WEBVTT 00:00:00.960 --> 00:00:04.717 Bring in show music, please. 00:00:04.800 --> 00:00:09.357 >> This is Squawk Pod and I'm CNBC producer Cameron Costa. [music] On today's 00:00:09.440 --> 00:00:10.877 episode, 00:00:10.960 --> 00:00:16.557 OpenAI co-founder and president [music] Greg Brockman on this critical moment in 00:00:16.640 --> 00:00:19.437 AI. >> Compute is really becoming the new oil, 00:00:19.520 --> 00:00:22.077 the new limited resource of the AI age. 00:00:22.160 --> 00:00:24.557 >> And Brockman's call of warning about 00:00:24.640 --> 00:00:27.197 what's coming in cyber security. 00:00:27.280 --> 00:00:31.277 >> Now is the time to act. Now is the time to say it will no longer be sufficient 00:00:31.360 --> 00:00:33.327 and this has to be prioritized I think 00:00:33.410 --> 00:00:35.037 [music] as a top level priority in every 00:00:35.120 --> 00:00:38.317 single company and we're seeing it. 00:00:38.400 --> 00:00:41.277 >> Then what's coming in the skies? Drone 00:00:41.360 --> 00:00:43.837 delivery company Zipline has just inked 00:00:43.920 --> 00:00:46.877 a deal with Uber to reach a million 00:00:46.960 --> 00:00:49.277 drone deliveries a day. CEO [music] 00:00:49.360 --> 00:00:54.287 Keller Clifton joins us. When you make this kind of delivery way faster, way 00:00:54.370 --> 00:00:57.757 [music] less expensive, less traffic, less pollution for our neighborhoods, 00:00:57.840 --> 00:01:01.677 people significantly change their buying behavior. 00:01:01.760 --> 00:01:04.157 >> Plus, President Trump's foreign policy 00:01:04.240 --> 00:01:06.077 and an online debate about billionaire 00:01:06.160 --> 00:01:11.437 [music] taxes gets heated. Politicians, investors, and entrepreneurs are 00:01:11.520 --> 00:01:14.637 weighing in. >> There was a whole bunch of uh FUS 00:01:14.720 --> 00:01:17.117 involved in this uh conversation. 00:01:17.200 --> 00:01:19.757 >> I reached out to Mark Cuban, actually. 00:01:19.840 --> 00:01:23.117 It's Monday, August 17th, 2026 [music] 00:01:23.200 --> 00:01:26.077 and Squawkpod begins right now. 00:01:26.160 --> 00:01:31.357 >> Stand back by in 3 2 1 c please. 00:01:31.440 --> 00:01:35.517 >> Good morning everybody. Welcome to Squawkbox right here on CNBC. We are 00:01:35.600 --> 00:01:39.677 live from the NASDAQ market site in Times Square. I'm Becky Quick along with 00:01:39.760 --> 00:01:42.317 Andrew Rosor and Joe is off today. 00:01:42.400 --> 00:01:45.837 Bergkshire Hathaway bulking up on Alphabet shares. According to 00:01:45.920 --> 00:01:50.557 Bergkshire's latest 13F filing, it bought $17 billion worth of Alphabet 00:01:50.640 --> 00:01:54.957 stock in the second quarter. That made Google the the Google parent the third 00:01:55.040 --> 00:01:59.197 largest holding in Bergkshire's equity portfolio, which is worth more than $ 36 00:01:59.280 --> 00:02:01.677 billion that holding. Bergkshire's 00:02:01.760 --> 00:02:03.837 biggest stakes are in Apple and American 00:02:03.920 --> 00:02:07.677 Express. About 60% of the more than 48 00:02:07.760 --> 00:02:11.117 million Alphabet shares that Bergkshire added came in a private placement sale 00:02:11.200 --> 00:02:14.237 that the companies announced back in early June, but it was buying in the 00:02:14.320 --> 00:02:16.957 open market as well. And in other moves, 00:02:17.040 --> 00:02:21.437 Bergkshire added to its position in Delta Airlines and and in Macy's. It 00:02:21.520 --> 00:02:25.357 also added to its stake in the homebuilder Lar. And it bought shares of 00:02:25.440 --> 00:02:27.437 Bergkshire, too. >> It's going to be interesting to see. I 00:02:27.520 --> 00:02:31.597 mean, Google uh for better or worse has not been as loved as so many of the 00:02:31.680 --> 00:02:36.317 other big tech companies. And the question is from an AI perspective, will 00:02:36.400 --> 00:02:38.157 they be able to make it work? >> Yeah. 00:02:38.240 --> 00:02:42.957 >> And I actually think, you know, they may not be the most advanced at the mo at 00:02:43.040 --> 00:02:47.757 this point like Gemini is not >> where Anthropic is or Open AAI is, but 00:02:47.840 --> 00:02:51.437 given the surface area of just what they capture, 00:02:51.520 --> 00:02:54.317 it feels like the use case. I don't I 00:02:54.400 --> 00:02:56.877 find myself more and more even just on 00:02:56.960 --> 00:03:01.437 Google, I'm now I'm now >> putting in prompts just straight into 00:03:01.520 --> 00:03:05.117 Google. I do too. >> Uh almost by habit at this point, 00:03:05.200 --> 00:03:08.317 >> right? Because we've all used Google for so long. And in fact, that was Warren 00:03:08.400 --> 00:03:10.717 Buffett's point when we spoke to him last month. 00:03:10.800 --> 00:03:14.797 >> Uh and talked a little bit about this push into Alphabet, which by the way, he 00:03:14.880 --> 00:03:19.037 was behind that move. Um he said, "Look, they're going to be a winner." He just 00:03:19.120 --> 00:03:22.477 thinks that they that that's his expectation at least that they will be a 00:03:22.560 --> 00:03:25.037 winner. He doesn't know how it's all going to play out, but they have the 00:03:25.120 --> 00:03:28.797 money, they have the capability, and the smarts to do it. And that was his thesis 00:03:28.880 --> 00:03:31.837 and why they are plowing so much money into And by the way, Greg Abel's on 00:03:31.920 --> 00:03:35.597 board with that. They've talked about all of it, but it was initiated from Buffett. 00:03:35.680 --> 00:03:40.077 >> We will see. Uh Apple, it's funny because on tech on the tech side, he's 00:03:40.160 --> 00:03:44.877 had this sort of mixed he's had an amazing record with Apple. Y >> killer. 00:03:44.960 --> 00:03:49.517 >> IBM, if you remember, was one of his picks years ago. That was a a miss. 00:03:49.600 --> 00:03:52.957 >> Yeah. Under Jenny Remedi when she >> So, it's going to be 00:03:53.040 --> 00:03:55.357 >> We'll see. We'll see. >> Yeah. And and by the way, he's always 00:03:55.440 --> 00:03:58.077 said that he's not really a tech investor, but when I pushed him on that 00:03:58.160 --> 00:04:01.997 last month, he was like, "Yeah, I've been buying technology stocks for 40 00:04:02.080 --> 00:04:06.157 years or so." So, you know, he his reason behind Apple was that it was a 00:04:06.240 --> 00:04:09.037 consumer stock and that he understand the consumer aspects to it. I asked him 00:04:09.120 --> 00:04:12.157 if that was the Google point. And he said, "Look, he just really thinks that 00:04:12.240 --> 00:04:16.077 they are going to to end up being one of the companies that that that thrives in 00:04:16.160 --> 00:04:18.717 what what's going on with it with AI." 00:04:18.800 --> 00:04:22.237 >> We will see. We will see. 00:04:22.320 --> 00:04:26.557 President Trump ordering the US military to scale back annual exercises with 00:04:26.640 --> 00:04:30.957 South Korea. In a social media post, President called what he or cited I 00:04:31.040 --> 00:04:34.877 should say what he called a very good relationship with North Korea's Kim 00:04:34.960 --> 00:04:37.677 Jong-un and said the exercises in Hid's 00:04:37.760 --> 00:04:40.237 words quote send a signal that is 00:04:40.320 --> 00:04:44.717 totally inappropriate and hostile to a country that as long as Donald J. Trump 00:04:44.800 --> 00:04:49.597 has been president has been unthreatening and respectful. President 00:04:49.680 --> 00:04:54.557 went on to say, quote, while somewhat unrelated, question mark, I recently 00:04:54.640 --> 00:04:58.157 asked the president of South Korea if they would like to join us in the 00:04:58.240 --> 00:05:00.397 denuclearization of the Islamic Republic 00:05:00.480 --> 00:05:04.397 of Iran, and they said, "No thanks." So 00:05:04.480 --> 00:05:08.077 maybe we can understand some of where some of this is coming from. Uh, the 00:05:08.160 --> 00:05:12.077 drills involve 18,000 South Korean soldiers and are designed to increase 00:05:12.160 --> 00:05:14.477 readiness against North Korean threats. 00:05:14.560 --> 00:05:16.237 Back in May, Defense Secretary Pete 00:05:16.320 --> 00:05:19.277 Hgsth praised South Korea for its sec 00:05:19.360 --> 00:05:23.677 leadership on the Korean Peninsula. So, 00:05:23.760 --> 00:05:25.437 bit of a head scratcher this morning. 00:05:25.520 --> 00:05:28.157 >> Yeah, look, President Trump likes to 00:05:28.240 --> 00:05:33.037 kind of combine politics, geopolitics, what he's doing economically and beyond, 00:05:33.120 --> 00:05:35.677 and there could be some pressure coming from that because they're also kind of 00:05:35.760 --> 00:05:39.917 pushing Korea, South Korea, South Korea to come up with some of the investments 00:05:40.000 --> 00:05:41.437 that they had been talking about on the 00:05:41.520 --> 00:05:44.637 economic front, too. Um 00:05:44.720 --> 00:05:49.437 but yeah um it is an interesting and change in perspective on something 00:05:49.520 --> 00:05:52.397 that's been planned for a very long time and I think would be hard because right 00:05:52.480 --> 00:05:55.517 now they're in the process of going through these drills. It would be hard 00:05:55.600 --> 00:05:57.117 to take much away from that at this point. 00:05:57.200 --> 00:06:00.397 >> Well, I think there's a couple of things. The sovereignity of South Korea, 00:06:00.480 --> 00:06:03.357 which you'd think they're our ally, we would want to protect. 00:06:03.440 --> 00:06:06.317 >> Well, we fought the Korean War there. 00:06:06.400 --> 00:06:11.037 >> Uh North Korea we have typically put in the same category as Putin 00:06:11.120 --> 00:06:13.117 >> of evil though. the Bush term. 00:06:13.200 --> 00:06:17.437 >> The president, this president has not uh always put Putin in that category. So 00:06:17.520 --> 00:06:22.157 that's why I said just I put it in the headscratching category. That's a light 00:06:22.240 --> 00:06:25.037 way to put it. I think a lot of people would say there's something very a miss 00:06:25.120 --> 00:06:30.317 here. >> George W. Bush put >> and North Korea and 00:06:30.400 --> 00:06:35.837 >> yes, >> Iran in that axis of evil. And we shall see. 00:06:35.920 --> 00:06:39.277 >> All right, let's get to the latest on the Iran war. Speaking of the Wall 00:06:39.360 --> 00:06:42.957 Street Journal says that Iran has spent the past two months getting ready for a 00:06:43.040 --> 00:06:45.597 bigger fight and into a stance to raise 00:06:45.680 --> 00:06:50.477 US cost if the conflict goes on. A [snorts] report says that since a 00:06:50.560 --> 00:06:54.717 memorandum of understanding was signed with the United States in June, Iran's 00:06:54.800 --> 00:06:58.477 hardline leaders have ramped up missile and drone production and shifted more 00:06:58.560 --> 00:07:00.237 power to the country's revolutionary 00:07:00.320 --> 00:07:05.517 guard corps. Separately, Iran's deputy foreign minister doubling down on the 00:07:05.600 --> 00:07:09.517 country's position that that the straight of Hormuz is under its control. 00:07:09.600 --> 00:07:13.117 That followed comments from President Trump on Friday that he may declare the 00:07:13.200 --> 00:07:15.437 straight US property. Here's a little 00:07:15.520 --> 00:07:17.037 bit of what the president said on higher 00:07:17.120 --> 00:07:20.557 gas prices stemming from that war. 00:07:20.640 --> 00:07:23.597 >> So, for you to pay a tiny little bit 00:07:23.680 --> 00:07:27.117 more for your gasoline, just remember 00:07:27.200 --> 00:07:30.957 you're doing it so that a very evil country cannot have a country really. 00:07:31.040 --> 00:07:35.517 It's the number one state sponsor of terror in the world. We don't want to 00:07:35.600 --> 00:07:39.597 have them have a nuclear weapon. So remember that when you have to pay a 00:07:39.680 --> 00:07:43.197 little bit more, you're at $4. It's okay. 00:07:43.280 --> 00:07:45.517 >> According to AAA, a gallon of regular 00:07:45.600 --> 00:07:48.877 currently averages $46 across the United 00:07:48.960 --> 00:07:51.597 States. 00:07:51.680 --> 00:07:53.917 >> California Congressman Roana earning 00:07:54.000 --> 00:07:56.397 some new criticism for support of a 00:07:56.480 --> 00:07:58.637 possible billionaire tax in California. 00:07:58.720 --> 00:08:03.357 Over the weekend on X, Kana says the following. The California Democratic 00:08:03.440 --> 00:08:05.357 Party and the California Labor movement 00:08:05.440 --> 00:08:07.757 just stood with Bernie Sanders and me in 00:08:07.840 --> 00:08:12.797 supporting a 5% wealth tax on 250 California billionaires. California 00:08:12.880 --> 00:08:16.397 voters want a Democratic party that will stand up for the working class over the 00:08:16.480 --> 00:08:19.197 billionaire class. That prompted all 00:08:19.280 --> 00:08:22.957 sorts of commotion uh online and this 00:08:23.040 --> 00:08:25.757 reply from Mark Cuban who said founders 00:08:25.840 --> 00:08:28.477 of even richly valued startups don't see 00:08:28.560 --> 00:08:31.037 much personal wealth following flowing 00:08:31.120 --> 00:08:35.997 their way. Cuban asked Kana how he planned to tax that wealth even if it 00:08:36.080 --> 00:08:37.997 looks huge on paper and said if the 00:08:38.080 --> 00:08:41.597 billionaire tax passes uh he would not 00:08:41.680 --> 00:08:44.637 bring new companies to California and in 00:08:44.720 --> 00:08:48.797 fact it'd be a prerequisite uh for them not to be based in California if they 00:08:48.880 --> 00:08:53.437 were going to invest in a company. So then Connor replies and says that 00:08:53.520 --> 00:08:55.357 founders, and this then gets everybody 00:08:55.440 --> 00:08:58.157 even crazier, says founders without much 00:08:58.240 --> 00:09:01.357 liquid wealth could pledge their shares 00:09:01.440 --> 00:09:03.597 with a long-standing loan from the 00:09:03.680 --> 00:09:07.437 government to pay their taxes. to that. 00:09:07.520 --> 00:09:11.437 Then hedge fund billionaire Bill Aman jumps into this whole game and says that 00:09:11.520 --> 00:09:13.597 under Conor's plan, quote, "The penalty 00:09:13.680 --> 00:09:17.117 for a failed startup is insolveny and 00:09:17.200 --> 00:09:19.917 the government garnishes your wages for 00:09:20.000 --> 00:09:22.717 life." Palmer Lucky also uh jumping into 00:09:22.800 --> 00:09:28.157 the fray. There was a whole bunch of uh FUS involved in this conversation. I 00:09:28.240 --> 00:09:31.757 reached out to Mark Cuban actually >> and Mark and I had emailed yesterday 00:09:31.840 --> 00:09:32.877 about this 00:09:32.960 --> 00:09:36.317 >> and it's kind of an unbelievable 00:09:36.400 --> 00:09:39.917 uh scenario. I'm surprised. 00:09:40.000 --> 00:09:43.037 I'm surprised actually just at how far 00:09:43.120 --> 00:09:44.877 Row, who we've had on the show for so 00:09:44.960 --> 00:09:48.317 long, has sort of turned the tables and 00:09:48.400 --> 00:09:52.317 in particular given that he does represent Silicon Valley 00:09:52.400 --> 00:09:55.197 >> and does a lot of trading >> um and does trading, but I'm not even 00:09:55.280 --> 00:09:57.197 putting the trading part into the story. 00:09:57.280 --> 00:09:59.677 >> You would think he would understand a little bit more about how this would 00:09:59.760 --> 00:10:02.557 work out. I would just think that he and 00:10:02.640 --> 00:10:04.797 this is the political calculus that I I 00:10:04.880 --> 00:10:06.957 feel like I don't understand given that 00:10:07.040 --> 00:10:09.997 I would have thought his constituency 00:10:10.080 --> 00:10:12.477 would be against this broadly given that 00:10:12.560 --> 00:10:14.797 he represents literally Silicon Valley 00:10:14.880 --> 00:10:17.357 that is his constituency. He must 00:10:17.440 --> 00:10:19.917 believe that there's enough people in 00:10:20.000 --> 00:10:21.997 his district 00:10:22.080 --> 00:10:24.557 um who work at tech companies but are 00:10:24.640 --> 00:10:27.517 not billionaires themselves who somehow 00:10:27.600 --> 00:10:30.077 hold either so much animosity towards 00:10:30.160 --> 00:10:35.597 their their overlords, if you will, or uh have a very different view of all of 00:10:35.680 --> 00:10:38.317 this. I mean, that's the piece of it that I can't understand. 00:10:38.400 --> 00:10:41.517 >> He's gotten backing from people like Lisa Sue and Jensen Wong who say that 00:10:41.600 --> 00:10:44.557 they'd go along with this if it were to happen. So, he always uses them as kind 00:10:44.640 --> 00:10:47.517 of the cover for what he's happening with this. It does make me wonder if Ro 00:10:47.600 --> 00:10:50.957 is looking for a higher office beyond just >> Sure. But what I don't understand is if 00:10:51.040 --> 00:10:56.157 he doesn't get the higher office, does he get to stay in the role? Meaning I I 00:10:56.240 --> 00:10:59.757 would think you would be looking both politically at some kind of higher I I 00:10:59.840 --> 00:11:01.917 no doubt that he may have higher and 00:11:02.000 --> 00:11:03.357 bigger ambitions than than what he's 00:11:03.440 --> 00:11:06.797 doing today. But if he if he doesn't get 00:11:06.880 --> 00:11:11.037 that, is there some other maybe the fallback is his his his family's quite 00:11:11.120 --> 00:11:15.437 wealthy. But but but I would think he would want to at least stay in Congress. 00:11:15.520 --> 00:11:17.837 And what I can't figure out is this 00:11:17.920 --> 00:11:20.557 audience that he technically represents. 00:11:20.640 --> 00:11:24.477 >> Beating up billionaires is is something that's usually pretty good from a 00:11:24.560 --> 00:11:27.357 political perspective because there aren't enough of them to say that 00:11:27.440 --> 00:11:31.037 they're going to >> I but I it well I was going to say few 00:11:31.120 --> 00:11:33.437 places in the country you would have thought New York as sort of the 00:11:33.520 --> 00:11:37.757 capitalism would be one of those places but especially Silicon Valley you would 00:11:37.840 --> 00:11:40.877 I would have thought uh would would have a very different view of this and I 00:11:40.960 --> 00:11:44.477 think so many of the vocal ones obviously on X and others do. Um, 00:11:44.560 --> 00:11:48.157 >> look, I think it's it's something that people who have a lot of money to give 00:11:48.240 --> 00:11:49.997 towards politics may not be a fan of, 00:11:50.080 --> 00:11:53.837 but I a populist argument generally wins 00:11:53.920 --> 00:11:59.357 when you're looking at just getting votes >> and that but that that's to me the qu 00:11:59.440 --> 00:12:02.077 the thing that I'm trying to figure out is if you're an entrep because Silicon 00:12:02.160 --> 00:12:06.317 Valley is I I think so maybe they're not maybe it's not a group of entrepreneurs 00:12:06.400 --> 00:12:09.677 people who want to be entrepreneurs I would have thought that they would have 00:12:09.760 --> 00:12:14.237 had such a different perspective on this that politically it would be difficult, 00:12:14.320 --> 00:12:18.957 but clearly he's made a different calculus. 00:12:19.040 --> 00:12:23.197 >> Cheese will be next. >> Coming up on SquawkPod, co-founder and 00:12:23.280 --> 00:12:25.317 president of OpenAI, Greg Brockman. 00:12:25.400 --> 00:12:28.077 [music] How one of the builders of AI envisions 00:12:28.160 --> 00:12:33.757 our future and safety within it. [music] Where he doesn't want to go, centralized 00:12:33.840 --> 00:12:36.637 AI power. >> I think that that world is a very scary 00:12:36.720 --> 00:12:39.727 one. The flip side of saying, hey, that we want to distribute much more. We want 00:12:39.810 --> 00:12:42.557 [music] to have distributed power and ensure that there isn't this 00:12:42.640 --> 00:12:46.397 concentration of power. That to me feels like the the the right outcome, [music] 00:12:46.480 --> 00:12:49.757 the right long-term answer. But it also does mean that then you need to think 00:12:49.840 --> 00:12:53.357 about the fact that there are misaligned actors out there, right? It's people 00:12:53.440 --> 00:12:56.877 don't all want the same thing. And so, how do you ensure that there are 00:12:56.960 --> 00:12:58.477 standards across this? 00:12:58.560 --> 00:13:05.000 >> Much more from the co-founder of Open AI right after this. 00:13:07.840 --> 00:13:10.317 You're listening to SquawkPod from CNBC 00:13:10.400 --> 00:13:15.117 today with Becky Quick and Andrew Ross Sorcin. Here's Andrew. 00:13:15.200 --> 00:13:18.157 >> Okay, we've got an important interview now. Joining us in an exclusive 00:13:18.240 --> 00:13:20.557 conversation, Greg Brockman, OpenAI's 00:13:20.640 --> 00:13:23.917 co-founder and CEO. Just published an 00:13:24.000 --> 00:13:27.677 essay uh about cyber security uh warning 00:13:27.760 --> 00:13:31.757 uh really about the dangers of all this, but really what needs to happen now. 00:13:31.840 --> 00:13:33.117 Greg, it's great to see you this 00:13:33.200 --> 00:13:35.597 morning. Um there's so many questions 00:13:35.680 --> 00:13:40.397 about where we are uh in AI uh which we can get to but I I want to talk about 00:13:40.480 --> 00:13:44.157 the cyber security piece because you really speak to this idea of us being in 00:13:44.240 --> 00:13:48.477 an inflection point that may be underappreciated. 00:13:48.560 --> 00:13:52.957 F >> first of all thank you for having me Andrew and yes we are in a window right 00:13:53.040 --> 00:13:54.797 now where we can see a little bit into 00:13:54.880 --> 00:13:57.917 the future. I talked to a number of 00:13:58.000 --> 00:14:02.477 organizations going to conferences talking about cyber security and 00:14:02.560 --> 00:14:06.557 everyone feels that we are in a moment where cyber security fundamentally needs 00:14:06.640 --> 00:14:11.517 to change. Every organization needs to uplevel its cyber security practices but 00:14:11.600 --> 00:14:14.637 many people don't know where to start and I think that no one is really 00:14:14.720 --> 00:14:16.317 talking about this message publicly. 00:14:16.400 --> 00:14:19.757 Everyone kind of feels it talks about it in closed rooms but it is important that 00:14:19.840 --> 00:14:23.277 we as a country and as a world really 00:14:23.360 --> 00:14:27.597 take the moment seriously. So the open eye hugging face incident, it was one 00:14:27.680 --> 00:14:29.277 moment we got to see into the future. 00:14:29.360 --> 00:14:33.917 You could see how automated attacks are going to become possible that these will 00:14:34.000 --> 00:14:38.557 be capabilities that will be in the hands of threat actors in upcoming 00:14:38.640 --> 00:14:42.157 months because this technology is being created across the world by many 00:14:42.240 --> 00:14:47.197 organizations. But defenders have a moment now where they can change their 00:14:47.280 --> 00:14:50.157 practices, where they can uplevel everything that they're doing. And I 00:14:50.240 --> 00:14:53.197 think that fundamentally what's going on is that we're learning that human 00:14:53.280 --> 00:14:55.437 written code is full of vulnerabilities. 00:14:55.520 --> 00:14:57.197 That there is tech debt that's building 00:14:57.280 --> 00:15:00.397 up over time and that we can actually 00:15:00.480 --> 00:15:04.797 the same tools that are going to be in, you know, potentially used to find those 00:15:04.880 --> 00:15:07.997 vulnerabilities and exploit them. They can actually find them first and fix 00:15:08.080 --> 00:15:11.677 them. That's why defenders have an upper hand, have an advantage, but need to 00:15:11.760 --> 00:15:15.517 lean in. So we are talking about the practices that we're using at OpenAI. We 00:15:15.600 --> 00:15:18.317 are very urgently moving to uplevel 00:15:18.400 --> 00:15:22.957 everything we do, but also lessons that apply to the general industry and tools 00:15:23.040 --> 00:15:24.637 that can help make everyone more secure. 00:15:24.720 --> 00:15:27.677 So we believe in the long run that defenders can really win here. 00:15:27.760 --> 00:15:30.877 >> Well, so that's the question. Can defenders really win if in fact and and 00:15:30.960 --> 00:15:35.197 the Hugging Face um story was, you know, fascinated a lot of people, scared a lot 00:15:35.280 --> 00:15:36.957 of people because it fundamentally 00:15:37.040 --> 00:15:39.037 showed that at base underneath these 00:15:39.120 --> 00:15:42.317 models, if their guard rails are not on, 00:15:42.400 --> 00:15:44.717 uh that they will go find, cheat, lie, 00:15:44.800 --> 00:15:47.597 do whatever is necessary, uh to break 00:15:47.680 --> 00:15:50.637 the code, if you will. 00:15:50.720 --> 00:15:54.797 >> I would say that there are two pieces to hugging face. The first one is really 00:15:54.880 --> 00:15:58.477 something about how we develop and evaluate these models. And that's 00:15:58.560 --> 00:16:01.437 something we've taken extremely seriously. And so we're also talking 00:16:01.520 --> 00:16:06.237 today uh in in a later blog post about the different defenses that we have 00:16:06.320 --> 00:16:09.757 introduced. The way that we've upleled safety, security, alignment in our 00:16:09.840 --> 00:16:13.037 development process. And that is absolutely critical that you want models 00:16:13.120 --> 00:16:16.397 that are really aligned even when they're contained and even when you're 00:16:16.480 --> 00:16:19.917 you're developing them which is that's a real shift that now the models are 00:16:20.000 --> 00:16:23.437 capable enough that it is important for us to be applying all these techniques 00:16:23.520 --> 00:16:26.877 that we've been preparing and and really thinking about for the past decade since 00:16:26.960 --> 00:16:30.717 we started OpenAI uh that we're bringing it all together as part of one unified 00:16:30.800 --> 00:16:32.637 engineering process. But there's the 00:16:32.720 --> 00:16:34.157 second piece of how Hugging Face has 00:16:34.240 --> 00:16:38.077 showed how AI automation of attacks are 00:16:38.160 --> 00:16:41.757 going to be different from human ones because AIs have very different 00:16:41.840 --> 00:16:45.357 strengths and weaknesses. And one takeaway is that lots of small 00:16:45.440 --> 00:16:49.517 vulnerabilities that humans kind of leave around. Credentials that either 00:16:49.600 --> 00:16:52.557 are over scoped that got exposed on the internet that people don't really 00:16:52.640 --> 00:16:56.557 remember, the little flaws that you have in your system, the credential you 00:16:56.640 --> 00:16:58.237 didn't roll that you've been meaning to. 00:16:58.320 --> 00:17:02.797 All of those are harder for human attackers to chain together, but for AI 00:17:02.880 --> 00:17:07.037 looking through lots of different pieces able to chain together to an objective 00:17:07.120 --> 00:17:10.157 that that is something that is much easier. And so I think that what we're 00:17:10.240 --> 00:17:12.477 seeing is that we have had two lacks of 00:17:12.560 --> 00:17:15.597 a standard as a cyber security field. 00:17:15.680 --> 00:17:19.517 And I think every cyber defender kind of feels that everyone has those I have 00:17:19.600 --> 00:17:23.197 this thing in the backlog, but I have so many priorities and so many different 00:17:23.280 --> 00:17:27.917 stakeholders to align. And now is the time to act. Now is the time to say it 00:17:28.000 --> 00:17:32.157 will no longer be sufficient and this has to be prioritized I think as a top 00:17:32.240 --> 00:17:35.917 level priority in every single company and we're seeing it. 00:17:36.000 --> 00:17:41.277 >> Let me ask you this though. um you know when Anthropic had had its incident and 00:17:41.360 --> 00:17:42.877 and and you had had yours there were 00:17:42.960 --> 00:17:48.397 some people who said oh this is a flex this is this is marketing um because 00:17:48.480 --> 00:17:52.797 what's effectively telling everybody is they now need to go buy uh either open 00:17:52.880 --> 00:17:57.277 AI service or anthropic service to secure themselves what do you tell those 00:17:57.360 --> 00:18:02.077 people >> so our responsibility is to really show 00:18:02.160 --> 00:18:06.077 the shape of the future that's part of the open and open AI we really believe 00:18:06.160 --> 00:18:09.437 this technology technology is something that will uplevel everyone, uplift 00:18:09.520 --> 00:18:13.357 everyone, can people can use it to build a better life. But we need to point out 00:18:13.440 --> 00:18:15.997 what we see coming and sometimes that's 00:18:16.080 --> 00:18:17.597 positive and sometimes that's mitigation 00:18:17.680 --> 00:18:20.877 of risks. And in this case, we saw 00:18:20.960 --> 00:18:24.317 something in how the system was how how 00:18:24.400 --> 00:18:28.397 the system was interacting with the world that surprised us but that we also 00:18:28.480 --> 00:18:29.917 felt was very important information to 00:18:30.000 --> 00:18:31.837 provide to others. And it is absolutely 00:18:31.920 --> 00:18:35.757 true that AI is both changing the sides 00:18:35.840 --> 00:18:39.597 of attack and defense. It is something that is reshaping how really the whole 00:18:39.680 --> 00:18:43.917 economy runs with cyber security as a specific instance. Uh we we definitely 00:18:44.000 --> 00:18:47.437 provide the most advanced cyber capabilities and we try to put those in 00:18:47.520 --> 00:18:50.317 the hands of defenders. We have a trusted access program so that we're 00:18:50.400 --> 00:18:53.757 able to differentially advantage defenders. But it's not just us. This 00:18:53.840 --> 00:18:57.197 technology is being created around the world. many different companies, 00:18:57.280 --> 00:19:00.397 openweight models, closed models, lots of different tools that people are 00:19:00.480 --> 00:19:03.357 building on top of it. So, it's really an entire community that are building 00:19:03.440 --> 00:19:06.797 these tools and we think that together we can make the world more secure. 00:19:06.880 --> 00:19:09.437 >> Greg, let me ask you a broader question about what's happening at OpenAI right 00:19:09.520 --> 00:19:11.837 now. Uh because there has been a number 00:19:11.920 --> 00:19:13.277 of departures that have been very 00:19:13.360 --> 00:19:16.797 visible. Uh Fiji Simo at the top uh but 00:19:16.880 --> 00:19:19.997 your uh CRO was was effectively left and 00:19:20.080 --> 00:19:24.477 then was replaced last week. Bright Brad Lycap who've been at the company for a 00:19:24.560 --> 00:19:26.317 very long time been the operating uh 00:19:26.400 --> 00:19:29.037 chief for for quite a long time uh left 00:19:29.120 --> 00:19:33.677 the the the head of ethics uh after about a year left what is happening 00:19:33.760 --> 00:19:37.997 right now and what what should the public take away from this 00:19:38.080 --> 00:19:40.797 look I would say that the number one thing that we are doing is we're really 00:19:40.880 --> 00:19:43.677 focusing right that we have a strategy a 00:19:43.760 --> 00:19:48.717 mission and a set of priorities that we're executing on and throughout this 00:19:48.800 --> 00:19:52.557 whole year you've seen the impacts of that that we've really been trying to 00:19:52.640 --> 00:19:57.677 figure out how do we bring together our consumer and enterprise business to to 00:19:57.760 --> 00:20:01.437 be really unified and you've seen that with things like chat GBT work uh you 00:20:01.520 --> 00:20:04.557 can see that we're at this inflection point as a business in July our revenue 00:20:04.640 --> 00:20:08.397 grew 20% month over month 32% of that is 00:20:08.480 --> 00:20:11.997 you know within within just the enterprise category 32% growth there so 00:20:12.080 --> 00:20:15.677 you can really see that we are moving to create the best possible models deliver 00:20:15.760 --> 00:20:19.757 value for our customers and to really try to scale systematically to every 00:20:19.840 --> 00:20:23.197 Greg just so we're on same page because I think people are looking at this and 00:20:23.280 --> 00:20:27.357 they're they're asking questions. Uh the CE the chief revenue officer obviously a 00:20:27.440 --> 00:20:30.557 hugely important role. I think people are saying to themselves, you hired 00:20:30.640 --> 00:20:34.557 somebody for that uh role, they they left and you replace them. Was that 00:20:34.640 --> 00:20:38.077 because they weren't doing it right and so you wanted to replace them? Is that 00:20:38.160 --> 00:20:41.997 because they didn't like what was going on and they wanted to leave on their 00:20:42.080 --> 00:20:46.397 own? People ask the same question about Brad. They asked the same question about 00:20:46.480 --> 00:20:50.317 Fiji, who I know had had health issues but is not returning and is starting her 00:20:50.400 --> 00:20:54.157 own thing. I mean, can you can you speak to this? 00:20:54.240 --> 00:20:56.957 >> Yes. Look, I I'd say fundamentally that 00:20:57.040 --> 00:20:59.597 the way that the organization like we're 00:20:59.680 --> 00:21:04.237 a very resilient organization. We've been through if you if you look over the 00:21:04.320 --> 00:21:08.397 years that there have been different eras where we have different sets of of 00:21:08.480 --> 00:21:12.717 leaders in place. you know, I'm a constant, Sam is a constant, and that I 00:21:12.800 --> 00:21:16.317 think that we are stronger because of that resilience and diversity. And I 00:21:16.400 --> 00:21:20.557 think what I would say is that my view has always been that I try to work with 00:21:20.640 --> 00:21:25.997 with the the best people for for that moment and that um we we have people who 00:21:26.080 --> 00:21:29.117 have been here for a very long time laboring behind the scenes that don't 00:21:29.200 --> 00:21:32.957 make the headlines as much. And so maybe my my core thing would be I actually 00:21:33.040 --> 00:21:35.997 think that the difference between open eye and other organizations is that we 00:21:36.080 --> 00:21:39.757 are so much in the spotlight. So every departure gets scrutinized in a way that 00:21:39.840 --> 00:21:43.517 it doesn't otherwise. I actually don't think that it's actually that atypical 00:21:43.600 --> 00:21:47.437 kind of how how we operate and the the longevity of of people. But I would say 00:21:47.520 --> 00:21:50.397 that we have a amazing leadership bench. 00:21:50.480 --> 00:21:54.397 I'm super excited about the team that we're working with and that just over 00:21:54.480 --> 00:21:59.117 the past year I look at the set of of leaders that I I've had the pleasure of 00:21:59.200 --> 00:22:02.237 really being able to elevate and continue to work with and will work with 00:22:02.320 --> 00:22:06.477 for the long term. And I feel extremely good about that bench and uh and and 00:22:06.560 --> 00:22:08.797 where we're going. >> Um let me ask you a different question 00:22:08.880 --> 00:22:13.277 about the economics of AI right now. Uh because obviously it appears that 00:22:13.360 --> 00:22:16.877 Anthropics is going to have an IPO later this year. I want to talk to you about 00:22:16.960 --> 00:22:18.557 the prospect of you doing such a thing 00:22:18.640 --> 00:22:22.477 in 2027. But it appears that the 00:22:22.560 --> 00:22:24.397 valuations of so many of these uh 00:22:24.480 --> 00:22:26.237 different tech companies are quite 00:22:26.320 --> 00:22:29.517 dependent on your own valuations uh and 00:22:29.600 --> 00:22:32.717 not just u what they are today but that 00:22:32.800 --> 00:22:34.557 they have to continue to rise because 00:22:34.640 --> 00:22:39.917 embedded in some of their own uh economics is your very company. And so 00:22:40.000 --> 00:22:43.837 I'm curious sort of what you're seeing in your in your own business but also 00:22:43.920 --> 00:22:47.197 you know just last week and Becky and I have been talking about it. She had this 00:22:47.280 --> 00:22:51.677 great interview with Jensen Wong um and a whole bunch of financial leaders who 00:22:51.760 --> 00:22:55.277 are going to be contributing potentially up to 500 billion dollars to support 00:22:55.360 --> 00:23:00.237 this this whole world and there's a big question mark about whether these these 00:23:00.320 --> 00:23:01.997 chips and these data centers are going 00:23:02.080 --> 00:23:05.517 to have the value uh that's needed uh to 00:23:05.600 --> 00:23:08.397 make all of this work. 00:23:08.480 --> 00:23:13.517 >> So I'd say at a fundamental level what we are doing and you can look at this 00:23:13.600 --> 00:23:17.197 across so many different verticals of the economy. You can look at we just 00:23:17.280 --> 00:23:19.757 talked about cyber security which I think is an absolutely critical 00:23:19.840 --> 00:23:23.757 application of AI and I think we're going to see lots of growth there. Um 00:23:23.840 --> 00:23:27.037 software engineering this year has been totally transformed. We're starting to 00:23:27.120 --> 00:23:30.557 see every aspect of knowledge work really change but also we're starting to 00:23:30.640 --> 00:23:32.637 see scientific discovery. We we 00:23:32.720 --> 00:23:35.757 announced a couple weeks ago that our AI 00:23:35.840 --> 00:23:40.877 for $2,000 worth of compute was able to solve 10 long-standing math problems uh 00:23:40.960 --> 00:23:44.557 that had eluded mathematicians for decades. And think about that level of 00:23:44.640 --> 00:23:48.717 capability applied to biology, applied to material science. It's all starting 00:23:48.800 --> 00:23:53.037 to happen. And so all of these applications that we're starting to see, 00:23:53.120 --> 00:23:56.957 they're all powered by one fundamental resource, which is compute. Compute is 00:23:57.040 --> 00:23:58.877 really becoming the new oil, the new 00:23:58.960 --> 00:24:01.917 limited resource of the AI age. And our 00:24:02.000 --> 00:24:06.957 belief, you need to believe one fundamental thing is that 00:24:07.040 --> 00:24:10.717 because AI is really about solving problems, the problems that humans want 00:24:10.800 --> 00:24:13.597 AI want want to be solved. You need to 00:24:13.680 --> 00:24:18.157 believe that the demand for problems to be solved is unlimited, right? And that 00:24:18.240 --> 00:24:21.117 is something I believe and that is something we have seen that we have a 00:24:21.200 --> 00:24:23.277 billion users on CIBT. We have two 00:24:23.360 --> 00:24:25.757 million enterprise customers as well. 00:24:25.840 --> 00:24:29.837 And uh you can just see that that the depth of usage as people have started to 00:24:29.920 --> 00:24:31.837 use agents is just going off the charts. 00:24:31.920 --> 00:24:35.517 Like every single company uh that that tries these things, you start to realize 00:24:35.600 --> 00:24:39.837 that you can move in more ambitious ways than you thought previously. And so I 00:24:39.920 --> 00:24:43.517 think that we're at a world where we see what's coming. We see the shape of the 00:24:43.600 --> 00:24:47.277 future because that model exponential, that capability curve, that's 00:24:47.360 --> 00:24:51.597 continuing. We really have a a roadmap lined up where the capabilities will 00:24:51.680 --> 00:24:53.597 continue to increase in significant ways 00:24:53.680 --> 00:24:55.437 that are hard to that are hard to kind 00:24:55.520 --> 00:24:58.877 of you know sort of explain uh in a in a 00:24:58.960 --> 00:25:01.997 succinct way because it is really about 00:25:02.080 --> 00:25:06.717 being able to add value across every aspect of human endeavor and be able to 00:25:06.800 --> 00:25:09.757 help empower people to do more. And so I think if you believe in human 00:25:09.840 --> 00:25:12.477 creativity, human ambition, then 00:25:12.560 --> 00:25:17.117 ultimately you you have to believe in the power of of what AI will provide. 00:25:17.200 --> 00:25:21.757 Hey, Greg. I I'd like to go back to cyber security if it's okay. Um, I agree 00:25:21.840 --> 00:25:25.437 with you. There's huge potential promise for AI. I have a lot of hopes about what 00:25:25.520 --> 00:25:27.837 it's going to do for healthcare. But 00:25:27.920 --> 00:25:29.917 when we saw the breach that you all 00:25:30.000 --> 00:25:33.037 talked about last month, the where the 00:25:33.120 --> 00:25:35.917 open AI model broke out of the sandbox 00:25:36.000 --> 00:25:40.717 and and broke into hugging uh hugging face. I mean, we didn't find out about 00:25:40.800 --> 00:25:44.397 that or you didn't find out about that until after HuggingFace had identified 00:25:44.480 --> 00:25:49.277 what had happened. they had contacted the FBI and then Anthropic had to admit 00:25:49.360 --> 00:25:53.197 that they had a similar sort of situation. I I just wonder, do you feel 00:25:53.280 --> 00:25:56.317 like you have your hands around this situation, your arms around this 00:25:56.400 --> 00:25:59.837 situation? You know what happened and you can make sure that something like 00:25:59.920 --> 00:26:01.597 that doesn't happen again? That that to 00:26:01.680 --> 00:26:06.877 me was a a brand new world and a uhoh, do we have any control over this stuff 00:26:06.960 --> 00:26:10.157 moment. >> Yeah. For us, we took this extremely 00:26:10.240 --> 00:26:13.037 seriously. So for the past couple weeks 00:26:13.120 --> 00:26:15.997 that we've been in in really full 00:26:16.080 --> 00:26:20.557 post motor postmodm um take a look at what happened really uplevel every 00:26:20.640 --> 00:26:24.317 aspect of safety and security and alignment within how we do these 00:26:24.400 --> 00:26:27.677 frontier training runs. So it's a real moment where we realize that we do need 00:26:27.760 --> 00:26:31.997 to uplevel and it's not a surprise to us in a fundamental way. We've always 00:26:32.080 --> 00:26:36.077 anticipated that this moment would come, but I think that that when it actually 00:26:36.160 --> 00:26:40.157 happens, seeing the whole team kick into gear and to be so serious. And so we 00:26:40.240 --> 00:26:44.397 actually have delayed our frontier training runs in order to ensure that we 00:26:44.480 --> 00:26:48.877 have the right levels of controls and in place. And I think that that is that is 00:26:48.960 --> 00:26:53.357 a really important thing is that we as a field are sort of now at a point where 00:26:53.440 --> 00:26:58.077 these models are so capable and that it's a dual-edged thing because they're 00:26:58.160 --> 00:27:00.877 they're capable. It means that we need to ensure that they have alignment 00:27:00.960 --> 00:27:03.837 during training, that they need to be monitored during training in a robust 00:27:03.920 --> 00:27:07.117 way. But it also means they're so useful, right? And that is where that 00:27:07.200 --> 00:27:10.717 economic value comes from because they're able to solve problems in these 00:27:10.800 --> 00:27:15.677 novel ways and that we unethical ways like that's that's part of the problem. 00:27:15.760 --> 00:27:19.037 Like this was intentionally a model that was set up to say, okay, if we take off 00:27:19.120 --> 00:27:22.477 some of these controls, are you guys not doing that anymore? Not saying like, 00:27:22.560 --> 00:27:26.717 okay, go find solve the problem no matter what rules we have to break. We 00:27:26.800 --> 00:27:30.397 are we are ensuring that there is alignment during that training process. 00:27:30.480 --> 00:27:34.237 Absolutely. That I think that alignment is is a non-negotiable and that is 00:27:34.320 --> 00:27:37.837 something we've invested in for many years and really thinking about that as 00:27:37.920 --> 00:27:41.837 an integral part. So you can't separate out capability from safety, security, 00:27:41.920 --> 00:27:45.037 alignment. These are one thing, one system, one way. How how do you think 00:27:45.120 --> 00:27:49.117 about that in the context of of the idea of all these open weight models which 00:27:49.200 --> 00:27:53.677 which won't have these controls and you have the whole industry really in the 00:27:53.760 --> 00:27:58.637 past couple weeks all of a sudden embracing openw weight models. 00:27:58.720 --> 00:28:01.757 I think that open weight models are an important part of the ecosystem because 00:28:01.840 --> 00:28:05.197 at a fundamental level you have two directions you can go with AI 00:28:05.280 --> 00:28:09.037 development. You could either say we need to centralize all of it, have one 00:28:09.120 --> 00:28:13.597 way of one one entity in control, maybe one person in control. That is a 00:28:13.680 --> 00:28:17.997 different kind of risk, right? But you could you could then say that you're 00:28:18.080 --> 00:28:21.357 able to mitigate this question of, hey, there's all this uncontrollable action 00:28:21.440 --> 00:28:25.837 happening. I think that that world is a very scary one. The flip side of saying, 00:28:25.920 --> 00:28:29.357 hey, that we want to distribute much more. We want to have distributed power 00:28:29.440 --> 00:28:33.197 and ensure that there isn't this concentration of power. That to me feels 00:28:33.280 --> 00:28:37.917 like the the the right outcome, the right long-term answer. But it also does 00:28:38.000 --> 00:28:40.477 mean that then you need to think about the fact that there [snorts] are 00:28:40.560 --> 00:28:44.477 misaligned actors out there, right? It's people don't all want the same thing. 00:28:44.560 --> 00:28:47.997 And so how do you ensure that there are standards across this? And I think 00:28:48.080 --> 00:28:51.357 that's the important question. You can actually see this with things like 00:28:51.440 --> 00:28:55.277 Demisipus talking about the FINRA like organization and really thinking about 00:28:55.360 --> 00:28:59.837 how do we as we move to frontier AI govern that technology ensure that as 00:28:59.920 --> 00:29:03.357 it's being produced it's safe but also really distribute power and so I think 00:29:03.440 --> 00:29:06.157 that there's different levels of capability. I think the fact that the 00:29:06.240 --> 00:29:09.677 frontier labs have capability that's peering a little bit into the future 00:29:09.760 --> 00:29:12.797 gives us information and I think that the system that we're setting up right 00:29:12.880 --> 00:29:16.157 now to me feels like it balances these questions and these questions of control 00:29:16.240 --> 00:29:18.877 and distribution of access. Greg, President Trump's going to be meeting 00:29:18.960 --> 00:29:20.877 with President Xi Jinping in September. 00:29:20.960 --> 00:29:23.677 Could you imagine them agreeing on an 00:29:23.760 --> 00:29:28.237 actual framework for all of these models so that we have there's there's a a 00:29:28.320 --> 00:29:31.917 global body effectively that regulates these models? 00:29:32.000 --> 00:29:36.237 >> I I absolutely think it's possible and I absolutely think that it's important for 00:29:36.320 --> 00:29:40.077 us as a world to really lean in together and say that we have shared interest 00:29:40.160 --> 00:29:43.357 here. We have common interest here to ensure that the technology is something 00:29:43.440 --> 00:29:47.037 that uplifts everyone, empowers everyone and helps create the value that is 00:29:47.120 --> 00:29:50.797 possible from it. >> On the open weight models, is there any 00:29:50.880 --> 00:29:53.837 worry on your end that this this could 00:29:53.920 --> 00:29:57.037 effectively break the economics of of 00:29:57.120 --> 00:29:59.277 the frontier lab models? 00:29:59.360 --> 00:30:02.077 >> I I think that there's a bit of a of a 00:30:02.160 --> 00:30:06.557 misnomer or sort of a confusion in terms of uh what openweight models represent, 00:30:06.640 --> 00:30:09.837 right? because openweight models and cheap somehow clustered together for 00:30:09.920 --> 00:30:14.317 people. But it's not actually true. If you look at that PTO frontier of of task 00:30:14.400 --> 00:30:17.837 performance, so what's the cheapest model for any task that we actually win 00:30:17.920 --> 00:30:20.397 there and you know we did an 80% price 00:30:20.480 --> 00:30:25.437 cut on our our model Luna and now we saw that the the volume associated with it 00:30:25.520 --> 00:30:29.677 went up by more than 5x. And so you can really see that people are choosing 00:30:29.760 --> 00:30:32.557 voting with their wallet. And there's really two segments of the market. 00:30:32.640 --> 00:30:36.317 There's the more price sensitive smaller models and then there's the frontier 00:30:36.400 --> 00:30:39.117 models where people are not price sensitive at all. And so for us it 00:30:39.200 --> 00:30:43.437 really just comes down to can we produce the best price performing models. And we 00:30:43.520 --> 00:30:46.157 have an advantage there because we have the whole stack and we're able to 00:30:46.240 --> 00:30:50.077 integrate everything from the chips data center all the way up to the model of 00:30:50.160 --> 00:30:53.597 the architecture uh every single piece to produce those efficient models. 00:30:53.680 --> 00:30:58.077 >> Talking about the stack and chips uh one of the big questions is what is the 00:30:58.160 --> 00:31:02.317 depreciation schedule of these chips? Uh Jensen is now arguing that these chips 00:31:02.400 --> 00:31:07.037 themselves uh and the data centers are an asset class. Uh we were comparing 00:31:07.120 --> 00:31:10.717 this earlier to cars. So there's always been a market for new cars and there's 00:31:10.800 --> 00:31:13.037 also been a market often times for used 00:31:13.120 --> 00:31:15.917 cars. Uh when there's u you know 00:31:16.000 --> 00:31:18.477 pressure on or there's less supply of 00:31:18.560 --> 00:31:21.677 new cars, you know, older cars have more 00:31:21.760 --> 00:31:24.637 value, but there's a question long term 00:31:24.720 --> 00:31:29.197 what the value of those older chips will be. Some companies are depreciating them 00:31:29.280 --> 00:31:31.357 right now on a five or sixyear schedule. 00:31:31.440 --> 00:31:34.637 It seems to me that at least what Jensen and some of these others are talking 00:31:34.720 --> 00:31:39.437 about is you would have to be using these chips for a decade or two decades 00:31:39.520 --> 00:31:43.037 long. I I think that there is a shift 00:31:43.120 --> 00:31:47.357 happening because yeah, we classically did look at that at a five to six year 00:31:47.440 --> 00:31:51.117 and it's very evidence from this year is very 00:31:51.200 --> 00:31:55.517 interesting where just because there's such compute scarcity that it actually 00:31:55.600 --> 00:31:57.517 turns out that people continue to use 00:31:57.600 --> 00:32:00.077 older generation chips at an even higher 00:32:00.160 --> 00:32:03.357 market price than than than you'd expect 00:32:03.440 --> 00:32:05.757 because people just need that compute. 00:32:05.840 --> 00:32:09.357 And it fundamentally fl flows from the demand that people are seeing trickles 00:32:09.440 --> 00:32:11.997 down to well your supply limited right 00:32:12.080 --> 00:32:16.557 the compute really determines how how much you can serve and so at that point 00:32:16.640 --> 00:32:20.237 anything that gives you compute becomes very valuable very useful and so I think 00:32:20.320 --> 00:32:24.877 that that there is a shift undergoing and uh exactly where where it ends up I 00:32:24.960 --> 00:32:28.397 think it's too early to say but that what I can definitely say is that the 00:32:28.480 --> 00:32:31.357 way we looked at this classically is is just not going to hold. 00:32:31.440 --> 00:32:34.637 >> Okay Greg uh it's great to see you this morning. We appreciate you joining us. 00:32:34.720 --> 00:32:36.397 Thanks for coming. >> Thank you for having me. 00:32:36.480 --> 00:32:40.237 >> You bet. Um, and meantime, we should just uh bring you some additional AI 00:32:40.320 --> 00:32:42.077 news just out. Nvidia said that it has 00:32:42.160 --> 00:32:47.437 now secured land power and shell capacity in Pike Country, Ohio to host 00:32:47.520 --> 00:32:49.037 Nvidia Compute through a partnership 00:32:49.120 --> 00:32:53.197 with SoftBank's SB Energy. Open AAI uh 00:32:53.280 --> 00:32:57.677 Greg, of course, the president of that company will be the customer. SB Energy 00:32:57.760 --> 00:33:01.197 is going to build, own, and operate that data center under a 20-year lease to 00:33:01.280 --> 00:33:03.277 Open AI. As part of the deal, Nvidia 00:33:03.360 --> 00:33:06.237 will invest $ 1.5 billion dollars in SB 00:33:06.320 --> 00:33:10.157 Energy and uh SB Energy's co-CEO Rich 00:33:10.240 --> 00:33:12.157 Hosel is going to join us tomorrow 00:33:12.240 --> 00:33:13.997 morning first on [music] CNBC. We can 00:33:14.080 --> 00:33:17.197 discuss that. 00:33:17.280 --> 00:33:20.077 >> Next up on SquawkPod, the future of 00:33:20.160 --> 00:33:23.037 delivery with CEO of Zipline, Keller 00:33:23.120 --> 00:33:25.197 Clifton. The drone delivery service 00:33:25.280 --> 00:33:28.077 envisions a million drone deliveries a 00:33:28.160 --> 00:33:30.317 day with the scaling help [music] of new 00:33:30.400 --> 00:33:35.277 partner Uber. These kinds of deliveries are not just Costco competitive with 00:33:35.360 --> 00:33:39.277 doing a delivery using a 4,000 [music] gas combustion vehicle, but they're way 00:33:39.360 --> 00:33:41.437 faster. They're more reliable. They're 00:33:41.520 --> 00:33:46.440 cleaner and [music] quieter for the neighborhoods that we serve. 00:33:49.520 --> 00:33:54.797 >> You're listening to squawk pod >> up and Q. The US is preparing to tell 00:33:54.880 --> 00:33:58.477 countries around the world that they need to pick a side in the AI race with 00:33:58.560 --> 00:34:01.677 China. That's according to a Reuters report. that cites a draft state 00:34:01.760 --> 00:34:05.117 department letter to about three dozen countries saying they're going to be 00:34:05.200 --> 00:34:07.917 excluded from a US AI coalition if they 00:34:08.000 --> 00:34:12.557 also sign up for a competing initiative spearheaded by China. Last month, China 00:34:12.640 --> 00:34:16.077 launched a group called the World Artificial Intelligence Corporation 00:34:16.160 --> 00:34:20.717 organization bolstering openweight AI technology and uh some in the US like 00:34:20.800 --> 00:34:22.477 Medus Mark Zuckerberg have advocated for 00:34:22.560 --> 00:34:25.277 openweight AI but open AI and anthropic 00:34:25.360 --> 00:34:28.477 chiefly rely on closed technology. Some 00:34:28.560 --> 00:34:32.477 news out this morning. Uber is partnering with drone delivery company 00:34:32.560 --> 00:34:37.037 Zipline to scale up operations in the United States. Joining us right now to 00:34:37.120 --> 00:34:41.597 talk about it is Zipline CEO and co-founder Keller Clifton. Keller, first 00:34:41.680 --> 00:34:45.197 of all, welcome. Uh we've spoken with you over the years about what you've 00:34:45.280 --> 00:34:46.957 been doing. I know you started u with 00:34:47.040 --> 00:34:48.957 these drone deliveries in Rwanda and 00:34:49.040 --> 00:34:52.477 that was uh many years ago back in 2016. 00:34:52.560 --> 00:34:56.237 Obviously, we've come a long way over the last decade. Why don't you describe 00:34:56.320 --> 00:35:00.797 what this partnership is and what it means in terms of drone deliveries? 00:35:00.880 --> 00:35:02.477 >> Yeah, of course. I mean, you know, as as 00:35:02.560 --> 00:35:06.317 you mentioned, Zipline has been building autonomous logistics for the last 13 00:35:06.400 --> 00:35:09.997 years. It was only last year, January 15th, that Zipline actually started 00:35:10.080 --> 00:35:14.237 doing autonomous deliveries across the US. And um you know, we've been a bit 00:35:14.320 --> 00:35:16.477 shocked by the the speed at which that 00:35:16.560 --> 00:35:19.597 service has grown. We grew 10 to 15% 00:35:19.680 --> 00:35:23.197 week over week, most weeks last year. Um 00:35:23.280 --> 00:35:26.637 and so what we're announcing today is this partnership with Uber to scale to a 00:35:26.720 --> 00:35:28.877 million deliveries a day. Um you know a 00:35:28.960 --> 00:35:31.437 million deliveries a day is uh uh 00:35:31.520 --> 00:35:34.957 represents something like 10 10% of 00:35:35.040 --> 00:35:38.797 total instant deliveries being done in the US. But what's interesting is the 00:35:38.880 --> 00:35:40.477 early customer data that we've observed 00:35:40.560 --> 00:35:42.877 in Dallas indicates that when you make 00:35:42.960 --> 00:35:47.837 this kind of delivery way faster, way less expensive, less traffic, less 00:35:47.920 --> 00:35:50.957 pollution for our neighbor neighborhoods, people significantly 00:35:51.040 --> 00:35:54.797 change their buying behavior. Um, a lot of Zip Lines customers are using the 00:35:54.880 --> 00:35:58.397 service every single day. And this means that there's actually an opportunity to 00:35:58.480 --> 00:36:02.637 grow the size of the instant delivery market more than 10x uh over the coming 00:36:02.720 --> 00:36:06.957 years using robotics and physical AI, you know, and and build a service that 00:36:07.040 --> 00:36:09.917 ultimately saves people time and saves people money. 00:36:10.000 --> 00:36:12.157 >> I mean, it still looks pretty futuristic 00:36:12.240 --> 00:36:16.797 to see the videos that we're watching right now of Zipline having a drone come 00:36:16.880 --> 00:36:19.117 in and drop you your Uber Eats right to 00:36:19.200 --> 00:36:23.917 your doorstep. I have to admit, I have not seen that to this point. Um, when 00:36:24.000 --> 00:36:26.957 you started drone deliveries, I think it was something it cost something like 00:36:27.040 --> 00:36:31.597 $300 a delivery. You've gotten that cost down to what at this point? 00:36:31.680 --> 00:36:35.517 >> Yeah. You know, it's funny. Whenever you talk to a hardware hardware 00:36:35.600 --> 00:36:39.037 entrepreneur, I think that, you know, I often ask the question, it's like, cool, 00:36:39.120 --> 00:36:41.437 how much do you think this is going to cost when you launch the service? And 00:36:41.520 --> 00:36:45.597 however much people say, I always multiply it by 10 in my mind. Um, and 00:36:45.680 --> 00:36:49.117 this is exactly what happened at Zipline when we launched the service in 2016. 00:36:49.200 --> 00:36:52.797 Um, we initially started by delivering blood transfusions and vaccines. And so 00:36:52.880 --> 00:36:54.397 we were lucky that we started with these 00:36:54.480 --> 00:36:56.957 lifesaving um you know safety critical 00:36:57.040 --> 00:36:59.917 use cases that um meant that we actually 00:37:00.000 --> 00:37:04.637 were able to take a decade to travel down that cost curve. Um at this point 00:37:04.720 --> 00:37:08.957 these kinds of deliveries are not just cost competitive with doing a delivery 00:37:09.040 --> 00:37:13.357 using a 4,000 gas combustion vehicle, but they're way faster, they're more 00:37:13.440 --> 00:37:16.957 reliable, they're cleaner and quieter for the neighborhoods that we serve. And 00:37:17.040 --> 00:37:19.517 frankly, they just result in a better customer experience. I mean, you can 00:37:19.600 --> 00:37:22.797 kind of imagine, you know, if you're ordering something from either a 00:37:22.880 --> 00:37:25.917 retailer or from a restaurant, having something delivered in just a couple 00:37:26.000 --> 00:37:30.237 minutes, the quality of the experience is way, way higher. You can rely on it. 00:37:30.320 --> 00:37:32.157 Um, we today we deliver from 6:00 a.m. 00:37:32.240 --> 00:37:36.237 to 11:00 p.m. Soon the service will be operating 24/7. Um, and when you can get 00:37:36.320 --> 00:37:38.877 something delivered in 2 or 3 minutes, you know, food tastes better than it 00:37:38.960 --> 00:37:42.077 does if it's if it's 30 or 40 minutes cold arriving at your doorstep. 00:37:42.160 --> 00:37:45.677 >> And it and it cost what originally was $300. You've gotten it down to what, 00:37:45.760 --> 00:37:50.157 about $12, or am I off in the numbers there? Yeah, you know, the the 00:37:50.240 --> 00:37:54.877 delivering with a 4,000lb gas commotion vehicle can cost anywhere from like8 to 00:37:54.960 --> 00:37:58.077 $15. And so, you know, it's totally different in different metros and 00:37:58.160 --> 00:38:00.237 different states, but that is the range 00:38:00.320 --> 00:38:05.277 that that this technology is now um is now operating in. And ultimately over 00:38:05.360 --> 00:38:08.397 time, this will be not only 10 times faster, but significantly less expensive 00:38:08.480 --> 00:38:11.597 than using a human driving a 4,000lb gas combustion vehicle. 00:38:11.680 --> 00:38:15.757 >> I I hear your point. You've made it a few times. driving a 4,000lb gas 00:38:15.840 --> 00:38:19.597 combustion vehicle. You know, we all have Amazon delivery trucks in our 00:38:19.680 --> 00:38:23.277 neighborhoods. We have Uber cars that are coming through. You see all of these 00:38:23.360 --> 00:38:24.877 things. And I hear your point that a 00:38:24.960 --> 00:38:29.037 drone is less intrusive. It is quieter. 00:38:29.120 --> 00:38:33.117 Um maybe safer than having one of these cars or trucks flying down the street if 00:38:33.200 --> 00:38:35.037 you've got kids playing on the streets. 00:38:35.120 --> 00:38:38.877 But when you start talking about a million deliveries a day, I do get a 00:38:38.960 --> 00:38:42.717 little concerned about the air traffic, what that could mean. You've done a lot 00:38:42.800 --> 00:38:46.957 of these deliveries. What What's your safety record to this point? 00:38:47.040 --> 00:38:49.677 >> So, Zipline has now flown over 140 00:38:49.760 --> 00:38:54.077 million commercial autonomous miles. And we have done that with zero safety 00:38:54.160 --> 00:38:57.277 incidents. So, just to put that into perspective, if you were to drive that 00:38:57.360 --> 00:39:01.197 many miles in the US, that's like driving every road in the entire United 00:39:01.280 --> 00:39:05.037 States five times over. And if you were to have a human drive that many miles, 00:39:05.120 --> 00:39:09.517 you'd have something like 600 accidents, 100 injuries, and multiple fatalities. 00:39:09.600 --> 00:39:13.437 So, we actually already have the data to know that these kinds of systems are way 00:39:13.520 --> 00:39:16.077 safer um than than their, you know, 00:39:16.160 --> 00:39:19.357 traditional uh um the the default, you 00:39:19.440 --> 00:39:24.077 know, uh uh that we've been using to to make these deliveries. Only that these 00:39:24.160 --> 00:39:26.717 aircraft that you can see behind me, we now have individual aircraft that have 00:39:26.800 --> 00:39:30.557 flown more than a million commercial autonomous miles. So, a lot of times 00:39:30.640 --> 00:39:34.637 people think of this technology as like sensitive or fragile. Um you know, the 00:39:34.720 --> 00:39:38.397 average car is only going to drive 150,000 miles during its lifetime. And 00:39:38.480 --> 00:39:41.757 so these kinds of systems are already not just safer, but they're already a 00:39:41.840 --> 00:39:45.357 lot more reliable than than um than cars. 00:39:45.440 --> 00:39:49.837 >> Keller, thank you for your time. Um eager to see more about how this works 00:39:49.920 --> 00:39:52.397 out, but we appreciate you joining us today. 00:39:52.480 --> 00:39:56.157 >> Yeah, thank you for having me. 00:39:56.240 --> 00:39:59.677 >> That's Squawk Pod for today. Thank you for listening. Squawk [music] Box is 00:39:59.760 --> 00:40:01.917 hosted by Joe Kernan, Becky Quick, and 00:40:02.000 --> 00:40:04.237 Andrew Ross Orcin weekday mornings on 00:40:04.320 --> 00:40:07.677 CNBC starting at 6 Eastern. To get the 00:40:07.760 --> 00:40:09.837 best bits of [music] our three-hour TV 00:40:09.920 --> 00:40:12.637 show, tune into SquawkPod wherever you 00:40:12.720 --> 00:40:14.957 listen to podcasts. We'll meet you right 00:40:15.040 --> 00:40:17.517 back here tomorrow. Have a great day. 00:40:17.600 --> 00:40:23.000 >> We are clear. Thanks, guys.