Mike Dubuski, ABC News Technology reporter with us this morning.
It is a Tech Tuesday. Good morning, Mike.
Good morning, Happy tech Tuesday.
Yeah, I'm always a pleasure. Okay. A story about Apple, and when Apple.
Invests, it's generally not forty six dollars, it's some big dollars.
And in this case, five billion dollars.
What's that about, Yeah, half a trillion dollars. You're absolutely right that Apple is not making investments to the tune of like scratch off cards or anything like that. These are high dollar investments, specifically in American tech infrastructure, and what that essentially means is that they are in part building actual infrastructure. They are building a factory in Texas that is designed to make AI servers, they say. But
they're also going to go on a hiring spree. They plan to hire about twenty thousand new employees over the course of the next four years. Those employees are going to be focused on research and development, silicon investing, and of course, artificial intelligence, which is exactly what this is all about. This is a major bet on the future
of AI. Apple has their own branding for their generative artificial intelligence tools called Apple Intelligence This seems to be the technology, the sort of back end stuff that's going to underpin the future of Apple intelligence.
Now, when you talk about servers and building servers and these huge warehouses, I mean we're talking hundreds of thousands of dollars one hundred thousands of square feet jammed full of computer gear and takes enormous amount of energy and incredible air conditioning systems.
Are they building those at a rapid rate?
Because what the Internet is growing, or it was growing astronomically, has that slowed down?
And is that building still going up? That kind of building?
Yeah, what you're talking about there are data centers which are increasingly becoming these really central pieces of the tech puzzle in the United States. And what the data center is is essentially, like you said, a big building full of computer servers, just a big sort of warehouse style thing, not many people in, really a security guard, a couple of technical officials. But companies came to those buildings and say, hey, I want a row of computers or i want this
little neighborhood of computer servers. I'm going to rent that out. And these data center companies basically act as landlords and they say, yeah, you can have this for this price, and then you get all this computing power. The reason for that is because when you open an app on your phone or you try to run a program on your computer, oftentimes it's not your computer or your phone
that's actually running that technology. They're offloading some of that work to these data centers, in part because the programs that we rely on every day are just so computer intensive, just so energy intensive. So that's why these data centers are important and are actual Intelvince generative. AI is very computer intensive to a degree that we really have before with other existing technologies. So these data centers are becoming
really important. And with Apple's five hundred billion dollar investment, part of that money is going to this factory to build these AI servers in partnership with this Taiwanese firm called fox Con. These are the servers that are going to go into data centers that are springing up across
the country. So that's kind of the idea here. Some of these data centers are owned and operated by companies Whole Cloths, Apple, Microsoft, Google all have their own, but there's also like third party data centers that are kind of like the landlords, right. They offer the energy they offer the air conditioning, and then you as the tech company, go in and place your own computers kind of where
you want them. So the really interesting piece of the sort of back end of the American tech infrastructure, and one that clearly is coming into clear focus with Apples half a trillion dollar investment and also similar investments from companies like open Ai.
All right, so Apple, Well I'll talk about Amazon in a minute, because that's our next segment.
But when you tech about these.
Data centers, is it like a clearing house of information, much like you have a clearing house of banking. The Swift system where everybody comes together and then the money flows out under Swift is the same thing happening here.
So it depends, right, It depends on what the data center is used for. As we said, some companies own their own use them for the purposes. For example, some data centers might be just used for cloud computing at Google, right, they might be used to underpin Google Drive. Similarly, Apple might use the data center to underpin iCloud or Apple Intelligence or some combination of the technologies that need all of this energy.
Really depends how big a how big a system is this because we don't hear much about this.
Is this one of those zillion dollar industries.
Yeah, it's huge and it's growing. And in fact, I visited a data center that was bringing up in Orangeburg, New York, which is about a half an hour north of New York City, in the fall, and it was, you know, under construction at the time. They were investing you know, several hundred million dollars in this facility as a company called Data Bank that was spinning this up, and it was set to open at about two months.
And I got to say, when I was walking around, you believed that, you know, it's like these things are getting a lot of attention, a lot of construction power is going into these sort of facilities. As I said, they're just basically big warehouses that you know, you put computers in, not a ton of people. You need the staff to run them. But there's another concern that comes
along with all this technology, which is energy consumption. Right, because one, you need energy, need electricity to pull from the grid to run the computers in your service, but you also need to run air conditioning and cooling units to keep those computers cool and to keep them functioning. So they are big draws on the energy grid, and that is something that we haven't really reckoned with yet. We haven't really figured out a solution to making the
things climate friendly and environmentally friendly. You can imagine as AI spins up and becomes more prominent, that is going to become an increasing concern.
All right, I want to go back for a moment to Amazon, the Amazon story where you reported that Amazon is going to hire twenty thousand new employees regarding that huge AI tech investment. Now, Amazon had a whole bunch of layoffs, and I don't know how many are those people going to go back to work, and how.
Does that connect with twenty thousand new employees.
That's a very good question. I'm not sure, but they certainly are spinning up a whole new slate of technologies, and that is kind of what you know they are touting this week. There's this big event in New York City scheduled for tomorrow. It's expected to be an event all about Alexa, which is, of course Amazon's very popular
voice assistant. Back in twenty twenty three, Amazon said that they were going to make this revamp of Alexa toy kind of fallen behind some competitors like Google Assistant that are out there just in terms of functionality and ease
of use in what have you. And Amazon says that by adding generative artificial intelligence to this technology, it's going to get a lot easier to use, and you can imagine that is going to have a lot of people on the back end working to make sure that this technology doesn't go awry as we've seen it in the past.
You know, these generative artificial intelligence models often make things up, they hallucinate, they get things wrong, and that requires sort of moderation teams and engineering teams to be on call in order to figure that out. We're going to get a better look at it tomorrow to see if that actually plays in the real world the way that Amazon
wants it to. I think there's a lot of risk here, especially when you consider the sort of unreliability of some of these AI systems, but that is what they say is going to make this voice a system a lot more competitive going forward.
All right, And what I normally do whenever we talk about a Lex is I refer to those of you that are listening who have an Alexa in your house and you have kids asleep.
Alexa Louder louder.
Yeah, yeah, exactly. You got to give the disclaimer every time you do a voice assistant segment. You know, I'm sorry. We've we've lit up all the Alexa devices around southern California this morning.
Yeh's lovely. I love it. I love it. Hey.
In terms of the new technology, it's I have friends, my daughter as a matter of fact, and my daughter's roommate who had a great job at Amazon.
She lost her job.
Not my daughter, but the roommate lost her job and is a very skilled computer person. That goes right into if you somehow are moving into the computer engineering in the world of AI.
How hot a market is that?
Is that the way you remember it used to be, where if you had any kind of computer skills, you could walk across the street for a ton more money and then walk back for even more money.
Is that what we're seeing in the AI world?
Certainly what you were seeing for a few months right, Like the tech world has gone through several hype cycles lately, they've been trying to figure out what the next big thing is going to be. Of course, if you remember a few years ago, everybody was talking about the metaverse, this sort of virtual world that we would all exist in something that Facebook and Instagram really put a lot of effort into, and the sort of long tail of
that didn't really go anywhere. Crypto was sort of the next big hype cycle that people got excited about, and obviously that market crashed as well. Now everybody's talking about artificial intelligence. So it's not enough to just be a computer engineer. You kind of got to specialize in one thing, and you've got to make a bet that your specific
specialization is going to be the thing that hits. Certainly, with these investments that we've been talking about from Apple and from open ai and from others, it certainly seems like a lot of the tech industry is sort of centering itself around this artificial intelligence revolution. But we've also seen some reasons to be skeptical about the long you know,
the sort of ongoing success of this particular industry. The emergence of deep Seek, the Chinese artificial intelligence company that was able to develop this very competitive model for a fraction of the cost of what American models were able to offer, really did kind of raise some eyebrows in the investing class. I think a big indicator Bill is
going to be tomorrow when Nvidia reports its earnings. They are the chip manufacturer that makes the technology that underpins a lot of these models used by open Ai and Google and others.
Now, my daughter showed me, my tech daughter showed me.
A picture of the first quantum chip that came out, and I didn't really understand that, And I want to know how much can this pop be cost?
Do you have any information on that?
Well, quantum computing has been around for a little while as this sort of idea that the you know, that our computers will somehow change and work differently on the back end. This is mostly an internal you know question, right, we're talking about chips and we're talking about processors. From a user perspective, you know, it's sort of questionable exactly what the change will be. But you're right to say that. Recently, Microsoft did show off what they call the first quantum
computing chip. In terms of cost, I'm not sure off the top of my head, but you can imagine it's going to be quite pricey, given that this is just a prototype, sort of experimental technology at this point. But yeah, that's something to keep an eye on. In the background. This is something that we've been talking about for several
years now. Not everyone has been able to get it to work just right, these sort of hyper efficient computers, but it is certainly something that Microsoft thinks that it's gotten a little bit closer to. I think what's going to be really interesting to watch is whether that actually shows up in the real world, how they implement this in a technology that you or I could use.
Thank you, and I want to end with Alexa, what does the fire engine sound like?
And good morning to everyone in the immediate Los Angeles area.
Thanks Mike, always appreciated