537: Do You Know Apple?
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From Relay, this is Connected, episode 537. Today's show is brought to you by OneBlocker. I'm your annual chairman, Federico Vittici, and it's my pleasure to introduce Mr. Stephen Hackett. Hello, Stephen. Hello, Federico. How are you? I am doing fantastic. Thank you. How are you? I'm good. We are without Mike this week, so a little sad, but everything's cool. He just had a conflict. There's no...

it's not baby time yet as far as i know it's not it's not as far as we know it's not i talked to him like 10 minutes ago he didn't say anything so uh okay he just had a conflict today you would think you would think he would tell you i would hope so yeah yeah he's like oh i've had a four-year-old this whole time what is a couple of years ago a couple of years ago one of my favorite uh video game podcasts uh triple click uh

Jason Schreier, co-host of TripleClick and also a reporter at Bloomberg, surprised his two co-hosts with his second baby.

that was actually born months before and he didn't tell them and it was an incredible moment on the show. That's awesome. Yeah, that was wild. But yeah, hopefully Mike will not try to copy that approach. It's like the time you told us that you had been using a PC for like six months. Well, I wouldn't say that was as dramatic as revealing a whole baby, but you know...

Okay, they're slightly different. Yeah. A little bit different. We got some follow-up. That's what we do here at the top of the show. And many people have written in about their own iCloud woes. This was the bulk of the episode last week talking about my whole iCloud situation with my legacy...

version of myself and the new iCloud family and I couldn't do the additional space. So it seems like a lot of people are in that situation. People are adding their legacy accounts to their iCloud families.

I will say, you know, a week and a half in, however long it's been, it seems like the dust has all settled, except on my Mac, in the Mac App Store, I can't update any apps. So... Okay. I got to deal with that. Sure. Why not? I mean, you know... It asked me to log into the purchasing account, which I don't want to do. Have you thought that maybe the Mac App Store is so bad there's nothing to update?

Well, currently I've got four. Oh, you do see the updates. Okay. To be fair, two of them are Safari plugins. Okay. And one is an Xcode plugin. So it's a ghost town in there. Look at you being a developer and everything. I know, right? Xcode plugins. I didn't even know you could get Xcode plugins on the Mac App Store. It's not really a plugin. It's an extension for the simulator. Oh, still. It lets you do fancy stuff. Okay. I'm a developer now.

I'm the developer now. Yes. Yeah. So, I mean, lots of people are dealing with this. Hopefully it was helpful if you find yourself in this situation. A couple of things that I didn't mention that some of them I didn't realize at the time that we recorded a couple of them. I just didn't get to because of time. One is that I lost all my test flights because I was signed in a test flight with that old Apple ID because test flight follows your purchases ID apparently. Yeah.

I mean, thankfully, I'm friends with most of the people whose test flights I run, but I'm choosing to view this as a clean start. I believe you will call it a blessing in disguise, right? Yeah, that's right.

I, like you, I'm sure, I had a bunch of stuff in there that I, you know. Oh, yeah. Expired apps. I mean, going way back to like years and years ago. I kind of want to look now. Let's see. Yeah. See if you can find the oldest thing in your test flight. And the two most important ones for me, I have the login to App Store Connect. So like, oh, I can just add myself back to Widgetsmith, you know, and underscores other apps.

Well, this is actually quite perfect because... So the oldest is TV Forecast, which is odd because I still use it. Excellent app. Parcel, the package tracking app. But I just think these are like...

build expired and build removed because the developers have new betas like these are like older versions but the first app that said tester removed is Devon Think 2 Go version 3 they removed me from Devon Think that's a bummer

yeah once you once you enter devon think you never leave unless you're you i guess some real gems in here though some real stuff yeah yeah i'm sure um so anyways uh if i was on your test flight you'd like me back please let me know um a also was rebuilding my music library some people had some suggestions on maybe what was causing this or what the deal was um

our friend Zach had mentioned, they said that, okay, maybe some of these are like pre DRM free purchases that maybe weren't upgrade upgraded. I don't really know what the, what the issue was, but again, like the test flight thing, blessing in disguise, like, let me just rebuild my library. I knew that I had music that was not in the store. So I have a copy of my old music library on my desktop. And I'm just like, as I'm like finding things, it's like, Oh yeah, let me just add this back to the library. Um,

But a couple of things to note in rebuilding your Apple Music library. And my previous library dates back to when I first started using iTunes in 2002. A lot of stuff in there I hadn't listened to in a long time that I sort of cut loose. But first thing,

But music encoded for Apple Music, in a lot of cases, sounds way better than what I had in my library. Like, you know, I had some ripped CDs and I did iTunes Match at some point, but you know, who knows what the deal was. Anyways, I've noticed on a couple albums like, oh, this sounds better. Or maybe it's been remastered at some point and I had an old version or whatever. But the thing that hurt me, and Federico, I think you in particular will appreciate this,

Too many of my favorite albums now have 20th anniversary versions. Oh, yeah. Like quite a few. And they're remixed or like Death Cab has done it with a couple and they've added like demos to the end of it, which I'm all for and it's like fun to hear alternative versions of songs and stuff. But I just noticed as I was like going through adding things, I was like, oh, oh, oh, goodness. Yeah. A lot of this.

A lot of pain in the past, you know? Mm-hmm. So, test flights, Apple Music. Yeah.

Mac App Store. Mac App Store? Anything else? So far, everything else has been pretty smooth. I said last week that some media wouldn't play back. That's all basically been settled. I watched the first couple episodes of Mr. Robot over the weekend that I had purchased years ago on my legacy account. They just played just fine. That show is holding up. I'm only three episodes in again, but it's really good.

Remember, did you watch Mr. Robot or was it Mike? Oh, no, I watched Mr. Robot. Maybe he did too. I feel like we talked about it back in the day. Do you see Mike as a Mr. Robot person? I can't remember. I thought one of you did and the other of you didn't. So maybe he didn't.

Hey, if you miss Mike on this week's episode, here's something that you can send him. Use your favorite generative AI service. It can be ChugGPT, it can be Gemini, it can be DeepSeek, which we're going to talk about. Well, it depends on what country you're in. Well, it depends on what country. And ask your favorite AI product to put together a short description of what role Mike Hurley could play in Mr. Robot. Wow. You know?

no well if Mr. Robot could feature Mike Hurley as a recurring character what would he do that's incredible I'm asking GPTO for right now yeah okay uh

I'm just going to read a couple of these to you. Okay. It's a list. Number one, the underground broadcaster title. Mike could play a podcaster or radio personality who operates a secret channel spreading anti-corporate propaganda, helping F-Society communicate with the masses. Incredible. Okay.

Number two, corporate insider turned whistleblower. Ooh, okay, because he used to work at a bank. I guess so. Given his real-world experience running a media business, Mike Hurley could be a high-ranking E-corp executive in charge of internal communication who slowly realizes the company's dark secrets and leaks them. And there are a couple of others here. This one's, I think, my favorite after the first one. Tech culture commentator.

In a meta twist, Mike could play a fictionalized version of himself hosting a tech podcast that dissects the rise of E Corp and the decline of privacy, inadvertently influencing key players in the show. Okay. And then the final one

A surreal take, Elliot's consciousness voice, where Mike is never physically present, but his voice constantly plays in Elliot's mind as an inner monologue or guide. Fascinating, but why? Why would Mike's voice be in Elliot's mind? What kind of role do you think would fit him best? I'm not engaging with you, Chachi Petit. Okay. I like that a lot.

We have some other, I don't know what this is. This is follow out. Follow in. I don't know. Follow FM. Yes. We've dropped the FM out of our name. We are now officially just Relay. There's a link in the show notes to a blog post I wrote over the weekend. We got our redesigned live.

New logo. You see it this week in the show art, a slightly tweaked show art, new logo. And I'm really, really happy with this. And if you are a member of Relay, which you can do, there's a link in the show notes to get Connected Pro, which is the longer ad-free version of the show. All memberships come with access to Crossover, which is this feed where we publish content

members only episodes. And in February, I'm going to be interviewing JD Davis, the designer who redid relays branding. And so that'll be fun in the discord. I'll ask for questions in February, but I'm looking forward to that conversation with JD. JD is awesome. He did a great job with this.

And I'm really, really happy with it. Nice. Yeah, I think it looks cleaner, modern, fresh. I really like this change. And it looks very good at small sizes and it's still recognizable even at a small size. So yeah, did an excellent job. Yes. Yeah, that was one of the goals was like, how does this look small? Because usually PyCast Outworks is up on your phone 400 pixels across. So yes, glad to have that out.

I did want to take just a second and kind of talk about the times that we live in. We were going to do this last week, but the three of us felt like we wanted a few more days to kind of put some thoughts together. We know that a lot of people in and beyond our community are hurting, given the state of things in the U.S. and really across a bunch of other countries. And we want to do what we always have done, provide a place to hang out,

talk about the topics we love with people who respect each other. And the thing I'm honestly...

most proud of is Relay's community. And in that community, there's a strong shared belief that everyone should be respected and that we should all practice compassion. And that comes out in a thousand different ways in our community. And one thing it means is that there's no room for hatred of other people in our community. And unfortunately, feelings like that towards

uh, individuals has become more mainstream and that's troubling to us. And we want to be a place that we can, again, hang out with our friends, talk about the things we love and be in an environment where we can be, or we can know we can be safe, whoever we are or wherever we come from. And, uh, you know, we're not turning our shows, uh, into anything that they're, they're not already. Um, we're going to keep doing what we do. Uh, but we did want to, uh, to tell people that, you know,

That's where we stand. And we think that a lot of the stuff in the world right now is not okay. And we want to use our platform where we can to protect those who are in our community. Yeah. If you may just add some personal context. Please. These are my personal opinions, but I feel like using the exact necessary words is

is important. So I want to start from my personal belief that trans rights are human rights. And I personally find what is happening in the US despicable and dehumanizing. And I cannot even, because I cannot imagine, I personally cannot imagine what it must feel like to feel like

other people want to make you and your identity feel unjustified and like something that shouldn't exist. I cannot imagine that, but I can relate to that feeling of

feeling powerless and feeling like there's nothing you can do. And to an extent, I, you, Mike, we at this network are, uh, are, are, you know, it's not like connected can change the U S government, right? Uh, if they only would adopt the bill of rickies, if only, if only they would do it. Um, but there's a couple of things that I will, that I would say. Um,

Now more than ever, I feel like, and unfortunately these discussions are trickling down to Italy as well, you know, because we have a government who very much sympathizes with the American government. So those discussions about human rights, they're happening here as well. But I feel like now more than ever,

It's important, if you feel like it, to be organized, to dissent, and to seek a safe space in real life and online. And I think it's important to find your people and to not accept what is going on.

And I know that it's a challenge. And I know that I am saying this from a position of privilege myself, because I, you know, my identity is not a risk. And, but I think it's important for people to be together and to feel those things together. And the second thing,

is that from my position and I think from our position, it's important to continue to provide the joy. If you find joy in this podcast, I hope you do. And to continue to provide the utility if every so often we share something useful. That's also my hope.

But I think it's important. Like once a quarter. Once a quarter, maybe. A segment about task managers. But I think it's important to, at the same time, keep doing what we do. Because in any dark time, you still need to find that light that never goes out, to quote a famous song. I think it's important to continue to provide that service for people who want it. Because like,

I think in any difficult period of your life, you need to have something that brings you a little joy. And so I think it's why now more than ever, we got to keep doing what we do. And if I could hug my listeners, I would. And this is one of those moments where I really miss...

not having a live show and seeing people in person. Um, and, but yeah, that's all I wanted to say. No, it's, it's, it's well said. I agree a hundred percent. And it, it is something that I agree with you. It is hard to, it is hard to put myself, uh, in the place where I'm, I'm told that who I am shouldn't exist. Yeah. But that doesn't mean that we can't

First of all, empathize with it to the degree that we can, but also provide a place where everyone can feel safe and comfortable and welcome. And that's what we want Relay and Mac Stories to be. And look, our discords are the best places on the internet and our communities are incredible. Yes. And, you know, we're still going to joke about iPod socks. Yeah. Yeah, exactly. Sound pretty good to me.

Yes. So we are literally going to talk about iPods. We are, yeah. For the next topic. Well, not socks, but we are going to talk about iPods. And more specifically, Stephen, I wanted to ask you what's your budget for iPods looking like these days? Because if you have an opening...

you could participate in the Sotheby's auction for the custom iPods from the late Karl Lagerfeld. It's a massive collection of how many? 500? Like how many? 300? I'm not sure. 500 iPods.

Of all kinds, including this diamond-encrusted iPod and microphone. There's multiple color variations. I didn't even know that Karl Lagerfeld was collecting iPods. So this entire story, that this collection is now up for sale at an auction, is new to me. Were you familiar with the existence of this iPod collection?

No, I wasn't. Okay. I mean, I was familiar with the name, you know, seeing Carl's name float around, but had no idea. And that goes deeper than we think it did, so we'll get to that in a minute. But right now, the bejeweled iPod and microphone, 500 euro. So, you know, we'll see how high that goes. A little rich for my blood right now, but it's...

This is incredible. And you can go through here and like so many iPods, there's some custom, custom like colorways of the first gen nano, which Apple just shipped in white and black.

There's red, pink, blue, and yellow. And I'm not normally like a yellow fan. Yellow iPod looks good, though. But the yellow iPod looks sick. Yes. It's so good. I'll have a link in the show notes to some of these. And it is just...

It's just incredible. You were talking about this on Macedon, and then we learned a lot more. So what was uncovered?

Apparently Carl Lagerfeld obviously was very much into iPods. I saw some posts and some old stories saying that he was basically treating iPods as like cassette tapes. So each iPod would be loaded with a specific type of music or a specific collection of albums and so forth. Which, I mean, if you are really into music and the storage limitations of the time where, you know,

the storage limitations at the time, I can sort of see that. You know, if you have an unlimited budget and you want to be fashionable and you are a fashion icon, in fact, and you're really into music and you'll be like, you know what? I am going to accumulate hundreds of iPods and each of them I will treat as a cassette tape. Cool. But what was interesting is that apparently Lagerfeld had a whole team of people dedicated to managing these iPods

Because obviously you needed to sync them with iTunes, right? And so the story goes that there was an entire raid of XServe to run this massive iTunes library and sync hundreds of iPods to this library. Yeah. Have you seen an XServe raid? Are you familiar with this? Never. Never seen it in real life. That's because you've never come to my house. I've got one. Yeah.

But yeah, terabytes of music, which I mean, think about the time frame of the iPod, right? Like that's that's pretty wild. We weren't we weren't, you know, doing eight terabyte MacBook Pros at the time. So absolutely incredible. Man, what a move. It's like, oh, this is my iPod team.

On one hand, like, I feel like I shouldn't be allowed to judge because, like, I do keep several video game handhelds for specific types of games. Sure. But on the other hand, I don't have 100 handhelds.

Like, I don't even have 20, I think. But, I mean, I'm also not Karl Lagerfeld. So it kind of cancels out, you know? I don't know, though. What a power move to have hundreds of iPods, servers to manage the syncing. Just the entire story is incredible. Yeah. There are also some modified... I just found them. Some modified iPod minis that...

including an all-white and all-black model, which look really cool. Are you sure you don't want to try just like even getting one of these? How much are the minis? The minis are at 400. One of, just one. Just a random one. Just like, hey, this used to belong to... You could, you know, you could touch it and be like, this iPod was also touched by Karl Lagerfeld. And now I am touching it, you know? This click, this click wheel.

was once clicked by Karl Lagerfeld. Yeah. There's a whole collection of third-gen iPods, which we know were the best ones. And those have, like, stickers on the back with notes, I guess, with maybe what was on them. Wild. Have you ever attended, like, an auction in real life? I have not. I've always wanted to. Me too. And I've always wanted to get into a bidding war with somebody, but that only ever happens on eBay. It's one of those things that, you know, I want to do at some point in my life. Yeah. Yeah.

getting into a taxi and being like, follow that car, but it's a random car and you got to pretend that it's important. You know, that sort of thing. But also like attending an auction and getting into a bidding war for like a totally random item. Like it doesn't have to be important and you have to be like really and oddly into it. You know, that'd be fun. Like, sir, are you sure you want to offer 3,000 euros for this hat?

And I'll be like, yes, I need that. I do. I do want to do that. I do think it'd be fun, but no, I've, uh, I've never even attended one. It's kind of a bummer. Yeah. Yeah. Maybe, you know, maybe one day, maybe one day. This episode of connected is brought to you by one blocker. One blocker is a premium content blocker for Safari on iOS and the Mac.

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Have you heard the good news of deep seek? Uh, I have seen the word a lot this week. Um, but, but you're like, you're wired in. Yeah. Yeah. I've been, I've been tracking this entire story. Um,

And it's going to be a long segment and Stephen allowed me to do my research and to take my time. So, hey, I think it's going to be an interesting one and a fun one. But if you're not interested, well, that's your problem, not mine. Skip to the closing. It's going to be exciting this week. It's going to be exciting because, yeah, it's going to be an exciting moment for the show. So...

In case you haven't seen it, or in case you've seen this name repeated to death and you couldn't be bothered to look into it, Dipsyc is this new large language model, this new chatbot,

that is supposedly rivaling in performance OpenAI, which had GPT, Gemini from Google, Cloud by Anthropic, and not just in performance, but also in how it was put together. So I've been trying to make sense of what multiple sources are saying. It's very...

hard to pin down exactly, also because of the language barrier and also because like it's, you know, everybody's saying different things. I'm going to try my best and sum it up. DeepSeq was put together, more specifically, the underlying large language model is called DeepSeq v3 by this. This is a word that I learned this week by a quant, which stands for quantitative

quantitative hedge fund. It's basically a hedge fund in China that uses sort of like advanced mathematical operations and whatnot to track market movements and that, you know, whatever hedge funds do. Yeah. I think they...

They go around trimming people's bushes. Yes, that's what they do. Come on. Yes, Stephen, please let me move on from whatever that was. So this company...

They were using machine learning and large language models to predict market trends and stocks and all that fancy money stuff. But they had assembled a collection of GPUs. And so the story goes that they started at some point a couple of years ago as a side project training a large language model called DeepSeek that they were going to use in their main project.

Then, last year, they started training with a lower number of NVIDIA GPUs than are typically used in America, in American AI labs to train large language models. They started training version 3 of their DeepSeq large language model with a reasoning version called DeepSeq R1.

And they have published, so this is, I'm getting to why everybody's losing their mind. They have published a white paper and this model has open weights. Um,

which sort of means open source, but I don't kind of want to get into that. They have published this model and this reasoning model for free. You can use it for free. There's a white paper that you can read and it goes into the details of how it was put together. Now, for those unaware, a reasoning model means that there's a version of DeepSeek when you go to the DeepSeek website or you're using the DeepSeek app on your phone.

you can enable R1, which shows you, it takes a little bit longer to execute, but it shows the model, the COT or the chain of thought of the model. It shows the model, quote unquote, thinking and trying to understand your problems and basically thinking out loud about the query that you just asked. Now, most people,

haven't been exposed to a reasoning model because both Google and OpenAI, I believe they only make it available if you pay for either Gemini Advanced or ChatGPT Plus and Pro. So ChatGPT, which is obviously the most popular in the world, they don't give you a reasoning model because you got to pay and most people don't pay for ChatGPT. And with ChatGPT Free, you only get GPT-4.0.

So what's impressive here, according to the theoretical story of DeepSeq, is that the company used a much lower number of GPUs for a much, much lower cost to train this high-performance large language model. And they did that by basically using constraints

There's, you know, there's these new export laws in the United States that were put forth by the Biden administration, I believe, that basically prohibit NVIDIA from exporting, you know, too many GPUs to China.

And through the cluster of GPUs that DeepSeq already had before the laws were enacted, and also apparently, now we're getting into speculation territory, apparently through black market channels, they were able to... So some people are saying 2,000 GPUs. Some other people are saying it's 5,000. Other people are saying, no, it's 15,000. But apparently it's a much, much, much lower number

than what, again, supposedly OpenAI and Anthropic are using. Like I saw someone reporting that OpenAI is using half a million NVIDIA GPUs in their data centers. So the theory would be like, imagine that for one-tenth of the horsepower and one-tenth of the cost, again, in theory, because it's not like DeepSeq is publishing their finances, but imagine that for one-tenth of the power and one-tenth of the cost, they're

DeepSeq was able to match and exceed the performance of ChatGPT-01. ChatGPT-01 being the basic version of the reasoning model. Yeah. How could they do this? Well, I was going to say there's speculation that maybe they didn't do it all on their own, right? So, yes. So there's also speculation. So this is where we get to the...

It's a complicated story, so I'm going to try and break it down piece by piece. What's clever and interesting about DeepSeek is that

DeepSync is obviously, like, it's not like DeepSync, they invented the transformer model or the idea of a large language model. They built on the foundation of something that was invented by American companies, right? It was invented by Google. I believe the first paper on the transformer model is, you know, it's, you know, credit to Google engineers for that.

And then later came OpenAI, which had GPT as a product based on that. And I believe OpenAI was also first with a reasoning model. So DeepSeq, this is what's fascinating, that DeepSeq optimized the foundation created by American companies. And they did that by applying constraints

to their engineering teams that were forced to work with less power and less money. And they did that by basically sort of putting a unique spin on how large language models can be trained. I'm going to try and simplify here.

because it gets boring fast and also because I'm not an engineer. But my understanding is that typically there's a lot of supervised training where humans are actually supervising the model and feeding the model the correct answers and the correct process when they're training. There's supervised training and then there's reinforcement learning where basically you are applying...

a reinforcing technique to say, yes, model, good job. This is the right answer. Basically, DeepSeq only used the reinforcement learning to train their larger language model. And apparently, they used DeepSeq itself to train DeepSeq v3 and to train R1. And this is where we get to what you just mentioned. Apparently,

OpenAI is now speculating that DeepSeq used training data from ChatGPT to train

So basically the news of the day is that OpenAI is mad because DeepSeek used data from ChatGPT to train their model, which is kind of ironic when the company that scraped terabytes and terabytes of data from the open web is now upset that a Chinese startup scraped that data.

their data to train their model. There's a, what did they call it? Poetic justice? Something like that? Yes. It's kind of beautiful. Anyway, the result of the debut of DeepSeek last week

So the DeepSeek v3 launched in beta last month, came out officially last week alongside the reasoning version R1. It took the world by storm. By that I mean that it became the most downloaded app on the App Store, that the entire tech and AI industry lost their minds because like,

They were like, how can this Chinese company that's coming out of nowhere... Spoiler, it's not coming out of nowhere. People who are really into AI knew what DeepSeek was up to. It's just the rest of the world realizing now that there's a public product. But in any case, as a result of the debut of DeepSeek, they basically took...

how many hundreds of billions of dollars off the US market? NVIDIA shares dropped. NVIDIA shares, like NVIDIA lost something like $300 billion in a single day. $600 billion. $600? Okay. So, yeah, we're looking at basically like if you consider the NVIDIA stock that was down 17% or something. Google was down. Meta was down. Yeah.

A bunch of other tech companies were down. Only Apple was up 3%, but we'll get to that later. There is a conspiracy theory here somewhere. And if I were into conspiracy theories, I would kind of believe it, which is like, wouldn't it be fun if you like this entire narrative? Because you could say like, what if this entire narrative about DeepSeek doing this for cheap and doing this with like one tenth of the power, what if all of it is fake?

What if the entire narrative is fake, but this little story that they put together was a tactic by the Chinese government to put a little dent into the NASDAQ, into the US market, and wipe off a little, almost a trillion dollars in a single day. Wouldn't that be fun? Now, that's a fun conspiracy theory. I mean, I am definitely not an expert in...

any of this. Yeah. Um, but you know, there, there's also the angle of like, it was at a, a stock market move or like, yeah, is it just China, China doing China things, right? Like, um, we're going to get to this, but you know, uh, many, uh, well, some countries in the U S Navy are like, Hey, don't use this. Um, this is very much wrapped up in those international politics that are above our pay grade, uh,

But, you know, there is an element to consider that, you know, what they say should be taken with a grain of salt until it's verified by other people, just as the same as we should verify what OpenAI and Google and these other companies say, right? Like these AI companies make really grand statements and you've got to you got to put them to the test.

Yeah. So even if we set the potential politics of it all aside, I think it's interesting to look at DeepSeq and specifically the white paper that the company published because it does paint an interesting picture for the future of American companies and the future of large language models and also the future of open source. So it is undeniable that the DeepSeq team used

a series of really creative approaches to build this large language model. For example, they were able to work with one fourth of the memory consumption because instead of using 32-bit floating point operations, they used 8-bit floating point operations. So that's like four times less RAM when you're running this in your data center, which is fascinating.

Using reinforcement learning and with some. So basically, like I was listening to a podcast about this yesterday. They were convinced that they could do just reinforcement learning without supervised learning. But then they realized that the model was not responding correctly and it was continuing to like mix and match English and Chinese in the same sentence.

And so for DeepSeq v3, they started from scratch again and they did all reinforcement learning with some supervision in the final stages of the process. So even the story that it was all entirely based on reinforcement learning is not correct if you read the white paper. So really some interesting approaches that as a result, like there is a product that

You can go there, you can go to DeepSeek on the web, or you can download an app on your phone, and you can talk to it, and I can tell you, because I have been testing all of these things, I can tell you that the performance of DeepSeek, it most definitely rivals O1,

and the latest Google Gemini version 2 advanced experimental models. The performance is up there. Now, does that performance come from scraping the same data sources as OpenAI and Google? I'm sure. Was it made possible because they used chat GPT responses to train DeepSeq? I don't know. But

Whatever it is, it works. And I think there's a few interesting takeaways and also some other things to consider, which I'll get to in a minute. First of all, I think it's undeniable that this large language model and this product was built because of the work that had previously gone into large language models in America.

Once again, it's not like DeepSeek has invented a completely new technology. They have taken an existing technology and said, but what if we optimized the costs? And what if we optimized the performance? What result would come out of that? So they optimized the foundation of something that was created in America. And I think it is undeniably eye-opening for American companies that...

Maybe you can achieve, and people who have been keeping an eye on the open source AI scene knew that this was going to happen. If you follow blogs and podcasts and YouTube channels about this stuff, you knew that this was months in the making, this idea of a free and open source model coming out and matching the quality of all one.

It's been like, even the people who saw DeepSeek a couple of months ago, the v3 beta said, oh, when this launches, it's going to be a big one. But it is eye-opening for both OpenAI and Google to have this kind of competitor. And I think, realistically speaking, what's going to happen here is that OpenAI will have to move up the timeline for the release of ChagPT-03.

Sam Altman has already said on X that they will accelerate the timeline of O3. And O3, by the way, is the even more advanced reasoning model that they announced in December.

Such terrible names. Yeah, they have terrible names. OpenAI will also, they also said they will make O3 Mini, which is the smaller model based on O3, they will make it available for free for maybe or at least up to 100 free queries per week.

And I think on the Google side, because like these are the two biggest players right now, right? It's in the sort of models that you can pay for. It's OpenAI with ChaiGPT and Google with Gemini. And I think what Google will need to do, Google will need to make an even bigger deal of their reasoning model, which is Gemini Flash 2.0 thinking,

Maybe... These names, man. Slightly better than 03, okay? Slightly better. Flash 2 thinking. It's slightly better. But I think Google wouldn't... The whole interaction with Gemini when you have to pick a model from a drop-down menu is just as bad as OpenAI. And right now, I think both Google and OpenAI will need to clean up their list of models.

And have something simple. Because DeepSeq is showing that you open, you have one model, you tap a button that says, do you want to have the reasoning one or not? And that's it. And so I think both Google and OpenAI will need to simplify and make available to people a thinking model of some kind.

And I will keep an eye on Google. I think a lot of people are under the assumption that Google Gemini is as bad as Google Bard used to be. And I can tell you that it's not like that anymore. Especially the, what's it called? The Gemini 2 Advanced. Oh gosh, Stephen, you're going to make fun of this once again. I'm sorry, but look, I'm not the guy in charge. Gemini 2.0 Experimental Advanced version 1206.

it's not my fault. I'm sorry. It rolls right off the tongue. But that model is really, really good. That version of Gemini is really, really good. So I think both Google and OpenAI are feeling the pressure from DeepSeek. There's another conversation to be had about the safety practices of DeepSeek and the idea of censorship by the Chinese government and the CCP sort of looming over DeepSeek.

First of all, it seems pretty much clear that the folks at DeepSeek don't have a safety team, don't have any safety practices in place in terms of like how exactly was DeepSeek trained, especially if DeepSeek trained itself via pure reinforcement learning. Like,

They haven't published anything in terms of how safe it is, what kind of content was it trained on. They don't have a dedicated safety team or even person that we know of. So that's a big question mark. And also, try and ask anything about the Chinese government or Chinese history or Taiwan or

Taiwan independence or the Tiananmen Square massacre. And you will be able to see in real time DeepSeek R1 exposing its thoughts and censoring itself in real time. You will literally see the chain of thought stop once the model realizes that you're asking about the Chinese government or Chinese history. It'll say, ah, let's talk about something else. Not great. Not great.

What's interesting, though, is that DeepSeq is open source and you can host it somewhere else. You can download the model

and put it on your own server or your own machine. Now, when you run the model yourself or when you're using DeepSeq hosted by somebody else, for example, I believe Perplexity, they are hosting DeepSeq R1 in the United States. I have seen other services already implement a DeepSeq option. And once again, you can run it yourself.

In that case, it will not be censored. It'll happily tell you about the oppressive Chinese government and the Tiananmen massacre in the past, and it'll tell you about Taiwan, and it'll tell you about anything. So, interesting that, obviously, DeepSeek, when it's running on the DeepSeek servers in China, it's censored, but when you run it yourself, it's not. And obviously, like...

With DeepSeek, most people are not going to download DeepSeek and run it on their computers. Which is why, for example, the Italian Privacy Watchdog, which is an entity of the Italian government, has banned DeepSeek from the App Store. So the DeepSeek app is gone from the Italian App Store and they have issued a warning to DeepSeek

and the parent company in China asking for details about privacy collection, user data collection, and user data retention, and about their privacy policies. And what exactly is DeepSeq doing with the data from Italian citizens? What are they collecting? Why? And where are they storing that data? So this kind of story

I think you will see it happen in more and more countries in the next few days. Because for most people, once again, this came out of nowhere. Even though people who are tuned into the AI industry knew that this was going to happen, for people like... I mean, I saw it everywhere on the Italian newspapers, on Italian news websites. It's everywhere. And so this kind of like...

governments getting into this and be like, hey, hold on a second, this model, this AI from China, what's it doing with the data of our citizens? I think it'll happen in more and more places. I think it will too. And I mean, the upside to this sort of thing is like, if these models can be created and trained on less hardware, that's good. It's good for the environment. It's good for smaller companies wanting to get into it.

good for competition. I can't help but think that some of the freak out over this, at least in the U S is that, Oh, this has been an American company thing. And now it's in China and there's some freak out around that and in corners of, of the U S. But, but I'll say this, that, uh,

Undeniably, the DeepSeq team, they applied some really clever engineering constraints to come up with DeepSeq v3 and DeepSeq R1. That's, I think, objectively undeniable, especially if you read the white paper.

And they for sure have documented some fascinating techniques that because of open source, I'm sure others will copy and implement. And that sort of, it's the rising tide, what's it, the floats all boats? Like what is it? Basically that, like everyone benefits from that innovation. But if you're running a product that hundreds of millions of people use,

you still need to run this somewhere and you still need to scale this service. Like the scale that Google has and the scale that OpenAI has. I mean, it's no surprise that the DeepSeq website has been barely accessible for me, not because I'm in Italy, but like it was often down,

the DeepSeq chatbot was not loading. I've seen people having all kinds of issues with the DeepSeq hosted API. You still need to... If you really want to be the next model, you still need to match the arguably incredible performance of American models because they have a whole impressive...

Set aside the fact that it's bad for the environment, but when you look at it as an object, it's undeniable that it's something that is scaling to how many hundreds of millions of people and how many billions of requests per day. From a purely web engineering perspective, it's remarkable, right? And so it'll be fascinating to see if the DeepSeq company can do that.

I saw some reports saying that they are using these NVIDIA GPUs that are not the H100s that like most companies are using or the H800s, which are smaller and not as powerful. I also saw some other reports saying that they're using some Huawei CPUs, which is a really fascinating infrastructure that they have put together. But here's the thing.

Once again, I think the most important aspect to understand is that DeepSeek optimized something that already existed. Yeah. I think, though, that the angle that OpenAI and Google will use to continue to justify their capital and operational expenses will be, well...

But if you want to push the bleeding edge of this stuff, like if you want to come up with the next new thing that then others will copy, we'll need the money and we'll need the horsepower. So it'll be interesting to see how this shakes out. Like,

Is something like DeepSeq enough for most people? Or can OpenAI, you know, they literally are now, what's it called, Project Stargate in the US? Like that 500 billion project, you know, backed by Microsoft, by Oracle, by the US government and others, like building a massive data center. Like that's a lot of money going into this. And that's why it is scary to have this little Chinese startup come up and say,

Hello, we have this and it's free and we spent less than $10 million on it. Goodbye. It's, you know, it's interesting. It is. Yeah. And, and the, the timing really couldn't be worse for some of those people asking for billions of dollars. Like,

I understand why they would be freaking out. Yeah. What is also fascinating here in this multiplayer AI onion that we just unpeeled is the Apple angle for a couple of reasons. Now, obviously, as we have established, Apple is at least a couple of years behind. Apple doesn't even have a large language model to begin with. And here we have companies...

you know, doing reasoning models, O3, Gemini 2, DIVs, like Apple doesn't even have a basic large language model in the first place. So setting that aside for a second, Apple also has a problem in China because they want to roll out Apple intelligence in China, but they cannot because the Chinese government doesn't allow models like ChatGPT or Gemini. You know, obviously, you know,

This is the same as social media. You have to use specific services to be approved by the Chinese government. So there's a couple of interesting angles here. The first and more obvious one, I think, is that DPSIC could be the in-house

that Apple was looking for to be able to offer Apple intelligence in China with an extension. Basically, the equivalent of the ChagPT extension in the US and other markets where Apple intelligence is available, DeepSeq could be the Chinese equivalent for it. A Chinese company with a large language model, high performance large language model, could be the next extension for Apple intelligence to be approved in China. I could see that.

It would also be fascinating to have another approach and to see Apple acquire Dipsyc. Now, Apple doesn't often make big acquisitions, but Dipsyc is a small company. The talent, you know, Dipsyc is a hedge fund. They have a small team of engineers working on this. Again, I saw some reports saying it's less than 50 people. Who knows what is correct these days anymore? But it would be interesting for Apple to say, well,

to kickstart our own large language model, maybe we could acquire this. And it would fit Apple's approach of like, it's high performance, it's more cost effective, it's more energy, like it consumes less energy than an equivalent to ChagPT or Gemini. It would be interesting to see Apple consider an acquisition for DeepSeq.

Although I have also long thought that eventually Apple will acquire Mistral, which is the France-based AI company. But I do think that eventually Apple will need to acquire some kind of large language model. We'll see. But I think more realistic, I could see a deep-seq integration in China to get Apple intelligence out the door in that market. Yeah.

I think I pretty much covered it all, except, oh, there's one final thing that I think it'll also be something that we need to keep an eye on in the short term, which is the... Oh, there's actually a couple more things I want to say. The first one is I saw this article in the information about how a bunch of different businesses and...

What do they call it, Stephen? SaaS companies? Yeah, software as a service. Yeah, yeah. A bunch of these SaaS companies are like jumping ship to the DeepSeek R1 API because it's much cheaper to run than OpenAI or Google or Anthropic. Yeah.

Which, by the way, Anthropic, what's going on at Anthropic these days? What are they doing? I feel like we haven't seen news from Claude in how many months now? I don't even know. I think they're mostly trying not to get sued by content makers. No, that's perplexity. That's perplexity. That's right. To be fair, Anthropic is the only company that's actually thinking in a more serious way about safety. So that's commendable of them. I do think, I saw some people say that

And this is where I disagree with the Apple community consensus. I saw people say, oh, actually, Apple being late to the game with large language models is a good thing because Apple now can be an aggregator of AI services and large language models. I think I cannot use the expression that I want to use on the show, but you can imagine what I want to use. I don't believe that.

Because let me tell you, if Apple hadn't been caught flat-footed in this space, if Apple could offer a large language model now, don't you think that they would? Yeah.

and also charge for it with a more expensive and powerful version, you would think that if Apple could, if they were in a position to do this, they would say, nah, we're good as an aggregator. That's our strength. The app store is our strength. I mean, do you know Apple? Do you know modern Apple? Do you think Apple relishes the idea of being an app aggregator for real? And second,

The whole idea of aggregation, if you put the value in Apple as being a distributor of apps rather than the provider of core services on your phone, you know what? Today, the more I use these AI tools, it's never been easier for me.

than it is today to switch from an iPhone to an Android device if I wanted to. And that's because all the work that I've done in ChargePG and Cloud

And Gemini, it's all based on a web service. It follows me around. And same with DeepSeq. I can use DeepSeq on my phone. I can use DeepSeq on Android if I wanted to. I can use DeepSeq on Windows if I wanted to. So this whole idea of like, no, well, actually, it's not that Apple is behind. It's that Apple is an aggregator. It's that Apple is late to the game. And this is good for them because Apple gets recognized as the app store. I mean, come on.

That is like, you know, the classic tale of the fox and the grape. Like, no, absolutely not. If Apple could offer a large language model today, they would. Now, all these AI tools, this is, I think, the greatest threat to Apple right now. It's not necessarily the fact that they are behind in large language models, because I could see Apple coming out late and offering something that is, you know,

powerful and much more integrated. The greatest threat to Apple right now is the web.

And the fact that all of this is web-based. And web-based means inherently it's portable. And you can take your data and you can take your identity and you can take your projects and it doesn't matter the phone that you're holding. It doesn't matter the computer that you're using. The web is also the number one thing they should be worried about as a platform maker, right? I mean, just look at the things in my doc.

A whole lot of them, just web apps and thin wrappers, right? There is a world that could be coming where being a vendor of an SDK doesn't matter as much as it does now. Yeah, I think this is something that I've been thinking about a lot lately. I think over the past five years, we were looking somewhere else in the Apple community and we haven't kept an eye on what exactly was going on.

in the web industry and in progressive web apps. And I think it's incredible what is possible today. And that's, you know, I think in hindsight, 20 years from now, we'll maybe look back at this and be like, that's a problem that Apple ignored. And it calcified into what became a big issue for them, which is developers and a whole new generation of young developers being fed up with the rules of the app store. And be like, you know what?

I'm going to build whatever I want to build, and I'm going to do it in Google Chrome and in a web browser and on the web when there are no rules. And the progress that has gone into the kinds of modern web apps that you can build today, I mean, look at Notion, right? Look at all these services that are now taken for granted in any workspace, and it's all web-based, and it's all web-first, actually. I saw yesterday a post by someone who was running DeepSeek in a web browser

With JavaScript-based acceleration, I was like... Yeah. You know, like, incredible. Dude, Finn has it running on an iPhone using Core ML. Like... Yeah. Wild. Yeah. So I think...

The whole idea that, I know actually this is great for Apple because it ties Apple to this identity of the App Store as an aggregator of the best stuff. Well, what about the Google Play Store then? It's literally the same idea. You go to the Google Play Store. I don't think of Google as the Google Play Store. No. Yeah. So...

We'll see what happens. But I think these... Also, yet another reason that's a bad take is...

what part of Apple's business has the most risk of being blown up by regulation around the world? It's the App Store. And Apple is clinging on to their model. We've talked about this a lot. They've clung on to that model at their own peril around the world. Like, what are we doing? Yeah. So it'll be interesting to see what Apple does here, not just because of the threat of web-based products that

doesn't really matter which device you're using, and Apple is a hardware maker, the threat of open source. Like what happens, and this obviously extends to Google, extends to OpenAI, extends to Microsoft. Like what happens if the best models are not closed proprietary models, but they are open source models? Like what happens then? What happens to the economy? What happens to all of these investments? Is Silicon Valley going to continue to freak out? Anyone who's been

following this space for the past few months will know that there's a curve of progress to the open source community and to the open source models that's only going up and up and up. And it's, you know, I can see why, you know, Sam Altman puts up a good face on Twitter, but

I wouldn't, you know, did you see the report that, for example, at Meta, they have assembled multiple war rooms to figure out how exactly DeepSeek built the model. And I can see that because it's, you know, and Meta is also doing open source, obviously, but it's... Yeah, with Lama. Yeah. Uh...

Man, it's been an... Even if DeepSeek, you know, the story ends up being that actually they had more GPUs than they said. Actually, they spent more money than the narrative initially said. Which is definitely possible. Which is definitely possible. But regardless, what's in the white paper is in the white paper. And regardless, the approach and the engineering was clever. And so...

I think it'll have repercussions. It'll have consequences. It'll ripple out to the entire industry and it'll be fascinating to see, but it'll also be fascinating to see, since we are an Apple show, what Apple does here. And I am convinced that I think the most realistic option is that they will partner with DeepSeek in China. Yeah, we will see. I am sure someone at Apple is looking at it for sure. Mm-hmm.

Thank you for letting me do this. Yeah, no, thank you. When we talked the other day, you're like, I want to talk about this. I'm like, sweet, I'm not going to pay attention. Just like let you sink this information into my brain. So thank you for your service. There's no denying we've had some rocky outros.

for the podcast recently. And, uh, our friend Rob has made a new tool, uh, that lets you, uh, design your own outro for the podcast. It's called one, two, three outro maker. Incredible. Perfect name. Uh, Rob is the best. There's a link to that in the show notes. If you want to, uh,

If you want to make your own outro at home, but for now, I'm going to give it a shot. You can leave feedback for the show at connectedfeedback.com. You can join at getconnectedpro.com and get longer ad-free versions of the show each and every week. This week, we talked about task managers, and I issued an apology because I messed something up on the show last week.

You can find our work elsewhere. Federico is the editor-in-chief of MacStories.net, and he is Vitici across the Fracture social media landscape. Mike is not here, but we still love him. He's the host of many shows on Relay. You can check out his work at Cortex Brand. They have some new Sidekick products out this week. And you can find him, Mike Hurley, across social media.

You can find my writing at 512pixels.net. I co-host Mac Power Users here on Relay. It comes out each and every Sunday. This coming Sunday is our review of Apple Intelligence. We spent...

A lot of time preparing for that episode. I think it's a really good one. So look for that on Sunday and you can find me on social media as ISMH86. I'd like to thank OneBlocker for supporting this episode. And Federico, until next time, say goodbye. Arrivederci. Bye, y'all.