Is AI Slowing Down?, Trouble at Tesla, Kate Middleton’s Bad At Photoshop

26:51Interestingly, no Microsoft seat. And Sam basically got on a conference call and said, I'm glad that we've put this behind us. I guess I still question like, you know, have we? But it does seem like this chapter has come to an end. I have a theory as you read the names of the board members. uh fiji simo she was she actually was one of the most senior executives running advertising at meta slash facebook um and i remember when she went over to instacart it was very clearly a signal it was pre-ipo that instacart is going to build out its advertising business and they did they did very successfully and now i'm not sure the exact percentage but it's a significant portion of their overall revenue mix.

27:35Does this mean OpenAI is starting to think about advertising in ChatGPT? Most definitely. Yeah, there's a rumor that they are building their own search engine. So Fiji actually makes a ton of sense there. Oh, I like this. I like this. We're not too far away from ChatGPT giving you an answer and then also providing you a suggested link or our suggested product. Absolutely. And Fiji, of course, was an important product executive within Facebook as well. She really knows consumer products that touch a lot of people and all the little tricks that you use to make sure that they keep coming back. So I think she's going to actually be an invaluable member of the board there.

28:15Yeah, that's an interesting one. I wonder, I still wonder that they didn't release the entire investigation, but only a summary. Did they use Chachi PT to summarize it and add to the prompt and do present this summary in a way that It is still favorable to open AI, but that appears balanced. That would be my prompt. I would be doing that. Absolutely. If you believe in the product, go ahead and use it. Maybe a little edited here and there. But yeah. Another thing that we talked about last week was sort of this email between Ilya Sutskever and Elon Musk about the desire to not be as open as they would, you know, sort of make it out to be to the public and saying that being open is for a recruiting process.

28:56and basically how this makes open AI's open seem hypocritical. And we had a listener point out quite angrily in the reviews that left out the fact that, you know, basically the whole blog post made Elon Musk's attempt to take over and to sue open AI somewhat hypocritical. And I agree with that. I think that's actually, you know, an important point. That did happen. That being said, like last week, we were just trying to talk about what mattered. And that what mattered was the fact that OpenAI had made this admission. I don't think Elon Musk is really that relevant anymore in terms of what OpenAI is doing.

29:31Of course, he's going to bring this lawsuit, you know, might poke them a little bit and help us learn more about them. But they're the big story, honestly, not Elon. And so it's not like a defensive Elon that that was skipped over last week. It was sort of a let's put the important story first. Well, no, but how do you then feel about I mean, Elon Musk is clearly one of the biggest figures in technology and he's suing open AI and he was a founding member of the company. You don't think he's central to the story? No, I think he is central, but I think the, like the, I don't think that it's as like what we care about is open AI.

30:08Do we care about, and that this lawsuit is going to get more information about them out in the public? Do we care about like the, you know, the fact that Elon's been exposed for, for leaving and then coming back and being self-serving? I don't think that that's as important. I don't know. Okay. I would agree in the sense that it's like Elon's role specific to the initial, like how, what his role was at the time. And is he going to get some kind of financial compensation? To me, it still feels though, like this puts him front and center in the AI conversation at a moment that he needs to be. It reminds the entire world that he was this, the most hyped AI company in the world.

30:52He is directly connected to, which still gives him a tremendous amount of credibility around AI in general. And it's something I think is at this moment and it's important. Yeah, no, I agree. I don't think he's a non-story. I just didn't think he was the main story last week. But anyway, we probably should have addressed it. And I just wanted to put it out there. Also, just like a word about, and I'll just do a quick little rant here about our sort of exposition about covering Elon because it does seem like every time we talk about Elon on the podcast, either someone who's pro Elon or someone who's anti Elon doesn't like like one thing or a few things that I've said or whatever has been talked about on the show and then leaves a bad review.

31:31So I just kind of want to talk about like my philosophy about covering Elon. So first of all, like I definitely like we have to acknowledge that Elon is a powerful and important figure in the tech world and we have to cover him. and he definitely inspires like strong emotions just about everybody who knows him and knows of him one way or the other and it's just like it's our job to cover him and at least speaking for myself I see Elon as a nuanced figure he's good at some things he's bad at others he's good at SpaceX which had a very important you know advance in his program with its Starship launch this week and for the most part he's good at running Tesla though really it's been rough lately and we're about to talk about that in the next segment.

32:10And I think he's been bad at running Twitter. And, you know, even though there are these like strong emotions, I don't want to feel afraid to speak about him or try to steer away from talking about him just because, you know, it's going to provoke some passions and, you know, I'll definitely get things wrong occasionally. The bottom line is that, you know, covering Elon and tech more broadly, you know, we're going to do it with a broad group of guests from across the ideological divide. And this is just how I think that we learn and you know how I hope you you're going to learn about what's going on because to leave these perspectives or leave people outside of the conversation um I don't think it really serves anybody and we're going to ask the tough questions to to anybody who comes on and about any story without fear or favor so um you know I I guess like when I see the ratings blow up like with bad reviews whenever we talk about Elon it just makes me want to like leave that topic completely alone.

33:05But I've just basically decided that like, we're going to cover it. And no matter where you are on the Elon spectrum, just asking, like, give us some grace, allow us to be wrong on things or right, you know, allow me some room to give it wrong. And if there's feedback or things that you think we miss, we put the email every every single week in the in the show notes. It's big technology podcast at gmail.com. You know, feel free to send feedback and we'll take it into consideration. And also like on the ratings, I know I ask for them often, but they really are the only publicly available metric that people get to see around the podcasts and guests and their representatives look at them before deciding whether to come on.

33:44So, you know, a bunch of five-star ratings could be the difference between a lower level executive or maybe having Jensen from NVIDIA on the show speaking with you here. So look, allow me to just humbly ask and finish this, you know, little exposition to please help us out if you can. Give us a five-star review if you can. And also just understand that if you, like anything like three, four, three, two, and one star, it basically means kill the podcast. Like you'd never want to go to a show with a three-star review. And look, I'm not going to talk about it anymore, but I just felt that that was important to be said.

34:17So like Elon, important to cover. We're going to cover him. Not always going to get it right, but I'm not going to ignore it. And I do want to hear from you if you think we're getting it wrong. Yeah, and as someone who can be tough on Elon, I will admit when I get it wrong. And certainly my predictions around Tesla's revenue and earnings growth in 2022 were definitely wrong. But 2023 and now into 2024 starts to tell a different story, I think. Yeah, so that's a great segue because in the nature of that little exposition, let's talk about Tesla earnings or Tesla's situation right now. So this is an unbelievable thing that's happened with Tesla.

34:59The analyst price target cuts have been crazy, crazy, just like earth shattering. Because remember, Tesla is already 60 % off of its highs. It was at$1.2 trillion. Now it's in the$500 billion range. And three major analysts have cut Tesla price targets this week. Deutsche Bank going from$250 to$218. Wells Fargo going from$200 to$125. This is the share price. And UBS cutting its price target from$225 to$165. dollars. Tesla right now is the worst performer in the S &P 500. It's down 32 % or 34 % now since the beginning of January. It's of course, the growth, this is from, from one of the analyst notes, he highlights that sales volumes rose only 3 % in the second half of 2023.

35:53From the first half where price and prices fell 5%. And basically, they're saying that Tesla is now a no growth story is yeah wells fargo colin langan it's a no growth story uh and this is happening as the s &p 500 is is up so what do you make of what's happening with tesla ranjan all right so i think when looking at tesla's stock it's always important to detach it from tesla the company Tesla's stock is down from the highs, as you said, I think almost 60%. It's still an expensive stock. The P-E ratio is still 37, whereas Ford trades at seven times earnings. So relative to traditional automotive manufacturers, it's still expensive.

36:42But it was able to be expensive for a long time because their growth in 2020, 2021, 2022 was incredible. And even just when you walk outside, I mean, here in New York City, when I go home to my parents in Boston, the amount of Teslas I see on the street is significantly higher. It used to be this kind of like fun oddities to see on the street and a novelty almost. It's mass market now. Yeah, now it's mass market. But in doing that, and they very specifically from a pricing perspective, significantly decreased prices. They took a margin contraction. The margin went from, I think it was like around 40 % to 25 % now.

37:22They're moving in the direction of a more traditional automotive manufacturer, which makes sense given the scale they are, and also given the growth of EVs across every automobile manufacturer. So I think they are becoming more of a normal car company. And in any other circumstance, that wouldn't be bad, right? Like that would be, okay, you're growing, you know, or maybe they grew so much in the last few years that maintaining that rapid pace of growth is difficult. but you're still a scaled automotive manufacturer that makes cars people like and come up with a new model come up with new traditional growth strategies but when you're trading like a tech stock you can't do that you have to have dojo robots on the roadmap and like you have to sell a much bigger story that is difficult to realize versus this has always been my issues just be a great car company and i think they could be a very interesting company yep and you're right like think about Tesla when it's more of the niche car company, right?

38:21It's selling the story, not the cars. Now it's moving toward a mass market car, mass market company. It's selling the cars and the story you write becomes less important because we're starting to see the numbers. And the Tesla story is not just about Tesla cars. It's about the technology, autonomous driving, the charging stations, right? Like you're going to be able to charge a Rivian in a Tesla charging station. It's about the batteries, right? People have called it a battery company. and all that. Okay, so I'm just going to put this out there. I think all that stuff seemed plausible when you were still small and you had more to grow.

38:56And it would even be more plausible now if Tesla was the leading story in the market. If Tesla, autonomous driving, and the brilliance of Elon Musk was the leading story in the market like it had been for years. But we have a new story. And the story is artificial intelligence. And Jensen Wang is the new Elon Musk. He's more stable. He's behind the product that's really leading us into the future. And he's selling like crazy. And his margins are nuts. Do you think that Tesla will pull off that ecosystem story that was promised? Maybe not Dojo Robots, but they become a battery company and the charging infrastructure of the country.

39:40And do you think they pull that off or do you think they just continue into mass market automobile manufacturer? As with everything with Tesla, it depends on Elon, right? And that's why Elon's centrality. It's just a centrality Elon story here. Can he push that vision forward? That's the vision. We'll see. Now, look at Elon. He's a little bit stretched thin. He's doing the Twitter thing. He's doing all these other things. And does he have the time and the force of will left to, you know, be sleeping in that factory again and make that happen? And if you look at like the recent calls he's had with analysts and the recent performance of the company, you know, even Dan Ives is talking about how they're, you know, they've been train wrecks.

40:29And, you know, I think that the Twitter thing is definitely contributing here. There's no way that's not a major distraction for him. So I think you should sell Twitter and just get on with it and focus on the things that are working. Now, I think, again, as you had gone through, sometimes we get it right. Sometimes we get it wrong. If Tesla pulls off this ecosystem story and becomes a battery or charging or insurance company, I will readily admit I was wrong. Because right now it does not seem like it's heading in that direction, but you never know. Yeah. And again, do I think Elon Musk can pull this off?

41:06Absolutely. Do I think Elon Musk in his current state can pull this off? No. Yeah, I think that's fair. And the market needs him to be, you know, it kind of needs him to be that if Tesla, is it a coincidence that Tesla's dropped by 60 % the stock, you know, since effectively the Twitter acquisition? Like, no, the market needs him to be this like Tony Stark-like figure to believe in him that it's going to happen. And that's why I've said all along that the Twitter acquisition has the potential to be more costly than just the$44 billion. It's cost him way more than that because there are people who are trading and being like, I don't believe this guy can do it.

41:47Yeah, but I disagree with that in the sense that the negative public perception of Elon Musk that's been growing based on what he tweets has always been there long before the acquisition. Now it's just he's more of a story to the average person rather than the kind of like, you know, tech crowd, myself included. No, his business acumen is now tied directly to those tweets. He owns the company. Everybody can see it. Yeah. Okay. All right. That makes a little more sense then. But it really is a tough time for Tesla. SpaceX doing great, but Tesla will have to figure this out. this is a pretty the thing is it's again it goes back to the story and the story is not in its favor and the the um the markdowns or the downgrades that these analysts they're dramatic it's crazy like going from 200 to 125 dollars well they mirror the markdowns on the cars as well that going from like 50 000 average unit retail to 34 it's it's when you're taking the same car and cutting the price.

42:56You're going to sell more of them, hopefully, but you're just going to kill your margins. Totally. Yeah, it's a perfect storm. Okay, so speaking of a perfect storm, TikTok might be gone, which is crazy. We talked about this on the Wednesday show with Solana, but the bill passed the House, and now it's in the Senate. So as I teased at the very top, that bill in the Senate looks like it's slowing down. So this is from the Wall Street Journal. TikTok's fate now hinges on the Senate. The Senate has hit the brakes and floated possible changes to the measure, dashing proponents hope for quick passage and offering a potential reprieve to the popular short video app.

43:33Among the reasons for moving cautiously, senators say worries that targeting TikTok would curb free speech and set an uncomfortable precedent of meddling with the private business, while also trampling on younger voters devoted to the app if TikTok were ultimately shut down. uh this isn't going to be as easy as a lot of people imagined even though the fact that the house voted in favor of the ban dramatically well we have been since i think i've been for too long of a time saying it's going to be banned but i think we discreet about this back in our predictions for this year i said it would be banned you said it wouldn't we're getting closer at least.

44:14I think for me, I wrote about May 2019. I said, I still can't believe it's not a bigger story that a Chinese-owned app is quietly taking over the American market. And I've been looking at this closely for years, and it's always blown my mind, especially the amount of influence it has from a media perspective, the fact that it's a black box algorithm. So I will say personally, I'm very happy that this is on the national agenda right now. It's going to be interesting in the Senate. I think like it's so rare that there's any kind of issue that brings together coalitions like we're seeing where you see, I think it was Marjorie Taylor Greene and AOC both voting against it.

44:58That was amazing. Yeah. Yeah. Which for me, I like makes me feel more confident in my will for a TikTok ban. But for me, I think it's it all just comes back to the idea that a country of like China has mastered the art of controlling the information flow of a billion people. They built the great firewall. They are the world's greatest sensor and kind of controller of information. And an app that is a black box algorithm has become the most influential property in America. And again, that's both for younger people, but also TikTok drives overall culture right now. It still blows my mind that there's resistance to this.

45:45And I've been trying to read every argument on the other side that could possibly try to sway me. And I still haven't found it. Well, let me do my best then. What do you think about this David Sachs argument that it's TikTok today and X tomorrow? and effectively that the bill calls these platforms for, I don't really believe this, but I'm just going to like advance it and knock it down. The bill calls for like a forced investment or sale to any foreign controlled entities or ban if they don't do it. And what Sachs is trying to say is that like they could use foreign controlled entities to be like, Elon is actually controlled by China.

46:30Therefore, it has excess to be banned. I mean, but that's where a slippery slope argument to me is bananas, because like the slippery slope is already here that a foreign adversary that is the world's leader in controlling information runs a black box algorithm that, you know, controls our attention and media influence. And it's like, I think, yeah, again, I think the idea that it will somehow go after X specifically, I think, is a bit ridiculous. But it is fair. I think questioning how are different people beholden to different interests is something that should happen more, especially in any kind of influencer, influential media property.

47:13So I don't think that's an unreasonable thing to bring up or ask. And Elon Musk's, if there is pressure related to Tesla's goals in China and how that could influence Twitter, I think it's a reasonable question. So I think those kind of questions should be asked and have not been in the past. And that's why we are where we are. Wait. So do you think that if people find enough suspicious things about Elon's relationship with China, that they should force him to sell X because it could be controlled by a foreign adversary? well no but okay so two things on that one i think it's a question that should be examined and investigated definitely because it's important but this is so clear that it's an own it's wholly owned by a foreign adversary that they are the dominant controller that's it's one thing to be influenced and it's another thing to be owned right and this is divestment to if by a company that is owned not influenced like this is so far beyond just general influence And again, that kind of question of is Elon influenced is a very two steps, three steps because of Tesla's growth ambitions in China.

48:24It could mean he's making product decisions. So that's not going to in any way. This bill, the language of it would never, ever touch that. Yeah, exactly. I mean, if you're going to start asking those questions and you got to ask about Apple, right? Like the list goes on. Yeah, yeah, exactly. Anyway, yeah, I do think the bill as constructed is pretty good. I will miss TikTok if it goes. I like using TikTok. My usage has been way up this week. I guess TikTok has been like sending notifications and things like that. And I've just been like, oh, yeah, forgot about TikTok. It's such in the mind. They must have like the best usage going.

48:56But, you know, I'm totally, if they ban it, they ban it. And like Solana and I talked about on the show on Wednesday, like, so be it. We'll get over it. And meta will get better. That's it. Or they divest it. But to me, the tell in all this. They're not divesting. They're not. no of course not i know there this thing will either be be not the bill won't pass or tiktok will get banned i'm sure of that yeah i mean but the fact that they are adamant about not divesting is it tells the ceo shochu on like capitol hill was interviewed and he's like oh he's terrible like he's awful but well it's funny because he he everyone loved him for a bit and his uh you know his testimony on the no come on that was awful also that was bad but yeah but the fact that Like to me, the tell is from a public facing perspective, you have a Singaporean and everything they're doing, they move the headquarters.

49:49They try to push forward, you know, like non-Chinese national faces as the public faces of TikTok, the app. And then every bit of reporting around any kind of conflict within TikTok, the company's operations are all about people have to go to work earlier because they have meetings with ByteDance managers in China. Like it's so directly integrated. And the fact that they one say we will not divest, it's we cannot divest, it's an outright ban. And then two, the fact that they're hiding it, like the fact that they're trying to do everything they can to say TikTok is not a Chinese company, I think is just a reminder that it is.

50:31Yeah. But now the Senate resistance does lead me to believe that this is not a, despite the fact that it passed the House the way that it did, it's still a real open question of whether this goes through i'm sticking my prediction it's not going to get banned i'm still team ban we'll see let's end on what what may be the most interesting story of the week where is kate middleton uh so ronjan i you're an expert in this i'm not but i did uh i've spent almost zero time paying attention to the royals but i do like technology and uh over the weekend or yeah was it over the weekend or or uh earlier in the week they they've so she's been basically out of the public eye after an abdominal surgery and earlier in the week they posted this photo of her with her kids and people on twitter started picking out the fact that this thing was photoshopped like crazy like nothing lined up the hair blurred the fingers were warped in weird ways.

51:29And at a certain point, the Associated Press decides, all right, we are going to kill this photo. I've never seen this before. They put out this notice, the first official of a photo of Kate, Princess of Wales, since she underwent abdominal surgery nearly two months ago, was pulled from circulation by the Associated Press and several other news organizations because the image appeared to have been manipulated. And then this response is just, is unbelievable from Kate Middleton. And then I'm going to let you run with it, Rajan. She goes, like many amateur photographers, I do occasionally experiment with editing.

52:06I wanted to express my apologies for any confusion the family photograph we shared yesterday caused. I hope everyone celebrating had a very happy Mother's Day. What? Okay. I love this story and I got two rants on it. The first is the, I'm not sure if you had heard the theory, I guess it's more of a theory than a rant, that part of this is driven by the fact that Prince William has been having a potential affair. And this is my favorite British thing. Allegedly. with the Marquess de Chalmondele is how it's spelled, but it's pronounced Chumley. That alone just bringing in who's married to the Earl of Roxavage.

52:50Like the whole thing is just the most awesomely British royal thing. And I have never been interested in the British royal family, but this is pretty fun right now. The Earl of Roxavage, he did everything. He was a great family man. He just tried really hard. He was there for her. And this was always bound to happen to him. No one talks about the Earl of Rock Sauvage. Maybe we can get him on the podcast and he can tell his side of the story. Talk about Photoshop. Maybe he can give some Photoshop. Maybe he knows how to use generative fill in Adobe Photoshop better than the average new graphic designer.

53:24Or Kate Middleton. But my other rant on this, my other rant, not Kate Middleton, certainly. My other rant on this, though, is I should not be annoyed of this, but I am annoyed how everyone is saying AI when it's actual, just standard Photoshop errors. Everyone's like, this is AI. This is the future of AI. You can't trust anything. I'm like, this is literally bad Photoshopping. This is like, you know, moving stuff around or using standard Photoshop feed. This has nothing to do with generative AI. Maybe if she used generative fill, it would have actually been good, But this is like the conflation with how this could mean AI is going to screw up everything in the world and destroy all trust and increase misinformation, I think is a complete misdirection here because this is just bad Photoshop.

54:16And Kate Middleton is bad at Photoshop. Right. If she even photoshopped it. Well, that's the question I want to ask you. So the weirdest thing about this to me has been the social media statements. I mean, those have been the creepiest ones. first of all she said i think she said william took the photo which like it was a perfectly shot photo it seemed like like that's strange like you don't most normal people can't take a photo like that and then she said that she did the photoshopping i mean what the hell like do you believe she was doing the photoshopping that's wild bananas yeah i think uh how do you put a tweet out like that no but here here's here's what's happening i'll tell you the royal family america and england listen up here we go due to harry and megan's uptick in fame obviously it's been trailing off a little bit but they certainly got the big netflix contracts and they got the podcast contracts what a spotify whatever else they became the influencers they became more interesting than the actual royal family itself the royal family decided it was time for us to become interesting again.

55:23And then they saw on TikTok, maybe they even influenced those initial viral TikToks about Kate Middleton conspiracy theories. But this is all a PR gimmick to become the center of attention once again. You heard it here. This is my second favorite conspiracy theory about what's going on with them. My first favorite one is that it's been circulating on social media, is that they used Kate's exact face from a Vogue cover for the shot, and they overlay the Vogue cover, and then they fade out the Vogue, and there's her face. And it's like, people, you put her face on her face. Oh, obviously, it's her face.

56:04Yeah, we'll talk about it, yeah. Bellingcat, the investigative journalist operation that kind of is amazing at understanding the nuance of digital paths and fraud and everything like that. They had a pretty good response to why this is not what it is. But the Vogue viral tweets that saying, like, I have proven that they're using Vogue, it's actually kind of a, it's also maybe it's good for Elon Musk, too, because Twitter feels alive and back again in a way that it hasn't been in a while where, you know, the engagement grifters are alive and well. There's fun conspiracy theories going around. there's it's just in a good way in a healthy way in a in a harmless hopefully way it feels good i do think twitter's gotten a little better like they've dialed in the algorithm a little bit more like i don't see as many chat gpt influencers and menswear guys although i did block menswear guy i couldn't take that guy anymore uh yeah but kate middleton saved us from the chat gpt influencer that's right so okay let's end on this where is she where is i think she's at home watching the numbers come in roll in and smiling as she realized she just restored the royal family to be the most interesting people in the entire world and that's something we have not had for a long time so congrats kate congrats kate and congrats to all of you, you now know the truth behind Kate Middleton's disappearance.

57:37All right, Ranjan, thanks so much for joining. Have a good weekend and let's keep tabs on Kate and see where she is. We will. Hopefully we'll have an answer by next week. All right, everybody, thank you so much for listening and we'll see you next time on Big Technology Podcast.