Why OpenAI Paid $6.5 Billion to make the new iPhone & How Google Just Ended Hollywood w/ Dave Blundin & Salim Ismail | EP #174
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It's funny, in this entire AI battle, I've never been a Sam Altman fanboy until now. The first thing he does is he launches a product that competes directly with Perplexity, tries to take over Search, and announces, kind of declares war against Google and Search.

Next thing he does is he goes and gets Johnny Ive and says, okay, now I'm going to start building devices. VO3 Grand Slam home run. The future of media is going to completely flip where it's on demand. Like, this is what I want to see created on the fly for me. Curious as to how people are going to use it at a personal level. But will I really use it to generate my own entertainment? Hollywood is decimated. I think it will continue to exist in two or three years from now. Now that's a moonshot, ladies and gentlemen.

Hey, everybody. Welcome to Moonshots. I'm here with my Moonshot mates, Dave Blunden and Salim Ismail. And this is an episode of WTF Just Happened in Tech. It's been a big week, guys, a big week on announcements, in particular with Google I.O. and our friends over at Anthropic. Dave, where are you today? I'm in beautiful Wakefield, 10 miles north of MIT. Actually, this is a company I founded right after DataSage manages $2 trillion of data

There's $50 trillion in the U.S. stock market. $2 trillion of it trades and flows through this building. So it seems sleepy, but there's a lot of digital movement through this building.

you know, you throw out trillions like they're nothing, but Hey, it's, it's good to know. Good though. Someone does that. And Salim, I know that you're in the bedroom about, about three, five meters that way. So Salim and I are actually up in Tiburon. We were at an event last night that a friend of ours through, uh, everybody's asleep because they got in a two o'clock in the morning. We're in this building on the water here. It's gorgeous. It was a, a conversation on quantum and consciousness. It was pretty amazing. Uh,

But we got up at the crack of dawn to do this podcast because this is an incredible week. So a lot of you do it. Okay, you you wake up.

I'm awake, and I think it's an incredibly, one of the busiest weeks we've ever had in terms of tech stuff. Oh, it is. All right, let's dive in. Let's talk about AI of it all. That's the winner this week in terms of tech news, and I think it's going to be the winner every week going forward. So, Dave, great.

Would you clue us in on this news? OpenAI to buy AI device startup from Apple's Johnny I for $6.5 billion. Um,

That made headlines. You know, it's funny in this entire AI battle. I've never been a Sam Altman fanboy until now. This is the move of all moves. And I know Sam was talking about this huge coup and a very aggressive move. And it was really probably in Sam's mind the whole time. It was just waiting for the $300 billion valuation so he could afford it.

But he was talking about this, what, a year ago. And at the time, he backed off, didn't want to kind of wake up the competition. And he said, you know, the iPhone is probably the most perfect device ever made by mankind. And so trying to compete directly with the iPhone and the Android phone is kind of crazy. So he was backing off while he was still planning. And now this is the move. So the fundamental thought here is that AI is such a game changer.

All the big tech companies need to have a direct-to-consumer device or interface. So, you know, Meta buys WhatsApp. Meta buys Instagram. You just got to control the consumer front end. Google builds Chrome. Google launches Android. Android doesn't even make money. Why does Google need Android? But we need to control the data and the front interface that the consumer uses every day.

And of all the big AI companies, Sam is the guy who most intuitively seems to get that.

And so the first thing he does is he launches a product that competes directly with Perplexity, tries to take over Search, and declares war against Google and Search. Next thing he does is he goes and gets Johnny Ive and says, okay, now I'm going to start building devices that the consumer interacts with directly. So a lot of the other foundation model companies are just trying to build foundation models and let the economy bubble around them. Sam is actually trying to control the high-low market.

and get the front of the consumer and the entire AI backbone. But I think the big insight here is that you can build a consumer device that's AI first, which means you're always talking to it. You're interacting with it like a person. And that's disruptive enough that a lot of the iPhone magic isn't really relevant. And so we can potentially leapfrog and bypass that.

Then, you know, to spend six point five billion dollars on a no revenue idea, but you're getting the guy and the team. And that's very Steve Jobs like we can we can riff on that. But I think it's just brilliant. Yeah. So the question ultimately is, what's the next level device going to be? Is it going to be glasses? Is it going to be a device that's just listening all the time? And there are a few different companies coming out with this. Salim, you're going to say.

Yeah, I mean, this, I think, lets us straight to that Jarvis thing of an agent from your perspective, always looking at the world and listening and making sense of the world. So I think this is a huge step. As you said, Dave, very, very ballsy, and I love it. Yeah, actually, very similar. Google, you know, they spent $3 billion on character AI specifically to get Noam Shazier back.

So it's another case where you're willing to write a nine-figure check for a fundamentally a single human being, but you know that person's going to bring a team with them and they're going to bring that kind of Steve Jobs magic with them. But these price tags are completely unprecedented. But then the upside on a win is also orders of magnitude bigger than ever before. So it's actually very rational.

Yeah. Well, can't wait to see what comes up next. You know, one of the questions, of course, we're going to have probably a whole slew of AI devices listening to your conversations all the time. And I think it's going to get socially...

accepted eventually but in the beginning uh you know as you step into and you're having a conversation with your friend and you notice that they're wearing a pendant or something on their head or something on their wrist that's listening and the question becomes are you okay with every conversation you're having uh being recorded because that's where we're heading

That's where we're heading. You know, I think this is actually that podcast we had just a couple of days ago with Anish is directly related to this too. Anish was pointing out that there are huge swaths of demographics, you know, including older people, including just huge swaths of different countries that have completely missed the iPhone, Android phone revolution.

And the AI interface, the voice interface that's super empathetic opens it up. And so, you know, it's not like you have to stop everyone from using their iPhones tomorrow. What you need to do is open up whole new territories of users that were largely overlooked before. So I think this is likely to penetrate very quickly that way. And yeah, it'll be like a lightweight, easy to use, probably dirt cheap device that you're just talking to that has an agent as the core doing everything you just ask it to do.

Yeah. And it's the lurking that's going to be interesting, right? Where, uh, you know, you don't know. Remember when Google came out with Google glass and, uh, they were wearing them to bars and people said, you know, they gave him the term. Yeah. Getting beat up. Yeah. Uh, so it's going to be, it's going to be fascinating. We're, we're about to see social norms of interactions with human to human with AI there. Uh,

begin to get defined very quickly. Look, it started already. Every time I have a Zoom meeting now with a few people, all their AIs show up before they do. And you have to go, wait, we're trying to have a confidential meeting here. And then we have to turn them all off and stuff. The shift is happening.

You're right. We could riff on that for a sec. But the regulatory, there's no regulation, basically. The regulators are completely asleep at the wheel. But if you look at TCPA and, you know, you can't tap phone lines and there's very good reasons for that.

But all of that is now moving to digital where there are no laws whatsoever. But you notice when Zoom calls started having AI spies on them, they announced themselves. That's all. Now they just listen and you don't even know they're there. And the same with consumer phone calls. A lot of our companies have either sales or customer support over the phone is moving to AI voices at an incredible rate, using every GPU on the planet, by the way. It works incredibly well. It's far better than a human call operator.

But most of them don't tell you they're AI. And there's no regulation that says you have to tell you. And so a lot of the times I'm listening to the calls, the consumer, you know, about 10, 20% of the time they're aware they're talking to AI. The rest of the time they're not.

But that's amazing. I mean, that's, you know, kudos to the designers there. I mean, that's extraordinary. And it's just going to get better and better. Every week, I study the 10 major tech meta trends that will transform industries over the decade ahead. I cover trends ranging from humanoid robots, AGI, quantum computing, transport, energy, longevity, and more. No fluff. Only the important stuff that matters, that impacts our lives and our careers. If you want me to share these with you,

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All right, let's move on. We have a lot to talk about here. So this, the bottom line, sort of Google stole the week, at least for a little bit. Dave, do you want to just outline what we're seeing here? This is a slide titled Gemini Leads Across All Models, and we're talking about Gemini versus GPT, 3045, DeepSeek, Grok, everything. Yeah.

Yeah, this is the Empire Strikes Back right here. So OpenAI has stolen the audience, the user base, and then AI primacy. XAI claimed it back in February very briefly.

Then Google came roaring back, or sorry, OpenAI came roaring back with new models. And then that woke up Google. Google's coming in and the empire strikes back. Okay, we have had this in the lab. We didn't know exactly how to announce it or when to announce it. But now that the competitive pressure's on, we're going...

completely to the wall here uh this is the best of everything we've got and we're going to roll it all out this week and and here you go and it is mind-blowing so they're claiming the number one spot in every single category um we'll get to it across yeah well okay so the the one that caught everyone's imagination well overall obviously um image generation uh

Hard prompts. Hard prompts is, you know, difficult questions. I guess that's pretty obvious. Coding and math, they claimed number one on that for all of a few hours. Math they still own. Creative writing, seeing as people doing their English papers. Long queries. So they've actually had dominance in super long context windows for quite a while. They just didn't tell the world about it. And this is exactly, Peter, what you were saying a couple weeks ago.

Big companies have a real struggle with innovators dilemma. And so even though this has been in the lab, Demis Hassabis and the team have been working on it for a long time. They've had it, but they were so worried about how to roll it out and whether there'd be consumer backlash. But now under competitive pressure, it's unleashed.

I mean, this is Google over and over again. I mean, Google had Transformers first. It did all the fundamental work. It basically had the equivalent of GPT, but decided not to do what everybody said. Don't do this. Don't put AI out in the open web. Don't make it accessible to everybody. Don't let it suffer.

referentially program itself. And of course, once it was released into the ether, Gemini or Google had to come back and demonstrate themselves. Listen, I love Google as a company. I'm impressed by them. And they've got an extraordinary base to build on. I'm sorry, Salim, you were going to say?

No, you know, a few days ago, I generated an image of a Gutenberg printing press, and I said, give me a photograph of it. And I did that across several models, and the Gemini one was way better than all the others. It was incredible. And so I think we're going to find over time, the interest is still over with OpenAI. There's a lot of attention there, but I think over time, the sheer quality will kind of come through.

I think if you love a good drama, you know, this is the space race times a thousand and the players keep leapfrogging each other. And you'll see later, you know, that Google's kind of ace in the hole is that it has hardware control, hardware design control. So you go from algorithm all the way down to chip design with the TPU V7s. Nobody else has that.

But the other guys have other competitive weapons we can talk about later in the pod, too. So don't expect that this is the end. In fact, I've seen Game Over said now about 20 times. Every time someone leaps over someone else, it's definitely not Game Over. It's Game Just Beginning. So if you like a good drama, this is just the next act. And we'll see that in a second. And if any of you ever wondered...

Is this field accelerating? It is massively accelerating, and it's the competitive pressures between these companies. It's no longer between countries. It's between a set of individual companies that are just trying to outdo each other. The challenge is that ChatGPT, i.e. OpenAI, captured the mindset of the world as a first mover advantage strategy.

You know, kids throughout elementary through high school and college, you know, the average mom and dad out there, they're all using ChatGPT, and it's reflected in the revenues that OpenAI have. Gemini really needs to catch up because I don't care how good you are, if your product is not being used, you're in trouble. This is an interesting thing to watch just because throughout history,

Even though we kind of talk about first mover advantage, it's never been the first mover that made the big bucks, right? Google wasn't the first search engine. Facebook wasn't the first social network.

OpenAI has leads, it remains to be seen. It might actually be a completely new competitor that completely changes the game for everybody. Oh, it will be. It will be. I mean, there's no question about it. So here, this chart that we're showing, if you're watching this on YouTube, is Google as number one across the board.

But then how many hours later, Dave, did we get this chart? And Theropic introduces Claude 4.0. Yeah. So amazing little 24 hours there. So Sundar gets on stage, talks about something we'll look at in a minute, which you can use just basically all AI all the time and not use regular Google search. We'll see it in a second. Google stock goes way down.

Then they next day, they come out with VO3 with a whole bunch of just mind blowing AI, you know, number one benchmark stock goes up 7%, you know, just in reaction to that. So everybody's like, what is going on here? There's so much chaos right in the middle of it. Claude four comes out. So Dario is like, yeah, look, Sundar just claimed number one encoding.

Not true. Well, it was true yesterday. Now it's not true. Today we have Cloud 4 and here are the benchmarks. And these are accurate, by the way. It really is the case that Google was ahead in coding for about 24 hours. And now, if you look at this chart, it's a pretty significant gap, actually. Cloud 4 has just launched

to the top again. And those scores on the far left are incredibly meaningful to the people who understand what the implications are. You know, for like companies like Blitzy in our portfolio that do long form coding, 3 million lines of code in a single night, you know, Brian Elliott is all over YouTube talking about it. It works fundamentally because of the benchmarks on the far left. The AI can now actually build entire products that,

while you're sleeping and you come back and use it the next day and it's functional. And that app, that works when these benchmarks get around 80%. It doesn't work when these benchmarks are around 50, 60%. There are just too many bugs in the code the next day. So even though it doesn't look like much on this chart, it's an incredible tipping point in terms of functionality when you get above that 80% level on SweBench. And

And now we need to reinvent the benchmarks, by the way. This is SWEBench, which is the most fundamental benchmark on how good is the code written by AI. There's a new one coming out called SWEReBench, which is just making it harder and upgrading it. But we need new benchmarks now because the AI has basically broken the benchmarks.

You know, when Ray talks about the singularity, that point after which you can't predict what's coming next, that's what you're seeing here, right? You're seeing literally a drop the mic moment over and over again, being leapfrogging everybody else.

And it's awe-inspiring. All right. Here's yet another part of the equation. We talked about AI improving based upon a multitude of different factors, better hardware, more capital coming in. And this one is really improvements in algorithms, algorithmic improvements. And the prediction here is...

is we're going to see a 10x to 100x improvement algorithms. Salim or Dave, why not comment on this? This is something we've been tracking in, say, solar energy forever, where the materials become cheaper, where lithium-ion batteries have dropped 90% in their price performance over the last decade. The same thing, and people forget about this, they kind of look at electricity needs on the current models, and then they project that, and everybody goes, oh my God, oh my God.

not realizing that the models are becoming much more efficient very radically quickly. As a real world example, the amount of fuel in a plane needed to cross the Atlantic has dropped by two thirds in the last few decades, just because the engines are so much more efficient. We know what routes

to fly on, where's the air less resistant, et cetera, et cetera. So I think we're going to see the same thing happening in AI, where the models are becoming very much more efficient, and that's going to change the game. Not enough to drive the upside, but definitely it'll help hugely on the overall energy needs over time. Yeah, I checked this post and researched it for accuracy, and

And two things to riff on. One is Jevons Paradox, which we all love to talk about. Actually, our good friend Eric Brynjolfsson is probably the top guy on the planet on that topic. And we should have him on as a guest to talk about this. And then the other is this is way, way, way understated. So starting with the way understated, this is worth reading, but it was built kind of by extrapolating bottom up.

But I know the actual innovations under the covers that are driving this, and they're much bigger than this, and they're much faster. Software innovation that's done by AI can be deployed in real time. You're not waiting for any hardware or anything to come online. You just deploy and go. And so this will happen much, much faster than what's shown on this chart now that the AI can improve itself.

And the other thing is, you know, it's extrapolating to about 100x, anywhere from 30 to 240x. But I know that in the quantization of the neural nets alone, there's about a 20 to 40x in that dimension. Then in the chain of thought reasoning, just in that. These are all multiplicative, by the way. So you have at least three dimensions that I know are 20 to 100xs that are multiplicative with each other.

And so it's going to be more like a thousand to ten thousand X. There's a there's a brilliant researcher at MIT, Shane Longprey, that I was talking to yesterday. He desperately want to build a company around him, but he has to finish his Ph.D. first. And it's frustrating as hell. He's just got a few more months to go. But but he's doing a lot of great work with, you know, right now, when you use an A.I. to do something for you, build a video or be an agent for you.

The parameters in there also speak Swahili and know about quantum, you know, quantum computing. Like all this other knowledge is actually being...

is using up the GPUs and it's using up the compute, even though it's not relevant to that question. And so you can actually take much smaller subsets of that great brain to give you just as good an answer. And that's on the order of 100x factor by itself. So he's wrapping up his research on that right now, and then we'll end up trying to productize it. So no doubt in my mind that this is way understated, both in time and in impact. So yeah, it's pretty exciting. Yeah.

Bottom line, when Eric Schmidt says AI is massively underhyped, it's the realization that we have all of these knobs we can turn and they're going to give us improvements. Each one of them, 100x improvements times five or six different knobs.

It's insane. Let's talk about Jevons Paradox for just a second there, too. Yeah, please go ahead. Because I think this, you know, no one had ever said Jevons Paradox, I think, for 100 years until now it's going to come up every week. So we might as well all understand it. Define it for us. All right. So here's the deal. In normal economics, Eric Ben Yolfson is the master of this. In normal economics, you have supply demand, you know, ISLM. I don't know if you ever took 1402 at MIT. I did.

You know, so if you said, hey, I found a way to grow bananas, you know, they're twice as cheap now. They cost half as much. You know, people don't consume twice as many bananas because they're half as expensive. They consume maybe 5% more bananas. That's normal economics, right? Price comes down.

then that fraction of the economy is smaller because the price is lower, oil being the classic example of this. Then you get into tech, and something really weird happens where if I make a GPU 10 times faster for the same price...

my video game got better. Do I use 10 times less video game? No, no, I use actually more video game than ever before because it's more fun than it was before. So even though it got 10 times cheaper, my overall consumption of that actually in dollars went, goes up, not down. And that's completely paradoxical, paradoxical for an economist. And so you're seeing that, uh,

Most acutely in AI, more than ever before, if it is more capable because you made the model, in this case, 30 to 240 times more efficient, doesn't that bring the need for GPUs and data centers down? And it's not. It's going to go the other direction. The need for data centers, chips, and electricity actually goes up dramatically.

very, very steeply. And so a lot of people are mispredicting the investment in energy, in data center supply, in chips. You know, chips will be sold out for at least the next five years and maybe infinitely in the future for exactly this reason. Because the capabilities, like one of those VO3, we'll look at some VO3 videos in a minute, and you'll see immediately, as soon as you do it, you want more. Yeah.

Every time the capability gets better, you want more. You realize it's going to reinvent entire industries. I mean, not just give you a new tool, it's reinventing entire industries. Everyone, as you know, earlier this year, I was on stage at the Abundance Summit with some incredible individuals, Cathie Wood, Mo Gadot, Vinod Khosla, Brett Adcock, and many other amazing tech CEOs. I'm always asked, hey, Peter, where can I see the summit? Well,

I'm finally releasing all the talks. You can access my conversation with Kathy Wood and Mogadot for free at diamandus.com/summit. That's the talk with Kathy Wood and Mogadot for free at diamandus.com/summit. Enjoy. I'll ask my team to put the links in the show notes below. All right, let's dive into Google I/O.

What we've done here is we've grabbed a 10-minute video. It's a recap put out by Google, and it's a Google I.O. recap in 10 minutes. We're going to play this at a little bit of accelerated speed, and I'm going to have my moonshot mates here sort of weigh in and comment as we go along. It's very rich here. It's important that people understand what Google just announced. Google remains the dominant player here today.

And there's a lot. Okay, so we'll go to Sundar who opens it up and we'll break every occasion for some fun conversation. Hello, everyone. Good morning. Welcome to Google I.O. We want to get our best models into your hands and our products ASAP.

I'm particularly excited about the rapid model progress. And today, Gemini 2.5 Pro sweeps the LM Arena leaderboard in all categories. It's getting a lot of love across the top coding platforms thanks to all of you. Gemini 2.5 Pro is our most intelligent model ever.

And now that it incorporates LearnLM, our family of models built with educational experts, 2.5 Pro is also the leading model for learning. Right. So, you know, one of the things we've talked about a lot is using this to re-educate the planet.

And I think that we're going to see a massive disruption in education across every field. One of the challenges we're going to have is whether the educational field is going to accept this. I don't know how you guys feel about this, but teachers unions are going to have to get on the game here.

And we're going to start to see, you know, do I put my kid in school because they're using old style or do I use AI to educate my kids? Thoughts? Well...

Yeah. You know, one high level thought on that is Dennis Sassabas is going to push this agenda. He's taking the high ground. It's really interesting to watch Google now decide, look, our Nobel Prize winning brilliant guy, we're going to put him on stage and make him a centerpiece. And he, you know, he rises to the occasion incredibly well. But he can't compete with Sam Altman in the use cases that are going to propagate

you know, at light speed, which is, you know, virtual friends, you know, creating your own internal copyright violating versions of movies, you know, all that stuff. He can't touch that because he's a Nobel Prize winner. He's going after saving hundreds of millions of lives with biotech innovations, you know, because he's the AlphaFold guy, which everybody, so he has to take this incredible high moral high ground. So on stage, he's very focused on

new models that work from fundamental physics principles up to teach the, to have fundamental scientific innovations and to teach the world everything they need to go. It's like, it's incredibly high ground, important use cases that are going to take a long time to percolate out because of, like you said, teachers unions and regulation and so forth. While Sam on the other end of the world is just going to run away with, with,

With consumer, whether it's spyware or not, we're doing it. We're moving 100%. And this is the quandary that Google's in. Sundar doesn't want to be that guy. Demis doesn't want to be that guy. This next woman that'll talk doesn't want to be that person. It's just big company versus small company mentality everywhere. All right, let me jump back in, and then Salim, I'll come back to you next.

I got 2.5 pro to code me a simple web app. Someone comes to you with a brilliant idea. I'm going to add in a prompt that asks 2.5 pro to update my code based on the image. And here's what Gemini generates. Whoa. I was able to create this just based on a sketch, but what if it topped?

That's where Gemini's native audio comes in. That's a pangolin, and its scales are made of keratin, just like your fingernails. Today, we're making 2.5 Pro even better by introducing a new mode we're calling DeepThink. DeepThink uses our latest cutting-edge research in thinking and reasoning, including parallel techniques. We are in a new phase of the AI platform shift.

where decades of research are becoming reality for people all over the world. Introducing Google Beam, a new AI-first video communications platform. Beam uses a new state-of-the-art video model to transform 2D video streams

into a realistic 3D experience. So let me pause at Google Beam here. Salim and Dave, we had a chance to see Google Beam at the Abundance Summit this year. And it's not, you know, my 13-year-old boys were with me and they said it was the coolest thing they saw at the Tech Hub.

The ability to actually be there. Now, Cisco tried this years ago, and it was expensive, multimillion-dollar hardware. I don't know if the price point has been announced yet on Google Beam, but it's going to be sort of an appliance that's in your home when you want to contact your mom or your grandma. It'll be very cheap. Yeah, for sure.

It can be very cheap. And I think this is a very big deal because you can think about the language potential that comes with it. All the other capabilities will come with it. I think it'll up the game for companies like Zoom and force them into a new innovation cycle also.

Fascinating. Yeah, we need to talk about price point for a second here, too, because a lot of this stuff is just mind-blowing and you need to experience it. And then Google says, well, to access anything I'm showing you here, you've got to get a Gemini Ultra account for $250 a month.

It had a ballsy move on their part. Ballsy move. Ballsy. And one of the things I love about this podcast is, look, this is the actionable, like we're trying to improve people's life choices and trajectories through life by giving them as much actionable information as possible. And a lot of people who listen to this podcast are going to say, I don't, 250 bucks a month, that's like rent.

So the good news is you can, you can try it at half price for a couple of months and then cancel your subscription if you want. So you, but you definitely got to try it. I mean, you can't do it justice. Google's trained us to get everything for free, right. And just give up our rights and such. I mean, open AI has proven a $20 price point is acceptable to most individuals. I'll give up a couple of lattes and have access to the world's intelligence, two or 50 bucks, uh,

I think it'll become mandatory for anybody in the professional modality. Because those tools will be so rich, and there'll be enough there for them to do quite well out of it, I think. Six months ago, a lot of people were saying, look, foundation models are a race to the bottom. They're a commodity. The price points will come down. These $300 billion valuation for OpenAI is insane, given that it'll commoditize.

Now, it's got to be obvious to everyone that all of that was wrong. Just absolutely could not have been more wrong. Because you're a foundation model company, the capabilities that you can invent and launch and the price point that they'll command is astronomical. And then right now, any of our listeners are basically going through what's inevitable. I can't be competitive if I don't have my hands on this. I need to try it. I'm going to drop behind society today.

If I don't get on top of this, well, sorry, that's going to cost you 250 bucks right away. And I noticed that, you know, it took my money instantly, but it took 24 hours for me to make my first, my first VO3 video. It's like, wow, this thing is over. I mean, I'm interpreting that as it's over subscribed and overloaded. So it's obviously like a race. One thing, Dave, which is,

The capabilities that existed before, when I say before, last month, last quarter, will be available for free. We're going to still get a lot of fundamentals for free. But if you want the cutting edge, that price will be increasing over time.

Let's jump back in here. We are introducing this real-time speech translation directly in Google Meet. It's nice to finally talk to you. So instant translation, we've been seeing this for a while now. I think it's going to be fascinating to incorporate across all the video platforms. I mean, right now YouTube is translating our podcast online.

In every language out there, that's fantastic. Zoom's going to have to catch up to Google Meet. Any comments on translation, Salim? I mean, I travel a lot, and this will be so great to hold up my phone and do real-life transitional conversations in different countries. I'm super excited about this. There's such...

enablement that comes from this. We've been kind of tickling it. It's been available in kind of a clunky form for a long time. I think this sounds like it gets to a level of seamlessness from a user interface perspective that could change the game. So, Salim, this directly affects our side bet, which we need to finalize, by the way. Peter needs to adjudicate this side bet that we agreed to a few weeks ago, where I see the forces of concentration of wealth

into just a few hands are overwhelming. And then the forces of democratization are moving much more slowly. And so, and your side bet was, no, this is going to benefit broad swaths of humanity, you know, on a more, and we haven't quantified that. So we have to settle that, but I'm willing to put any amount of money you want behind it. But here it changes the definition. You talked about trillions before, so you can put down trillions and I'll put down a few bucks. We'll see how that goes.

All right. We'll call it a Bitcoin exchange. But it's interesting. Listen, as a parent and you're listening to this, in the past you would say, oh, it's really important for my kids to learn French or Greek or Turkish or Japanese, whatever your cultural roots are or whatever you think. You need to learn Mandarin because China is rising the world. And then you need to load coding. Coding was always like pushing your kids to learn to code. So now we have...

This digital world allowing us to do coding through natural language by coding and Why would I ever learn a language if I can just be translated instantly so there's an interesting? social Re-engineering going on here because of course when you learn to code you learn how to think in a different way and when you learn languages you learn culture in a different way, which is going to be obviated through here and

So I'm fascinated by this. There's something that I think will persist here, and the reason is that when you learn a new language, your brain rewires automatically.

It does. In fundamentally different ways. It's the same way so many creative people play music, are into music, is because their brain rewires fundamentally around a different paradigm. And you triangulate now. You've got different brain neural circuits that you can bring to bear. In India, when they have kind of countrywide math competitions, it's always won by a dang South Indian. Their ability to do mathematics is like 10%.

10x everybody in the north of India. And they worked out that it has to do with the structure of the language. The rhythmic patterns on the structure make their minds naturally available for that. So I think the idea of learning piano or learning coding or learning certain deep skills or languages will persist just because it will create so much more creativity in people. And more creativity will be the only thing that's available for humanity going forward.

Well, the reason I think this affects our side bet, Saleem, is because there's latent talent all over the world, and it's usually locked up behind language barriers. And now that the translation is real-time, but it also keeps your voice intonation, so your natural voice, you can actually make a real friend in a different country where you don't have a common language.

And I think that's new in the world. We don't know where it's going to go exactly. But all of our successful startups are dominated by this theme of best friends grinding it out, working 24 by 7. Oh, my God. That's brilliant, Dave. I mean, our ability now to find – I mean, there's so much talent in Pakistan, in India, in parts of Southeast Asia that are locked up and don't have access to our capital markets. You know, you can imagine – we have Link Studios –

As part of Link Exponential Ventures, they're on the campus of MIT or adjacent to it. And we're opening up Abundant Studios here in LA. You can imagine tapping into that deep bench and having natural conversations like we have with our buddies down the street. So can we just say that I won the bet right now?

I'm jumping back into Google I.O. We got a lot to cover here. Our research prototype project, Mariner. It's an agent that can interact with the web and get stuff done. We released it as an early research prototype in December, and we've made a lot of progress since. And we are starting to bring agentic capabilities to Chrome, Search, and the Gemini app.

Let me show you what we are excited about. We call it agent mode. Say you want to find an apartment for you and two roommates in Austin. You've each got a budget of $1,200 a month. You want a washer dryer or at least a laundromat nearby.

Using agent mode, the Gemini app goes to work behind the scenes. You might be familiar with our AI-powered smart reply features. Now imagine if those responses could sound like you. That's the idea behind personalized smart replies. With your permission, Gemini models can use relevant context across your Google Apps in a way that is private, transparent, and fully under your control.

Let's say my friend wrote to me looking for advice. He's taking a road trip to Utah and he remembers I did this trip before. Gemini can do almost all the work for me, looking up my notes in Drive, scanning past emails for reservations. Gemini matches my typical greetings from past emails, captures my tone, style, and favorite word choices, and then it automatically generates a reply.

Wow. Just wow. I mean, so it's like agent mode there and Google's ability to personalize in a very deep and meaningful fashion. I'm blown away. I mean, no, listen, the fact of the matter is their goal is to get everybody to switch over from iPhones to Android and from Outlook to all of Google's suite. And it's

Getting compelling. I mean, it's going to be to a point where I want that and I'm willing, you know, this cost of switching platforms is huge.

And if Google is able to provide enough eye candy and enough cognitive candy to get me to switch, that's a big deal. The use case they demo is just so funny to me because Sundar is like, hey, suppose I want to go to Utah and I want to rent a bike. Like, come on, man. We already did this week here at Vestmark is we took that same A2A agent to agent and MCP capability.

And we moved it inside our firewall and it now opens inbound emails and Outlook with trade requests.

then the AI will read the trade request, automatically trade the account. We're talking about trillions of dollars here, generate the trade file automatically and then route it out. And so we're already using that exact capability in a much higher leverage use case, but completely built the artificial operator. The financial services industry spends about $100 billion a year on back office operations related to these activities.

And when we sample them, every single one of them is possible to do with AI now, if you're willing to connect it to sensitive information, financial accounts, and you find a way to put it behind your firewall. And so they just rolled that out here this week. And it's such a huge unlock. But, you know, when you get on the stage like this, you got to talk about something like, hey, I'm renting a bike. Okay. Well, and why does Sundar sound like an AI? I mean...

Well, his name is Pitch AI, so that's why they chose him, I think, to be CEO. Oh, no. It's terrible. But Sundar is in the maelstrom, right? And he's got Sergey and Larry looking over his shoulders. He's got the innovators dilemma. Again, their entire revenue base has been Google search. Not entire revenue base, two-thirds of their revenues. They've got YouTube, which is incredible. They've got Waymo. They've got a whole slew of other. But

switching things over, and we'll see this in a minute, switching this over away from search, they have to do this in order to continue to survive and grow. Any comment on the agent element, Salim, or the personalization? Does it feel weird to have the AI searching all your emails and responding on your behalf? I mean, I find that

The responding on our behalf is a little creepy and a little unnerving, right? Because you don't know what it's going to say, et cetera, et cetera. I think it's just one of these things we'll just get used to it and it'll become routine fairly quickly. The initial emotional reaction will be there for people. I think the potential is much, much bigger here on the business side than on the personal side.

The B2B implications of this type of stuff are off the hook for customer service responses and all sorts of things. So I think we'll see a lot more agendic AI stuff at the enterprise level than at the personal level. Yeah. All right. Let me continue. So much to talk about. Go ahead. Go ahead, Dave. Go ahead. This is rich. We could spend days on this stuff. But if you say you want to hear it.

On the consumer side, you know, everybody worries about privacy, but then they roll out functionality that you just absolutely have to have and you have no choice. You always check the box. How many times a day do you push the accept button? You don't even know what you just accepted. I mean, privacy is long since dead. I mean, come on. I mean, people cannot, people want privacy, but your Alexa is listening. Your Siri is listening. Everything is listening all the time. Privacy is a great thing to desire. And I don't accept that it's true.

Well, this is why the truly brilliant Demis Hassabis types and Mark Pincus, our friend,

They need to get involved in regulatory, which, you know, probably the last thing they thought when they were born, when they were, you know, a kid growing up is that they'd get involved in regulation. But at the rate these capabilities are coming out, if people like that don't get involved in regulation, and I mentioned those guys in particular because they're genuinely concerned and they really want a functional, non-dystopian future. And we have to use AI as a tool in creating the regulation on AI. There's no other way it's going to keep up.

So it's heartwarming that people like Dennis are at the top of the stack because they're just incredibly humanist, good natured people. So that's encouraging.

On the government side, this is a Rubicon we crossed a long time ago. In the US, there is no right to privacy anymore. It's been totally dissolved by technology. The best framing I've seen for this is, consider you're living in a global airport. In an airport, you know you're being surveilled and your rights can be taken away at any time. And essentially, that's essentially transmitting now down to every aspect of life in every country.

Yeah, you're getting so convenient to give your AI access to your conversations and your emails. It's going to make the world automagical for you that that turning that off.

will be like turning off half of your cognitive capacity. Again, I think, remember, Peter, like 10 years ago at Singularity, we played that video of Mark Zuckerberg. It was an onion clip of Mark Zuckerberg. And they said, wow, that was the best CIA agent ever. He got the whole world to just tell us where they were. We don't even need spies anymore because that really just tells us

Well, they are. So, Mark Zuckerberg, here's an award for greatest CIA agent in history. I think this is where we've been going down this road for a long time, and I don't think there's any going back from it. Well, I had meetings with two of the biggest insurance companies, top Fortune 50s, earlier this week.

And I said, look, you guys, how are you going to act on this? You need to act on it like tomorrow. And one of them wants to use AI to do their quarterly closing. So you can't talk about like as a public company. So there's nothing more sensitive in the world than your quarterly closing data.

And they said, well, we have two choices. Microsoft says, just give it all to us. Trust us. We've already got all your emails in Outlook. So just throw it over to us and trust us. And they're like, yeah, that sounds kind of scary, but maybe. The other choice is to take Lama 4.

distill it and bring it in-house inside their firewall. And that's startup heaven right there. And very, very viable as a solution. They just need a vendor to come in and wire it up for them. So I think a lot of the companies and countries that care about their future are going to take that latter path

But the alternative is to concede every aspect of your life, your data and everything to either OpenAI, Microsoft or Google or XAI. It's just not viable for sovereign states, for a lot of fintechs to take that path.

So it's an interesting, you know, very, very dynamic time. I am jumping back into the Google I.O. video here. All right, let's do it. Gemini Flash is our most efficient workhorse model. The new Flash is better in nearly every dimension, improving across key benchmarks for reasoning, code, and long context. Flash will be generally available in early June with Pro soon after. Gemini Diffusion is a state-of-the-art experimental text diffusion model.

that leverages this parallel generation to achieve extremely low latency. The version of Gemini Diffusion we're releasing today generates five times faster than our fastest model so far. This is our ultimate vision for the Gemini app.

to transform it into a universal AI assistant. In Project Astra, we've upgraded voice output to be more natural with native audio. We've improved memory and added computer controls. A quick aside, you probably heard me speaking about fountain life before, and you're probably wishing, Peter, would you please stop talking about fountain life? And the answer is no, I won't, because genuinely, we're living through a healthcare crisis. You may not know this, but 70% of heart attacks have no precedence, no pain, no shortness of breath,

and half of those people with a heart attack never wake up. You don't feel cancer until stage three or stage four, until it's too late. But we have all the technology required to detect and prevent these diseases early at scale. That's why a group of us, including Tony Robbins, Bill Kapp, and Bob Haruri, founded Fountain Life.

a one-stop center to help people understand what's going on inside their bodies before it's too late and to gain access to the therapeutics to give them decades of extra health span. Learn more about what's going on inside your body from Fountain Life. Go to fountainlife.com slash Peter.

and tell them Peter sent you. Okay, back to the episode. We are going to show a video example of Project Astra. I mean, listen, Jarvis is here. My ability to talk to Astra and ask it to do things for me, research things for me, show me where something is in the room. I mean, it's insane. We'll come back to this because the example video is so compelling.

But I just, you know, I've been tracking the Jarvis, if you would. And it's finally it's finally here. And thank you to Google for providing it to more people than any other product in the world. In our biggest markets like the US and India, AI overviews are driving over 10 percent growth in the types of queries that show them.

What's particularly exciting is that this growth increases over time. We are introducing an all-new AI mode. It's a total reimagining of search. With more advanced reasoning, you can ask AI mode longer and more complex queries. We're excited to start rolling out AI mode for everyone in the U.S., starting today. Over time, we'll graduate many of AI mode's cutting-edge features and capabilities directly into the core search experience.

That starts today as we bring the same models that power AI mode to power AI overviews. So you can bring your hardest questions right to the search box. Okay. Big move on Google's part. Very, very moving. Bet the company move. Mm-hmm.

It would be great to overlay the stock price with this exact timeline, because this is exactly when the stock started plummeting. And, you know, it clearly cannibalizes the core business. Incredibly impressive that they're willing to do that. And then right after that, they have to roll out.

They have to. But, you know, they got it all back and more the next day when they rolled out all the incredible AI capabilities. So it's actually paid off, you know, by the end of the week, it worked as a strategy. But, you know, everybody knows OpenAI is running away with the actual AI user base and Google is miles behind. But now they're going to claim that, well, anyone doing a Google search that turns on this mode...

is an AI user. So we're actually ahead of open AI. So that's pretty smart and aggressive too. It's interesting. I have my family members and friends say, oh yeah, I asked chat, right? They have a personal relationship with chat GPT. They've given it a name. AI mode, you need to personalize these AIs if they become part of your everyday life. And so I guess I had a conversation with Gemini is where it's going to go.

Saleem, what are you thinking about this? I think kudos to them for doing this. It would be really easy to hunker behind the old search box and just leave it the way it was while they experiment. But to make something this aggressive where it's built right into the core product that they have is incredibly courageous. I agree they don't have much of a choice, but many other companies would not have done this. So let's see where this goes. Okay.

I think if you step back from this, too, I mean, the reason America works fundamentally is because startups innovate and push the agenda. But this capability would have been buried inside Google for years, maybe forever. Yeah.

Without the competitive pressure. So it's a great little case study in what we need to preserve in the American economy is exactly this dynamic where the big guys only move if we keep funding the small guys. And if the if the IPO economy and the venture economy ever fell apart, this whole country would just grind to a halt. And so this is a great case study in it.

I love it. Well said. All right, let's jump back in. Let me make a point related to that. If Google was a European company, this would never would have happened. Yep. Yeah. All right. Let me find where we were. It's like having my very own sports analyst right in search.

Search figured out that the best way to present this information is a graph, and it created it. Complex analysis and data visualization is coming this summer for sports and financial questions. Using your camera, Search can see what you see and give you helpful information as you go back and forth in real time. We're bringing Project Mariner's agentic capabilities into AI mode.

Search can take work off my plate while still under my control. Search helps me skip a bunch of steps, linking me right to finish checking out. Tickets secured. With AI Mode, we are bringing a new level of intelligence to help you shop the Google. Search dynamically generates a browsable mosaic of images

and some shoppable products personalized just for me. To create a try-on experience that works at scale, we need a deep understanding of the human body and how clothing looks on it. To do this,

we build a custom image generation model specifically trained for fashion. All right, here we go. Google's getting into Amazon's business, instant shopping. It's going to be an interesting overlay there. Dave? This feels like they're just throwing everything against the wall. I mean, just throw it all out there.

I'll tell you the dirty little secret behind this though. Google's search volume went flat back in 2017. They stopped reporting it years ago because it's flat.

But the revenue just keeps going up and up and up and up. And they say, well, look, we don't show any more ads than we ever showed before. But what they actually do is they took all the ads off the low-value searches, so baseball scores being a great example, and they amped up the ads like crazy on the topics that drive all the revenue. So that's auto insurance, mortgage, jobs, travel, just one or two other categories drive all the revenue. So now as they roll this out, notice the examples they give are baseball scores,

There's no revenue there anyway, so move that over to AI. And then the other one is shopping, where they got crushed by Amazon. Something like 60 or 70% of all shoppable product search, you go straight to Amazon. You don't even start on Google. And so they're not winning that war anyway. So they're basically going to claim AI supremacy and try and move only the categories that are low click-through rate revenue over Amazon.

And they're very good at optimizing that balance internally. So this is their way of trying not to cannibalize too much while claiming more users than OpenAI has. And, you know, there's nothing...

I think they're going to go after Amazon here on purchases, right? I mean, it's like if I'm in the AI mode with Gemini and I'm talking about things and it pops up and says, by the way, you can purchase it here. Seamless shopping in the middle of conversations or in the middle of doing research, then having to shift over to Amazon. It's going to be an invasion in Amazon's revenue engine.

It's a great point. And actually, in this all of this PR war that's going like Claude coming out right on top of this event and, you know, everyone's jumping on each other. But Amazon is notably silent, even though they do have a ton going on inside AWS. And I know they're working on it. They have a plan for sure. They just don't seem to be fighting the PR war.

Yeah, and then Apple's sort of just given up altogether. That is so scary and so weird. Yeah, it is so weird. All right, let's jump back in here. This is the future of Google search, a search that goes beyond information to intelligence.

Our goal is to make Gemini the most personal, proactive, and powerful AI assistant. Gemini Live now includes camera and screen sharing. All of it is rolling out free of charge in the Gemini app on Android and iOS today. We're bringing our latest and most capable image generation model into the Gemini app.

It's called Imagine 4. The images are richer with more nuanced colors and fine-grained details. Today, I'm excited to announce our new state-of-the-art model, VO3. VO3 comes with native audio generation. That means that VO3 can generate sound effects, background sounds, and dialogue.

All right. VO3 Grand Slam home run. Oh, my God. Extraordinary. Dave, you started playing with it when you got your $250 account.

How easy was it? Yeah, yeah. Oh, my God. Well, it's trivial. You've got to get the account and just play with it. It's instantly mind-blowing. The integration of the audio, I think, really puts it over the top.

But it's immediately obvious to you that the future of media is going to completely flip where it's on demand. Like, this is what I want to see created on the fly for me. And as soon as, you know, every time you do a VO3, it's clipped at eight seconds and you immediately want a full feature length movie. And you're like, well, why can I only get eight seconds? And the answer is there aren't enough GPUs on the planet. There isn't enough compute on the planet yet.

to meet the demand of everybody who wants this instantaneously. And that gives you a sense of where, you know, how many data centers and Chase Lockmill or Caruso's are going to succeed.

Because just that use case alone will use up everything, let alone customer service and code writing and all of these things combined. But it's amazing that Josh Woodward got this unit. Like, this is the keystone. Like, this is it. And Peter, your buddy Josh got it. Yeah, Josh was on stage with us at the Abundance Summit this year. He's a great, great presenter. But it was awesome. Salim, what are your thoughts on VO3?

I think it'll be interesting as people start. I'm curious as to how people are going to use it at a personal level. There's obvious business uses, et cetera, but will I really use it to generate my own entertainment? I'm not sure I would. You know, we watch movies particularly because people have created an experience for us, right? So I think this will be great for the professional filmmakers and it'll be great for making pilots also.

All sorts of stuff will come through with this. I don't think it will affect the end consumer that much. I don't know about that. I mean, listen, Gemini...

Gemini 3, Gemini 4, one of these will have looked at every movie I love. It'll understand the context, the nuance of what I really enjoy. I mean, if it's got a camera facing at me, it'll understand when I'm smiling, when I'm frowning, when I'm making reactions to it. And it can generate a, you know, imagine you want the next season of a particular TV show, right? I'd love to see the next season of the original Star Trek. Yeah.

you'll have that. That's a great, great example, Peter, because yeah, every Netflix show,

you know, from Earth to the Moon or whatever, you always want more when you get to the end. And they just physically can't create more. Well, now they can. And whether it's passive or active, you know, real time and created for you, or it's just the producers can now create the episodes that much more quickly and cheaply. You're never going to let, like Harry Potter, you're never going to let the audience just drop. Like, oh, this is the last book, this is the last movie, disappear. That's just crazy inefficient to just let the audience fall off a cliff.

So now that'll probably never happen again, whether it's just because production costs are much, much lower or because people can create their own. Either way, that trend will happen. But I'd love to side bet with you on this one, too, Salim. I think that, you know, the movie producers have always dwelled on this concept that people are fundamentally lazy.

But I don't think that's true. I think that the medium, the passive medium, if you go into a dark theater on a sunny day in L.A. and you come out of that dark theater and it's sun's blaring, you feel like crap. You know, you love the movie, but you feel like, where am I? The ability now to keep the dialogue going, you can move around and keep it going and you can guide it in the direction you want. That's going to be so compelling for people. I don't think the producers have mastered the new medium yet. But when they do, I think...

I just Googled this and it says, what's the average shot time for a movie today? So a modern movie, the average shot length is between 2.5 to 6 seconds. In an action film, it's 2 to 3 seconds per shot. In a drama or art film, it's 8 to 10 seconds per shot. So if there are any physical limitations here, you're going to just cobble these together. But Hollywood is decimated.

I mean, I'm sorry. You know, I drive by all the studios out in Hollywood when I'm when I'm in L.A. And how do they continue to I think continue to exist in two or three years from now? Yeah, you're dead right on that, too, because because, you know, look at Bollywood and how successful that's been. And, you know, why? Well, it's because, look, the movies are culturally aligned and interesting.

and it just aligns with the audience. But, well, why did all the movies pop up in LA in the first place? Well, it's because we need to shoot the scenes outside in good weather. It's way too expensive to move all the equipment inside every time it rains in New York. So we got to set up out here where we have good weather. But now, you know, this kind of content, it's weather independent and it's global and it's language independent. So it's just talent constrained. So yeah, you're right. It should be democratized and moved across the world very quickly now.

All right, let's jump into the Google I/O. We've got three quarters in, one quarter left to go. A new SynthID detector can identify if an image, audio track, text, or video has SynthID in it. Based on our collaboration with the creative community, we've been building a new AI filmmaking tool for creatives. We're calling it Flow, and it's launching today. Let me show you how it works.

These are my ingredients, the old man and his car. We make it easy to upload your own images into the tool. It lets you extend the clip too, so I can get the perfect ending that I've been working towards. But what about emerging form factors that could let you experience an AI assistant in new ways?

that's exactly why we're building android xr right now you should be seeing exactly what i'm seeing through the lens of my android xr glasses like my delicious coffee over here and that text from sharon that just came in let's see what he said all right it's definitely show time so i'm gonna launch gemini and get us going gemini what was the name of the coffee shop on the cup i had earlier

Hmm, that might have been Bloomsgiving. Okay, Gemini, show me what it would take to walk here. It'll take you about an hour. Okay. I can get some steps in, and these heads-up directions and a full 3D map should make it super easy. I'm excited to announce today that Gentle Monster and Warby Parker will be the first eyewear partners to build glasses with Android XR. All right. Uh...

So, I mean, I would give anything to be at the next Apple board meeting because you've got you've got Sam Altman saying, I'm getting Johnny. I'm going to do devices. And I've got Google saying, I movie get out of the way. We've got much better AI driven. And, you know, what's like, oh, my God, they they I mean, and this is where, you know, Apple should pay the price. They haven't done anything to even try. Crazy. Yeah.

So, Salim, I mean, XR glasses, I mean, it's about time that we've got some good AR up and running. But it's going to change our behavior, right? So every day as I'm walking down the street, do I have education mode on? Do I have gameplay mode on? Do I have entertainment mode on? I mean, it's going to become the major educational partner if we let it.

You know, Wubby Parker coming in, maybe they'll look good. Maybe they'll look fashionable. Maybe you won't look like a geek if you're wearing them. I don't think anything can help you not look like a geek when you're wearing those glasses. But I was playing with the meta glasses, Peter, that you handed out at A360 last year. Yeah. They were amazing.

They look like good sunglasses, they act like good sunglasses, and they've got all those of this AI capability built into them. It was really quite fascinating to see. That was just like version one. The next level versions are going to be 100 times more capable with AR built into the middle of it.

I think this is going to be quite a game changer around this. I think it'll be really amazing to see the use cases and the potential utility is off the hook. Every day I get the strangest compliment. Someone will stop me and say, Peter, you have such nice skin. Honestly, I never thought I'd hear that from anyone. And honestly, I can't take the full credit.

All I do is use something called OneSkin OS1 twice a day, every day. The company is built by four brilliant PhD women who've identified a peptide that effectively reverses the age of your skin. I love it, and again, I use this twice a day, every day. You can go to OneSkin.co and write Peter at checkout for a discount on the same product I use. That's OneSkin.co and use the code Peter at checkout. All right, back to the episode.

All right, let's hit a few. I'm going to exit out of the Google I.O. summary there. A lot of amazing stuff. And kudos to Sundar and Sergey Brin, the whole team there, for the work that they've done. They really came out on top this week. And if you look at PolyMarket, you know, who's going to be leading AI by the end of May? The PolyMarket results show Google at 80%, Anthropic at 19%, XAI at 1%.

Okay. Seems rational and reasonable. And then let's take a look at what Polymarket predicts by the end of the year, 2025. Google is still on top at 38%. OpenAI is back at 26%. And XAI is at 23%. That makes sense, I think, for me. OpenAI is going to – this is a battle between the two of them. And then, of course, you've got Elon coming out of right field, obviously.

And, you know, never bet against Elon is my mantra here. Any comments on this, Dave? This is the most entertaining thing in the world to watch. But you said Google's, you know, back on top. But look, they were number three in March on this chart. So everyone had written them off. And you can actually put money on this if you want to make a living out of betting on who's leapfrogging who. But at this stage, you know, despite this chart, it's just a four-horse all-out race. Everyone going as fast as humanly possible.

So, you know, I don't think the short-term trend which vaulted Google to the top, you know, is that it's going to actually collapse.

many more times over the next year among these four players. But there's this level of intense energy we haven't ever seen before. And it's what's accelerating our AI future. It's also the most important race in the history of human innovation. The implications are so much bigger now.

you know, the past races we've seen. So the amount of money, the amount of energy, the short timeline, it's, if you want to track one thing and enjoy it in your lifetime, this is it. I'm going to just hit on a couple of more VO slides. We saw this side here, but you made this one, Dave, tell us about it. It was my very first ever VO3. So I just wanted to memorialize it. Okay. And capture it.

What was your prompt? It's right there. Make me a video of data centers getting overrun by dinosaurs. I couldn't believe how good it was. No reprompting, no tuning. This is what it comes back with. But I had Chase Lockmiller and Crusoe and Project Stargate in the back of my mind because Chase has become a celebrity overnight. More power to him. He's our fellow MIT alum.

And Crusoe, you know, he's the company building Stargate in Abilene, Texas. So I was watching the video of this insanely large amount of construction, the electricity, the pipes, the power generation, and now the chips are going to start coming in. And that's worth following just as a storyline by itself. Chase is a great, great guy. He'll

He'll be another kind of Mark Zuckerberg character for a long time to come. I don't know why I wanted dinosaurs to be overrunning it before it's even done, but it was just what was on my mind.

All right. There's one more VO3 I need to show. And I find it fascinating. All of us, you know, evening TV, you see these pharmaceutical ads that are ridiculous and they spend a lot of money on these ads. Well, this is an example of a pharmaceutical ad made for 500 bucks instead of $500,000. And just take a quick listen to this one. I tried everything for my depression.

Nothing worked. Every day felt heavy. I felt trapped. Then I tried Pupperman. Our prescription helps your body secrete a special pheromone that attracts puppies. So that movie, the commercial goes on and it's hilarious. But it's like that for me would be the equivalent of an ad campaign for some, some,

Something that makes your, you know, nevermind. I'm not going to go there. That looked jaw-droppingly real. It did. It did. So this is my favorite. This is my favorite Google IO piece. And this is for me, the materialization of Jarvis. I want to play this, look at this, and then let's talk about holy shit moments and how this is going to change our lives. Can you go on YouTube and find a video for how to fix that? Of course. I'm opening YouTube now.

This looks like a good video. Place a rubber band over the head of the screw. Oh, nice. Can you go through my emails with the bike shop and find which size hex nut I need? Sure. According to the email from Bicycle Habitat, you need a 3-8 inch hex nut for your sprocket. I've highlighted the correct bin for you. It seems like I need a spare tension screw. Can you call the nearest bike shop and see what they have in stock? Yep. Calling them now. I'll get back to you with what they have in stock.

I think my brake pads are wearing down. Can you check the manual again and see if it talks about them anywhere? According to the manual, if you look on page 24... Hey, do you want to get lunch? Yeah, give me five minutes. Can you finish what you were saying? As I was saying, if you look on page 24, section 2, you'll see how to replace the brake pads. Hey, any updates on that call?

Yep, I just got off of the bike shop. They confirm they have your tension screw in stock. Would you like me to place a pickup order? Could you show me some examples of dog baskets I can put on my bike? Sure, I can help you with that. Just give me a moment. Here are some options. I think Zuka would look really great in these.

Jarvis baby is here. I want to free myself from holding the phone. I want to have my eyewear and my audio pickups and have it see what I'm seeing. But holy moly. Yeah. Well, this is a good place for me to make a shout out to all our sovereign leader friends in the Middle East and elsewhere. What you just saw is not actually going to happen in your country.

And the reason is because the compute, you don't have access to the compute. You can do this for the next few months, but then all the other use cases that are bubbling up are going to overbid you for that data center space. And then your population is not going to be able to do what they just saw unless you have some kind of a national compute plan. And, you know, like we said last time, about 180 out of 200 countries have no plan whatsoever.

And you have to get on that right now if you want what you just saw to actually exist in your population. And they're going to be screaming for it. Wow, it is. It's magical powers. It's superpowers. That's so true. We are so compute limited. It is the currency of the future. It's oxygen for us. And it's a basic human right. It's going to be more important than other basic human rights within a year or two. And populations don't recognize that today. But once they experience that and then they're deprived of it,

Then they'll all be all over their leaders. Wow. How quickly a miracle becomes something we expect and feel like we deserve. Salim, what did you think of that?

The video is amazing. Once you can get all the millions of little YouTube clips activated and useful in this kind of seamless way. Holy moly, that's pretty incredible. I want to touch back on what Dave said, though. You know, it's incredible what's happening online.

in this realm, and then you look at country policy for most countries, and they're like unbelievably backward. I was talking to the head of state of one of the countries that's emerging that's about to become a very big, very wealthy country. And their first idea was let's build a call center.

And you're like, no, there's four generations. Let's at least get into the 19th century. Forget the 20th century. Forget the 21st century. And this is where I think smart people at government level are going to need to be there to really change the game. Because almost every country in the world does policy defensively and reactively. Only two places do it positively and forward-looking, which is Dubai and Singapore, right?

And I was thinking, they don't do it that well. And so imagine you had a really forward-looking policy in any country. It could really change the game. So I think one or two or three are going to start doing it, and then we're going to see this general transformation in government. But boy, this is going to change the... I think this will be the forcing function that drives that transformation. So that's very exciting. I want to add, you know, listen, when I think of this as Jarvis, the countervailings policy

partner to Jarvis is Tony Stark, right? Tony Stark is this radical billionaire who has accessed this incredible AI capability. But guess what? This capability is now available to everybody. We're demonetizing and democratizing our vision of this future. And that's extraordinary. And, you know, that's going to weigh in on you winning the bet here, Salim, versus me. I was just

Oh, I have. All right. We'll get into that another time. Well, we have to finalize. I think we're done.

I don't want to give away too much of, all right. Well, let's finalize the bet first, and then I'll tell you why I'm going to win. All right. Actually, Peter, I want to tell you, between Salim in New York, me at MIT, and you in LA, we're booting up a new company right now that takes advantage of, you saw that synthetic ad is just as good as a real ad now. But we ran some tests over at EverQuote using celebrity ads, and they work incredibly well.

One of the problems you run into with LeBron James is that his peak click-through rate or his peak impression value is right during the playoffs when he can't go to a studio and shoot a video. And so we tested two things. If you make a synthetic LeBron James at

peak season, what's the click-through rate? And it's incredible. And then also if you make thousands of variants of the ad where LeBron is doing different things, maybe different languages, just different messages, that also incredibly drives up the value of the ad. So what we're working on right now is a company that makes, basically the celebrity just needs to check a box and collect money.

And they don't have to show up and shoot anything. Everything else is done by AI. Super. And that'll also get a lot of your LA superstar, your movie star friends who you see all the time. They never show up at MIT. Only Will.i.am and... Well, they don't show up for anything half the time. They only show up at their own movie openings. Yeah.

Well, so you'd be amazed if you get like Will.i.am or, you know, anyone to show up on MIT's campus. The students come out by the hundreds. They just way overreact to a celebrity. So I'm really excited about this project dragging just a handful over to the campus.

I love it. Here's a quick fun tweet from Dario saying, 2026, we'll see the first $1 billion company with one human employee. We've been predicting this for a while. I get it. And I agree. I don't know if you guys... Two years ago, you and I were launching the EXO 2.0 book, and we said it would take three employees and AI to deliver. So that's not shrunk to one. It'll soon shrink to zero, by the way.

Yeah, with agents and crypto. Yeah. Well, who gets the money? That's interesting. The agent. This is the whole DAO kind of paradigm coming to life. Yeah, distributed autonomous organization. For me, probably one of the most exciting things that's coming

is how these models are going to help us drive breakthroughs in math, physics, chemistry. So this is from, I believe, Anthropic. This is the prediction on when disciplines will be solved. So pure mathematics being solved by 2028.

This means all of the unsolved math challenges out there are getting solved by AI. Let's move down. Computational chemistry by March of 29. Medicinal chemistry leading to candidate molecules by October 2029. Material science is being solved by 2030. This means you're able to say, I need a material that has these thermal properties, these properties

cost properties that's insane cell biology core pathways by may 2030 and climate earth modeling systems by 2033 this is the non-linear inflection that just just explodes all of our expectations about the future look look at that little note where it says most diseasable curable by in two and a half years right that vertical line that's crazy

Well, this is what we saw Demis Hassabis state. They were going to have all diseases cured within the next decade. I'd like to see in, say, pure mathematics or computationally, I'd like to see which breakthroughs they expect to achieve. Because I'd like to see the discipline is solved, quote unquote. But I'd like to see what specific milestones they're expecting to hit there.

So, anyway, we can worry about that some other time. But this is amazing overall. Yeah, this is where we desperately need Richard Socher as a guest because he's mapped out the timelines. It would be great to get his opinion on whether these timelines are accurate or not. Because they're mostly gated by simulation modeling and synthetic data. And that varies by different discipline. But we've known that quantum computing is really, really important for material science.

And for chemical reaction simulation, which is the full cell simulator. So the timeline and the technology is probably somewhat predictable now.

This is why I love getting on this podcast with both of you guys to really consider what's just happened this past week. And you really do help me contextualize it. And for everybody listening here, I hope you're enjoying this because Dave and Salim and I are pouring our hearts into this. We're making this our priority every week to really deliver to you what we've seen, what it means today.

So please join us in moonshots as we move this forward. And as we do every week, let's talk a little bit about crypto and Bitcoin. This was a big one. Bitcoin surpasses Amazon and Google's market cap. It's been a big week for Bitcoin as well. Salim, are you happy?

I'm getting happier by the day as the thing goes. For me, this is the definition of democratization because every single individual in the world can own Bitcoin. And it's very, very hard to own, say, gold.

And so this is, I think, a huge trend in the right direction. And we could have a whole dedicated episode just on the impact of this on fiat currencies. That might be with Jeff Booth as a guest and just talk through what are the implications for how we've been doing things for 50 years with fiat currencies having enormous stress. We saw this week the struggle in the Congress to pass a bill that's just gonna blow the debt open.

And so there's some big implications for all of this.

Yeah, we'll see Bitcoin surpass Microsoft as well. It's got a while to go for beating out gold, but it will get there as well. And of course, this week we saw a surge, Bitcoin surpassing $110,000, setting all new time highs. Just an extraordinary time to be alive, as we say, every single time. You know, we talk about the value of markets. $50 billion of Bitcoin gets traded every day.

That's the staggering number. I mean, it's incredible. Yeah. I know one person is very happy, and that's Mike Saylor. You know, I haven't seen MicroStrategy stock continuing to peak at the same time that Bitcoin's been going up. That's interesting if it's dislocated from Bitcoin in some fashion. But that's a different conversation. Thank you, everybody, for joining us. Please subscribe. This is our desire to deliver to you the news that is transforming Bitcoin.

how we govern our nations, how we run our companies, our industries, even educate our kids and our families. Always grateful and appreciative to my moonshot mates here, Salim Ismail, who's that way about...

about five meters and Dave Blunden on the other side of the US in Boston alright guys can't wait to see what miracles are going to happen next week so before we sign off Peter I just want to throw out a thank you for inventing this podcast it's getting far far more views than I ever would have guessed and

And for me, it's been life-changing in that this is so much more efficient a way to reach out to people than one-on-one meetings, getting on stage, which I do a lot of anyway. But this has just been life-changing for me. And I just want to thank you for inventing it and also for inviting me to join you in it. It's part of the family here. I love your insights, brother. All right. It's so fun.

I mean, you're wrong about a couple of things on the democratization, but the tech insights coming from you, Dave, are off the hook. So really great. Thanks, Lynn. All right, guys. Bye.

All right. Have an awesome day. Can't wait to see what unfolds next week. If you could have had a 10-year head start on the dot-com boom back in the 2000s, would you have taken it? Every week, I track the major tech meta trends. These are massive game-changing shifts that will play out over the decade ahead. From humanoid robotics to AGI, quantum computing, energy breakthroughs, and longevity, I cut through the noise and deliver own

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