Big Tech’s Insane Hidden AI Spending, Ranking Anthropic vs. OpenAI, AI For Travel Debate

20:59Big Technology Podcast Host:Well, I think, you know, maybe it's not a given that Wall Street is functional, but they should be ahead of this. Because if Ed Zitron can do it and the Wall Street Journal can do it, surely Morgan Stanley should be able to do it. And here's the quote. I always love looking at the quote at the end of these stories because it tells you what the author really thinks. You know, after they make through their like carefully hedged language, like laying out the facts. Here's the quote. As these off-balance sheet commitments become frequent, larger, and more complex, it's becoming increasingly difficult for investors to assess companies' total potential leverage.

21:34Big Technology Podcast Host:And that comes from none other than a Morgan Stanley accounting analysis.

21:43Ranjan Roy:They're starting to get on it. I mean, even the way you outline that order, Ed Zitron first, then the Wall Street Journal starts to get in on it, like the story. Like it's – again, the mania is so strong that it shows you that you have the kind of Ed Zitron persona, the kind of like gadfly truth teller blogging in the corner, like trying to scream about this story. And again, like I disagree with him a lot on the idea that like generative AI and agentic AI is all like, you know, not a useful technology. But he's gotten – he's been ahead on a lot of this stuff. And I think like to be the one saying that the data center financing doesn't make sense when the company is investing in it are just – their stocks are skyrocketing.

22:39Ranjan Roy:again if you missed nvidia you do not look good like if you missed anthropic on the private side and open ai like if you're the one trying to say this 12 to 18 months ago and managing money you'd be looked at as a failure by your investors so i think like that's there that those are the mechanics why it takes so long for these things to come out right and so i think like another reason

23:05Big Technology Podcast Host:you do this, of course, you don't want the street to maybe see it and hit your stock, but you may not be so sure you're going to pay it all back. I think that could be part of it. And ultimately, this is where it becomes a problem is when you pay it all back. If you're sure you can pay it all back, you go to your friend and you're like, hey, let me get five bucks. If you're not sure you can pay it back, you're like, can you go to this person and get money? And I'm sure my other friend will pay them back. And you're starting to say, hey, am I going to get my five back or am I not going to get it back?

23:36Big Technology Podcast Host:So this is like one more piece of the story. This from the Wall Street Journal again. There are reasons to believe tech companies will make good on all their obligations, optimists see skyrocketing demand for AI tools as a proof point that demand is going to be strong for years and the money will pay all those bills that will be rolling in. For the more anxious set on Wall Street, it's a warring sign that some tech companies that once seemed to have a fortress balance sheet have needed to tap the capital markets frequently. I don't know. What side are you on?

24:08Ranjan Roy:What are the sides? How are we defining them?

24:11Big Technology Podcast Host:Side one is they're going to clearly pay it back because the AI boom is going to bring in so much money that they won't know what to do with it. And side two is like, well, these are some of the strongest companies in the world. They had these huge balance sheets of cash and now they're going to be debt ridden.

24:27Ranjan Roy:I don't know if I – so the danger is very clear that these are the largest companies in the world and they're taking a levered bet. Like and they're all taking the same levered bet. So that's not good. Like you never like to hear that, again, where everyone's money is just sitting is all betting on the same thing. Again, I firmly believe that AI demand will explode and the economy is going to get agentified and all of that's going to happen in the years to come. But I guess I would lean on the anxious side in terms of like when everyone is taking the same bet, it's always a bit concerning. What about you?

25:19Big Technology Podcast Host:No, not just – I agree with you and not just the same bet. Like you mentioned, a lever bet. and we've seen in the past couple weeks that leverage bets on ai don't always work out right so talk a little bit about the risk here i mean it's it's one thing if it's leopold

25:34Ranjan Roy:it's another thing oh man we were we were on vacation for leopold yes um and demis by the

25:41Big Technology Podcast Host:way which we've we have covered on the show but you and i haven't had a chance to speak about it yet but but yeah the the idea that you're gonna that these are big bets i mean 340 was 347 billion dollars that meta has and obligations for leases that haven't kicked in yet like this i mean you know the term bet the company is used way too often but this is bet the company type activity

26:05Ranjan Roy:here it is but that's what so that's again if we're gonna lean on the anxious side and man i can't believe we never got to talk about leopold but uh maybe we can start working that in

26:16Big Technology Podcast Host:i think uh we we did for listeners ranjan and i did happen like just as ranjan went on break and And we did like exchange a bunch of text being like we knew there was going to need to be an emergency podcast. So anyway, we'll definitely get a chance to give our Leopold analysis. There's going to be a round two and a three.

26:35Ranjan Roy:I'm not worried about that. I think – but when you say that, remember Mark Zuckerberg has said – I'm not going to remember the exact quote, but it was around like, oh, well, if I were spending this much, we should be spending more. Like every – this is – I honestly wonder what the group chats are like for Big Tech C. Are there group chats where it's like Sundar, Mark, and everyone? But like they're all feeding on each other and they're competing on each other against each other and thinking the same thing. And yes, they are all saying effectively bet the company. This is the single biggest moment in their history, the tech's history, humanity's history potentially.

27:22Ranjan Roy:So of course you're going to bet the company.

27:25Big Technology Podcast Host:I mean it all goes back to what Paul Kudrowski said on the show a week and a half ago, which is effectively that what we're looking at is a call. Basically the way that it works is it's what all the spending is a call option on AGI. That if you get something that what people are envisioning to be AGI, like a powerful AI that, I don't know, maybe does people's jobs and cures cancer, money will spend. You would think if you could hoard it or maybe. But if not, there's going to be a reckoning here. It seems like as you read deeper into this activity, and I agree with you, by the way, that I'm not skeptic on, let's say, the capabilities of AI, at least the way they stand today.

28:09Big Technology Podcast Host:They're exceptional. And we're going to talk about this in the second half. How far AI has come in the past few years is insane. But you can at once say that and also say, by golly, I'm afraid of the numbers that I'm looking at. And it seems quite concerning when you put it all together.

28:29Ranjan Roy:I love that your phrase of exclamation is by golly.

28:39Big Technology Podcast Host:There's one thing that I've changed on break.

28:41Ranjan Roy:Can you say that on CNBC soon?

28:46Big Technology Podcast Host:I will attempt it. Absolutely.

28:49Ranjan Roy:By golly, these numbers are astounding. I think - They are. Is there any other way to refer to it? No. No, by golly is the only way that we can ever refer to this again. And as Leopold round two and round three or whatever else comes next, that's our exclamation. That's what we're both yelling.

29:12Big Technology Podcast Host:By golly moment. Yeah. Okay, reckon with the substance, Ranjan. Don't lose sight of the substance.

29:19Ranjan Roy:I think I forget the substance at this point.

29:21Big Technology Podcast Host:The substance is that this is not going in a good direction.

29:25Ranjan Roy:Well, okay.

29:29Ranjan Roy:So, no, it is – so to me the question – and I don't even say this as highly anxious. I say this as I don't think this plays out completely smoothly. And in that call option framework, and again, a call option, the right to buy, basically having unlimited upside for kind of like smaller premium, taking that kind of bet. I don't think it's – the question to me is what does an unwind look like? And I will say like it's – when we say$347 billion bet, it's not$347 billion in the sense of if things go wrong, this is – that's like a guarantee of lease payments over a large number of years. It's no way that like Meta has to pay$347 billion.

30:25Ranjan Roy:There's going to be – it's going to play out slowly potentially. It's over time. There's lawyers involved. There's people losing money left. Maybe it's in a very distributed fashion and people notice their pension fund investments are down 10%, which is not good. But it's not like Meta's$91 billion of cash evaporates next week. unlike the Leopold situation of highly levered bets for a hedge fund where you can go from$45 billion to$6 to$10 billion or whatever it is and lose a massive amount of money in minutes or hours. So I think – so that's to me still, let's say 6 to 12 months, OpenAI and Anthropics IPOs are duds.

31:13Ranjan Roy:people stop having this absolutely manic drive towards the story, the AGI call option. What does a drawdown look like? I think to me that's the more interesting question. Because again, Meta is still going to be raking in advertising dollars. That's not going anywhere. Google, between their cloud and consumer businesses, that's not going anywhere either. So to me, I think like how does this actually play out is going to be – I don't know. And it's very hard to say, but I think that's going to be the interesting part of this.

31:52Big Technology Podcast Host:Oh, definitely. I mean I think we've talked about it on the show numerous times that you need perfect execution really by many of the players here for this all to work out. And if the execution is not perfect, then that's when things get somewhat interesting and probably very rough for some of the players involved. And we just – we don't exactly know what that looks like. But with the size of the numbers that we're seeing, some extraordinary things have to happen in order for this – it almost reminds me of like the soft landing scenario or the no landing scenario, right? That the Fed is trying to get inflation down.

32:30Big Technology Podcast Host:It's like you need so many things to go right or you're going to have a problem.

32:35Ranjan Roy:That's a good kind of like corollary, the soft – is there a soft landing? Is there no landing? I think that's a good way to think about it. And what do those different scenarios look like? I think we're going to be talking a lot about that, especially as it's August 21st and Anthropic is supposedly coming out to the market next month. I think we're going to start seeing a lot more concrete numbers assigned to this whole story. Yeah.

33:09Big Technology Podcast Host:For what it's worth, I just want to state my perspective on this because I have been thinking about over the past couple of weeks. And then we're going to get to the Anthropic and IPO and revenue numbers and open AI revenue numbers. I'm starting to think there's really only three true outcomes for AI. Like one is AI works and it's good, right? So it leads to economic prosperity and like a rollback of disease. The other is AI works and it's bad. So we start to see more of the rogue hacking activity that we've seen and it gets in the hands of bad actors and it leads to bioweapons and things like that.

33:48Big Technology Podcast Host:Or the third possible outcome is that AI doesn't work. And I've really struggled. The idea of this soft landing, I struggle to see it. If AI doesn't work, there's been so much money tied up into this system that there's going to be some form of crisis. So I really see it as – and I think I'll write about this on big technology when I get the newsletter back up and running probably like post-Labor Day. But I really see it as three true outcomes here. What do you think about that?

34:16Ranjan Roy:Well, I'm going to be your editor and say that I vehemently disagree with your framing of three possible outcomes. Okay, good, good, good. Yeah. Because everything we have been talking about is completely independent of the three scenarios that you outlined. if it works and it's good or it works and it's bad actually can be totally independent of will data centers work over the next few years and be able to actually make bondholders whole because it could work over a longer time period it could work but then the actual compute requirements because of innovation dramatically decrease and then actually the data center story fails but AI is either curing diseases or hacking into all of our bank accounts.

35:06Ranjan Roy:So I think they're two very, very separate things, the story that we're talking about and those possible outcomes. I think independent or separate from the whole financing story, I think, yes, those are three outcomes that kind of cover the entirety of anything. But I also, the curing diseases thing, I'm kind of tired of. And I say this only because that feels like such a crutch that Dario and everyone just keeps falling back to just to be like, guys, please like us. We'll cure disease. We haven't outlined any possible way of like any concrete things that actually are going to get us there. But you should like AI because it's going to cure disease.

35:54Ranjan Roy:I strive.

35:55Big Technology Podcast Host:Okay, so first of all, we'll add a fourth potential outcome is that AI works, but it works too slowly and it causes financial collapse. There we go. There we go.

36:04Ranjan Roy:Now I'm good. That's the fourth outcome. Now I'm good.

36:06Big Technology Podcast Host:But I very much disagree with you about this disease thing. I mean alpha folds, I know it's been kind of talked about forever. But like some of these personalized healthcare examples that you're getting, maybe it's not a cure. It could be managed. they're very very difficult to argue with and i'm personally like i i think that it could be very big in a way that and and the amount of focus that's going into it uh no no but you know within the labs um to me i think it's it's not worth you know it's sort of waving away

36:40Ranjan Roy:no no but i i firmly believe that ai will bring tremendous progress and innovation around rare disease, disease as a whole. I firmly believe that. I don't think that tells a story about why Anthropics IPO should succeed or you should like Anthropics specifically. Like them, those CEOs using it as kind of a crutch, that's what I have the problem with. I think like if you're a university professor doing research on how large language models can kind of like parse through mass amounts of unstructured data around rare disease, that is the future and that's great and that is the most beautiful story to tell.

37:25Ranjan Roy:If you're Dario and you're worried about where, or even Sam, remember, I feel OpenAI has been kind of talking about this more and more now because their enterprise story, which we'll get into, is not going great. So it's like another one where it's just, again, it's like moonshot-y type stuff

37:44Big Technology Podcast Host:when for these very mature businesses so that's that's the rant there yeah but you don't think that's going to be economically valuable i think it will be i don't think i don't think they have shown anything specific to their business today that makes them any more i don't know like that they're going to be the ones to do this i think like yep startups some chinese company whatever

38:11Ranjan Roy:It's like everyone – it is open season. It's like – which is good. And that's exciting to me. But that's my rant, which I'll continue for weeks on end as we had entire PO season.

38:23Big Technology Podcast Host:Okay. I love it. I love it. All right. We've teased it enough. When we come back from the break, we're going to talk about Anthropic and OpenAI's new numbers where it seems like Anthropic is surging and OpenAI is – well, we'll get to it. Back right after this.

38:36Ranjan Roy:There are a lot of things AI can replace.

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41:13Big Technology Podcast Host:So innovation scales without scaling risk. It's a single platform instead of a pile of tools, bringing security, governance, and resilience all together. AvePoint, the unifying trust layer for AI. Learn more at avpt.co slash bigtechnologypodcast. That's avpt.co slash bigtechnologypodcast. And we're back here on Big Technology Podcast Friday edition with Ronjan Roy of Martins. All right, let's talk a little bit about the numbers that we teased before the break, looking at Anthropik and OpenAI's revenue that have started to leak. This is from Bloomberg. Anthropik's annualized revenue topped$65 billion before IPO.

41:56Big Technology Podcast Host:Anthropik is on track to generalize annual revenue of more than$65 billion based on its current performance, up more than sevenfold from its pace at the end of last year. The company's run rate hit$65 billion by the end of July. The dramatic acceleration in revenue bolsters. Anthropics planned for a public listing. Anthropics and OpenAI filed confidential paperwork to go public, with Anthropics expected to make its Wall Street debut as soon as this fall ahead of OpenAI. So on the quarter,$11.5 billion compared with$787 million in the corresponding period in 2025. All right, those numbers, by the way, they say a lot.

42:39Big Technology Podcast Host:This company is growing exceptionally fast, and we have numbers that look more like real financial statements, quarterly revenue, not just run rate, which I know you hate. Your reaction here to Anthropics Growth?

42:54Ranjan Roy:This made me even more excited about the day we get to see – you said more in line with real financial statements, but we're not quite there yet. Because, again – okay, two parts of this. One, my God, still, it's like trying to make us backward calculate your like July and August revenue when you're like, well, actually, quarter ending June 30th, we made$11.5 billion, but it's a$65 billion run rate. So what was the revenue acceleration, like trying to backwards calculate that versus just saying, here's what we made in April and May and July, and here's a graph that shows it's going up into the right.

43:35Ranjan Roy:That's what should be happening because, again,$11.5 billion in a quarter, obviously, if it's accelerating, but that's still not$65 billion over a one-year period. I don't know. I'm excited for real numbers to come out. I hope they come out. There's part of me that's like, is this IPO so hyped that they could just be like, nope, we're only going to give you vague run rate numbers even as a public company somehow and they get away with it. But I'm not comfortable with these numbers yet.

44:05Big Technology Podcast Host:Yeah, I don't see how they could – how could they ever do that? I'm always curious how the numbers come out in stories like this. We know how the numbers come out. As part of its regular update with investors. But there's also the prospect that they're going public and the sourcing in the Bloomberg story is according to people familiar with the matter, which sounds like it might have been delivered in an envelope from Anthropoc. Although I get in trouble for speculating, but it's like really in Anthropik's interest to get the numbers out there to scare OpenAI away from trying to go public before them.

44:40Big Technology Podcast Host:I don't know. What do you think?

44:42Ranjan Roy:No, no. This is – like whenever this happens, I – when I was at – in my past direct-to-consumer e-commerce experience was part of a potential IPO proceeding. the level of secure like if we were to ever even say figures to our wives and families and friends we would get annihilated by the bankers everyone did everything they could to prevent any kind of leaking of any figure to the press and meanwhile like every conveniently at any moment i mean we're all just seeing these numbers like this is a very and again anthropic sandwich in the park they're comms masters like all this stuff is orchestrated i can't like it has to be and whether it's an investor providing that envelope or whoever else like like because almost by definition as this if this number were truly leak leaked like there should be held to pay within anthropic within the bankers that are actually working on this IPO.

45:52Ranjan Roy:But this has happened for a while now. We're like, again, in the past, remember, valuations weren't attached publicly to a funding round. That was supposed to be like, actually like leverage for investors in a competitive space. And now it's a given that that's going to come out. But so yeah, I think I actually think, I don't think that's just speculation. I think that's actually an important part of how this story does get reported.

46:20Big Technology Podcast Host:Yeah, yeah. I think it's, you know, it does feel inside baseball a little bit, but it's, I think it's our duty here to sort of talk through sort of how the sausage is made in situations like this. So I'm really, I'm glad that we covered it. And now if basically Anthropic is seemingly on track to IPO this fall, which is not so far away, even though it's warm in the northern hemisphere now. We're not too far away from the crispy days of fall, and we could be seeing an anthropic IPO with potentially Dario ringing the bell. How crazy would that be? Does Dario ring the bell?

46:59Ranjan Roy:Does that feel too pedestrian to ring the bell?

47:02Big Technology Podcast Host:I mean, maybe. Do you sort of, I don't know, does Claude do it? That seems cliche. He'll ring it. He'll ring it. You only get to do it once or twice, three times.

47:13Ranjan Roy:I don't know. Maybe Claude ringing the bell. I don't know what that's going to look like. Robotic arm with an agent attached. That's what I want to see. That's what I want to see.

47:23Big Technology Podcast Host:Yeah. That would be seriously a visual for the ages. All right. Let's move over to OpenAI because we also have their second quarter numbers, which just so happened to make it out into the public as well. And this is from the Wall Street Journal. OpenAI told investors its revenue grew by 18 % from the first quarter to the second quarter while its losses deepened. Results had disappointed some shareholders who had hoped that the startup would show more progress catching up to rival Anthropic. Sorry, that sounds like the investors leaked it. I don't know. It doesn't seem like OpenAI decided that that – if OpenAI did put those numbers out, they're probably not happy if that was framed.

48:02Ranjan Roy:No, exactly. And again, there's reporting that Sarah Fryer in an all-hands said that they're not IPO-ing until 2027. Like, OpenAI, okay, we were both off. Denise Dresser leaving as chief revenue officer. And again, I know this one hits closer to home for me working in enterprise AI. And I can say that this at Ryder, like, everyone was like, jaws hitting the floor. because eight months into the job, the chief revenue officer who is like has a stellar background in – she was I think Slack CEO under – Yes. Like I mean what do you think is going on over there? What do you think is going on? I've been waiting to ask you this for a month now.

48:49Big Technology Podcast Host:So it's not just Dresser, right? So this is from this journal story. Last week the company replaced its chief revenue officer, Denise Dresser, after she spent less than a year on the job. Her departure followed a string of other exits, including former chief operating officer Brad Lightcap and Fiji Simo, once seen as the heir apparent to chief executive Sam Altman. So it is a lot of departures. Fiji, of course, health related reasons, but Brad Lightcap is a big one. Look, I think this is just the consequences of them, you know, really getting their butt kicked by Anthropic on the way to coding.

49:25Big Technology Podcast Host:And they've taken a few months to sort of turn their ship and focus it on Codex, which is still in the process of being released. So, you know, they got their first draft out of it before, you know, sometime in July. And now they're going to refine. But this is obviously a very powerful and very lucrative form of artificial intelligence. And they are behind the eight ball right now. So when that happens, yeah, revenue tends to grow more slowly than the arrivals. I mean, they made$7 billion in the quarter. It's not bad. Yeah, but that's not – But that sort of – that leads to tumult.

50:04Ranjan Roy:But there's tumult and then there's by golly because that's like – We're going to get second by golly in one episode, OK? I think, by golly, three senior executives leaving. Also, not just senior executives, each the one that is supposed to be like, especially Fiji and then Denise, like enterprise is the future. We're going to focus, et cetera, et cetera. These are the people leading those efforts. And you're not – your business isn't collapsing. I don't know. To me, like, and also, like, if you were to be executing on some giant vision to pivot one of the biggest consumer stories of our lives into enterprise, you would get more than eight months.

50:53Ranjan Roy:Like, you would, that does not happen in eight months anyways. And again, for her to come in and then even the leaving process, you know, it's not, it doesn't happen in a moment. Like, it's going to happen over weeks and months. So like, I don't know, like that to me, that's the part that is just still kind of crazy that the timing of all of it.

51:19Big Technology Podcast Host:Yeah. Well, I have a theory on this. I kind of want to run it by you. It's not like anything too juicy, but it is organizational, right? So like most companies that go through, and I've been a part of fast growing startups. I know you. Yeah, I have at least two of them. I know you have in the past and are now. don't you like in the way that startups work is there's a certain group of leaders that are there from like you know sort of no money to 10 million then there's like a certain group that's there from 10 million to 100 and certain group from 100 to like 500 right so you're so part of the chaos of working for a startup is constant leadership turnover because there's the people with the idea then there's the people that notice sort of take you from like series a to series b so there's like They start to standardize some of the processes and they start to like really structure your hyper growth.

52:09Big Technology Podcast Host:And then you bring in like more seasoned executives from bigger companies who like turn your startup into a big company. Right. And so like, you know, it's not uncommon to like work in a startup. One day, the person that hired you, like you've been like working underneath for months is gone. And there's like some new person that comes in because they're used to working with big pre-IPO companies. and then you IPO and there's another person. So, but here's no, I just want to talk through it. I'm not excusing. I just want to explain something. OpenAI is, you know, as with everything in this cycle, OpenAI is compacting that thing into the shortest amount of time that it ever has.

52:51Big Technology Podcast Host:Like even hyper growth startups, when they do that, they take a moment, they grow, they breathe. They take a moment, they grow, they breathe. I mean, just think about the numbers we read from Anthropic, You know, under a billion dollars to$11.5 billion and a quarter and maybe more in the quarter we're currently in. Right? It's crazy. So that's where you get this kind of madness. No, no.

53:12Ranjan Roy:But I 1 ,000 % agree with you having been and currently in a very fast-growing scaling startup. Like scaling startup and that keyword startup, you described it perfectly. these are companies that are seeking$2 trillion market capitalization valuations that are bigger than the vast majority of companies in the world. Like, these are not startups. And if they want those valuations, you have to at least, to me, the operating model should be more in the line, at least pre-IPO startup, as you said, which they are, rather than that series B to C, C to D, kind of like testing the waters. If you want that valuation, you got to show a little bit of maturity.

54:05Ranjan Roy:They're asking for$2 trillion.

54:08Big Technology Podcast Host:Yes. Okay, here's the thing. They are startups in one really important way. And that is like, yes, the numbers are as big as any enterprise company, most, right? But one of the things that defines a startup is you're not fully set on your product. You know, you become an established, like people like the old question, well, what's a startup and what's not? I mean, part of it is you sort of, you're not a startup anymore when you have a thing that you sell, right? And it's just kind of the thing. You sort of find that product market fit and you settle into it and that's what you are. Now, of course, you adapt.

54:41Big Technology Podcast Host:But the thing with OpenAI and Anthropik, by the way, that gives them the nature of a startup is the technology that they're developing is not mature. It's still growing. The capabilities are growing fast. The offering is growing fast. So you don't have the stability of a traditional big company, even if the numbers look like you do. So this is the kind of point I was going to make. When you bring in somebody like Denise Dresser from Slack, and I'm just – this is speculation. When you bring in somebody like the former CEO of Slack, that person is a good fit for the numbers. But are they a good fit for the chaos and the figuring it out part?

55:19Big Technology Podcast Host:That is what's going to make these roles so difficult to hire for and so difficult to keep people in because it doesn't really line up the two things that you're looking for.

55:29Ranjan Roy:All right. No, no, no. I'll give you that. I'll give you that. That like is enterprise the future? Is a cloud business the future? Is personal devices or wearables or household – like especially in the open AI case, wide open? So in that sense –

55:45Big Technology Podcast Host:And even if it is, by the way, what is enterprise?

55:47Ranjan Roy:What are you selling? You know, these are the sort of open questions. Yeah, no, no, it's fair. And again, that's in my world. Like, is it codex to developers within enterprises, which has been the current story? Is it knowledge work, which they're kind of like chat GPT work and trying to get into? But OK, that's fair. Like, they are a startup like anyone else in that sense. Yeah.

56:10Big Technology Podcast Host:Anyway, we will see. But I think bottom line from these reports is Anthropic, Juggernaut, Enroute, too. Like, it seems like Anthropic is putting some distance between itself and OpenAI. And I don't know. I, you know, it's sort of, you know, it was clear that Anthropic had a small lead over the past, you know, basically since the beginning of the year this year. But that gap seems to be growing. It's not to say OpenAI isn't capable of closing it or surpassing Anthropic again, but at least when you look at the state of play right now, yeah, Anthropic is putting some distance between itself and OpenAI.

56:50Ranjan Roy:I think in terms of AI use cases in markets that are mature, I'd like to hear about travel because we're going to be talking about Anthropic and OpenAI for a few months and weeks on end. And so I want to hear you're sitting in a Dubai hotel room. I want you to pitch that actually travel is the right story for a Gentic. And that's right.

57:15Big Technology Podcast Host:So, so, okay. So yeah, before we go, we have to talk about this. Ranjan, you and I, I think we've had like this back and forth relationship on talking about travel as like a worthwhile key use case that tells us something about AI's capabilities. and at our summit, for instance, like I wrote up a travel use case and you're like, leave that at the door, man, or something of that nature. And I've been traveling over the past couple of weeks and I'm probably gonna write about this again in the newsletter. But I think that travel, when it comes to assessing AI's capabilities, is actually an excellent proving ground.

57:53Big Technology Podcast Host:All right, I'm gonna make the case with three quick points. the first one is when you're traveling you need to use something to sort through a lot of information a lot of information what to do, where to stay, what to eat how to get there, how to get home what days things are open on, what they're not the internet, the web is terrible for these things and there are terrible incentives to provide the information for you like all the affiliate links online and all the fake review sites So I think that this is like something that's kind of made for generative AI, which takes in all the information, adds context, adds a little intelligence, and then provides it to you in a succinct way.

58:36Big Technology Podcast Host:The second thing is that with travel, what you're dealing with basically is a cascading series of small and big tasks that are always changing in some way. So I think as an eval, so to speak, for AI, it's actually really good because it resembles some more high stakes type of cases where you're like maybe at work and you're working a project. Well, what does it have on a project? You have a cascading series of small and big tasks that are always changing in some way. But the best thing about the travel example is that you can experiment more at lower cost on a trip than you can, let's say, at work.

59:18Big Technology Podcast Host:And if AI aces your tasks there, looking at it again as an evaluation, you can be somewhat clear that it's going to maybe not ace your work test, but you can feel more comfortable putting it towards more economically valuable tasks. because travel is in what I'm going to call like the Goldilocks zone of important but not so important tasks. So there's real stakes when you're traveling and you fail at something. Like if you show up and like the hotel that you booked was actually hallucinated by Chachaputi, you know, there's real stakes, but it's not a disastrous stake. Like you don't lose your company.

59:55Big Technology Podcast Host:You just kind of have to walk down the block and book a different hotel, maybe for a little bit more than you were anticipating to pay, but you can sort of survive that. That's why I think travel is such a great eval for ai uh and i certainly like you know uh traveling this year compared to last summer was really able to experience like the capability increase uh of um you know let's just say like the latest versions of chat gpt where i did like almost all the planning and logistics work what do you think are you gonna are you on my side now are

1:00:26Ranjan Roy:you with me i okay just coming back from my own extended uh travels over the past month i i actually am not gonna disagree with you i'm not gonna i like the framing i like the framing travel as the eval i actually kind of love that in fact like and and honestly like i believe there needs to be more actual normie evals as opposed to whatever latest benchmark there is so the Kantrowitz, TripAdvisor, travel booking, combing, Google Flights, eval, we should construct. But it's funny. The one thing I'll disagree with is you said if ChatGPT hallucinates your hotel, it's not disastrous. Traveling with a wife and child, I would actually disagree because if I did that, but I had my own kind of...

1:01:21Ranjan Roy:So I went to Spain and I was like joking. It was kind of like an AI generated vacation that basically my wife wanted to go to Barcelona. I've been there a bunch. So like, I was like, we'll do a few days there. But I basically gave AI a bunch of requirements, like really specific around, like, I want best value for Airbnb in a specific price range with a pool at the Airbnb. I want like snorkeling, but shallow water as my son is only still learning to swim. I want sandy beach. I gave all this stuff and it came up with Denia, Spain. And we went for four days and not touristy. And a lot of Spain in August is just like Barcelona.

1:02:04Ranjan Roy:We didn't see a single Spanish person other than people working. Like it was Denia was amazing. It was like one of the best. It had been so long since I'd like actually felt kind of like traveling that you discover something and it really is kind of magical. And AI got me there. It was literally a set of requirements. And then also during the process as well, creating a markdown file with the context of all your rental car booking numbers, even now having passport information, everything, hopefully secure. But like, I mean, no, no, like, and then being able to quickly ask, oh, wait, what's my rental car number?

1:02:45Ranjan Roy:What's required for a rental at budget? it like in spain all of that so so ai got me to denia spain i don't want to uncover this hidden gem but to our listeners you deserve certainly to uh to make it there and would highly recommend it

1:03:02Big Technology Podcast Host:yeah this was supposed to be a debate but i'm glad you sort of see it see it my way uh on this one and i had such a similar experience i mean for me you know this trip i it was a very logistically challenging trip. Like I think I was on, um, maybe four or five islands in Indonesia, uh, over like the span of like 15 days. Uh, and then yeah, coming back through Dubai and it was just logistically so, so seamless. And I had, what I had to do, I planned it in one chat. And, um, before I boarded the plan, I said every day, 6am, I want you to search the chat, search Gmail, search my calendar, give me a brief of everything that's going on today, all the numbers I should be aware of, all these things.

1:03:45Big Technology Podcast Host:And it did perfectly until I think I had like canceled my account because I wanted to switch credit cards. And I was defaulted back to the free version of ChatGPT like two days ago. And I'm going to resign up to premium when I get back. But the free version of ChatGPT sucks so bad. And I cannot wait to be back on the good stuff again. Go ahead.

1:04:08Ranjan Roy:So actually one thing you said I kind of love is like the ambition of complex logistics and travel is increasing significantly. Because I remember like, again, whether travel with family, even before, I remember being old, the days of like printing out map quests into a folder and all your information. and itinerary. Like you would actually include less ambitious logistics because you just didn't want it to fuck up. You didn't want to like end up in a travel disaster. Again, when I was traveling like alone throughout Asia and stuff, maybe you took on ambition because they're going back to like whatever happens, happens.

1:04:55Ranjan Roy:But like now this trip, there was a lot of changes and transitions and cars rented and hotels booked and the Airbnb, be like in a remote place where no host is checking you in and there's a lockbox and like all of that. And it was still perfect. Like, because, and I'm not like a huge planner planner in the past. And this actually like kind of makes me feel as empowered as my kind of like obsessive friends who would create spreadsheets for trips back in the 2000s. So yeah, I like that ambition to travel.

1:05:32Big Technology Podcast Host:Yeah, definitely. And it's not my strong suit. So it was cool to see it. All right, we'll leave it with that. Ranjan, great to have you back. Your glorious return. Not a minute too soon or too late. I don't know. We're glad to have you and looking forward to doing this. We're back.

1:05:48Ranjan Roy:It's going to be a fall. It's going to be a fall. Hold on to your seats. No, wait, wait, sorry.

1:05:54Big Technology Podcast Host:By golly.

1:05:55Ranjan Roy:By golly. Here we go.

1:05:58Big Technology Podcast Host:Thanks, Ranjan. All right, thanks everybody for listening and watching, and we'll see you next time on Big Technology Podcast.