Microsoft Chairman and CEO Satya Nadella speaks to attendees at Microsoft’s Build conference in Seattle on May 23, 2023.
Dan DeLong | Microsoft
If there’s one company that has popularized artificial intelligence in the past year, it’s the small but richly funded startup OpenAI, the entity behind viral chatbot ChatGPT.
This week at its Build conference for software developers, Microsoft made extensive use of its collaboration with the startup, in which it’s invested billions.
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Front and center on Tuesday, the first day of the show, was a onstage conversation between Greg Brockman, OpenAI’s co-founder and president, and Kevin Scott, Microsoft’s technology chief and the person credited with building the unusually close relationship between the two companies.
“You heard it from Greg,” Scott told the crowd assembled at the Seattle Convention Center near the end of the talk. “You all are the ones who are going to make AI great.”
Toward that end, Microsoft announced a slew of products for developers that draw on OpenAI’s technology:
A forthcoming chatbot promises to help developers work with data and prepare it for analysis.
Developers will be able to build plug-ins that work inside of ChatGPT and the chatbots inside Microsoft’s own products, including one that will debut in Windows next month.
Developers who receive coding suggestions through the GitHub Copilot feature will gain access to a chatbot inside of the Windows Terminal command-line program.
Generative AI will change software forever, says Nadella
OpenAI released ChatGPT to the broad world in November, sparking lots of interest from consumers. Shortly thereafter, companies such as Atlassian, Morgan Stanley and Salesforce rushed to show off integrations of OpenAI’s GPT-4 large language model, which powers the chatbot. GPT-4 and alternatives from the likes of Amazon and Google have been trained on extensive internet data sets and have become capable of spitting out chunks of natural-sounding text.
The technology is a popular form of what has come to be called generative AI, which can take human input and respond with a computer-generated output.
“Every layer of the software stack is going to be changed forever and no better place to start than the actual developer stack,” Microsoft CEO Satya Nadella said during his Build keynote address on Tuesday. “We as developers, how do we build is fundamentally changing.”
It’s crucial for third-party developers to enrich Microsoft’s own software properties, such as the Microsoft 365 productivity software bundle. Such work might help Microsoft’s Teams communication app, for example, to become a more obvious hub for an increasingly wide selection of processes and tasks that companies need to carry out. That can make companies less likely to switch to alternatives such as Google Workspace.
Microsoft highlighted dozens of plug-in developers on Tuesday, including Adobe, Asana, Canva, Cloudflare, Redfin, Spotify and TripAdvisor. A demonstration showed the Windows chatbot turning on a Spotify playlist, creating a company logo with Adobe Express and sending the logo to a person’s colleagues over Teams in response to a series of typed messages.
Greg Brockman, OpenAI president and co-founder, and Kevin Scott, Microsoft chief technology officer, speak onstage at Microsoft’s Build conference in Seattle on May 23, 2023.
Dan DeLong | Microsoft
At the same time, Nadella has pushed for Microsoft to incorporate GPT-4 directly into Teams and older Microsoft products, such as the Bing search engine, often resulting in bots branded with the name Copilot. The Copilot term emphasizes collaboration with people, in contrast with (for example) the Autopilot advanced driver-assistance system for Tesla vehicles.
“We are adding Copilot into everything,” Scott Guthrie, executive vice president of Microsoft’s cloud and AI group, told CNBC in an interview last week. “It’s less of a top-down mandate, although we’re certainly pushing top-down. I think it’s something where we’ve actually evangelized internally and really got every team excited about. And we are building a common stack across Microsoft that the entire company is building on top of.”
Analysts responded favorably to the developer onslaught.
“The pace of MSFT’s GenAI innovation remains stunning to us,” Mizuho analysts with a buy rating on Microsoft stock wrote in a Wednesday note to clients.
Brockman hinted to developers that the cost of GPT-4, which runs in Azure, could come down.
“I think we did a 70% price reduction two years ago,” he told Scott. “Basically, this past year, we did a 90% cost reduction. A 10 times cost drop — like, that’s crazy, right? And I think we’re going to be able to do the same thing repeatedly with new models. And so GPT-4 right now, it’s expensive, it’s not fully available. But that’s one of the things that I think will change.”
Apple is losing market share in China due to declining iPhone shipments, supply chain analyst Ming-Chi Kuo wrote in a report on Friday. The stock slid 2.4%.
“Apple has adopted a cautious stance when discussing 2025 iPhone production plans with key suppliers,” Kuo, an analyst at TF Securities, wrote in the post. He added that despite the expected launch of the new iPhone SE 4, shipments are expected to decline 6% year over year for the first half of 2025.
Kuo expects Apple’s market share to continue to slide, as two of the coming iPhones are so thin that they likely will only support eSIM, which the Chinese market currently does not promote.
“These two models could face shipping momentum challenges unless their design is modified,” he wrote.
Kuo wrote that in December, overall smartphone shipments in China were flat from a year earlier, but iPhone shipments dropped 10% to 12%.
There is also “no evidence” that Apple Intelligence, the company’s on-device artificial intelligence offering, is driving hardware upgrades or services revenue, according to Kuo. He wrote that the feature “has not boosted iPhone replacement demand,” according to a supply chain survey he conducted, and added that in his view, the feature’s appeal “has significantly declined compared to cloud-based AI services, which have advanced rapidly in subsequent months.”
Apple’s estimated iPhone shipments total about 220 million units for 2024 and between about 220 million and 225 million for this year, Kuo wrote. That is “below the market consensus of 240 million or more,” he wrote.
Apple did not immediately respond to CNBC’s request for comment.
Amazon said it is halting some of its diversity and inclusion initiatives, joining a growing list of major corporations that have made similar moves in the face of increasing public and legal scrutiny.
In a Dec. 16 internal note to staffers that was obtained by CNBC, Candi Castleberry, Amazon’s VP of inclusive experiences and technology, said the company was in the process of “winding down outdated programs and materials” as part of a broader review of hundreds of initiatives.
“Rather than have individual groups build programs, we are focusing on programs with proven outcomes — and we also aim to foster a more truly inclusive culture,” Castleberry wrote in the note, which was first reported by Bloomberg.
Castleberry’s memo doesn’t say which programs the company is dropping as a result of its review. The company typically releases annual data on the racial and gender makeup of its workforce, and it also operates Black, LGBTQ+, indigenous and veteran employee resource groups, among others.
In 2020, Amazon set a goal of doubling the number of Black employees in vice president and director roles. It announced the same goal in 2021 and also pledged to hire 30% more Black employees for product manager, engineer and other corporate roles.
Meta on Friday made a similar retreat from its diversity, equity and inclusion initiatives. The social media company said it’s ending its approach of considering qualified candidates from underrepresented groups for open roles and its equity and inclusion training programs. The decision drew backlash from Meta employees, including one staffer who wrote, “If you don’t stand by your principles when things get difficult, they aren’t values. They’re hobbies.”
Amazon, which is the nation’s second-largest private employer behind Walmart, also recently made changes to its “Our Positions” webpage, which lays out the company’s stance on a variety of policy issues. Previously, there were separate sections dedicated to “Equity for Black people,” “Diversity, equity and inclusion” and “LGBTQ+ rights,” according to records from the Internet Archive’s Wayback Machine.
The current webpage has streamlined those sections into a single paragraph. The section says that Amazon believes in creating a diverse and inclusive company and that inequitable treatment of anyone is unacceptable. The Information earlier reported the changes.
Amazon spokesperson Kelly Nantel told CNBC in a statement: “We update this page from time to time to ensure that it reflects updates we’ve made to various programs and positions.”
Read the full memo from Amazon’s Castleberry:
Team,
As we head toward the end of the year, I want to give another update on the work we’ve been doing around representation and inclusion.
As a large, global company that operates in different countries and industries, we serve hundreds of millions of customers from a range of backgrounds and globally diverse communities. To serve them effectively, we need millions of employees and partners that reflect our customers and communities. We strive to be representative of those customers and build a culture that’s inclusive for everyone.
In the last few years we took a new approach, reviewing hundreds of programs across the company, using science to evaluate their effectiveness, impact, and ROI — identifying the ones we believed should continue. Each one of these addresses a specific disparity, and is designed to end when that disparity is eliminated. In parallel, we worked to unify employee groups together under one umbrella, and build programs that are open to all. Rather than have individual groups build programs, we are focusing on programs with proven outcomes — and we also aim to foster a more truly inclusive culture. You can read more about this on our Together at Amazon page on A to Z.
This approach — where we move away from programs that were separate from our existing processes, and instead integrating our work into existing processes so they become durable — is the evolution to “built in” and “born inclusive,” instead of “bolted on.” As part of this evolution, we’ve been winding down outdated programs and materials, and we’re aiming to complete that by the end of 2024. We also know there will always be individuals or teams who continue to do well-intentioned things that don’t align with our company-wide approach, and we might not always see those right away. But we’ll keep at it.
We’ll continue to share ongoing updates, and appreciate your hard work in driving this progress. We believe this is important work, so we’ll keep investing in programs that help us reflect those audiences, help employees grow, thrive, and connect, and we remain dedicated to delivering inclusive experiences for customers, employees, and communities around the world.
New Tesla Model 3 vehicles on a truck at a logistics drop zone in Seattle, Washington, on Aug. 22, 2024.
M. Scott Brauer | Bloomberg | Getty Images
Tesla is voluntarily recalling about 239,000 of its electric vehicles in the U.S. to fix an issue that can cause its rearview cameras to fail, the company disclosed in filings posted Friday to the National Highway Traffic Safety Administration’s website.
“A rearview camera that does not display an image reduces the driver’s rear view, increasing the risk of a crash,” Tesla wrote in a letter to the regulator. The recall applies to Tesla’s 2024-2025 Model 3 and Model S sedans, and to its 2023-2025 Model X and Model Y SUVs.
The company also said in the acknowledgement letter that it has already “released an over-the-air (OTA) software update, free of charge” that can fix some of the vehicles’ camera issues.
In 2024, Tesla issued 16 recalls in the U.S. that applied to 5.14 million of its EVs, according to NHTSA data. The recall remedies included a mix of over-the-air software updates and parts replacements. More than 40% of last year’s recalls pertained to issues with the newest vehicle in the company’s lineup, the Cybertruck, an angular steel pickup that Tesla began delivering to customers in late 2023.
Regarding the latest recall, the company said it had received 887 warranty claims and dozens of field reports but told the NHTSA that it was not aware of any injurious, fatal or other collisions resulting from the rearview camera failures.
Other customers with vehicles that “experienced a circuit board failure or stress that may lead to a circuit board failure,” which cause the backup camera failures, can have their vehicles’ computers replaced by Tesla, free of charge, the company said.
Tesla did not immediately respond to CNBC’s request for comment.