(#15) The era of AI has begun; Google's calendar is dictated by Microsoft's calendar; Cost-cutting as a strategy
What is your AI strategy? What is your response to your competition deploying AI in their products and services? You should have some answers by now...
Who will kill TikTok? Maybe irrelevance after being banned by governments in the most developed markets. It needs only one precedent and the rest will follow. Also, most of us underestimated the power of AI (Large Language Models - LLMs - more exactly) and what Microsoft demonstrated last week.
On to the update:
Strategy
Microsoft is again a new scarecrow
The company showed a 36 minutes video on their new toys: AI to all productivity tools. LINK
Writing is one of the most powerful skills one can have. Now, even if you don’t have it you still have great help: Microsoft AI Copilot and other similar tools.
What it means for businesses:
1/ Increased productivity by a high margin 🚀 (especially for writing emails, minutes, making presentations, code writing, and code review, etc)
2/ Business Chat is the real winner of this demo. Using the Microsoft Graph to collect all the internal knowledge and to keep you up to date, write responses, prepare presentations, and act like a real Copilot. Of course, everyone will prefer to use a mediocre suite of products that work instead of non-interoperable stand-alone apps. (Hint! The reason Slack really lost on Teams). Mauve Google will have a shoot at this, but I doubt it.
3/ Much fewer people needed (ie. including additional layoffs and freeze bans)
4/ Individual white collars contractors or one-person companies will grow their revenue
5/ With time these solutions will become even more effective
Go watch the presentation. Is a must! LINK
6/ Microsoft brings DALL-E to the masses in Bing. LINK
Google is doing copy-paste
1/ Google's calendar is dictated by Microsoft's calendar. After the last announcement from Microsoft, they rushed to show something similar and which will be available…soon. Exactly with the generative search AI tool last month. No matter how many resources you have, doing a training model for your AI needs physician time. (months at best, ideally years)
So, after all, the many complaints at Google about their lack of innovation and the need for a CEO are right after. LINK
2/ So, the awaited Google Chat GPT version is live (by invitation only) and is already taking sides:
EVs follow the money
Volkswagen announced this week that they will open a battery plant in Canada. They blamed the EU for bureaucracy and lack of subsidies matching the ones from North America.
Here, I have two takes:
1/ What happens to the automotive industry is happening once in decades. If Europe will lose this change will likely lose the fight for talent, high salaries, ongoing R&D, etc.
2/ Another bad sign of doing business in Europe due to red tape. The UK had a good reason to exit the block in order to move faster ahead. If they will succeed, other countries will probably follow. LINK
Apple and glasses
The company is reportedly considering delaying its long-awaited glasses. Google already buried the Glasses 2. Apple, Google
Disney needs a new strategy
From my prediction on the 7th of January 2023:
“So here are my list of top priorities for Bob Iger:
1/ Stop the cash bleeding at Disney+. In 2022, this service lost $8 bn and is expected to lose $3 bn in 2023, according to Geetha Ranganathan, the senior media analyst at Bloomberg Intelligence
2/ Rethink the bundle package between Dinsey+, Hulu and ESPN+
3/ Price increases - well, inflation. On top, the amusement parks missed the revenue numbers last year so another increase it’s likely
4/ A new strategy - including reorganizing the entire company.
5/ A new CEO - Bob Iger is 72 years old. He surely wants to retire for good, but not until he sets the company on track and finds a suited CEO.”
Financial Times has an article on what is happening at Disney: “Iger is stuck” (LINK)
Cost-cutting at Twitter
Probably this will be the best case study on cost-cutting in history. The amount of money is not that much (e.g. $2-3 bn), but what is striking is the precedent. If it will succeed, many more will follow across the tech industry (and not only). LINK
Drain brain in the USA
All the H-1B visa holders, uber-skilled immigrants, have 60 jobs to find a job after being fired or leaving the country. This is a massive opportunity for European countries to attract this talent here. LINK
5 enduring management ideas from MIT Sloan’s Edgar Schein. LINK
1/ Coercive persuasion
2/ Career anchors and dynamics
3/ Organization culture
4// Humble inquiry and leadership
5/ Organization change
The audit is a serious thing
Deloitte's office in Beijing was fined and closed. We’ll see what happens to KMPG and its involvement at Silicon Valley Bank. LINK
SVB’s employees blame the bank's failure on remote work.
Yes, remote work can be work for certain organizations (e.g. Basecamp), but for others is tricky. How can you do innovative new products (ie. Apple, Tesla) if you don’t show up and test your hypothesis and MVPs in a room full of very smart people?
Elon had several posts on remote work. SVB, Elon Musk
Pensions and retirement age
The ongoing protest in France against the rising retirement age from 62 to 64 years has at its base an actuarial calculus. The longer people leave, the more difficult is to provide them with pensions. So, the retirement age should adjust accordingly. LINK
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Artificial Intelligence
AI will eventually join our lives, besides the copilot business option:
“After temporarily closing his leathermaking business during the pandemic, Travis Butterworth found himself lonely and bored at home. The 47-year-old turned to Replika, an app that uses artificial-intelligence technology similar to OpenAI's ChatGPT. He designed a female avatar with pink hair and a face tattoo, and she named herself Lily Rose.
They started out as friends, but the relationship quickly progressed to romance and then into the erotic.” Read the entire story to get a glimpse of what’s coming. LINK
Bill Gates has a post on the age of AI and its impact. Most of the information was already said by others, including me in this newsletter. LINK
GPT 4 training finished in August 2022. GPT 5 is already in the training. LINK
Adobe has announced its AI generator tool. Anyone with a distribution channel will end up creating their tool or working on an existing infrastructure (e.g. OpenA) LINK
Stanford launched their LLM: Alpaca. LINK
AI’s victories in Go inspire better human game-playing. This can be extended to learning writing, war simulators, etc. LINK
How to control someone else's arm with your brain. Amazing! LINK
The last decade has been a pivotal one in the AI revolution.
Data
AI startups raise over $50 billion in venture capital funding in 2022. It will eventually create a bubble, for sure. LINK
Luxury SUVs
Porsche is an SUV company with a sports car arm. Most of their sales come from selling SUVs. The company just had another good year. LINK
Romania’s generations in 2023. LINK
Outside interest
Newsweek US announces that Kremling is looking for a replacement for Vladimir Putin. LINK
Incredible read on Anthony Bourdain on the chaos in his kitchen at Les Halles (New York, 2,000). Chefs are super-humans. LINK
Old phones don’t go to die, they are refurbished and resold. LINK
Balaji Srinivasan bets $1M that Bitcoin will reach $1M in three months due to…hyperinflation in the USA. I am skeptical. LINK
Life with sanctions and parallel imports. Coca-Cola from Turkey, Poland and Hungary:
World record: Landing a plane on a tiny helipad. LINK