Greg Brockman’s “Rough Day” in Court, Amazon’s Hybrid AI Search, SpaceX’s $60B Cursor Deal

0:13Welcome everyone to The Information's TI TV. My name is Akash Pasricha. It is Tuesday, May 5th. On today's show, The Information has exclusive reporting about some big product changes at Amazon. Our Amazon reporter will join the show to share with us what she knows. We'll then turn to our reporter at the courthouse, Rocket Drew, who is covering the Elon Musk OpenAI trial for a recap on Greg Brockman's testimony. We'll also unpack Coinbase's layoffs and we'll then get into our exclusive reporting on the hidden costs behind XAI's fast and cheap data center build out. And we'll wrap with a look at AI coding, how startups are differentiating themselves in an increasingly competitive landscape.

0:55It's going to be a fun show, so let's get right on into it. Amazon is planning some big product changes for its core e-commerce website, some of which take a page from Google's playbook in search. My colleague Catherine Perloff wrote about that in a story out today. I want to bring her on to talk all about it. Catherine, welcome to the show. It's great to have you here. Hi, Kosh. So what product changes is Amazon planning at their company? Well, it's a little, it's still hypothetical, but, you know, so I spoke to the VP of core shopping at Amazon, a key executive who kind of controls partly how the website looks.

1:35And one idea she said they've been sort of tossing around is creating sort of a more hybrid search experience. So up until now, there has been the Rufus chatbot, which Amazon formally introduced in 2024, where users could have kind of a more chatbot-like experience about shopping for products. And then the more traditional search engine where, you know, a shopper could just put in terms and then they get sort of a list of items instead of a more like paragraph conversational like response. And what Amazon is thinking about is could there be a more combined experience where there is a paragraph describing, you know, some of the product features and then below that the results.

2:25So, you know, this might remind you a little bit of Google AI overviews, which, you know, they rolled out a few years ago where they kind of provided this AI summary and then links to the site below that. And, you know, this is just one experience Amazon might offer. It's not necessarily going to be that way all the time. You know, Amazon has a different business than Google where they're selling. They want people to buy things and not just people to buy ads. But yeah, it is interesting sort of how the Amazon website might evolve with AI. So let me understand this. So when I go to search for products on Amazon, I know I have the search bar there and it takes me to all the results.

3:10And so is the idea here that what's under consideration is if I search for household items or shoes or whatever, then I will get an AI overview type of thing with links to results and then the listings? Or what is under consideration? Yeah, so maybe there would be like a summary. Say you're – maybe you're saying like household products – this is an example I'm coming up with – like to get stains off the counter. And maybe then there would be a rufous-generated summary of sort of like, you know, what are different chemicals or different, you know, what the market looks like for these types of products.

3:52And then below that summary, there might be actual product listings for, you know, different types of wipes or counter cleaner, sprays, etc. So, you know, and that's different where basically kind of that summarized answer that was more like, you know, conversational, someone talking to you was sort of bifurcated in the Rufus chat window, which a shopper had to sort of toggle over and choose to use. And then there was a separate kind of main shopping experience. And this is sort of, you know, could maybe be opting in by default in certain instances, shoppers to a more conversational experience, while not fully taking away the ability to browse specific items.

4:32So I got to be honest, like, I don't know if I'm going to like this. I mean, you know, I kind of like when I search for the thing and I just want to see the options right away. And now they're introducing, they're possibly going to introduce this AI overview thing. I mean, why do you think they're doing this? And is the only reason because Google did it? I mean, we don't even know how successful the AI overview thing has been, right? Well, I think Amazon is aware. And, you know, their business is different than Google. So, you know, one thing Amanda Doerr, who I talked to, mentioned was like for something, searching for something like...

5:10And her role, Amanda's role is what? VP of course shopping at Amazon. Okay, okay. That, you know, when you're searching for milk, you don't really want a paragraph about, like, the difference between 2 % and whole. You know the difference. So they wouldn't, you know, there's definitely a lot of types of searches where the kind of standard format where you just see a list of products is the best option. There are other types of searches where you're like, you know, what are the best hiking boots, is an example she gave, for the season. And in those cases, you know, maybe you want some more information about, like, what makes a good hiking boot.

5:49So I think Amazon is trying to figure out what are the types of products where more information is helpful. And I think there certainly are some of those types of products. Like, I know when I'm looking for, say, like, new earphones, I usually have to, like, go search on Wirecutter or some other site and try to figure out, like, what people like about, you know, AirPods. So I do think that there are items where people do need more information, and there are items like milk where people really don't. And I think Amazon is trying to kind of thread that needle and figure out like - Like a little bit of like a wire cutter-esque, like where there are recommendations that can be useful, that's where it might lean into these types of searches and stuff like that.

6:30Exactly, exactly. And it kind of helps Amazon in a way go up the funnel, which is kind of marketing jargon. But, you know, kind of that's sort of been almost Google's historical role, helping you with the product discovery process. And then you go to Amazon when you know what you want. But if you can go to Amazon to learn about products, you can spend more time on Amazon. Maybe they can sell you more ads. There's probably lots of good things that can happen there for them. So, right, right. Now, you mentioned your conversation with Amanda Dora, the VP of Core Shopping, I think you said was her role.

7:01What questions did you come out of the conversation with in terms of how you think this could be rolled out or, you know, the company strategy at large? Yeah, I mean, I am still sort of, yeah, curious, sort of, again, how they thread the needle. She also mentioned that, like, and we've reported on this in the past, they've been tweaking the way that, like, the regular search engine works to sort of be more responsive for natural language. And, like, they've, you know, now I believe, like, 60 % of searches use autocomplete, and they've been trying to use LLMs to make autocomplete smarter. So it is sort of like, are the lines going to blur?

7:47So that is definitely a question I have. Like, you know, as regular search becomes more natural language-y, like, you know, how does it become different from a chatbot? And maybe it's in the response, but then, you know, does everyone start asking questions to the Amazon search bar? How does that sort of change the experience? Another, you know, question I have is like, Like, they have been really interested in this new buy for me feature, which is helping shoppers find items that are not on Amazon's own site, but they, you know, will scrape the web or use other features to find out about these items.

8:25And then you can buy that item that isn't on Amazon's site. They'll direct you to the other site and you can, you know, find it and buy it there. And I'm also very curious, like, to what degree does Amazon want to be sort of like the first stop on the Internet? kind of, again, taking that role that Google's often had and being the place where you learn everything and you do product discovery, even if that means buying a product that's not on Amazon and how important that is for them and where that kind of puts them in the whole e-commerce process. Right. And last question for you, Catherine. So we don't know exactly if or when they are planning to roll out this type of feature.

9:02We just know that they are considering it at this point, right? Yes. We don't know the exact timeline, And though I will say, you know, yesterday, actually, there was some observers who saw that, like, when they used the regular Amazon search bar, it would, instead of just populating with a list of results, it would go into a more, like, chat, chat, conversational, Rufus-like experience. So that was, you know, and, you know, we asked Amazon about it. They're like, you know, we're testing things, whatever. So I think it shows they're kind of already thinking of more hybrid modes. Like, you know, people have been seeing them in the wild.

9:40Right. You know, so it seems like things are underway. An exact product roadmap, we don't exactly know, but yes. Right. Great. Well, Catherine, I want to thank you for coming on. That is Catherine Perloff, our Amazon reporter, here at The Information. The Information's Rocket Drew is covering the Elon Musk OpenAI trial from the courtroom all week long. Here is his latest update for us on OpenAI President Greg Brockman's testimony in court on Monday.

10:13Greg Brockman had a pretty rough day in court. A lawyer for Elon Musk had the chance to ask Brockman, who was a co-founder of OpenAI and its current president, some tough questions about his personal finances, including his stake in OpenAI itself, but also his stakes in companies that have done business deals with OpenAI. That includes Stripe, Cerebris, CoreWeave, and Helion Energy. As far as his stake in OpenAI, Musk's lawyer asked him right out of the gate, and he confirmed that his personal stake in OpenAI is worth in the neighborhood of$30 billion. That puts Brockman in kind of an uncomfortable position in the lawsuit, because Musk is arguing that Brockman has been unjustly enriched by his involvement with OpenAI, and that OpenAI has breached a charitable trust.

11:00It's sort of broken some charitable obligations or commitments by operating more as a for-profit than as a non-profit. In its founding documents, OpenAI says that it's not organized for the private benefit of any individual, which raises questions about Brockman's$30 billion stake. Now, in response, OpenAI's lawyers pointed out that most OpenAI employees do have equity, that Brockman's equity stake was decided without Brockman's input, and that OpenAI's charitable wing, the OpenAI Foundation, is very well funded. Now, Elon Musk's lawyer did not find that argument very compelling. He compared it to a bank robber taking a million dollars from a bank, but then saying, well, you have millions of dollars left.

11:41So Musk's lawyer in particular had a field day with records of an old diary that Brockman kept. And in this diary, Brockman is contemplating different paths forward for an OpenAI for-profit subsidiary. And he muses about which path, a path with Elon or without, will more quickly take him to a billion dollars. And in court, Brockman suggested that a million dollars would sort of be sufficient for him. So Musk's lawyer countered, well, if a billion dollars is sufficient, why not take the difference, call it$29 billion, and return it to the nonprofit? That turned into a pretty uncomfortable line of questioning for Brockman.

12:19It didn't seem like he really had an answer to that prepared, but he did fall back on saying that the OpenAI nonprofit is very well resourced. So it was a pretty tough day. I think both sides, the OpenAI side and Elon side, have come out scathed by questioning from the other side's lawyers. So we'll see if OpenAI's lawyers questioning Brockman tomorrow are able to restore and rebuild his case and see if he comes out looking any better after that questioning. So that's what's up next in the Musquey Altman trial. coinbase said that it plans to cut 14 of its workforce in order to manage costs amid the market downturn and improve efficiency using ai the announcement comes ahead of its first quarter earnings on thursday our crypto reporter yuechi yang joins me now for her reaction yuechi welcome back to the show so coinbase is doing layoffs we've seen layoffs across the crypto sector what was your reaction to this one yeah so coinbase today said they're laying off 14 of jobs and that's uh affecting about 700 people at the company it is a big sliceable layoff but as a percentage of the total number of employees it's actually smaller than the layoffs that coinbase did in the prior bear market in 2022 and 23 and at that time coinbase did two major rounds of layoff.

13:48The first one was 18%, followed by another one that was 20%. And then when CEO Brian Armstrong announced the second layoff back then, he said that in hindsight, Coinbase should have cut further in the first round. So we are waiting to see if this layoff is it for the rest of the year, or if there might be even more layoffs coming out depending on market conditions. Okay, so this is kind of interesting because we have these two crypto bear markets that have come sort of a couple, I don't know, a couple years apart maybe. Was that bear market worse than this bear market? Yeah, that's a great question.

14:31I think that bear market in 2022 was characterized by dramatic blow up of big companies like FTX and a series of crypto lending platforms. And I think in the current market is more like a quiet down market. You don't see these dramatic collapses, but then at the same time, retail investors are just losing interest in crypto and a big part of the crypto economy is down. when you look at the token prices for a lot of these tokens that are not Bitcoin, not Ethereum, but the smaller ones, they just really haven't recovered from even the last bear market. So I think the crypto industry is going through this fundamental change.

15:16It's unclear whether some of these tokens will ever make a comeback. And so that's also going to affect Coinbase business model as well. Well, and the reason I'm asking that question is because I think it really sets us up to answer the next question really well, which is whether or not these cuts are bear market cuts or if they are AI cuts, which is the reason that Brian Armstrong cited in his note to employees. I mean, we live in a world where CEOs can say whatever they want in terms of why they're making cuts. But what's your assessment as to whether or not this is actually a true AI-related cut or if it's just an excuse for the crypto bear market?

16:00It's a bear market cut.

16:01Theo Wayt:And I'll show it. Okay. All right. That's it. See you later. The number shows it because in the last quarter, the fourth quarter of 2025, Coinbase revenue was down about 20%. It posted a net loss of about$670 million. So Coinbase hasn't reported the first quarter result yet. As you mentioned, it's going to report earnings on Thursday. but some of its peers like Robinhood has already reported and Robinhood said its crypto revenue was down by almost half in the first quarter so we know that the numbers are not going to look good and some of the other crypto exchanges like Gemini like crypto.com have already started layoff so the market condition is definitely the most important factor for the layoff that we're seeing here.

16:55AI is also an issue. Coinbase CEO Brian Armstrong is very vocal about encouraging employees to use AI. In today's tweet announcement, he said that there will no longer be any pure manager, meaning that every leader in the company will also be an individual contributor. And he also envisioned this future where there will be one-person teams at Coinbase where people will act multiple functions including being an engineer bringing being a designer being a product person with the help of ai do you have any sense from people at the company around the company whether or not they are in favor of this structural change i'm not talking about the layoffs i'm talking about this this change from you know having pure managers to everyone being an ic an individual contributor everyone having a little more ownership i'm sort of thinking about this and i'm asking this question because it's not just coinbase right i mean this is something that we will see across tech companies i wonder if you've talked to any people at all about um whether or not employees like this or if they kind of liked the you know being part of a team maybe yeah i think coinbase ceo himself started to talk about how he even he as a ceo has uh returned to the code base of Coinbase last year and started to do some coding himself again using AI tools.

18:25So it is a top-down approach. Everyone needs to get their hands dirty. And I think from employees' perspective, this layoff probably isn't too much of a surprise. Everyone knows the market has been in poor condition. Do they think there might be even more? Because last time, you just said the bear market they did two rounds of cuts and then they said we could have cut even more is that a concern do you expect maybe there to be more cuts i think it's definitely going to be a concern and it depends on market conditions in part which we don't know how it will play out and i i think this is something that coinbase will be asked about when they do report earnings to whether they will commit to a certain level of profitability or uh to be able to to make sure that the company can outlast the number of cycles that we're seeing.

19:20I want to pivot to talk a little bit about another piece of crypto news this week. So Andreessen Horowitz has raised its latest crypto fund. It is just over$2 billion. What was your reaction to this fund that they raised? I think the size stood out for me is much smaller than the prior fund they raised in 2022. It's about half the size. So back then, they raised a$4.5 billion fund. That was a record size. And it happened right before the crypto crashes occurred in 2022. too. I think even in the blog post that they announced the new fund today, they alluded to the fact that the market cycle is currently on a quieter part.

20:08And they mentioned that they wanted to invest in founders that are building products for everyday uses, even though right now they don't get as much attention. So I think they're pretty aware of the fact that a lot of the interest from investors have moved on from crypto to AI. But they seem to suggest that that's not necessarily a bad thing because it allows them to stay focused and to also capture to capture and identify good founders at a time when they don't get attention. And it strikes me that that perhaps is a little bit of a contrast to the way that Han Ventures positioned their latest fund that they also announced this week, I believe.

20:53I mean, they still said that they're focused on crypto. They said they're sort of opening the aperture a little bit to take advantage of where AI and agents could intersect with crypto. But it sounds like Andreessen is saying, we're going much deeper into crypto. We're finding the best crypto founders first. That's what the goal is here. I think for Andreessen, the intersection between crypto and AI is also an important focus in their blog. they did allude to the fact that agentic payments will become more of a thing and the internet will be run by agents in the future they didn't really spell out specific examples of how this intersection between crypto and ai will look like it's kind of like a high level a big picture star so we look forward to seeing how exactly that will pan out great well you actually i want to thank you for coming on.

21:48That is Yuechi Yang, our crypto reporter, here at The Information. SpaceX has been highlighting XAI's speed and cost advantage in its data center buildout compared to rival AI labs, but exclusive reporting from The Information found those advantages come with some hidden costs. My colleagues Theo Waite and Valida Pau published the story today. Theo joins me now to share with us what he knows. Theo, welcome back to the show. It's great to have you here. Hey, Kosh. So tell us what we know about XAI's data center build-out efforts.

22:22Theo Wayt:So, you know, XAI is this company that, you know, pitches themselves as doing things very differently from other AI companies and other data center builders. And, you know, the first, you know, aspect of that is that they even chose to build their own data centers in the first place. Like if you look at OpenAI, Anthropic, other, you know, large AI labs, they're largely letting other companies do the building. xai is building their own and in spacex's x1 um s1 sorry after acquiring xai they talk quite a bit about this metric called um price per megawatt in data center construction and the draft of the s1 that we've seen says that spacex is or sorry xai's which is now part of spacex uh xai's cost per megawatt is$2.7 million per megawatt compared to a industry standard of 12.3.

23:20Theo Wayt:So cheaper, cheaper access to compute. Like 25 % of the cost of what other people cost, of what other people pay to build data centers. But XAI didn't define that term precisely. It's unclear exactly how they measured it. There could be some, you know, creative decisions being made about what to include in that number. But the point is xai is saying we know how to do this a lot cheaper than our competitors because we're crafty um and that you know comes out in a lot of ways okay so crafty so expand on that a bit more what what is behind xai's craftiness here so they they're using a lot of um kind of like temporary and improvised measures you could say to to get their data centers online over the past couple of years.

24:08Theo Wayt:That includes using these mobile gas generators to power the data centers, which has been quite controversial because they produce air pollution and are meant for temporary use in remote areas and they're running them close to a city. The other thing they've been doing is relying on these mobile chillers which basically look like semi-truck trailers and they just have like over 100 of them kind of parked outside the data center to cool the servers in there. And those are also a temporary measure. And overall, you have like all of these temporary unusual setups that kind of add up to a lot more potential places where things can go wrong.

25:00Theo Wayt:And my understanding is that's contributed to the data center sites having a lot more outages than would be standard at a data center that took a lot more time to stand up. So they put together these improvised solutions to get these data centers up and running faster. And you've also, I mean, you've covered a number of these. what there's colossus one and then colossus two i think is is it it's being built at this point now is that do i have that right or is it built uh there's one building of it that's like mostly done and then there's another building of it that is not done at all okay okay so so but but the point is i mean uh these are the xai data centers and so what they're touting here in the spacex ipo is that we can get these up and running faster because we have these improvised solutions.

25:57We've got generators, we've got trucks. And what your reporting shows is that sometimes these improvised solutions aren't actually as reliable, understandably, as if they were to have taken a little more of a, you know,

26:13Theo Wayt:I guess, traditional approach to build. Well, to be clear, they're not touting the temporary measures in the IPO. That's based more on my reporting. the IPO pitch is, you know, that everything is amazing and perfect, obviously. Right. So, okay, so they get the data centers up and running. Do they get access to the compute? You know, another part of your story that was interesting, though, was you talked a little bit about the utilization of compute and, you know, how well they are using all the compute that they've sort of built capacity for. Talk a little bit about that for us. Yeah, so credit goes to my colleague Anissa actually for getting this memo, but there was a SpaceX executive who's been installed at XAI named Michael Nichols, who kind of sent this memo about this internal metric basically showing how efficiently XAI is using the chips that it has.

27:17Theo Wayt:that it has spent a ton of money to get in its data centers and said that this metric is embarrassingly low and XAI needs to figure out how to use it better. And in the process, a ton of the leadership on the data center team and the computing team has left the company. So it's made that push. The other part of your story that was interesting is, are there any, well, you spelt it out in the story and I'm hoping you can explain to us here. I mean, what are the safety implications behind doing things the way they have? Yeah. So, you know, in the process of reporting on the story, I found out about a few different incidents where, you know, XAI employees have either, you know, been involved in accidents or made other complaints about working conditions.

28:07Theo Wayt:Employees of XAI or contractors working on the site. In January of this year, there was a worker who was using this device called a fusion machine that is basically this really powerful industrial machine that fuses pipes together. And he got his finger stuck in the machine, and it crushed it, and it was amputated. And following that incident, the contractor that works for XAI said that they implemented additional safety measures, including basically having multiple people verify that nobody's hand is in this device when it's operational. And then last month, there were also some complaints at the site about generators being used inside that made employees sick.

28:57Theo Wayt:and then last fall there was a incident where a couple of people got electrocuted so i i mean with this kind of thing it can be hard to say like what is just a typical you know accident in the course of construction because construction is inherently a dangerous field um but with some of the you know with both the finger loss thing and the uh air quality issue like xai or its contractors have committed to doing things differently following that, which would indicate something is going on that they had to address. So data centers are very large, ambitious projects, and trying to do them really quickly can have downsides.

29:45Right. Big picture for you, Theo, before we let you go. So, I mean, as you think about questions that you have to push the story ahead, what are sort of the next topics that you're interested in pursuing on your beat?