Microsoft and OpenAI tech bromance under pressure
This week there are more rumours about turbulence in another tech twosome: Satya Nadella and Sam Altman.
The chief executives of Microsoft and OpenAI were once joined at the hip, co-starring on tech stages, everywhere including Davos. When Altman was briefly fired, Nadella was there immediately with a job offer.
It is no longer so cosy as OpenAI is having to renegotiate its original deal with Microsoft.
'Obviously in any deep partnership, there are points of tension and we certainly have those,' Altman told the Hard Fork podcast last week when he disclosed that he had a recent 'super nice call' with Microsoft's CEO. 'But on the whole, it has been … wonderfully good for both companies.'
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Reuters
25 minutes ago
- Reuters
Exclusive: Intel's new CEO explores big shift in chip manufacturing business
SAN FRANCISCO, July 1 (Reuters) - Intel's (INTC.O), opens new tab new chief executive is exploring a big change to its contract manufacturing business to win major customers, two people familiar with the matter told Reuters, in a potentially expensive shift from his predecessor's plans. If implemented, the new strategy for what Intel calls its "foundry" business would entail no longer marketing certain chipmaking technology, which the company had long developed, to external customers, the people said. Since taking in March, CEO Lip-Bu Tan has moved fast to cut costs and find a new path to revive the ailing U.S. chipmaker. By June, he started voicing that a manufacturing process that prior CEO Pat Gelsinger bet heavily on, known as 18A, was losing its appeal to new customers, said the sources, who spoke on condition of anonymity. To put aside external sales of 18A and its variant 18A-P, manufacturing processes that have cost Intel billions of dollars to develop, the company would have to take a write-off, one of the people familiar with the matter said. Industry analysts contacted by Reuters said such a charge could amount to a loss of hundreds of millions, if not billions, of dollars. Intel declined to comment on such "hypothetical scenarios or market speculation." It said the lead customer for 18A has long been Intel itself, and it aims to ramp production of its "Panther Lake" laptop chips later in 2025, which it called the most advanced processors ever designed and manufactured in the United States. Persuading outside clients to use Intel's factories remains key to its future. As its 18A fabrication process faced delays, rival TSMC's ( opens new tab N2 technology has been on track for production. Tan's preliminary answer to this challenge: focus more resources on 14A, a next-generation chipmaking process where Intel expects to have advantages over Taiwan's TSMC, the two sources said. The move is part of a play for big customers like Apple (AAPL.O), opens new tab and Nvidia (NVDA.O), opens new tab, which currently pay TSMC to manufacture their chips. Tan has tasked the company with teeing up options for discussion with Intel's board when it meets as early as this month, including whether to stop marketing 18A to new clients, one of the two sources said. The board might not reach a decision on 18A until a subsequent autumn meeting in light of the matter's complexity and the enormous money at stake, the person said. Intel declined to comment on what it called rumor. In a statement, it said: "Lip-Bu and the executive team are committed to strengthening our roadmap, building trust with our customers, and improving our financial position for the future. We have identified clear areas of focus and will take actions needed to turn the business around." Last year was Intel's first unprofitable year since 1986. It posted a net loss attributable to the company of $18.8 billion for 2024. The Intel chief executive's deliberations show the enormous risks - and costs - under consideration to move the storied U.S. chipmaker back onto solid footing. Like Gelsinger, Tan inherited a company that had lost its manufacturing edge and fell behind on crucial technology waves of the past two decades: mobile computing and artificial intelligence. The company is targeting high-volume production later this year for 18A with its internal chips, which are widely expected to arrive ahead of external customer orders. Meanwhile, delivering 14A in time to win major contracts is by no means certain, and Intel could choose to stick with its existing plans for 18A, one of the sources said. Intel is tailoring 14A to key clients' needs to make it successful, the company said. Tan's review of whether to focus clients on 14A involves the contract chipmaking portion of Intel, or foundry, which makes chips for external customers. Regardless of a board decision, Intel will make chips via 18A in cases where its plans are already in motion, the people familiar with the matter said. This includes using 18A for Intel's in-house chips that it already designed for that manufacturing process, the people said. Intel also will produce a relatively small volume of chips that it has guaranteed for (AMZN.O), opens new tab and Microsoft (MSFT.O), opens new tab via 18A, with deadlines that make it unrealistic to wait for the development of 14A. Amazon and Microsoft did not immediately comment on the matter. Intel said it will deliver on its customer commitments. Tan's overall strategy for Intel remains nascent. So far, he has updated his leadership team, bringing in new engineering talent, and he has worked to shrink what he considered bloated and slow-moving middle management. Shifting away from selling 18A to foundry customers would represent one of his biggest moves yet. The 18A manufacturing process includes a novel method of delivering energy to chips and a new type of transistor. Together, these enhancements were meant to let Intel match or exceed TSMC's capabilities, Intel executives have previously said. However, according to some industry analysts, the 18A process is roughly equivalent to TSMC's so-called N3 manufacturing technology, which went into high-volume production in late 2022. If Intel follows Tan's lead, the company would focus its foundry employees, design partners and new customers on 14A, where it hopes for a better chance to compete against TSMC. Tan has drawn on extensive contacts and customer relationships built over decades in the chip industry to arrive at his view on 18A, the two sources said.
Daily Mail
30 minutes ago
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World's biggest retailer will soon have more robots than human employees
Amazon will soon have more robots than human employees working in its warehouses. The retail giant has long been increasing automation for tasks once completed by humans. As a result it now has more than one million robots in its workplaces, according to the company's own data. This new record is nearing the amount of human workers in its facilities, and will soon surpass them. Amazon's enormous warehouses are now staffed with large plucking 'robots' that can pick up and move packages with their long metallic arms. Other robots are used to pack products into packaging and to help with sorting. One of the newest robots, called Vulcan, even has in-built sense of touch which helps it to distinguish between different items on shelves, the Wall Street Journal reported. Amazon's latest move is to connect the robots to its order-fulfillment systems - meaning the machines can work together and with humans to complete jobs - according to the report. 'They're one step closer to that realization of the full integration of robotics,' robot analyst Rueben Scriven told the Journal. Currently around 75 percent of Amazon's deliveries are helped by a robot at some point on their journey. Amazon claims this has been one of the main factors behind their improved productivity. It also helps solve issues such as high staff turnover at its fulfilments centers, the retail giant said. It has also freed current staff from some repetitive and cumbersome tasks such as heavy lifting. 'I thought I was going to be doing heavy lifting, I thought I was going to be walking like crazy,' Amazon employee Neisha Cruz told the Journal. Cruz spent five years picking items at an Amazon warehouse in Windsor, Connecticut, but was then trained to oversee the new robotic systems. Cruz now earns more than double the pay she started on and is able to work behind a computer rather than on her feet. Amazon boss Andy Jassy warned that AI will lead to job cuts However, the robots are also replacing jobs and slowing hiring at the company which currently employs 1.56 million people, mostly in warehouses. It comes after Amazon's CEO Andy Jassy recently revealed that the increased implementation of AI means the company will slash the size of its workforce in the coming years. 'As we roll out more Generative AI and agents, it should change the way our work is done,' Jassy wrote in a memo to staff last month. 'It's hard to know exactly where this nets out over time, but in the next few years, we expect that this will reduce our total corporate workforce,' he explained. And Amazon is not alone. Last month Microsoft also said is planning to cut thousands of jobs as it ramps up investments in AI. The cuts, which will hit sales roles in particular, are part of a broader effort to streamline the company's workforce, according to Bloomberg. The layoffs are expected to be announced early next month, following the end of the tech giant's fiscal year, the report said, citing people familiar with the matter. In June Procter & Gamble, which makes diapers, laundry detergent, and other household items, also announced it would cut 7,000 jobs, or about 15 percent of non-manufacturing roles. Americans are growing increasingly concerned about the impact of AI on the jobs market. The tech is continuing to upend the jobs market with white collar entry-level jobs disappearing fastest and layoffs in tech, finance and consulting gathering pace.
Reuters
an hour ago
- Reuters
SoftBank's Ampere deal to face in-depth review by FTC, Bloomberg News reports
July 1 (Reuters) - The U.S. Federal Trade Commission has launched an in-depth investigation into SoftBank Group Corp's (9984.T), opens new tab purchase of semiconductor designer Ampere Computing LLC, Bloomberg News reported on Tuesday. The probe, known formally as a second request for information, is a follow-up inquiry into the deal and suggests that the acquisition may undergo an extended government review, according to the report. Reuters could not immediately verify the report.
