The Rise of AI | The Next Big Thing | 1

0:12It's an afternoon in early 2013. Larry Page leans back in the wide leather seat of a private jet. He absentmindedly smooths his salt and pepper bangs against his forehead as he skims emails on his phone. Back in 1998, Page co-founded Google. What started as a search engine is now one of the biggest tech companies in the world, trafficking in email, video sharing, cloud storage, and more. As CEO, Page is on a mission to keep growing the behemoth, and he's always on the lookout for the next world-changing technology. In a seat near Page, Elon Musk cracks open a Diet Coke. In the early 2000s, Musk was involved with PayPal, the e-payment system.

0:57Now he runs Tesla, the electric car company, as well as SpaceX, which builds space rockets. Page and Musk are good friends, and when the scheduling works out, they hitch rides on each other's jets. Along with him today is Luke Nosek, a co-founder of PayPal. Nosek's computer beeps with the sound of a new email coming in. Nosek clicks it open. Moments later, the beeps and boops of an old-school video game emit from his laptop speakers. Nosek's eyes go wide as he watches. Hey Elon, did you get this email from Demis at DeepMind? Musk and Nosek recently invested in an artificial intelligence company called DeepMind based in London.

1:39Yeah, but I haven't opened it yet. You gotta. This feels like true artificial intelligence. Page puts down his phone. His interest peaked. Along with other big tech companies, Google has been pursuing developing artificial intelligence for the past few years, but it's been relatively slow going. I want to see. Musk angles his laptop screen so Page can watch with him. He clicks on the link. The video starts. It begins with the opening screen of the video game Breakout created by Atari in the 1970s. In it, a player controls a rectangular paddle at the bottom of the screen and tries to bounce a ball into rows of rainbow-colored bricks at the top.

2:18The goal is to clear all of the bricks from the screen. If the paddle misses the ball too many times, the player loses. The game starts to play. At first, the player controlling the paddle is unskilled, unable to even hit the ball most of the time. But over the course of the video, the player gets good. Really good. By the end, the player has figured out how to get the ball behind the bricks, where the ball bounces between the upper wall and the bricks, clearing them quickly without ever risking the ball passing the paddle at the bottom. As the video ends, Page looks up at Musk and Nosek. Let me be sure I understand.

2:56The player is a computer, and it wasn't programmed to know how to play the game? Nosek nods. All they told it was to maximize the number of points it achieved. It figured out the rest on its own. Page looked stunned. In two hours, it came up with its own strategy, and by the end, it played better than any human ever has. Just incredible. Musk shifts in his seat. Incredible and terrifying. Today, it's beating a video game. Tomorrow, it's operating power plants and making military decisions. But at this moment, Page isn't thinking about the downsides of AI. All he's thinking about is that this technology should belong to Google.

3:41What'd you say the company that developed this was called? DeepMind? Soon, Google won't be the only company interested in acquiring DeepMind. And DeepMind won't be the only leader in the field. the major tech companies are about to enter a race to develop the most superior artificial intelligence the world has ever seen and potentially change society forever

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6:22From Wondery, I'm David Brown, and this is Business Wars.

6:52In 1958, a research psychologist at Cornell University Laboratory named Frank Rosenblatt programmed a massive mainframe computer with a mathematical algorithm that allowed the computer to teach itself skills. He demonstrated this ability by feeding the machine two cards, one marked with a square on its right, the other on its left. At first, the computer couldn't tell one from the other. But Rosenblatt continued to feed it the cards, and after just 50 trials, the computer was able to distinguish left cards from right ones with a high degree of accuracy. At the time, the New Yorker declared it was the first machine to rival the human brain.

7:34The New York Times also predicted that in the future, computers would walk and talk and possess a superior intelligence to humans. Soon, however, researchers in what was starting to be called artificial intelligence ran up against the limits of the technology at the time. Computers just weren't powerful enough to do much more than recognize some images. For decades, scientists were in what they called an AI winter, where few advancements were made, and many researchers considered AI nothing more than a pipe dream. But by the 2010s, computers had advanced dramatically. Plus, the proliferation of the Internet meant that there were now massive data sets.

8:15Electronic books, social media profiles, caches of photos, maps that could be used to train various AI models. The dream of creating artificial intelligence came roaring back with a vengeance. The big tech companies saw it as the key to the future of their businesses, envisioning a world where computers can diagnose diseases, trade stocks, write legal briefs, and more. In our new three-part series, we're tracking the race between Google, Microsoft, and Meta to develop the most powerful AI possible. We'll dive into the awe-inspiring breakthroughs and the terrifying existential questions, the corporate maneuvering, and the boardroom backstabbing.

9:01This is Episode 1, The Next Big Thing.

9:12It's fall 2012. Chi Lu knocks on the door of his boss's office at the Microsoft Research Lab in Redmond, Washington, roughly 15 miles east of Seattle. Lou takes off his small oval glasses. As he cleans them with his shirt, he notices his hand is trembling. He's nervous. Lou shakes his head. He's not usually nervous at work. He's one of the highest-ranking executives at Microsoft. He helped develop Bing, the company's search engine. And now he's one of the lead researchers in artificial intelligence. But he takes this handshaking as a sign of just how badly he wants what he's about to ask for. Come in.

9:56Lou replaces his glasses and walks in. His boss looks up from his computer and smiles. Gee, what's going on? Why the urgent need for a meeting? I just got a really exciting email regarding Jeff Hinton. Lou pauses to see how his boss reacts. Hinton is a professor at the University of Toronto and one of the leading academic researchers in artificial intelligence. Lou's boss nods. What's Jeff up to these days? Still stubbornly clinging to neural networks? Neural networks are an algorithm that mimics the way neurons fire in the brain. Most researchers gave up on it decades ago. But Jeff's just kept at it.

10:34It's paid off. He and two of his graduate students developed one that can identify common objects, like flowers, cars, and dogs with a high degree of accuracy. Baidu in China offered him$12 million for it, but he hasn't committed. I think we should make an offer. Lou's boss wrinkles his brow. I don't know. We decided long ago that neural networks weren't where we were going to put our money or attention. There are other ways to build artificial intelligences. With respect, this is a major breakthrough. It's going to change AI research forever. Lou bites his lip, deciding whether or not to say the next part.

11:10After a moment, he goes for it. We're falling behind. Google beat us to better speech recognition software, even though we initially led that research. We've lost several of our best scientists to other companies, in part because they want to work with neural networks. But if we buy Hinton's company, we can catch up, even surpass the others. Lou's boss thinks for a moment. You said Baidu's offering$12 million? Lou nods. Okay, you can offer up to$20 million. Lou thanks his boss and leaves. As he returns to his office, he hopes$20 million is enough. Microsoft is trailing in the race for AI, and Lou fears that if they lose this auction, they'll be left in the dust.

12:02It's close to midnight in December 2012 in Lake Tahoe, Nevada. Jeff Hinton stands at a Jerry Riggs standing desk inside a small hotel room. It's an unsteady stack of an overturned waste paper basket on top of a table, on top of a bed. But an old back injury means that Hinton risks a slipped disc any time he sits down, so he's willing to go to extreme measures to never sit. Two of Hinton's graduate students from the University of Toronto hover over him. Together, the three of them have founded the company DNN Research, based on a neural network they developed. They're holding an auction to sell the company while attending an artificial intelligence conference.

12:43They've been receiving emails all day as companies make bids for DNN Research. At the beginning, there were four bidders, Google, Baidu, Microsoft, and London-based startup DeepMind. But now, as midnight approaches, only Baidu and Google remain. Hinton clicks on the email from a representative from Google. 44 million. Let's see if Baidu matched that. He clicks on an email from Baidu's representative. Yep, 44 million. His students smile. One of them with red hair and glasses shakes his head. 44 million, this is crazy. The other grad student, who has dark hair, rubs his hand across his face. How do you think they'll go?

13:28Hinton crosses to the window, looking out onto the mountains, barely visible in the dark. They'll go high, but I think we need to take a step back. You know, we all agree that$44 million is enough money, right? We don't need more than that, huh? Both grad students nod. So maybe we don't pick the company that's going to offer us the most money. It's not immodest to say that whoever we sell this technology to will achieve a big advantage in developing artificial intelligence, right? The red-headed graduate student nods emphatically. How could they not? We'll be handing them the ability to train computers to learn, using more data than any human could ever retain.

14:11Hinton nods. Right, so who do we think will be better guardians of this technology? I guess that to me is as important a question as who will pay us the most money. The dark-haired student paces for a moment. I think Google. I mean, their motto is don't be evil. Hinton turns to the red-headed student. What about you? I agree. Google seems like a genuinely ethical company. My vote is that we suspend the auction for the night. I mean, it's almost midnight. I'm 65 now. I need my sleep. So if we all feel good about this decision in the morning, we'll tell Google that there are new bosses. Sound good?

14:53Yep, sounds good to me. The next morning, Hinton notifies Baidu that they're going with Google. Baidu tries to persuade Hinton that they have plenty of money left to offer, but Hinton and his grad students stick with their gut. With the acquisition of DNN Research, Google is unequivocally the leader of AI. But soon, the other companies see an opportunity to catch up.

15:30It's mid-2013 in Menlo Park, California. Mark Zuckerberg strolls across Facebook's sprawling campus, sipping a smoothie. A breeze ruffles his close-cropped, light brown hair. Walking beside him is one of Facebook's engineers, who specializes in what's called computer vision, the ability for computers to recognize objects. The two of them just had lunch with the founders of DeepMind. The DeepMind scientists started by talking about how their algorithm is learning how to play various video games. But that was just the beginning. They're adamant that in the future, there will be nothing a human can do that artificial intelligence can't.

16:14Zuckerberg finishes his smoothie and turns to the engineer. So, what do you think? The engineer lights up. They're the real deal. And they're right that neural networks are going to change everything. You're certain? Absolutely. I think about it. With a neural network, you don't have to build systems through programming it line by line of code. That's like making a recipe. You're telling the computer exactly what to do step by step. But with neural networks, you just give it all the ingredients, and it figures out how to make the meal and it can do it that way faster than it takes us to come up with a recipe.

16:46Hmm. Then I think we should buy DeepMind. The engineer's eyebrows shoot up. Really? If neural networks are the next big thing, then we should be in on it. I mean, what they're doing is really groundbreaking, but to be clear, a lot of their biggest claims are going to take years, if not decades, to achieve. At Facebook, we don't really do long-term research like that. Zuckerberg shrugs. The important thing is that Facebook stays in the game. We can't let the other companies move into an area that we don't follow. Zuckerberg throws his cup in the trash. He's determined to bring DeepMind into the Facebook fold.

17:28But Mark Zuckerberg isn't the only big tech CEO intent on buying DeepMind. By the time Zuckerberg learns what DeepMind claims it's going to do, Google CEO Larry Page has already had his sights on the company for months. He learned about DeepMind on a private jet alongside fellow tech billionaires and DeepMind investors Elon Musk and Luke Nosek. And the more Page learns, the more he's certain he also wants to buy the fledgling company to cement Google as the industry leader in AI. soon the founders of DeepMind have a choice to make one that will shape the race for AI dominance

18:17it's late 2013 in London the founders of DeepMind Shane Legge, Demis Hassabis and Mustafa Suleiman sit at a conference table in DeepMind's headquarters Hassabis starts the conversation off A former child chess prodigy, Hassabis stopped playing competitively as a teen to pursue computer science. To me, the answer is obvious. It's Google. I don't even understand why Facebook wants us. They're all about corporate growth and we're all about research. Legg nods. He met Hassabis when they were both graduate students at the University College London. I agree, and they refused to add the ethics language we wanted to the contract.

18:56DeepMind is asking any potential buyer to form an ethics board to review every AI product released. That's true. Zuckerberg doesn't think there's anything to worry about with AI. We know there's plenty to worry about. Suleiman leans forward. An entrepreneur, he was brought in to the company for his business know-how. Just to play devil's advocate, I want to point out that Facebook offered twice as much money as Google. Legg and Hassabis exchange a glance. Then Hissabes nods. This is powerful technology. We should make sure it's in the best possible hands, not just the richest. As Leg nods in agreement, Sudamon claps his hands together.

19:35All right, I'll get things moving with Google. Google is charging ahead of every other tech company in the race for AI, in part because of its commitment to ethics. But soon, a new player emerges, which will challenge Google's ethical standards. Head on.

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21:35It's 2015 in Menlo Park, California. Greg Brockman cuts into a piece of chicken. He's at a large table in the private dining room of a large ranch-style hotel called The Rosewood. A wall of windows frames the Santa Cruz Mountains outside. As the former CTO of Stripe, an online payment company, Brockman has been to The Rosewood many times. It's a favorite spot for Silicon Valley bigwigs to meet, but the view never gets old. And this table is full of bigwigs. Elon Musk sits across from him, as well as some of the most prominent AI researchers in Silicon Valley. They've all been invited by Sam Altman, who's sitting at the head of the table.

22:1830 years old, with big eyes and short curly hair, he's the president of Y Combinator, the startup accelerator. Altman didn't say why he was inviting them all to dinner, but Brockman's pretty sure Altman's flirting with starting his own AI company. Brockman notices the man sitting next to him looking out the window as well. He's an AI researcher, and he turns to Brockman. And I spend so much time thinking about generating images, sometimes I forget just how amazing reality is. Before Brockman can respond, he's interrupted by Altman clinking his knife on his glass. You're probably wondering why I asked you all here today, although I'm sure some of you have started to guess.

23:03It's no secret that the big tech companies are going all in on artificial intelligence. What I gathered you all here to talk about is if it would be possible to form a new AI company, a startup, that could act perhaps as a counterweight to the big tech companies. Musk jumps in almost immediately. Well, I don't know how feasible it is, but I just want to say that I think it's incredibly important. I was an early investor in DeepMind, and the pace that the technology is developing is mind-boggling. I genuinely think that there is a risk of something truly devastating happening to humanity as a result of AI in the next five to ten years.

23:41Altman nods. Yes, I completely agree with you, Elon. I was thinking that this new lab should be a non-profit, so it's not motivated by the need to increase revenue. But would it be possible for a new lab to start now? I mean, could a startup even compete with the big money of Google and Facebook and Microsoft? One of the AI researchers cocks his eyebrows skeptically. Well, the biggest hurdle is going to be recruiting talent. The big tech companies are throwing ungodly amounts of money at researchers. But another scientist at the table shrugs. That is true, but a lot of AI researchers have concerns about the technology.

24:20You could convince them to take pay cuts if you had a mission that directly addressed those concerns. Altman nods. Yes, but to make any noteworthy progress, we need a critical mass of researchers. Do you think there's enough researchers willing to turn down the money that a place like Google offers? The researcher shrugs. That's the$64 ,000 question, isn't it? Or$64 million. Brockman stays quiet as the conversation continues. It seems to go in circles, and the consensus is that it's hard. But Brockman notices that no one actually says it's impossible. After dinner, Altman gives Brockman a ride home.

25:04Brockman looks out the window as they drive past the offices of one tech company after another. You know, I think we should do it. Altman looks stunned. Really? You're in? People seem pretty pessimistic. It's worth a shot. Like one of the guys said, we need to fine-tune our mission to be clear we're talking about using AI to benefit humanity, and that we're aware of the risks. And so in that vein, I guess, I think we should make the technology open source. You mean release it to everyone? Yeah. I mean, we know the tech companies will keep their developments behind lock and key. We can take more of the approach of academia.

25:46You know, put it all out in the open. Hmm. But as everyone keeps saying, this technology could be dangerous. You really think it's a good idea to put it out there for everyone to use? I think it'll make us more mindful of how we develop the technology. You know, mutually assured destruction. Yeah, that makes sense to me. So you really want to do this? Brockman nods, and Altman breaks out into a big grin. Over the next several months, Altman and Brockman secure promises for over a billion dollars in financing for their new endeavor, which they call OpenAI, including donations from Elon Musk and PayPal co-founder Peter Thiel.