Bloomberg Audio Studios, podcasts, radio news from the heart of where innovation, money and power collide in Silicon Valley and beyond. This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
Live from San Francisco.
This is a special edition of Bloomberg Technology Live from the Bloomberg Tech Summit.
Yeah.
Absolutely, leaders from across tech and business Gavitt here to discuss how they're going to navigate economic, geopolitical uncertainty and multiply the opportunities in that landscape.
We'll be hearing from some of those speakers.
We kicked it off last night with incredible conversations with Alphabets and the pitch I metus Andrew Bosworth right now. Now the tech sector is also very focused. Caro and markets are right about the discussion between President Trump and China's EUGENPI.
And it's giving a positive spin to markets and as that coming out of its lows, we're now training higher. Look not gargantuan moves. We're up about three or four tenths of a percent on the NASAK one hundreds you'll see, but we are trending higher as we see a positive signal coming from President Trump that they're going to be meeting.
Yet further with it, cause the first.
Lady going to China and indeed a reciprocal kind of discussion coming with the Chinese leaders come to the US.
But more broadly, rare Earth. Is there any clarity on rare Earth? That's we want to hear.
Let's get some news breaking out of the Bloomberg Tech Summit. Anderil, the defense tech company that's quickly become a major player in US national security, has just closed its latest funding around joining us for more is Trey Stevens, co founder and executive chairman of Anderil, is also a partner at Founder's Fund. He will be a speaker as well at the Tech summit later today. Trey, good morning, congratulations, This is Series G. What are the details and this seems meaningful for Anderill?
It is, you know, as we continue working on building a company that has the capacity to scale into the largest problems for the national security community, we thought it was really important to shore up the balance sheet and make sure that we have the ability to deploy capital into these manufacturing and production problem sets that we're working on. The round ended up being a two and a half billion dollar round at an evaluation of thirty point five
billion post money. It's a tremendous opportunity for us to continue growing the team, growing the infrastructure in our ability to really ramp up into these bigger problems.
At sound is fund led around.
You have an interesting role as executive chair at Anderill, but you reccuse yourself from the found This fun part of that, I believe right like one of it's not their biggest check ever.
Yeah, the largest check and founders on history.
We put one billion dollars into the two and a half billion dollar round.
Okay, why is this commitment, this necessary money right here, right now?
Is this gonna be the last one before a potential IPO?
Oh man, it's a great question. You know, there are a lot of ways to raise capital. It's not just the possibility by po Obviously, long term, we continue to believe that andrel is the shape of a publicly traded company. We're not in any you know, rapid path to doing that. We're certainly, you know, going through the processes that are required to prepare for doing something like that in you know, the medium term. But right now we're just very focused on the mission at hand. Going at this as hard
as we can. Does that mean we raised another private round of capital at some point? Maybe hard to say. You know, we're always surprised at how how much demand there is in these massively over subscriber on how the subscribed space it was a lot like eight to ten x of what we had the capacity to take on.
You know, there's a lot of players that are starting to figure out that the momentum is drolling into you know, being able to do this at Androil, and I think there's just a lot of a lot of interest from growth funds, across server fonds, from mutual funds for getting a bite of that before there's a public market opportunity.
Well interesting, you say, getting a bite of the action when it comes more broadly to defense, Suddenly all the Silicon Valley kind of wants to be in defense and in US manufacturing. In fact, Boz Andrew Bosworth of Meta yesterday talking about how maybe there's some bigger patriotism than we realized across Silicon Valley.
Just take a listen.
There's a much stronger patriotic underpinning that I think people give Silicon Valley credit for. But taking a step deeper, this is actually a return to grace for the Valley, potentially not just from Meta, but from Google and other companies. The Valley was founded on a three way investment between the military, academics and private industry. That was the founding
of it. There would be no technology if we weren't all tasked with the problem of computing naval ballistic trajectories during the first two World Wars.
You have a partnership the technology that Meta makes working hand in hand with Andreil.
Interesting of course that Palmer.
Lucky now goes back to a company that he have caused sold Oculus to in many ways with this partnership, what does it look like in more partnership is going to be erupting him?
Well, I mean to Bas's point. You know, the world has changed a lot in the last eight years. Andrew actually turns eight years old tomorrow. We're approaching our anniversary, which is the anniversary of D Day as well. We started the company on the seventy third anniversary of D Day, recognizing there's an important contribution for not only ourselves but also the American enterprise into national security efforts.
You know, Palmer was fired.
By Meta in twenty sixteen for his politics. You know,
there's a Google Maven walkouts and protests. The reality is is that the silent majority actually believes that these things are really, really important to work on, and you know, Palmer being able to go back to his roots and reach a point of forgiveness with the Meta team to focus on the most important task at hand, which is leaning in on the best in class optics and VRAR work that they're doing to contribute to the mission that we're leading with the IBS opportunity with the DoD.
What was really interesting about how Buzz explained it is that they are basically providing components. We actually had delian As off on the show the other day in the context of founders and in Duro sat and what he was talking about is that the innovation of big tech is being driven by consumer electronics, right, and thinking about
your supply chain. Could you just explain mechanics of how Meta works with you and why it's useful to you for them to come up with these components in the products that you want to do, right.
I mean, they're obviously they've done an incredible amount for the ar VR community. I think Palmer has been on record many times saying that Zuckerberg is VR boy number one.
He's led the way.
With putting a ton of capital into solving some of these basic science and research problems around optics, you know, the physics challenges that make this really difficult. You know, we don't have to take all of that on ourselves. We can go and partner with someone in America who believes in the mission, who's done a lot of that work, and then we can bring that into an integrated system, which is really what we do as a defense products company.
Let's talk politics. You talked about Palmer's politics. You know, the story today is about President Trump speaking with China's using pain, and at the heart of that is rare earths. But I actually think for you guys, you've historically when we've discussed China taken a different approach, which is, you believe anderall is critically important now because of future hostilities from China.
Just explain that that thesis.
Yeah, I mean, obviously there's a huge supply chain component to all of this. China is right in the middle of most of these conversations around manufacturing production, supply chain challenges with natural.
Resources, including raress medals.
You know at ANDROL We've been thinking about this long before the you know, the second Trump administration started. We've been shoring up to make sure that our Tier one suppliers are being sourced from allied nations, the US and our allied nations.
And you know, for the first time ever, I.
Think that the entirety of the government is taking supply chain and seriously as a national security asset rather than just something that's kind of like important from a trade context. So I think it's incredibly critical that we don't wait until we have you know, our access to critical materials, our access to chips, our access to all of these things removed from.
US we need already happening.
Isn't there a limitation already on rare US And how does that impact your business?
There is? And you know, this is the type of thing that.
You have to plan for well ahead of time, believing that at some point, yeah, we might lose access. And I think all you know, intelligent and thoughtful American companies need to be thinking about how to how to address that problem before it actually becomes a really critical existential threat.
Well, has the administration been doing it in a methodical manner that you wanted to see because at times has been and worry about basically the timeframes that we get cut off too quickly before the US has really understood its own supply chain and resources. Many companies haven't been looking at this as well as Andrew.
Absolutely, yeah, I mean and Andrew, certainly, we've been thinking about it a lot, and through the founders on context, I spend most of my day thinking.
About this exact problem.
You know that g has said very clearly that he intends to you know, reclaim Taiwan by twenty twenty seven.
That's a really short timeline.
That doesn't mean that we have five or ten years to build up semiconductor of manufacturing capabilities. It means that we have like two years eighteen months, and so, you know, we really need to be thinking about these things.
I think there's it's incumbent upon.
The US tech community to contribute in ways. It's incumbent upon the US venture community to put capital towards solving some of these problems, and certainly every company needs to have a plan for how they're going to address that should it become a real issue.
Golden Dome.
Golden Dome, Yes, you know, obviously there's very few things as exciting as the idea of protecting the.
U s homeland from airborne threats.
You know, we've been engaged in a lot of conversations there too soon to comment on anything.
That's my understanding, though.
So when this big announcement happened at the White House, there were some of the sort of legacy prime defense contractors named Lockheed Martin being one, and a lot of people that I speak to are surprised that the name Anderill wasn't said over and over again because of the position you now have as a supplier to the US military apparatus. But it is early in this process. I
guess the point is what will happen. Do you have to make pitches and competitive bids and say here's what we can offer in this or is it a case of the administration come into you and say do this for us.
Well, it'll obviously have to be a tremendously multi layered approach. There's not going to be a single vendor that provides the entirety of this system. You know, there's interfectors, interceptors, things like that, space based interceptors, you know, all the censored works that are going to be required, and then a software layer to coordinate and see two all of.
That activity that's going on.
So you know, it's not just going to be Andrew, It's not just going to be Lackey Martin. I believe that it will likely be a you know, a mosaic of a lot of different companies coming together to make sure that this problem is solved in the best way possible.
You talk about space, there is one particular founder who is very close to the White House who now seems to be less close, and it's Elon Musk. How are you seeing the relationship of venture with the administration right now? And is there a repercussion as Elon withdraws and then seemingly gets pretty angry at the state of the current spending mill or at least the way he sees it as a spending bill, they says reconciliation.
Yeah, well, I mean we're still very kind of near in on the start of the administration. We're only what five months into things right now. I do think that this administration is incredibly communicative with the tech community, with the venture community. The channels are open, they're curious, they're looking for information.
Do you have a direct line with President Trump at all?
There's lots of paths into the White House without without without commenting any further on that. But yeah, I think I think that there's a tremendous openness to having that dialogue a lot of these initiatives, whether you're talking about the big beautiful bill. You know, I like what Elon said, it's difficult for a bit a bill to be both big and beautiful. It can be big or it can
be beautiful. It can't be both. But you know, I think you know there's there's at least receptivity and we'll see how some of these big programs, these big plans shape over over the next year.
And the reason Carrie's question is important is you know, you were part of the contingent that went to the goal for the Middle East with the President in Corporate America. Let's end here with a look at the future. After you and I were together in Ohio in January, my phone just kept ringing from private companies and startups that are in the defense technology space. Is there a world where andrel and three or four other players exist and coexist or is it just anderill and nothing out.
Well, first of all, I want to say thanks for coming to the Arsenal launch in thank You're one of the few people X Androl who has even seen the site in Ohio, so it was cool to have you out.
Thanks so much for doing that.
Yeah, you know, I think categories are tough, right, Like there usually isn't such.
A thing as category investing.
You know, if you're a social media investor and you didn't invest in Facebook, you probably lost money. If you're a space investor and you didn't invest in SpaceX, you probably lost money. Do I think that there's room for a couple of players to make a big entry into the defense space. Sure, I don't think there's going to
be multiple anerles. And that's really our goal is we're trying to create a concentrated opportunity to be a next generation defense products company that goes out and wins these major programs where we're going to have the ability to bring software, chops, the you know, autonomy, speed scale manufacturing into the defense industry for the first time as a new player in a really long time, a.
New player that is now worth one than thirty billion dollars, just double the valuation having raised more than two billion. Tracey Humans, it's a joy to have you Androil executive chairman, founder's fun partner as well. Now so much more coming up about clearly the future of AI. Alphabet CEO, son of Pitchye, following his panel at Bloomberg Tech Summit last night, talking about actually competition, I was looking at AI.
This is really big technology.
You know, there's no doubt to me that three years from now there will be a company which will be dominant in this AI age, which we don't even know the name of today.
Welcome back to a special edition of Bloomberg Technology Live from the Bloomberg Tech Summit.
Alphabet CEOs and the pitch I.
Says the company will continue to expand its engineering ranks at least into twenty twenty six, emphasizing human talent remains key despite AI investments. That was part of the discussion with Bloomberg's Emily Chang last night when we kicked off the tech.
Some of here in San Francisco. Here's more of that conversation.
In twenty twenty five, our capex is seventy five billion dollars, right, so we are definitely investing for the long run. But you know, it's the same investment which powers businesses from search to YouTube to cloud, to workspace, to Android and play to way more right and so, and to our subscriptions business. We just launched Google AI pro and Ultra and you know it's definitely doing well. I mean pleased to see the reception. So I think it's such a
profound technology. I feel the opportunity ahead is bigger than the opportunity we had in the text.
So to double click there, if I may, what specific new revenue streams do you see increasing and what revenue streams do you see decreasing.
The growth in cloud like Vertex AI is up forty eight in usage on a token basis just in the last twelve months, so obviously you know we have billions of dollars in providing AI based solutions in AIS and infrastructure AI subscriptions.
So many many new businesses.
You have over one hundred and eighty thousand employees right now?
Is it half that In the future.
I expect we will grow from our current engineering base even into next year, right because it allows us to do more. I think the opportunity space is also increasing. I just view this as making engineers dramatically more productive, getting a lot of the mundane aspects out of what they do, allowing them to spend on higher value added tasks. But that means it's an accelerator.
People will be able to.
Do more, which means maybe we'll create new products and hence we will need more people, at least in the near term.
To me, it looks like, you know, we will.
Expand engineering velocity, and that doesn't mean we're constrained in what we will do.
We'll end up doing more as a company as well.
But in two trials now, judges have said that Google is a monopoly in search and partly a monopoly in ads.
How do you.
Address the concern that your AI is built on an existing domination of search and ads and that this is just reinforcing original monopolies.
First of all, you know, we disagree with the rulings and we are in the process of appealing these things. Look, if anything, this moment has shown I don't think there's anyone here who is using anything they don't want to use. You look at the success of chat repd or any other product.
People are literally.
Have more choice than ever before. The reason people use Google is because they want to use it, right, and so I think I think we continue to innovate. I think choice is good for users, competition is good for the world. So that's how I see it.
You said the remedies proposed are too extreme.
Would you ever voluntarily break yourself up control your own destiny?
Compared to what the initial scope of the ruling was, some of the proposed solutions are far overreaching. We'll see how it plays out.
I've heard you say a few times that you think of AI as an expansionary moment, but so far it does seem to be favoring tech giants and well funded startups with access to GPUs and data centers and enormous amounts of capital, Like, isn't this really concentrating power in fewer hands? And is AI just another winner take all game.
I'm confident there is a company that's going to be created with AI, just like when the Internet happened. Many years after the Internet happened, googledn't exist. So you know, there's no out to me that three years from now there'll be a company which will be dominant in this AI age, which we don't even know the name of today. Yeah, that's the only way things work in the future.
A confident alphabet CEO sin of pitch. I there along with Boomberg's Emily Chang. Right, now, we can talk it all through with executive editor Tom Giles, who joins us. From all that conversation you were sitting down with Bauz from Meta, after that with Sunder, but just going back to what Snow was saying around his optimism on jobs.
Look, today, one of the.
Most read stories on the NEWBG terminal is Visita Equity Partners Robert Smith saying, look at my conference today, sixty percent of you are going to need to find new jobs. White collar work is going out.
But keeps going on. And I want to quote, do you d just.
Last week Dario from Ammiday Fromanthropic fifty percent?
Right.
Look, the fact is AI is definitely coming for some engineering jobs. The number, the percentage of coding that is happening from artificial intelligence seems to keep creeping up and up and up. Some people would argue that's going to put a lot of engineers out of jobs, but as Sundar pointed out last night, he thinks what's going to happen is it's going to make them more efficient. It's going to mean creating more products, bigger companies, bigger businesses,
and need for more people. Where do you draw that line. I mean, we have to encounter as journalists, right when are you going to hear the news from the AIS. We have to stay a step ahead of and we have to stay smarter. And the engineers it's the same thing. You have to become more sophisticated in the way you code.
And that's what Sundar is talking.
And I guess the news headline was that they will keep hiring at least for the next eighteen months or so.
He fits in twenty twenty six. He didn't want to be pinned down into much longer into the future.
The thing is that Google is so core to the new cycle at the moment. That was why it was such an important way to kick off Bloomberg Tech summare. He made this point that like, look what we're doing in our scale, you can't accuse us of being a fret to the world existentially because we're also facing all of the competition. Some of that competition is going to be speaking over the next twelve hours for example.
Absolutely, you can't say on one hand that we are at extinction level threat right at the same time, too big, He definitely he came back to the anti trust question right the basically the government right now is considering breaking up Google. Would he consider breaking up himself? Of course, his answer is that is not on the table. He thinks that the government is overreaching right now and he has to keep sending that message that we are not a threat and that there is a lot of choice now.
I will say that when you come to him and say that people are using Ai much more chatbots to do their searches, even TikTok to do searches, that actually feeds into his argument. That's really beneficial to him to know that there is this much competition. The chat GPT is out there and people are starting to use it for all the things that Google is you usually do with Google and perplexity.
Who's speaking to Shuena little bit later today Shoween KAfari. We've also got Showen speaking with the government as well. Michael Kratzios, what are some of the conversations going to really be pushing forward? Do you think because yesterday you got bars Sametta to push forward on this patriotism focus on this alignment of Silicon Valley with defense.
What else came out of that conversation?
Right? Yeah?
I mean he pointed out that for many years Silicon Valley has said no to working with the Defense Department. The pendulum is swinging dramatically. Patriotism silent majority.
We heard that before in US history.
You'll recall I'm not sure I've seen the polling that shows that that demonstrates that, but I get the sentiment behind it. As you talk just now with Trey, I'll be talking with him a little bit later. I'm looking forward to here on you got to go to sea.
It looks great.
I am looking forward to hearing from Luri Mayor Luri to hear about the comeback of San Francisco, Is it real?
Is it lasting?
And what's ahead for this important city to Silicon Valley.
We're just getting kiked Off's head Technology Executive Editors Senior executive editor, Tom Giles.
Let's get out to Washington, d C.
President Donald Trump and Chinese leaders using paying agreeing to further trade talks during a phone call today, gloumost Kaylie Lyons has all the details and at the center of it Rare Earths.
Yeah, that's right.
The President said that after this phone call was she which lasted about an hour and a half, there should be no more questions around the complexity of the rare earth's issue. That does still leave us though with some questions, as the President did not specify exactly what was agreed to on rare earth if China has formally said that it will be lifting export restrictions or granting licenses for the export of those rare earths to American companies, so
we're still left with some questions here. China's readout of this call has been a bit different. China, in its statement also said that President Trump has said that Chinese students are welcome in the US, despite the State Department's efforts to be revoking some of those visas of Chinese students.
But the big picture here is that President Trump says that this has brought the US and China to a better place on trade and that they are going to continue conversations which will be a bit broader, remembering the first conversations in Geneva, or just the Treasury Secretary Scott Vessant with his counterpartner Howard Lutnick, The Commerce Secretary, as well as the US Trade Representative Jamison Greer, will be involved in the next top at a location that has yet to be announced.
As well as the.
Time China top of mind Kayley in thirty seconds. Elil Musk also top of mind for this big bill.
Oh absolutely.
The Speaker of the House was actually planning on talking to Elon Musk today as he says he needs he wants to see Americans kill this bill, possibly in part because it will roll back the seventy five hundred dollars EV credit by the end of this year.
In Tesla, of course, benefits from Matt.
Caroline Kaylee lines, thank you, welcome back to a very special edition of Blue Veg Technology. We are live on the Blue Veg Tech Summit right here in San Francisco, and Caroline Hi.
And I'm Ed Ludlow. Meta CTO.
Andrew Bosworth says that quote the tie have turned in Silicon Valley, making it more palatable for the tech industry to support the US military's efforts. He sat down to discuss that last night with Bloomberg Senior Executive aed Tom Giles.
I have family members in the Armed Services. I want them to have the best equipment available. And I've always been a very patriotic American and believe in the importance of our role not just inside the nation but globally, so there's a much stronger patriotic underpinning than I think people give Silicon.
Valley credit for.
But taking a step deeper, this is actually a return to grace for the Valley, potentially not just from Meta but from Google and other companies. The Valley was founded on a three way investment between the military, academics, and private industry. That was the founding of it. There would be no technology if we weren't all tasked with the problem of computing naval ballistic trajectories during the first two
World Wars. Like that is the heart and soul of the investment that led to what we are today, and that really got severed for a while there. And some of that's because of the procurement laws that change in the sixties and seventies. Some of that's the Last Supper that happened in ninteen eighty five. We ended up just kind of going our separate ways, and I think we're
worse off for it. I think we're spending more money for worse technology in the public sector, and I think the private sector is not attacking some of the most valuable challenges it's for us to solve. And I think it's a mismatch.
You mentioned smartphones earlier. Do you see spectacles headsets as a replacement for or a compliment to smartphones.
We've always talked about the mix reality devices VR devices as being kind of a laptop style market. It's like, I use this joke a lot, but you know if you ever on your phone and you're answering email and you're like, no, this is not a phone email. This is a laptop email, and you like put your phone down, you like upgrade your power, and like, yes, now I have all the windows and I will have all my research,
and it's like this a laptop email. There's like an increase in power that comes there that we all recognize and they just like know instinctively when you're in what's done. The headset should feel like that, it should feel like a crazy upgrade, like this is not a laptop email, this is a headset email. Just now it's like the world is your oyster and you're just moving things through the universe. So I think there's a there's a story there.
Certainly in the limit, I think ar glasses replace smartphones. That's a ways off. Smartphones are incredible, and it's not just that their great devices, and they're convenient, we're used to them. They also have like an incredibly entangled ecosystem of software connected to the rest of the world around us.
That is going to be a very slow to move over and a lot of.
People who aren't going to want to move over because it's going to disenfranchise them or disintermediate them. So I think I think that'll take a longer journey. The good news is they work really well in concert. The platforms don't make it easy. Cinder does better than tim But the truth is with AI, you've got this obvious use case where it just makes sense to have these wearable
devices even though you also still have a phone. So I don't We're not in a place anymore where it's like one or the other and you have to pick today. They will coexist for a long time.
Meta CTEO Andrew Bosworth, along with Bloomberg's Tom Giles. Look, it's not all about ar blglasses. When you think about the future, you also think robotics. For the perfect person to discussing with Haggy Johnson, CEO of Agility Robotics, No, we are thinking about the next step of humanoids working with humans you're already after a year in the job, a year with your human EID robots in GXO logistics, What are you learning about how difficult it is for us to work alongside them.
Well, the biggest factor to scaling humanoids is safety. So still today humanoids need to work inside of a work cell, which is a small gate that keeps them out of the proximity of humans.
To really scale, you need to come.
Outside of the work cell to be able to walk down to the loading dock or across a factory floor. And we're working on that right now. Our next gen, which we will show off before the end of this year, will be what's called cooperatively safe. We can be within proximity of humans in a safe manner.
How much is this software dependent rather than just hardware dependent. It's a bit of both.
You have to have a lot of sensors, a lot of cameras. Interestingly, unlike humans, robots can see behind them. They can see three sixty They're much like electronic vehicles in that fashion. But you do need a layer of software on top to ensure that nothing ever happens that would put a human in harms.
Way, have you what range of tasks can your robots currently perform I guess autonomously literally movements pressures?
Yeah, so right now, that entry point is moving materials, so moving plastic bins and boxes and things like that in warehouses. But that is only the entry point. It is a multipurpose robot. It can do a number of tasks. But this entry point can teach us new skills as we learn to do more things in those facilities and eventually come outside of those facilities and.
Into our homes.
What is agility's core competence?
You make hardware or are you better at the software components?
Well, I would say a little bit of balls, but.
You said that already though.
For Yeah, I get told every single day at the moment when you speak to a robotics company, ask them about how good their software team is, how good the engineers are, because it has been the limiting factor to progress.
Yeah, so AI has really supercharged that. We used to have to code all the movements of the robot, and now with AI we can teach it new skills much more quickly. We're actually changing exchanging engineering hours for compute hours, and it really shrinks the time and the cost of teaching the robot new skills.
What about supply chain?
We've got a lot of news about China US relationship today.
How is it looking for you?
Well, a couple of things we manufacture right here in the United States. Only about one percent of our parts come from China, so we're relativetively immune to any of the issues that others may be having. The robot was just initially built that way and it's been a real advantage for us.
So can you pit us?
Therefore, we love to put generative AI prowess of China versus generative.
Aipress in the US. What about robotics, he's winning?
I would say the US is winning. A lot of what you see coming out of China today are flashy videos demos, not actually on a factory floor like we are working eight hour shifts lifting heavy items. That is when that's the true test of what a rollback in.
That's the thing, right, I think the Bloomberg text audience really just appreciate understanding the basics. So with the gxodeal, in one calendar year, you've moved three hundred thousand items. But how many robots is that? How many actions can a robot doing a shift? I can't believe you use the word shift performer hour stress. Just how does it work in practice and give us a sense of scale.
Sure, so it is an eight hour shif it's just a handful of robots that are producing that type of number. Basically, the robots can walk in and perform a task. But what's interesting about humanoids is that they can perform several tasks. So they can do one thing in the morning, something else at noon, something else in the evening. Where robots, the traditional robots say, a single arm is very specific. They do one thing over and over, and they do
it very well. Humanoids can actually change what they do, and now with AI, we can give them commands and they can change on a moment's notice.
The history of agency is so interesting. It came out of Oregon State University with thinking at the moment about state funding, about funding to science and R and D, of talent being able to come in from immigration.
Are these things simple mind for you?
Well, we did have early grants from the US and it really helped the company get going. So I am a huge fan of basic research for US companies. We absolutely have to continue to invest both in research and in the talent. So we need proper immigration in place in order for us to be able to access this kind of talent.
Peggy Johnson, the CEO of Agility Robotic, Welcome back to a special edition of Bloomberg Technology. We live from the Bloomberg Tech Summer in San Francisco, where AI is top of mind. AI's impact on the workforce is already being felt, and that's especially true for engineers.
A partner, Channa Bragado, is.
The chief Product Officer of Experiences and Devices in Microsoft, which is at the forefront of some of these changes. He joined us here at Tech summert SF. So, as you know, about six months ago, I just did thirty days straight of using co pilot on a Windows based laptop. I wanted to commit to working out how on.
Earth you use these tools in the real world.
Really interesting that I felt within the confines of the laptop, I couldn't get out of the laptop onto my smartphone. What are you finding six months on and how knowledge workers use your use your tech.
First of all, thank you for having me, and also for thank you for like nailing the pronunciation of my name, you know, like taking a step back. I think we are in this like super early phase of like the AI shift. This is like the nineteen ninety five's equivalent of the Internet shift. To me, where I see it and to me, I think what we are starting to
see is for knowledge work very clearly, efficiency gains. Right for organizations, you're saving millions of dollars of like money and time automating workflows, I mean, summarizing documents, meeting notes a se.
Is co pilot just narrowly a tool for knowledge workers or are you finally consumers are using an equal measure?
It's it's it's broad because productivity is not bound by the work organizational boundary, right. But I do think that actually one of the things that we are seeing where the traction is is in efficiency for ourganizations, right, efficiency for at the individual level. They imagine having a digital assistant at work for every employee, right, which you couldn't
afford to have before. The thing that we are seeing and I'm seeing it with customers talking about it too, is that shift between from efficiency to more of effectiveness.
Meaning look, I mean it's fine, it is great.
For example, I can't imagine doing a meeting without the facilitation by copilot, right. It takes the notes it carries action items. It tells if you're going off the rails in a discussion, because in meetings that happens all the time. But what I am seeing is that for effectiveness, the key unlock has been these model advances in deep reasoning, meaning it's not just about like faster answers. We launched
an agent in co pilot called Researcher. Think about it as a super smart, intelligent chief of staff in your pocket. And so, for example, I had a customer meeting last week and this thing went around and kind of like scoured the whole web information but also the email from three years ago from the CIO of the customer to kind of like pointing an issue, said make sure you bring that up. I mean, that's the effectiveness. That's like superpowers that you didn't have before.
People are getting s superpowers from other places too, and chatgypt enterprise. The interesting nature of your relationship with open ai but also them as a competitor.
Can your customers afford both? Are they affording both?
I think with open Air, First of all, we have a great long term relationship.
It's a win win relationship.
We build products on innovative models from open AI. For the frontier models. Our customers build agents and you know, workflows on and AI apps on top of our Azure Open AI service platform.
The word I do see.
At Microsoft is for us at least, what AI and copilot is about number one, bringing the advanced intelligence right, that's table stakes. But number two is making sure that it works where you work, right, you're I mean teams all day or.
Just where you work. So right now I'm using this thing. This is a smartphone. Various brands are available in the future because this is part of your portfolio. Which device does Microsoft bet that knowledge workers are actually using for aiols?
I mean, there's clearly a lot of knowledge work that happens on laptops and desktops. But then I think we have a mobile app, for example, for them M through sixty five copilot, the one that you do use at work.
But I think the other thing I do want to.
Come back to is there is a You can't build all of these on Jenga blocks, right, you have to build this on security, safety, compliance, and governance. And that's the thing I hear all the time from customers. In fact, the phrase that I use internally is we need to innovate at the speed of trust right, which means it's an end right. And at Microsoft that's I think of as a differentiator, which is how do you innovate, but how do you do it at the speed of trust with governance.
I go back to that and though are people having copilot and other enterprise gendet FAI offerings right now?
It's a mix at and I would say it's actually a healthy thing right now because again, like think about I think of AI tools for employees as a contact sport.
In fact, I think one of the like you have to get in and use this stuff to actually get the about challenge is amazing because and in fact, we did a study called the work Trend Index, and one of the things we found is these class of companies we call them frontier firms, and the big distinction there is that they're not they're not thinking of AI as a snack. It's a main meal right for their employees. It's an org wide adoption. It's not this thing off
to the side. They're using multiple tools, they're experimenting with things, but at the end of the end of the day, they are also looking at what's the roy where are they getting the governance and the security and as well as kind of the latest access to intelligence. And that's how I think about like where Microsoft.
Is playing, Wow, it's a great contact sport.
I can't play rugby anymore based on contact sport. Different nature a pan Chinavagata, which is Microsoft Chief Product Officer of Experiences and Devices. Now we've got planning coming up turning to the battle of contact sport for chap pot dominance into a business.
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