Welcome to the Techmeme Ride Home for Thursday, May 23rd, 2024. I'm Brian McColle today. Nvidia's earnings are still historic, but what could upset their Apple cart? A few things, actually. I think we know the truth, or at least the timeline of the Johansson Gate, big new media deal for OpenAI, likes are going private on X, and would you clone your voice to answer the phone on your behalf. Here's what you missed today in the world of tech. In video,
reported Q1 revenue numbers yesterday. They were good. How good? Well, Q1 revenue was up 262% year on year to 26.04 billion dollars versus the 24.65 billion dollars which was estimated. So roughly a $2 billion beat on your estimates. Again, let me give you those numbers. 262% year on year, beating even those robust estimates. Nvidia is now forecasting Q2 revenue above even those estimates. Oh, and it is splitting its stock 10 for one.
Quoting CNBC. Nvidia's quarterly earnings report has become a way for investors to gauge the strength of the AI boom that has trans-fixed markets in recent months. It's strong results on Wednesday suggests that demand for the AI chips Nvidia makes remains robust. And CEO Jensen Huang said the company would see revenue from its next generation AI chip called Blackwell later this year. Nvidia said its data center category rose 427% from
the year ago quarter to 222.6 billion dollars in revenue. Nvidia finance chief Collette Cress said in a statement that it was due to shipments of the company's hopper graphics processors, which include the company's H100 GPU. A big highlight this quarter was Meta's announcement of Lama 3, their latest large language model which used 24,000 H100 GPUs Cress said on a call with analysts. She added that large cloud providers make up about quote mid 40% of Nvidia's data center revenue and quote.
So once again, if it wasn't clear, they are still historically epically killing it. The definition of killing it, but the Wall Street Journal took this opportunity to look at what if anything could slow or derail this runaway train quote rivals and key customers are looking to produce chips that can close the gap with Nvidia's products. Meanwhile, the AI market which has proven tricky for some startups is shifting in ways that could
diminish the popularity of Nvidia's chips. Despite the power and promise of AI, startups are struggling to come up with a business model that can recoup the massive investment in hardware. The technology requires so quite a capital estimated in March that the industry put $50 billion into Nvidia's chips to train large language models, but generative AI
startups had only made $3 billion in revenue. Some AI startups that built products using Nvidia's AI chips have run into turmoil, including inflection AI and Nvidia backed company that had its co-founder and other employees decamped for Microsoft and March. The chief executive of stability AI, which built the popular image generation AI tool stable diffusion,
left abruptly in March as well. AI companies big and small also are increasingly looking for ways to build into play smaller models that can be effective for specific tasks, but don't require as much of the computational firepower that depends on Nvidia's chips. Depending on how they play out, those factors could help take some of the gusto out of a year-long bananza for Nvidia, whose sales tripled in the latest quarter and are projected to double
in the second quarter. Nvidia's chipmaking competitors are increasing their game as well, releasing their own AI chips that they have claimed are better, at least at some AI computing tasks. They are also aiming to display Nvidia's dominance in software used to access its GPUs, responding to demand from customers who want alternatives. Nvidia's
market share in AI chips is estimated at above 80%. Big tech companies like Amazon, Google, Meta platforms, and Microsoft are opening another front against Nvidia by designing their own chips and having them made by contract manufacturers. Industry analysis from tech insights estimated this week that Google became the third largest designer of chips for data centers
in 2023 after Nvidia and Intel. Broadcom CEO Hock Tan said in an internal address this year that his company's Custom Chips division, which mostly helped Google make AI chips, was bringing in over $1 billion in operating profit a quarter, underlining how much money Google is spending on the effort. Hans Mosismen and analyst at Rosenblatt Securities said in a note that Nvidia was expected to lose market share in the percentage of the world's
AI chips that it makes because of the competitive pressure. But he said it was likely to maintain an even increase. It's overall share of the AI computing landscape because of moves it was making to grow its presence in other areas of computing and in software. Well, the Johansson gate continues a pace, but maybe we have the answer and maybe open
AI didn't do anything wrong. It's just gotten muddled. The Washington Post has done the shoe leather of looking at documents and reaching out to sources and they think they have the timeline down. Open AI did not use Scarlett Johansson's voice for Chatchy P.T.'s sky voice and indeed hired another actress months before Sam Altman even contacted Johansson.
Quote, an agent who spoke on the condition of anonymity to assure the safety of her client said the actress confirmed that neither Johansson nor the movie her were ever mentioned by Open AI when she was hired. The actress's natural voice sounds identical to the AI generated sky voice based on brief recordings of her initial voice test reviewed by the Post. The agent said the name sky was chosen to signal a cool, airy and pleasant sound.
Joanne Jang, who leads AI model behavior for Open AI said that the company selected actors who were eager to work on an AI product. She played the actors a sample AI version of their voice to demonstrate how realistic the technology could sound. Joanne said she also quote, gave them an out if they were uncomfortable with the surreal job of being a voice for Chatchy P.T. Long before the voice auditions, Jang began developing the way Chatchy P.T. would
interact with users. She worked closely with a film director hired by Open AI to help develop the technology's personality. Joanne said she quote, kept a tight tent around the AI voices project making chief technology officer Miramarati the sole decision maker to preserve the artistic choices of the director and the casting office. Altman was on his world
tour during the casting process and not intimately involved, she said. To Jang, who spent countless hours listening to the actress and keeps in touch with the human actors behind the voices, sky sounds nothing like Johansson, although the two share a breathiness and huskiness. And a statement from the sky actress provided by her agent, she wrote that at times the backlash quote feels personal being that it's just my natural voice and I've never been
compared to her by the people who do know me closely. Mitch Glazer, the chief executive of the Recording Industry Association of America said that Johansson may have a strong case against Open AI if she brings forth a lawsuit. He compared Johansson's case to one brought
by the singer Bet Midler against the Ford Motor Company in the 1980s. Ford asked Midler to use her voice and ads after she declined Ford hired an impersonator, a US appellate court ruled in Midler's favor indicating her voice was protected against unauthorized use. But Mark Humphrey, a partner and intellectual property lawyer at Mitchell, Silverberg and NUP said any potential jury probably would have to assess whether sky's voice is identifiable
as Johansson. Several factors go against Open AI. He said namely Altman's tweet and his outreach to Johansson in September and May. It just begs the question. It's like if you use a different person, there was no intent for it to sound like Scarlett Johansson. Why are you reaching out to her two days before he said? That would have to be explained. Let me quote. 10 million here, 10 million there. Pretty soon you're talking about real money, right?
News Corp. And Open AI have announced a multi-year agreement to bring newscorp's news content to Open AI sources say the deal could be worth $250 million over five years. Quoting the journal. Open AI would use content from newscorp's consumer facing news publications, including archives to answer users queries and train its technology. Terms of content licensing agreements between publishers and Open AI aren't public. But the newscorp deal is among the biggest
if not the biggest reach to date. The pack acknowledges that there is a premium for premium journalism newscorp chief executive officer Robert Thompson said in a memo to employees Wednesday. The digital age has been characterized by the dominance of distributors often at the expense of creators and many media companies have been swept away by a remorseless technological tide. The onus is now on us to make the most of this providential opportunity.
End quote. Newscorp's A shares were up 7.1% in after hours trading on Wednesday. Newscorp joins a growing list of publishers that have reached commercial partnerships with Open AI, including Politico and Business Insiders parent Axel Springer. The Associated Press, LeMonde, the Financial Times, and IAC's Dot-Maritath, home of such publications as People and
Better Homes and Gardens have signed deals as well. Other publishers, including the New York Times, have opted to battle Open AI and its backer Microsoft in court, saying their content was used without permission to train artificial intelligence tools and populate answers for users. Open AI has said the lawsuit is without merit. Among the other publishing deals Open AI has done Axel Springer's three-year pact, which includes use of its content for both training and display, is worth at
least $25 to $30 million over three years. According to people familiar with the deals, the FT, whose deal also includes both display and training, is worth $5 to $10 million per year,
according to a person familiar with the matter. End quote. Again, at the margins of the news and publishing business as it exists today, that's real meaningful revenue, and the degree to which some AI companies are clearly willing to pay up gives credence to the theory that high quality data and maybe especially timely data will be crucial to allowing various AI models to
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at Shopify.com slash ride. All lower case. Go to Shopify.com slash ride now to grow your business no matter what stage you're in. Shopify.com slash ride. Looks like a lot of lobbying by the crypto industry is starting to pay off. The US House of Representatives has passed the Financial Innovation and Technology Act for the 21st century, which would create a regulatory framework for digital assets
according to crypt. The bill dubbed FIT21 was approved by the House of Representatives with a 279-136 vote with 208 Republican members of the House voting in favor of the bill, 71 Democrats voted in favor of FIT21 as well. All but three of 217 House Republican members voted in favor of FIT21, while about a third of Democrats supported the measure too. The bipartisan push behind FIT21
encapsulates shifting attitudes towards crypto on Capitol Hill. Just last week, a measure rolling back crypto custody rules for banks from the US Securities and Exchange Commission pass both the House and Senate, receiving support from notable lawmakers like Senate Majority Leader Chuck
Schumer. The bill passed by the House on Wednesday creates a federal framework for the regulation of digital assets, establishing jurisdiction between the commodities futures trading commission, CFTC, and the SEC, giving issuers the ability to self-certify assets as digital commodities, among other initiatives. The bill was skewered Wednesday by SEC Chair Gary Gensler.
Among those that vocalized discontent for the bill was also President Joe Biden, who called out a lack of sufficient protections for investors and written remarks, still Biden in his Wednesday letter called for a quote, comprehensive and balanced regulatory framework for digital assets,
suggesting that the status quo is currently lacking. Curtailing the SEC's regulatory remit, FIT21 gives the CFTC exclusive regulatory authority over digital asset commodities under the bill criteria is provided for determining that status based on a project's level of decentralization, looking at factors such as how much of a token supply a party owns or a blockchain's
susceptibility to influence from a single party. Clarifying authority between the CFTC and SEC has been a long held hope within the crypto industry, as advocates have said existing rules are unclear. An FIT21 addresses several areas within crypto, including the treatment of trading platforms, decentralized finance, and how developers can raise funds for projects.
X Director of Engineering, Hal Thai Wang says, quote, we are making likes private on X, in an update happening, quote, soon, as quote, public likes are incentivizing the wrong behavior. Quoting his motto, X Premium users have been able to hide the posts they've liked for months now, but the future may soon become the default for everyone. A director of engineering at X said the platform is making likes private in a Tuesday post. Yeah, we're making likes private, Wang said in
a tweet, public likes are incentivizing the wrong behavior. For example, many people feel discouraged from liking content that may be edgy in fear of retaliation from trolls or to protect their public image. And quote, Wang noted that soon, quote, you'll be able to like without worrying who might see it. Notably Elon Musk liked this tweet as revealed by his public likes. Currently, most users on X have their likes publicly displayed on their profiles,
which shows all users the posts they're engaging with. X started offering paying users an option to hide their likes last September, but Wang's tweets suggest the feature may be expanding broadly. Twitter's public likes feature has historically revealed the edgy content celebrities and public figures are enjoying at any given moment. It's the feature everyone forgets about, but always comes back to bite them. Senator Ted Cruz's Twitter account wants to like the pornographic video,
but then he blamed a staffer and said it's not going to happen again. Samuel L. Jackson was once caught liking hardcore pornography, but then, unlike all of them, once his fans warned him they were public, and of course, must own public likes have placed him in hot water before as well. This change falls in line with Musk's broader vision for X to conceal likes and reposts more broadly. Previously Musk revealed a long-term plan to hide likes and repost counts on the timeline,
creating a cleaner experience that only shows the view count. He went on to explain that you'll only be able to see likes and repost when you click on the actual post. This change hasn't happened yet, but Musk says it is, quote, definitely happening. End quote. Finally, today, you don't have to be a podcast or dream of one day cloning your voice for
use for various purposes. TrueColor has partnered with Microsoft Azure AI Speech to let its AI assistant users create an AI version of their voice to answer calls based on a recorded clip. Quoting the verge. TrueColor is an app that identifies and blocks spam calls that some people prefer over their phone's default system. TrueColor's AI assistant screens,
incoming calls and lets users know why they are calling. Customers can see the reason for the call and can choose how to respond, either by picking up the phone or having the assistant answer for them. The assistant only available in select countries was first introduced on the TrueColor app in 2022. Users have always been able to choose from a preset number of voices to represent them, and the company says letting users record their own voice is a step in personalizing the service
even more. Azure AI Speech showcased during the build conference added a personal voice feature that lets people record and replicate voices. Microsoft says in a blog post, however, that personal voice is available on a limited basis and only for specific use cases like voice assistants. Microsoft says it automatically adds watermarks to voices generated by Azure's AI Speech personal voice, and it released a code of conduct requiring users to get the full consent of
people being recorded and prohibit impersonation. Last link in the show notes today is to a New York Times article about my wife. Well, not exactly though, she is quoted in the piece, look for Lisa Rose-Marick. The story is about the Palace Theatre, a huge Broadway theatre that was built back in 1913. This is an architecture project that my wife has been working on for the
last seven years. A developer hoisted the 14 million pound theatre. The theatre itself 30 feet up into the air to make room for retail below and replacing the hotel in the air rights above. The developer also paid for an $80 million renovation of the theatre because it was an interior landmark and now the theatre is reopening. Again, my wife did this. It was her dream project. It's absolutely gorgeous. When all of our dumb podcasts and tweets and apps are long forgotten,
this theatre will still be delighting people. Look at the pictures. Everything you see, she had a hand in from the chandelier to the plaster to the color of the seats to the bathrooms. I hope for all of you, the absolute blessing of having a life partner that is as talented as mine is. Congrats, Lisa. Talk to you tomorrow.