OpenAI Side Quests
Rumors swirl about OpenAI pivot, SEC working on proposal to eliminate quarterly earnings requirement, Shyam Sankar releases new book
Happy Tuesday.
The current thing in tech and business is reporting that OpenAI is working on a “major strategy shift” around coding and enterprise users.
Today’s lineup
𝕏 anon carried_no_interest at 11:45 AM
Palantir CTO Shyam Sankar at 12:30 PM
Ceramic AI Founder Anna Patterson 1:20 PM
Gecko Robotics Co-Founder and CEO Jake Loosararian at 1:30 PM
Cyberstarts Founder Gili Raanan at 1:40 PM
Daily Op-Ed, by John Coogan
OpenAI Side Quests
OpenAI is back in the WSJ after some comments from Fidji Simo, OpenAI’s CEO of Applications.
“We cannot miss this moment because we are distracted by side quests,” Simo told staff last week, according to remarks reviewed by The Wall Street Journal. “We really have to nail productivity in general and particularly productivity on the business front.”
Seems like a reasonable move. I’m actually in favor of Side Quests generally and particularly in a time when a new technology is having hard-to-predict impacts every few months. But let’s review the history.
OpenAI rocketed to a billion MAUs, probably faster than any company in history. Jordi started saying last year, “Think of OpenAI as a new hyperscaler.” That take has aged particularly well in light of the exponential growth in compute demand driven by reasoning models and then agentic coding harnesses. But the default playbook for hyperscalers also includes making lots of longshot bets.
Google has a balloon internet play. They have a contact lens that can detect how drunk you are, they briefly owned Boston Dynamics, but most importantly they bought DeepMind.
Amazon has taken tons of shots at drone-related delivery and home security stuff. They also own Twitch but never really linked the site to live shopping and closed that loop.
Apple tried to build a car, then pulled out. Who knows where the Apple Vision Pro goes (I hope it continues!), and they’ve worked on a bunch of health moonshots like non-invasive continuous glucose monitoring.
Meta went full sci-fi mode with a rebrand and tens of billions of dollars in VR related expenses. Tesla launched a premium tequila in a lightning-bolt shaped bottle.
Side quests come in all shapes and sizes. Some are just good for morale or branding, some are complete dumpster fires, and others reshape the business entirely.
Some of OpenAI’s bets come from very small teams with relatively tiny compute budgets, but they get lots of attention because of the particular product category (thinking of Sora here). The idea of experimenting quickly but then consolidating efforts even faster makes a ton of sense. Nano Banana was a big deal for Gemini. Bringing image, video, and audio generation together in a single ChatGPT flow is clearly the next step, but there are way more tradeoffs (the type that require real-world data and not just engineering resources) to actually create a delightful user experience. Dylan Patel said on Dwarkesh the TAM for GPT-5.4 is north of $100B. The enterprise opportunity is crystal clear for everyone involved. With that backdrop, Riley Walz and others joining OpenAI Labs makes a lot of sense.
The narrative around AI this year will continue to be dominated by the compute scaling main quest. Raise the money, do the deals, grow the capacity. As Travis Kalanick said about fundraising: “If you’re doing something and it’s easy, it’s not valuable. The key is, if money matters, which I think we would say it does, especially in certain categories, you need to be the best in the world at it.”
Headlines
WSJ: OpenAI to Cut Back on Side Projects in Push to ‘Nail’ Core Business
WSJ: SEC Prepares Proposal to Eliminate Quarterly Reporting Requirement
Bloomberg: Pentagon Moving to Replace Anthropic Amid AI Feud, Official Says
CNBC: Microsoft shakes up Copilot AI leadership team, freeing up Suleyman to build new models
Palantir CTO Shyam Sankar releases his new book Mobilize
WSJ: The AI Boom Has Exploded the San Francisco Housing Market
Bloomberg: Perplexity AI Shopping Bots Can Stay on Amazon for Now, Court Rules
WSJ: IBM Closes $11 Billion Deal for Confluent
The Information: Nvidia Needed Groq After All
FT: How AI license plate readers became a flashpoint in US immigration battles
Trump Administration Announces Deals Totaling $56 Billion During Indo-Pacific Energy Security Summit
Kalshi announces its $1B perfect March Madness bracket challenge
Bloomberg: Ex-Datadog Leader’s AI Startup Nabs First $49 Million Funding
Musk will donate winnings from OpenAI case to charity
WSJ: Rivian’s Make-or-Break Car Arrives at the Worst Possible Moment for EVs
Elon Musk says he will donate proceeds of any legal case against OpenAI to charity
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