Craigslist founder Craig Newmark is pouring millions of dollars into combating AI’s dark side
Craig Newmark, founder of Craigslist
Source: Bleacher + Everard
Craig Newmark made his fortune off a website, founded in 1995, that served as an early online bulletin board and looks like it hasn’t been updated in two decades.
That website, Craigslist, is still cranking along, featuring apartment listings, an active jobs board and items for sale. But the privately held company has long been surpassed in value by the likes of Airbnb, LinkedIn and Facebook Marketplace, which all face Wall Street’s demands for growth and profit.
Though Newmark’s internet company may be outdated, his concerns about where the industry is headed are most certainly not. Since the 2015 debut of Craig Newmark Philanthropies, the entrepreneur has donated many millions of dollars to various causes involving media and technology.
Most recently, his organization contributed $3 million to help fund a new artificial intelligence and education initiative from Common Sense Media, the nonprofit told CNBC this week.
“While I tried to pay some attention to what was going on, just everything caught me by surprise,” Newmark said, referring to the current boom of generative AI and all the new and intelligent chatbots.
Newmark, 70, spoke to CNBC as he was recovering from a minor heart procedure he went through in late August. The heart ablation required Newmark to lay on his back “the whole time in the wrong position” and he “woke up with a lot of back pain,” he said.
More than the surgery, Newmark wanted to talk about the hospital food.
“Hospital pudding is really good,” he said. “And since they served my lunch cold, I asked them and got more containers of pudding.”
Newmark, who ran his business out of San Francisco but now lives with his wife in New York, said the hospital stay didn’t cause him to reflect much on mortality, as he’d already addressed such existential issues when he decided to simplify his life by giving away much of his Craigslist riches.
Newmark’s foundation has principally focused on donating to organizations and causes pertaining to journalism, combating misinformation, countering online harassment, cybersecurity issues, and supporting veterans and military families.
The rapid evolution of AI and its potential hazards have recently caught Newmark’s attention, and his money.
The goal of Common Sense’s AI project is to provide an AI ratings system for parents, educators, policymakers and regulators so they can evaluate what makes certain tools like OpenAI’s ChatGPT safe or unsafe for children. Additionally, the nonprofit is offering online AI literacy courses intended to help parents and educators teach basic AI fundamentals to children.
The full scope of AI’s capabilities and potential for societal harm became more clear to Newmark by the time companies began “modifying search engines to use generative AI.”
“I realized that if a search engine was using sources that weren’t reliable, if the sources were about lying to people, that would create a big, ethical problem, and you really don’t want a news source of any sort to knowingly lie,” Newmark said.
Newmark is concerned that bad actors will use generative AI to more easily amplify and spread disinformation. At the same time, he’s worried that tech companies, particularly in social media, “aren’t even trying anymore to get rid of stuff they know is dishonest,” he said.
Tech companies like Meta, Amazon and X (formerly known as Twitter) recently laid off numerous trust and safety workers as part of major cost-cutting initiatives, but have said that the downsizing won’t affect the safety of their platforms.
‘Bad uses’ of the internet
Meanwhile, AI has the potential to profoundly affect society, like the internet and the printing press before it, Newmark said. That’s an area where he has notable expertise. Craigslist was both hugely disruptive to newspapers and their classified ads sections, and has been a site that’s attracted criminals and scammers.
Few people predicted the “bad uses” of the internet, which has allowed nefarious actors to “mostly lie to people in large numbers,” Newmark said.
“I guess the profits to be made in being a really good professional liar, those profits have greatly increased because the internet is a big amplifier,” Newmark said. “It’s everyone’s printing press, and you get to use it as a printing press, whether your intentions are good or bad.”
Newmark said he became interested in language-generating software like ChatGPT in the early 1970s, “when people were beginning to talk about language understanding and neural networks.” However, he says, “I didn’t really understand it.”
Now the technology is here and spreading rapidly.
Newmark said he doesn’t want to name names when it comes to the organizations he fears are creating the most societal discontent through AI, because he’s previously been scarred for getting that specific.
“In the past when I’ve pointed out major problems, I’ve learned the hard way that I’m no match for someone who lies for a living,” Newmark said. “So, I’m allowing myself to be chickens—.”
Rather, he said he relies on “people who are both braver and smarter” to call public attention to those matters.
“Protecting kids when it comes to AI is a big issue,” Newmark said, regarding his donation to Common Sense Media. “I have no idea how I would go about getting started, but I know where to put my money where my mouth is.”
Why Common Sense?
“A lot of groups and politicians talk about protecting kids,” Newmark said. “But these guys are the real deal, and so I’m helping them.”
Misinformation and journalism
Newmark acknowledged that the topics of misinformation, journalism and content moderation have become more polarized and politicized of late. House Judiciary Chair Jim Jordan, R-Ohio, alleged that tech companies unfairly censor conservative speech, and he’s undertaken a “censorship investigation” to probe suspected ties between the executive branch and certain technologists and researchers.
Several academics previously told CNBC that the politicized landscape has led to some organizations cutting back on funding research into combating misinformation for fear of being publicly criticized.
“Some people are backing off, some people are getting braver. Again, I’m not very brave,” Newmark said. He highlighted the Knight Foundation and Ford Foundation as organizations that are “doing brave things.”
Within journalism, Newmark’s most high-profile endeavor is the City University of New York’s Craig Newmark Graduate School in Journalism. The program was renamed in 2018 after Newmark endowed the school with a $20 million gift, though he made prior contributions in 2016 and 2017.
He also donated $20 million in 2018 to help fund The Markup, which describes itself as a “nonprofit newsroom that investigates how powerful institutions are using technology to change our society.” That project quickly became controversial after founding Editor-in-Chief Julia Angwin said she’d been fired over email by co-founder and Executive Director Sue Gardner.
Still, Newmark says both the CUNY journalism school and The Markup have been successful, while other efforts “have not been successful, and I’m being discreet about them because I’m still trying to help before I have much sterner talks.”
He pegs his philanthropy success rate at “70% or 80%, which is good, but it’s not 100.”
In terms of where he spends his time online, Newmark said he still posts on X, primarily to promote and highlight the work of teachers. However, he said the site is losing its effectiveness as it leans toward showing people algorithmically recommended posts.
Thilina Kaluthotage | Nurphoto | Getty Images
“As a social network, Twitter does seem to be gone,” Newmark said, adding that he’s trying out rivals like Bluesky, Mastodon and Meta’s Threads.
In particular, Newmark said he likes “like the spirit of Mastodon and Bluesky,” which he likened to the early days of the internet when it took a long time for websites to build devoted audiences.
“The audience development is very slow,” Newmark said. “Twitter and everything else grew slowly and the other sites are growing slowly, and yet we are impatient and we want to see network effects now.”
Cybersecurity is another area of focus for Newmark. He pointed to a recent $100 million commitment announced in March to a collection of organizations working on cyber-related issues, like combating the spread of ransomware and creating methods for tech and security companies to share threat information.
He said the total number will probably exceed $100 million, because he’s already “broken through $80 million.”
In June, Newmark’s philanthropy arm also pledged to donate $100 million to multiple organizations supporting veterans and military members, who “sometimes have to choose between decent housing or feeding their families,” Newmark said. He called the treatment of that community “a national security matter.”
“There’s nothing virtuous in that,” Newmark said about his donations, noting that he doesn’t spend his money on “yachts or fast cars.”
“It’s more satisfying to give it away,” Newmark said. “Again, that’s not pious or altruistic. It’s just what I was taught in Sunday school.”
WATCH: How Amazon is racing to catch up in generative AI with custom AWS chips
Amazon on Wednesday unveiled a new robotic system that’s capable of performing multiple tasks at once in the company’s warehouses.
The system, called Blue Jay, is made up of a series of robotic arms that are suspended from a conveyor belt-like track. Those arms are tipped with suction-cup devices that allow them to grab items of varying shapes and sizes.
Blue Jay combines “what used to be three separate robotic stations into one streamlined workplace that can pick, sort, and consolidate in a single place,” Amazon said in a blog.
The robotic system’s goal is to assist employees with otherwise strenuous tasks “while creating greater efficiency in less physical space,” the company said.
Amazon is testing Blue Jay at one of its warehouses in South Carolina. So far, the company has observed that the system is able to pick, pack, stow and consolidate “approximately 75% of items we store at our sites.”
Blue Jay joins a growing fleet of robotic machinery being deployed across Amazon’s legions of warehouses. Over the past several years, Amazon has debuted robots capable of handling different tasks, ranging from removing items from shelves to sorting boxes. In May, it debuted “Vulcan,” a robotic system that has a sense of touch.
Amazon’s warehouse automation efforts were largely jumpstarted by its $775 million acquisition of Kiva Systems in 2012.
The announcement comes as Amazon’s warehouse automation has come under growing scrutiny, particularly over how the technology is impacting its sprawling frontline workforce.
The New York Times on Tuesday published an investigation showing that Amazon’s automation team expects that it can avoid hiring more than 160,000 people in the U.S. by 2027, amounting to savings of about 30 cents on every item that Amazon packs and delivers. The report was based on interviews and internal strategy documents, the Times said.
In response to the report, an Amazon spokesperson told CNBC that the documents offer an “incomplete and misleading picture of our plans.”
“In this instance, the materials appear to reflect the perspective of just one team and don’t represent our overall hiring strategy across our various operations business lines — now or moving forward,” the spokesperson said in an email.
As the nation’s second-largest private employer, Amazon’s automation playbook could become a bellwether for the broader job market and other corporations. The company had more than 1.54 million employees globally at the end of the second quarter. That figure excludes delivery drivers, which are contracted through third-party firms.
The company on Wednesday said that employees remain “at the center” of its robotics development. Amazon said its goal is to “reduce physically demanding tasks, simplify decisions and open new career opportunities” for workers.
Amazon has sought to highlight how increasing automation in its facilities will lead to employees adopting “more rewarding” roles within the company. It offers an apprenticeship program in mechatronics and robotics, which involves honing skills around maintaining and monitoring robotic machinery.
WATCH: Meet Vulcan, Amazon’s new stowing robot that can feel what it touches
Applied Digital said on Wednesday that it signed a $5 billion infrastructure lease agreement with a U.S. hyperscaler.
Shares of the data center company dropped more than 7% following the announcement, continuing a recent slumped that’s sent the stock down over 20% in the past week. The stock has still almost quadrupled this year.
The lease announced on Wednesday is for about 15 years and will deliver 200 megawatts of capacity at the company’s Polaris Forge 2 campus in North Dakota. It brings the company’s total leased capacity to 600 megawatts at its two Polaris Forge campuses.
Across the tech industry, the major cloud providers and other internet giants are rapidly investing in artificial intelligence infrastructure and announcing plans for massive new data centers to handle an expected surge in demand. Applied Digital didn’t name its partner for the latest agreement, just disclosing that it’s an “investment grade hyperscaler.”
In an interview with CNBC’s “Squawk on the Street,” CEO Wes Cummins said the five U.S. hyperscalers are Microsoft, Meta, Oracle, Amazon and Google, “so that’s really who we’re targeting.” He said the tenant for the first lease was CoreWeave.
“We started down this path a couple years ago and we stubbed our toe a few times, but I think we’ve really dialed in the process of the ability to build at scale,” Cummins said, adding that the company has a 4 gigawatt “active pipeline.”
In June, Applied Digital announced two long-term lease agreements with CoreWeave for 250 megawatts of capacity. The company said it expects $7 billion in rental revenue over 15 years, and the shares soared 48% on that news.
Applied Digital also secured $5 billion in infrastructure funding from Macquarie Asset Management earlier this month.
“We believe Polaris Forge 2 builds on that momentum, reflecting the strength of our partnerships and the speed at which we’re reshaping the AI infrastructure landscape,” Cummins said in Wednesday’s release.
Technology
For workers in young, hot world of AI careers, the dream payday is as often ending as layoff nightmare
Jose Luis Pelaez Inc | Digitalvision | Getty Images
At around the same time Accenture announced its investment in data labeling startup Snorkel AI to power its financial services clients in August, the startup announced it was laying off about 13% of its staff.
It wasn’t alone.
When Meta took a massive stake in Scale AI in June, the deal was billed as a sign of confidence in the fast-growing data-labeling company. It was also the catalyst that resulted in laying off 14% of its staff. Windsurf, a coding AI startup, offered buyouts to all of its employees after a failed OpenAI acquisition attempt. Once Cognition acquired the company, it laid off 30 staffers and was offering buyouts, according to The Information. HP‘s acquisition of AI pin company Humane led to some staffers receiving 30% to 70% increases in pay, according to Techcrunch – and layoffs immediately for others.
The trend isn’t slowing down, either.
On Wednesday, Meta laid off 600 employees within its artificial intelligence unit, with Meta’s Chief AI Officer (and Scale AI founder) Alexandr Wang announcing the layoffs in a memo to staff.
As big technology companies double down on artificial intelligence by acquiring or investing in nimble startups, the workforces of those smaller companies are often the first to feel the impact. With Wall Street scrutinizing investments, instead of an eye towards keeping the startup culture and keeping employees happy, it’s turning into quickly eliminating duplicate functions.
“In the past, there would have been more concessions made to culture, to continuity, to that sort of thing,” said JP Gowinder, Forrester vice president and principal analyst. “That’s just not where we are. Big Tech is all about cutting to the very minimum viable staff for a variety of reasons.”
Accenture, Meta, Cognition and HP did not respond to requests for comment.
While job losses after mergers are nothing new, the way tech giants are handling these AI-driven acquisitions feels different. Part of the disruption stems from the fact that large tech firms are still recalibrating their workforces after years of pandemic-era hiring.
“As these big tech companies continue to pivot towards growth and that growth is generally driven by AI, they are going to shed lower growth or non-core assets, whether they divest them, they wind them down, or they restructure them,” said Malinda Gentry, EY-Parthenon Americas leader for the Technology, Media and Telecommunications (TMT) industry. “That is going to result in needing less of that workforce or creating a more streamlined and efficient workforce.”
“What you’re seeing now in the workforce and the adjustments you’re seeing is driven by the rapid pace of AI,” Gentry said.
Startup exits and career endgames
The World Economic Forum estimates AI could eliminate 80 to 85 million jobs worldwide over the next three years, while creating as many as 170 million new ones. The challenge for tech workers is finding a place in the meantime while the industry shifts towards a more AI-enabled workforce. Startups in the space offer flashy offers and opportunities for future career growth, but with many of these companies eyeing exits as the final endgame, it also creates job volatility.
Startups are less likely to be preserved as stand-alone units and more likely to be streamlined into big tech’s existing operations. This is occurring within a labor market where job seekers have long since lost the Covid era “job hopping” edge.
“When you buy a company, if you get rid of people who are at the company – unless you bought it purely for the IP or for the customer – you don’t really want to get rid of the talent in general,” Forrester’s Gowinder said. “But it is such an employer’s market at the moment, what are people going to do?”
The pace of AI development is another driver of workforce churn. The move towards AI has made many tech companies bet not only that they won’t need entry level jobs, but also rethink the employee structure of their companies and placing a larger emphasis on senior roles.
“They’re moving toward a flatter organizational model, where they’re getting rid of middle management layers,” Gowinder said. “So a lot of the layoffs happen at that middle management layer. It’s a bet that technology, like collaboration technology and very clear product development life cycles, are just removing the need for extra layers of management.”
For employees, startups used to dangle the carrot of being able to grow with new technology and reap the benefits of being acquired by a larger giant. But now, many employees view it as a risk. The uncertainty could change how AI startups recruit. Contracts may begin to include stronger guarantees of equity or severance in the event of an acquisition, as workers grow wary of being left behind in a deal.
“The implication of this ‘buy and liquidate the staff’ is sort of troubling,” Gowinder said. “It may make it a little harder for some of these startups to hire the talent that they want, if the talent that they want is hoping to have a share in the spoils of this.”
Despite the turbulence, experts stress that layoffs don’t tell the whole story. For every downsizing announcement, there are also hiring pushes in areas tied to AI strategy. Big tech is still racing to secure scarce talent in machine learning, data science, and AI safety. There’s no turning back from an AI-powered tech workforce future.
“There’s going to continue to be a trend in workforce reduction,” Gentry said. “But that is balanced with the ability to continue to grow and acquire talent, whether that talent is hired, acquired, or partnered with in the ecosystem.”
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