OpenAI, Jony Ive & SoftBank Reportedly Unite in a $1 Billion AI Device Venture
What sort of venture could be bold enough to satisfy the ambitions of OpenAI’s bad-boy CEO Sam Altman, ex-Apple star designer Jony Ive, and deep-pocketed SoftBank founder Masayoshi Son?
Last fall, we heard rumors that OpenAI CEO Sam Altman and SoftBank founder Masayoshi Son were discussing a three-way, $1 billion deal to produce “the iPhone of artificial intelligence” or “devices for the home.”
It made sense that Son, who controls the semiconductor firm Arm Holdings, would want the AI infusion Altman could provide. What most interested us about this rumor was that the third participant was said to be Jony Ive, the Steve Jobs protégé who left Apple in 2019, eight years after his mentor’s passing, to found the San Francisco design firm LoveFrom.
Here, I introduce myself as your curmudgeonly sleuth. I’ve been tracking one purported Next Big Thing after another since I witnessed the launch of the IBM PC in 1981. To separate false leads from plausibilities, I look for instances when means, motives and market opportunities suggest the potential for exponential ROIs.
In this case, I see strong circumstantial evidence that Altman, Son and Ive possess the technologies, skills and ambitions to conceive, brand and build wirelessly networked gadgets based on AI chips for smart homes; enhanced wearables to monitor health and extend mobile connectivity; control, safety and efficiency systems for factories and businesses; and other applications to usher in the long-awaited Internet of Things (IoT). In 2022, McKinsey & Company projected that the IoT could be a $12.5 trillion global market by 2030.
My circumstantial evidence begins with Altman, who got fired by an idealistic board of rookies who didn’t understand that OpenAI’s nonprofit governance structure was the fig leaf covering its profit aspirations. Altman’s rapid rehiring validated his decision to release a free version of ChatGPT in 2022.
That tactic generated publicity that OpenAI’s tech and business teams capitalized upon to book $2 billion in 2023 revenue by selling subscriptions to its consumer and business AI products, delivering an estimated 900 percent year-over-year revenue growth from $200 million in 2022.
Next, consider Son, the 66-year-old ex-wunderkind whose early wins on video games and computer trade magazines helped make him one of the world’s richest entrepreneurs. However, after many later losses, one media headline asked whether he might be “the worst investor ever.”
Let’s call Son better-lucky-than-smart for controlling UK-based Arm, which has spent 34 years designing and licensing obscure yet essential processing routines for all sorts of chips found in smartphones, automatic braking systems, and even central processing units (CPU) and graphics processing units (GPU).
Since 2013, Arm has had its fingers in the developing IoT market. Arm went public last September at $51 a share. After some stock gyrations, Barron’s stated in March that “outside of Nvidia, Arm may be the best fundamental growth story in technology.”
Last but not least is Ive, who has the chops to conceive and design products based on Arm-designed IoT chips infused with OpenAI smarts. In 2013, Wired Magazine described Ive as the “genius” behind the design-first product strategy that helped make Apple one of the world’s most valuable companies. “The iMac, iPhone, iPad and dozens of other products were conceived in Ive’s Industrial Design Studio – not Apple’s engineering groups,” according to Wired Magazine.
When interviewed by biographer Walter Isaacson, Jobs said something that the The New Yorker reprised in a 2015 profile of Ive. “If I had a spiritual partner at Apple, it’s Jony,” Jobs said. “Jony and I think up most of the products together … he’s not just a designer. That’s why he works directly for me. He has more operational power than anyone else at Apple except me.”
In 2021, on the 10th anniversary of Jobs’ death, Ive wrote a memorial about his mentor in the Wall Street Journal. “Our curiosity united us,” Ive stated. “I think it also tempered our fear of doing something terrifyingly new … (Steve) truly believed that by making something useful, empowering, and beautiful, we express our love for humanity.”
Lest I sound intoxicated with my theory, I hasten to acknowledge that most rumors fizzle and most deals flop due to clashes of egos, interests or sheer implausibility. Still, the technological means, participant self-interests and market opportunity make these whispers worth pursuing. Come back in May for the next installment in our quest for clues about what these alleged collaborators may be up to. Help our hunt by sharing your thoughts, tips or alternative theories in the comments below.
Best,
Tom for the Don’t Count Us Out Yet Team