AI’s Steve Jobs?, Big Tech AI Chaos Ladder, 2026 Crystal Ball

26:49Like, is any of this real? Like, again, all part of the stew of what's going on here. So I agree that the the deep mind angle that it seems like they're they're taking from this this documentary on down is a is a much safer and smarter angle to probably play out. Right. And, you know, that's the one advantage of being, I guess, of being deep mind is you do need that money and that infrastructure, but you're doing it within a multi trillion dollar company. or else like it's right because it's not like dmine is still doing or you know gemini is still doing all the same things that open ai is they all have to chase each other right they launch new image like nano banana isn't it is nano banana a big part of the documentary of like you know i haven't gotten to it yet but it could it could be but yeah you're right it is it is it is interesting and and i think that i mean we're going to get into predictions a little bit but these these companies leaning on their edges and sort of getting their positioning now especially as things commoditized is going to be a big deal this year.

27:48All right, let's take a quick break and come back. And we're going to talk a little bit about what this AI moment has done in terms of the reshuffling of the deck of cards, as far as like where big tech stands. It actually isn't as positive as it looked a couple of years ago or last year even. So I want to cover that. And then we'll probably have time for some predictions at the very end of the show. So we'll be back right after this. Let me tell you about my partners at NordVPN. If you ever want to watch sporting events, TV shows, or films that aren't available in your region, you can do it by switching your virtual location to a country which is showing that content with NordVPN.

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29:37And we're back here on Big Technology Podcast with M.G. Siegler, who joins us once a month to talk about the latest in tech and AI. You can find his writing at Spyglass, which is at spyglass.org. Highly recommend it. All right, MG, so you wrote a little bit about how AI is like a chaos ladder. Chaos is a ladder and the AI chaos is like creating opportunities for companies, big tech companies in particular, to move up that ladder and reshuffle the deck in terms of the power in the business and the technology community. We'll touch on some of these companies, but here's my big takeaway. I looked at where these companies stand compared to where they were previously.

30:21And I found more of them, I don't want to say falling down the ladder, but like less up the ladder than I previously expected. Here, I'll just run through a couple. Microsoft, for instance, big open AI deal. Now they're kind of stuck in the mud, it feels like. People are asking questions about Copilot. They don't have a standout product in a way that they did when they were shuffling the state-of-the-art GPT models into Bing, for instance. So Azure is growing in a big way. So maybe that's, but that's probably just, I don't know, is that reselling open AI in a way that, you know, others don't have access to because of exclusivity.

31:00And Amazon was another big one, right? Their big partnership that you mentioned was Anthropic, you know, and Anthropic is now partnering with NVIDIA and Google and who else? And Microsoft, right? And Microsoft, yeah. You know, Alexa Plus is doing okay, like we talked about, but AWS isn't killing the world. and then you have Apple, we've talked about the Apple problems and then Meta, right? Which doesn't seem to have his act together. It's act together in a way that, you know, it did in the early days. So my big takeaway from reading your piece, I mean, obviously Google's doing well, but my big takeaway after reading your piece is like, wait a second, like, are the big tech companies not going to capitalize on this in a way that we all thought?

31:42And maybe the momentum is actually moving to the AI labs themselves. Like, is it that big tech doesn't get as big of a boost. And the next big companies are the opening eyes and Anthropics, whose valuations seem to double every few weeks. What's your what's your perspective here? Yeah, I wrote this a few weeks ago, you know, ahead of the New Year. So the end of last year, and I was just trying to take a step back and look at the current states of the major players, you know, as you rattled off a bunch of them. And again, like for my chaos ladder analogy, I just think of like, who are the stable ones versus who are the less stable ones.

32:19And I think definitely at the top is Google right now, but it changes, right? Like Google was in the middle of last year, their stock was like super depressed. And I wrote about that at the time versus where the other players were. And like, why was that? Even though it seemed like they were, you know, found their footing with Gemini, but it still seemed like they were sort of being undervalued by the market. Fast forward to today, literally, they just hit 4 trillion for the first time. So So they joined that club and, you know, they're up like a one and a half trillion, I think, in, you know, in the past six months in terms of market cap, which is just incredible, obviously.

32:55But it just shows you like how fluid this sort of situation is, that it can sort of change that quickly for even a company of that size. But I do view them right now as the most stable. They've got this Apple partnership sort of locked in now, it sounds like. And so I think that that stability is going to probably continue for a while. I do view sort of Anthropic as another one of these more stable players, certainly in versus if you compare them to where OpenAI has been. I think OpenAI is a little bit more stable. You say that they're all falling. I think they're a little bit more stable than they have been, mainly because they finally have this Microsoft thing at least somewhat put to bed, right, the deal.

33:32And now they're the public benefit corporation. I think OpenAI is stable for sure. They're more stable, yeah, certainly than a year ago, like where everything was up in the air. There's a lot of questions, though, right? And like you heard it towards the end of the year, the notion, you and I talked about it maybe in the last time we were together, the OpenAI API, right? Sorry, the OpenAI API. The OpenAI IPO, do they go out in 2026? Can they possibly do that? And if that's the case, like is Anthropic, obviously there's talk that they're also going to do that. And if Anthropic beats them out there, like that causes potentially a lot of problems for OpenAI.

34:09And so while they might be more stable right now, they really need to hunker down and get the business in line, it feels like, in order to have the correct narrative to be able to go out if and when they need to, which it sounds like they probably will need to given the capital that they need to raise. And so, again, the level of stability that these companies have right now, I think, is a moving target. But it does feel a little bit to me like they're starting to sort of not certainly not cement in place, but starting to coalesce around these like more stable and less stable pockets. Meta is obviously unstable because they blew up everything.

34:44We'll see. We're probably a few weeks away, maybe less from whatever they're going to announce in terms of coming out of their new super intelligence efforts. Just their avocado model. Yeah, that's what the codename was, right? Yeah. So we're going to see that soon. Microsoft, as you note, because of this sort of official, unofficial severing of the ties with OpenAI, they're now free to do this on their own. But it feels like that hasn't been the easiest going. And so in some ways, they're sort of held back by the success that they saw with OpenAI, right? And as you know, they still have that exclusive partnership.

35:22And so in many ways, they have this weird situation where they have to sort of obviously still partner with OpenAI on a number of fronts, and they are, but trying to do their own thing and compete with them and make investments in Anthropic and do all these other things, like even though, you know, it's all sort of competitive with one another. And so they're in a weird spot. Amazon, as you know. But again, it's it's sort of feels like it's coalescing that that Google's in a really good position right now. Anthropic, I think, is in a pretty good position because they it feels like they have the right sort of model, at least to match, you know, what they're trying to do.

35:59And then going on down the line, like it goes from there and, you know, all the all the way down to sort of the real the real chaotic players right now, which is the mainly the ones that have that have blown it up and try to start it over. Right. But, you know, it's interesting because think about what we just listed here. So of the big tech companies, the ones that are in to use your system in unstable or less stable positions are Amazon, Microsoft, Apple and Meta. I mean, that's four out of the big five that are not in a good position, which is surprising to me because you would expect them to be at this point.

36:37Right. We're now three years and change past JetGPT's release. You would expect them all to be in prime position to be capitalizing on this. And it's very rare for them to be behind the eight ball. Yet that's where it seems like they are. I mean, I think that they they have their each individual company that you list there has their own reasons. We talked about Microsoft's partnership with OpenAI was sort of a double-edged sword. It helped them a ton in those early days. But now, because that's not an exclusive relationship that they have anymore, and they really feel like they have to do their own thing, they were behind the eight ball when they came out of that.

37:13In some ways, I think Amazon is similar with Anthropic. They relied on Anthropic in a similar vein to the way that Microsoft and OpenAI were working together. And so now they've been trying to work on their own models and have launched several of them, and they still have the anthropic relationship too. And so part of it is all goes to the ideas of how just circular all of this stuff is, right? And all of these players are working with one another because there's the cloud players that have to partner with the model makers. And some of the cloud players are also model makers. And then eventually some of the model makers are going to become cloud players.

37:50And so they all but they all have to sort of work with one another. And so, you know, at the end of the day, the only real winner, as you can see by the way that where they are in the market is NVIDIA. And if if that stands throughout the year, we'll see with all the competition that they have coming their way on the chip front. But yeah, I mean, you're right that the players, like these biggest companies in the world, I think that they are sort of still trying to find their way. And you see various reports to this idea that they're trying to figure out exactly what the right model should be of how they're leveraging AI.

38:25And they all say that everything's great, right? Like, oh, Meta's using it to tailor ads. And yeah, Microsoft's using it to sell Azure. And it's going great. And you can see it in the bottom line and yada, yada. But like there's a reason why they're all scrambling and why they're constantly reshuffling their teams. And I do think there will be a lot more of that in 2026 as they all try to jockey for a position on this ladder. Right. I mean, I might get some emails from this and I might regret saying this, but what standout product does AI product does Microsoft have outside of selling AI services from Azure?

38:58What standout product does Amazon have outside of selling some AI with AWS? What standout AI product does Apple have? We both know that they don't have one. And what standout product does Meta have? None. AI product. They have none. None. Certainly none on the consumer front. And even on the enterprise front, though, right? Like that's long been what Microsoft said would be, you know, sort of that's always been their fallback, right? If they couldn't do it on consumer side. And obviously they try across the board for every single different technology that comes out and they, you know, they don't have that much success on the fronts.

39:32But like you would think that they could fall back to the, you know, massive enterprise just sales, you know, sell through that they sell through that they have. And yeah, to your point, like they'll say that everything, it looks great. But again, just watch the actions of these companies. I think you're exactly right. And I think for Microsoft in particular, it's glaring because you hit on it. they had not only the open air relationship, they had Bing as like the original, like product out there. It was going to make Mike, it was going to make Google dance and who's dancing now it's Google. Like Microsoft is not dancing, you know, so no rhythm.

40:11They got no rhythm. Um, and it was a huge, a huge missed opportunity. They could have made being a real potential competitor to Google. And in some ways they, they, you know, they were probably too early, I'm sure. And they stubbed their toe and they pulled back, you know, the whole, obviously, uh, weird conversations going on. What a moment in history. That's people leaving their wives and stuff like that. But, um, but still they were there and they, they could have basically had what chat GBT became and, you know, they just didn't sort of focus on the right elements of it. I know I'm going a little longer on this than I anticipated, but I do think that we're really, this is really worth talking about.

40:52It's like, then you look at where the action is. ChatGPT, ground up. Cloud Code, ground up. Gemini, effectively, ground up. It's, you know, one of the things that's just sort of stuck out to me when I was, you know, speaking with Sam was he was like, you can't just bolt AI on the existing products. You need to build ground up. and you know as we have this discussion you know those words are certainly like seeming like they're ringing true like it's the businesses the business picture right now is looking like twofold one you sell ai services to companies who are trying to like build on your api or two is you build these like native ai first products and you grow them from the very start yeah and this story is nothing new right like this is what happened with mobile too where like a bunch of players rose because they built these mobile first applications from Airbnb.

41:47And, you know, they started a little bit before that, obviously, but that's what really helped them take off. But Uber, Uber is a great example, right? Like, why, why didn't Avis, where was Avis in the, in the app store and buying Teslas. And so like, but it's the same story of like, yeah, you, you've got to really go after sort of the owning the whole experience and sort of doing it in a native way. I even think back to when Facebook, I mean, I often think back to this these days, because I feel like it comes up a lot with meta and what's been going on there recently, where it's like, when they sort of made their mistake around HTML5 and thinking like, oh, we don't need native mobile apps, like it's not going to be a big, it's not gonna be a big deal, we're going to do this extensible thing where, you know, the open web is going to take over and it just didn't play out that way.

42:34And Zuckerberg said that that was one of their biggest mistakes in the previous era, at least. And so, you know, again, like the notion of you got to build these products around what the technology is and not just try to bolt on the technology. You see everyone make the same mistake over and over again. And to your exact point, I think it's a good framing of it that like, where is Microsoft's 100 % sort of, you know, native AI product, like they'll say it's co-pilot, but it's sort of like, you know it's sort of like an amalgamation of a bunch of things first of all copilot the branding is a mess because it's the enterprise thing is called copilot the consumer thing is copilot they've got characters cutesy characters they've got you know all sorts of uh of non-cutesy things for doing it within office they can't figure out the brand you go to office.com and you're you're shoved into microsoft 365 app whatever like the the press cycle was around that, like their awful branding.

43:31So they've got all sorts of weird branding issues. But Amazon would say, obviously, it's Alexa. And they are having starting, it sounds like to have, you know, some level of success with Alexa plus, but in some ways, they were held back to because Alexa is from the old generation, right of, you know, drop the plus, but Alexa was on millions and 10s of millions of devices and 10s of millions of homes. And so they were, yeah, again, held back by the success of what they had in that front. And so they don't want to blow it up and start over. And so as a result, Alexa plus, I agree, it's like it's better than it was, but it still feels a bit tacked on.

44:05And I don't think it's particularly going to be good for, you know, sort of these go forward future initiatives in AI, whereas something like ChatGPT, they just keep rocking and rolling, rolling out these new ideas and features, because again, they've been building in this AI native environment from the get go. Yeah, I mean, this conversation just suggest to me, like, as we start thinking about this is maybe AI is, you know, if AI works, it's going to be more disruptive than I think a lot of people imagine, because if it's going to pose this threat to the incumbent tech companies who've, by the way, they're the one putting all these, this gap back into the equation, then what does it do for everything else?

44:43And the last thing I would say about this, cause this, your point jogged a thought in my head, Like, I feel like with AI, you've often heard it said that it's basically it's like a website, right? It's like every company is going to have to have AI integrated. And it's just like every company had to have a website and eventually a mobile app. And, you know, it's like table stakes stuff. Right. But what if that's not the case? Right. I mean, I think that it will be the case to a degree. I do think that all these sites and services will have AI baked into them. But what if the really successful companies are the ones that are doing this, like leveraging AI?

45:16And I've written about this and talked about this a little bit in the past where it does feel like AI, there are companies that jump up in sort of the echelons into the biggest companies of the world by leveraging sort of these new technological shifts that come into place. And I think most everyone would agree that AI is one of those. And so if you're just really tacking it on to your current products, that is not going to be what gets you to over the trillion dollar market cap hump or two trillion or three trillion, right? Right. These companies that are out there right now that are sort of the sub one trillion dollar tech companies that are just trying to bolt this stuff on.

45:51Like if I were them, in some ways, I would at least have a Skunk Works project internally to like build entirely new products based off of AI and not just trying to tack it on. Because that's again, history has shown that's the only way to actually get into the conversation and become one of the biggest companies in the world is by doing that. Yeah, I think that's what Google has done well. Yes. Yes. There's a few companies that have done that. And Google is right there at the forefront of that. Yeah. OK, so I definitely want to get into we have like 10 minutes left. I want to get into some predictions.

46:24I think you and I both believe, despite the issues that Apple's had, that it's going to have a big year. One of your predictions for this year is that the folding phone is going to be a big hit for Apple. I think so. I mean, again, this is this is a little bit going against the grain because it does feel like that people are. maybe not skeptical of it, but I know you and I've talked about it, right? Like you were, I like the, I have a pixel fold as my sort of Android backup device that I test things on. And I do generally like it a lot, but I think that I like it in that it shows me the way forward of how the folding iPhone will work.

47:00But I do think like if they nail the screen without a crease, which seems like out of CES, there were some leaks that maybe Samsung has a great screen that doesn't crease anymore. So it feels like the pieces are starting to fall into place. Then you go into like, I don't think it will just necessarily be what everyone just assumes, which is just the standard iPhone that you unfold and then it's a bigger screen. I wouldn't be shocked if it's going to end up being sort of like a little bit different of a use case and the way that they market it isn't a little bit different. There's a whole weird, no one knows for sure, but there might be a different aspect ratio to the front of the thing.

47:33It might be a little like smaller and fatter when it's folded and people might appreciate having a smaller sort of device in their pocket. And then when it's unfolded, maybe it's more like an iPad mini, which is the device that I love, but it hasn't really resonated as big as, you know, sort of the bigger iPads have. But so anyway, so maybe there's these different ways to sort of frame it that does end up being a success. And if it's timed well with this new partnership with Google to get Gemini powering Siri. What if it's one of the first devices with like really good AI finally from Apple? That could be a very compelling selling point, obviously.

48:08Definitely. I'm looking forward to Tim Cook coming out there and introducing the iPhone origami. And you're able to make your iPhone into a duck. If it's Tim Cook. Might be any number of people. He might be tired. Give me one hell of an iPhone retirement. He turns it into like a little fortune teller thing. And then he goes, all right, I'm done, everybody. I'm going to give this over to John Ternus. Have a good one. But speaking of Tim Cook, the Times had an article that talked again. I mean, this is more smoke than you need to say that something's going on here. Times had this story that said Tim Cook has told friends he's tired.

48:53This guy's going to retire. I think this is the last year, I think, for Tim Cook. Just not based off of anything more than reading the reports, but I think he's done. I think so as well. I mean, obviously, there's always the pushback, right? Like, okay, so this report says this, but who would actually leak that Tim Cook is telling people that he's tired? And I think Gruber pushed back on that a little bit. And then, you know, Gurman, who's done a bunch of the reporting on this, has pushed back on like the timing of the whole thing. But I think there's too much smoke now. Like clearly the pieces are being put in place for him to at least have the optionality to step back when he wants to.

49:34And it does feel like it's going to be at some point in this coming year. You saw there was, you know, the news cycle around. They're letting Arthur Levison, who is the current chair, stand for reelection, even though he's 75, which is the unofficial official time of retirement for Apple board members. And you would think that that has to play directly into the notion that they're going to have Cook obviously step into that chairman role eventually. But because he's not ready to step down from the CEO role yet, you know, this is all sort of the period of transition. But it does, again, feel like that everything is moving into place to have Cook be able to do that, to step into that chairman role and perhaps to let John Ternus come in.

50:13And, you know, there was some push in that same story about like, oh, are there other candidates that could be in the offering? You know, a lot of the it's all the standard names that are thrown out there. The problem with most of them is that they're almost the same age as Cook, except for Craig Federighi, who is another one who I would view as a legitimate contender to do the job. And, you know, it has to be sort of between those two, between Ternus and Federighi. But everyone, you know, all the reporting points to Ternus. And so you have to believe that that's the thing. The one thing that I do think that's a wild card in this, I'm very curious to see who they hire to replace John Giandria as the head of AI.

50:50All the reporting right now has, of course, Mike Rockwell from Vision Pro has sort of taken over the org. And then he reports up to Federighi, who is sort of overseeing the entire strategy of that. And so either they let him continue to run it, but you think that they have to get a sort of an AI focused technologist in there to actually sort of oversee this entire thing. And so who that ends up being, we can go back to you and I talking all of last year about like, who does Apple acquire? Like maybe they do acquire someone to bring in the right talent in order just to lead that division. I'm not going to say it's like Ilya Sutskiver.

51:28I don't think that they're going to do a deal that's like, you know, the$30 billion,$30,$40,$50 billion that it would take to buy safe superintelligence just to do that. But like, they need a name like that of that caliber in order to lead this and give people, they now have the sort of bandaid stopgap, if you want to call it that a very good bandaid in the Google deal. But eventually, Apple's going to want to own this and do this themselves. And so they need the right person that they now have a years of runway thanks to this Google deal to be able to work behind the scenes on their own stuff.

51:56Yeah. One of the popular names is going to be Mistral and we do have a Mistral CEO, Arthur Mensch coming on the show in a couple of days. And, uh, at the end of the conversation, I said, Oh, I forgot to ask you, uh, are you going to sell to Apple? And, uh, and he said, uh, I, he was at, I think he was at Google deep mind and he was like, I didn't leave a big company to start a company, to get acquired, to go back to a big company now uh money's money talks yes uh but money always talks but the eu talks too i don't know how much the eu wants right they're their champion to be bought by an american big that's right but that's right yeah all right uh so so one more prediction that you have is someone is going to buy perplexity you don't think it's going to be apple um who could it be i think the most likely one is samsung for the obvious reasons that they have a big partnership with them though Samsung is in the process, it sounds like, of more deeply integrating Gemini as well.

52:52You know, obviously, they've been a longtime leader in the Android space. And so you'd think like anything that Google does, they're going to be closely aligned with. But again, they have the partnership with Perplexity. I wouldn't be shocked. It's going to be a big price, right? Like that company, I think, was last valued at 15. No, maybe 20 now, 20 billion. So anything to take them off the table will be immense in terms of price. So it narrows down the options of who could do it. I don't think it'll be Apple for the reasons that we've talked about. I think that Apple kicked those tires and decided not to go down that path.

53:23I don't think it'll be Google for a host of reasons. I don't think they really need it. You could see a Microsoft or someone like that trying to come in and do a deal that, again, maybe helps reset or establish some sort of consumer, more consumer oriented foothold. Something like that wouldn't shock me. And there's a, you know, you can go down the list of a handful of other players, the Amazons of the world and whatnot. But I do feel like the music is maybe slowing to the point where they might have to figure out the path forward for that company in particular. Yeah, I'm much less bullish on perplexity than I was.

54:03I just think that like their functionality is just going to be swallowed up by the Geminis and the chat GPTs of the world. And it's like, do you really need an AI search engine to do the same thing that you can do within chatbots? Yeah. And they thought, they thought like the browser thing would be, you know, a huge beachhead and they, they said they were going to buy Chrome. Right. And, uh, and TikTok too. And they had a year, didn't they? So they've been looking for, there were these strategies and, uh, I think they're sort of running, running out of options of what the, what the next strategy will be in order to maintain that momentum that they need to in order to keep fundraising.

54:40Website is spyglass.org. Definitely one of my must reads whenever it comes to tech and AI. MG, it's always great to speak with you. Thanks so much for coming on the show. Thank you, Alex. Great to chat as always. All right, everybody. Thank you for listening and watching. We'll be back on Wednesday, as I mentioned, with Arthur Mench. Then on Friday, Arthur Mench, the Mistral CEO. And then on Friday, it's a break down the week's news. Thanks again for listening and watching. And we'll see you next time on Big Technology Podcast. Refresh your good vibes with TikTok. With the right vibes it's... Oh man!

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