the OpenAI nonprofit's recent initiatives. "I don't know what's going on at OpenAI," Musk testified.

Savitt also asked Musk about his competing artificial intelligence startup, xAI. While not the main focus of the case, Musk said it is "partly" true that xAI used some of OpenAI's models to train its own models, a process known as distilling. Musk also suggested that xAI has used OpenAI's technology to help build the company. Musk sued OpenAI, Altman, and Greg Brockman, the company's president, in 2024, alleging that they went back on their commitments to keep the artificial intelligence company a nonprofit and to follow its charitable mission. He claims that the roughly $38 million he donated to seed OpenAI, a company he co-founded, was used for unauthorized commercial purposes.

Once Musk wrapped up his testimony after roughly two hours of questioning on Thursday, his attorneys called Jared Birchall, who manages Musk's billions at his family office, as their next witness. Birchall testified about his knowledge of Musk's specific donations to OpenAI. Judge Yvonne Gonzalez Rogers oversaw the proceedings from federal court in Oakland, California. The trial will resume on Monday. Recap:
Elon Musk Says OpenAI Betrayed Him, Clashes With Company's Attorney (Day Three)
Musk Testifies OpenAI Was Created As Nonprofit To Counter Google (Day Two)
Elon Musk and OpenAI CEO Sam Altman Head To Court (Day One)

An anonymous reader quotes a report from the San Francisco Chronicle: Elon Musk returned to the witness stand Wednesday in Oakland federal court for a second day of testimony in his case against OpenAI, detailing his shift from being an enthusiastic supporter of the nonprofit to feeling betrayed. He also clashed repeatedly with OpenAI's attorney over questions that Musk believed were unfair. He said his feelings towards OpenAI CEO Sam Altman and President Greg Brockman shifted from a "phase one" of support, "phase two" of doubts, and finally "phase three, where I'm sure they're looting the nonprofit. We're currently in phase three," Musk said with a chuckle. Musk said he was a "fool" for giving OpenAI "$38 million of essentially free funding to create what would become an $800 billion company," of which he has no equity stake.

In his 2024 lawsuit, Musk alleged breach of charitable trust and unjust enrichment, arguing OpenAI abandoned its original nonprofit mission to benefit humanity to pursue financial gain. OpenAI's lawyer William Savitt argued Tuesday during his opening statement that the nonprofit entity remains in control of the for-profit public benefit corporation and is now one of the most well-funded nonprofits in the world. Musk is seeking to oust Altman from OpenAI's board and upwards of $134 billion in damages, which he said would be used to fund OpenAI's nonprofit mission. During cross-examination, Savitt clashed with Musk over questioning. Savitt asked whether Musk had contributed $38 million to OpenAI, rather than the $100 million that he later claimed to have invested on X. Musk said he also contributed his reputation to the company and came up with the idea for the name, leading Savitt to ask Musk to respond yes or no to "simple" questions.

"Your questions are not simple. They're designed to trick me, essentially," Musk said, adding that he had to elaborate or it would mislead the jury. He compared Savitt's questions to asking, "have you stopped beating your wife?" Judge Yvonne Gonzalez Rogers intervened, leading Musk to answer yes to the $38 million investment amount. The world's richest man said his doubts grew and by late 2022, he thought "wait a second, these guys are betraying their promise. They're breaking the deal." "I started to lose confidence that they were telling me the truth," Musk said. A turning point was co-defendent Microsoft's investment of billions of dollars into OpenAI, Musk said. On October 23, 2022, Musk texted Altman that he was "disturbed" to see OpenAI's valuation of $20 billion in the wake of the Microsoft deal. Musk called the deal a "bait and switch," since a nonprofit doesn't have a valuation. OpenAI had "for all intents and purposes" become primarily a for-profit company, Musk argued. Altman responded to Musk by text that "I agree this feels bad," saying that OpenAI had previously offered equity in the company but Musk hadn't wanted it at the time. Altman said the company was happy to offer equity in the future. Musk said it "didn't seem to make sense to me" to hold equity in what should be a nonprofit. Musk also testified about former OpenAI board member Shivon Zilis, who lives with him, is the mother of four of his children, and served as a senior advisor at Neuralink. He denied that she shared sensitive OpenAI information with him. Court evidence showed Musk had encouraged her to stay close to OpenAI to "keep info flowing" and had approved Neuralink recruiting OpenAI employees, which he defended by saying workers are free to change jobs. "It's a free country," Musk said.

Recap:
Musk Testifies OpenAI Was Created As Nonprofit To Counter Google (Day Two)
Elon Musk and OpenAI CEO Sam Altman Head To Court (Day One)

Elon Musk testified on day two of his trial against OpenAI, saying he helped create the company as a nonprofit counterweight to Google and would not have backed it if the goal had been private profit. CNBC reports: Musk on Tuesday was the first witness called to testify in the trial. He spoke about his upbringing, his many companies, his role in founding OpenAI and his understanding of its structure. Musk said in his testimony that he was not opposed to the creation of a small for-profit subsidiary, "as long as the tail didn't wag the dog." Musk said he was motivated to start OpenAI to serve as a counterweight to Google. He got the idea after an argument he had with Google co-founder Larry Page, who called Musk a "speciesist for being pro-human," he testified. "I could have started it as a for profit and I chose not to," Musk said on the stand.

Earlier, attorneys for Musk and OpenAI presented their opening arguments to the jury. Musk's lead trial lawyer, Steven Molo, delivered the opening statement for the Tesla and SpaceX CEO. OpenAI lawyer William Savitt gave the opening statement for the AI company, Altman and Brockman. OpenAI has characterized Musk's lawsuit as a baseless "harassment campaign." The company said Monday in a post on X that it "can't wait to make our case in court where both the truth and the law are on our side."

During his testimony on Tuesday, Musk repeatedly emphasized that he founded OpenAI to serve as a counterweight to Google. He said he got the idea after an argument about AI safety with Google co-founder Larry Page, who Musk said called him "a speciesist for being pro-human." Musk said he was concerned Page was not taking AI safety seriously, so he wanted there to be an nonprofit, open source alternative to Google. "I could have started it as a for profit and I chose not to," Musk said on the stand. Further reading: Elon Musk and OpenAI CEO Sam Altman Head To Court