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More than 100 mayors attended Bloomberg CityLab’s Mayors Innovation Studio to learn about using artificial intelligence in city government.

Courtesy of Bloomberg Philanthropies

More than 100 mayors descended on Washington, D.C. this week to learn how generative AI tools like OpenAI’s ChatGPT could help them better run their cities.

The mayors sought to learn how the cutting-edge technology could help them do everything from better predicting which areas would be most affected by natural disasters to making it easier for residents to navigate city services.

The roughly four-hour Mayors Innovation Studio, hosted by Bloomberg Philanthropies’ CityLab on Wednesday, is an example of how generative AI tools are making their way into many aspects of life and every level of government. While only 2% of cities surveyed by Bloomberg Philanthropies said they’re actively implementing the technology, 69% said they were actively exploring or testing it and 96% of surveyed mayors said they were interested in using it.

In Washington, where much of the discussion of AI has centered around how Capitol Hill should place broad guardrails on the technology, the session provided a glimpse into how local governments may be among the first to harness the power of AI to serve their constituents, even as federal lawmakers debate lofty principles.

“Cities are places of action, where new solutions hit the ground,” said James Anderson, who leads government innovation programs at Bloomberg Philanthropies, in a phone interview prior to the event. Cities are “the last mile and often the first mile in terms of the innovations,” he added.

James Anderson, head of government innovation programs at Bloomberg Philanthropies, introduces mayors to the Mayors Innovation Studio on AI.

Courtesy of Bloomberg Philanthropies

Policies governing tech have increasingly become the domain of state and local governments as Congress has failed to pass many major tech bills, like those protecting digital privacy or creating guardrails for kids on the internet. Meanwhile, states have taken such matters into their own hands, which many tech companies fear creates a patchwork of regulation that’s difficult to comply with.

The focus of Wednesday’s session was primarily on how generative AI may streamline processes for cities or offer new insights to make them safer or more efficient. The pandemic showcased the power of local governments harnessing data, Anderson noted, when many built dashboards of local Covid cases and hospitalizations.

Early in the session, Mitch Weiss, a Harvard Business School professor and former chief of staff to a former Boston mayor, demonstrated how the group might use ChatGPT to better understand and solve a local issue. Weiss used the example of “storrowing” in Boston, when trucks scrape their tops off while going under a low-clearance bridge.

Weiss prompted the chatbot to channel various experts to give their opinions and come up with solutions to reduce the issue and asked the AI questions like why warnings for low-clearance bridges weren’t working. ChatGPT said drivers were distracted, unfamiliar with the area, or over-relying on GPS.

At one point, he prompted ChatGPT to create a line graph from an open dataset of such incidents in New York City, and many in the room wowed when a graph with a steep drop in incidents quickly materialized. He asked for a hypothesis for what may have improved New York City’s storrowing compared to Boston, and ChatGPT suggested improved infrastructure, better signage, modern GPS and awareness programs may have contributed to the decline.

In one instance, just for fun, he asked ChatGPT for wacky solutions to the problem. The AI chatbot suggested a truck catapult. He also asked for more realistic solutions inspired by the wacky ones, and ChatGPT suggested a designated detour route. 

Using AI for summer job programs and town halls

Later, Weiss prompted ChatGPT to create a form advertising a new summer jobs program with a city and target it in a way that would appeal to teens. The AI came up with the branding of a “Summer Hustle,” and Weiss then prompted it to create a colorful graphic to promote the program.

Weiss also showed mayors how the tool could be used to prep for community board meetings, by asking the AI to generate possible questions from community members, including follow-ups.

Some mayors who said they’ve already played around with generative AI tools said they’ve used it to anticipate town hall questions, summarize articles they haven’t had time to read, create draft job descriptions or draft responses to constituents.

CNBC agreed not to quote individual mayors who participated during the event, which was marketed as a place where mayors could come to learn and freely ask questions about a new technology.

More than 100 mayors attended Bloomberg CityLab’s Mayors Innovation Studio to learn about using artificial intelligence in city government.

Courtesy of Bloomberg Philanthropies

The mayors also heard from several cities already deploying or thinking about the use cases of generative AI in their cities.

The city of Buenos Aires, Argentina, for example, is working on a generative AI model based on ChatGPT with its existing Boti chatbot that residents can text with using WhatsApp. The new generative AI version of Boti is trained to discuss culture and tourism — topics Melisa Breda, undersecretary for evidence-based policies, said they determined to be relatively low risk. Still, the tool hasn’t rolled out yet as Breda said it still needs fine-tuning to ensure its responses fit their criteria.

Boston’s Chief Information Officer Santiago Garces shared the city’s basic guidance to its employees for using the technology: review any outcomes, disclose the use of AI and don’t input sensitive data. Garces said such guidance should weigh the risks with the opportunity for employees in different parts of the government to experiment with it to determine how it can make their jobs more efficient.

Garces also said Boston is exploring how to use generative AI to translate information into specific regional dialects to help enroll residents in services.

Bloomberg Philanthropies and the Center for Government Excellence at Johns Hopkins University announced at the session a new City AI Connect platform, where city staff could continue to share ideas and resources on using AI in their governments.

The event sought to give mayors a starting point for how to think about implementing generative AI into their processes.

“We were hearing … oh my god generative AI, everyone’s talking about it everywhere,” said Anderson. “We understand it could mean a lot for local government. We have no idea where to begin.”

Mayors who spoke with CNBC around the event recognized the potential of generative AI to solve problems in ways that weren’t previously possible.

More than 100 mayors attended Bloomberg CityLab’s Mayors Innovation Studio to learn about using artificial intelligence in city government.

Courtesy of Bloomberg Philanthropies

“This is not a trivial thing,” said Chattanooga, Tennessee Mayor Tim Kelly in a phone interview ahead of the event. “If we can get this right and people can use AI to better access city services, I think it could move the needle.”

Kelly imagined that AI could help residents become more connected to their local governments, by surfacing open board seats that match their interests or simply making it easier for them to get information about recycling.

Columbus, Ohio Mayor Andrew Ginther hopes the technology can someday be used to better predict natural disasters and areas of high traffic accidents as well as streamline the process for residents to obtain government benefits for food.

“There’s great promise with AI really to help us transform local government operations and service delivery,” Ginther said. “We think it’ll allow us to help for better frontline decision-making, more real time information … We think those efficiencies are going to save city staff time and money and we think there are going to be dramatic improvements in resident customer experience. But we’re also going to have to invest in it.”

San Francisco Mayor London Breed, in an interview after the event, envisioned that AI could help the city identify forgotten and contradictory laws on the books, so they could work on clearing unnecessary regulatory hurdles for things like housing.

“We can’t approach it from a place of fear,” Breed said of AI. “It’s coming whether we want it to or not. The question is, are we going to move with it and stay ahead of it to a certain extent, or are we going to fall behind and get run over? … My hope is that we don’t get to that place where we allow this technology to run away from us.”

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Cloud software vendors Atlassian, Snowflake and Workday are betting on security startup Veza

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Cloud software vendors Atlassian, Snowflake and Workday are betting on security startup Veza

From left, Veza founders Rob Whitcher, Tarun Thakur and Maohua Lu.

Veza

Tech giants like Google, Amazon, Microsoft and Nvidia have captured headlines in recent years for their massive investments in artificial intelligence startups like OpenAI and Anthropic.

But when it comes to corporate investing by tech companies, cloud software vendors are getting aggressive as well. And in some cases they’re banding together.

Veza, whose software helps companies manage the various internal technologies that employees can access, has just raised $108 million in a financing round that included participation from software vendors Atlassian, Snowflake and Workday.

New Enterprise Associates led the round, which values Veza at just over $800 million, including the fresh capital.

For two years, Snowflake’s managers have used Veza to check who has read and write access, Harsha Kapre, director of the data analytics software company’s venture group told CNBC. It sits alongside a host of other cloud solutions the company uses.

“We have Workday, we have Salesforce — we have all these things,” Kapre said. “What Veza really unlocks for us is understanding who has access and determining who should have access.”

Kapre said that “over-provisioning,” or allowing too many people access to too much stuff, “raises the odds of an attack, because there’s just a lot of stuff that no one is even paying attention to.”

With Veza, administrators can check which employees and automated accounts have authorization to see corporate data, while managing policies for new hires and departures. Managers can approve or reject existing permissions in the software.

Veza says it has built hooks into more than 250 technologies, including Snowflake.

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The funding lands at a challenging time for traditional venture firms. Since inflation started soaring in late 2021 and was followed by rising interest rates, startup exits have cooled dramatically, meaning venture firms are struggling to generate returns.

Wall Street was banking on a revival in the initial public offering market with President Donald Trump’s return to the White House, but the president’s sweeping tariff proposals led several companies to delay their offerings.

That all means startup investors have to preserve their cash as well.

In the first quarter, venture firms made 7,551 deals, down from more than 11,000 in the same quarter a year ago, according to a report from researcher PitchBook.

Corporate venture operates differently as the capital comes from the parent company and many investments are strategic, not just about generating financial returns.

Atlassian’s standard agreement asks that portfolio companies disclose each quarter the percentage of a startup’s customers that integrate with Atlassian. Snowflake looks at how much extra product consumption of its own technology occurs as a result of its startup investments, Kapre said, adding that the company has increased its pace of deal-making in the past year.

‘Sleeping industry’

Within the tech startup world, Veza is also in a relatively advantageous spot, because the proliferation of cyberattacks has lifted the importance of next-generation security software.

On the public markets, the First Trust Nasdaq Cybersecurity ETF, which includes CrowdStrike and Palo Alto Networks, is up 3% so far this year, compared with a 10% drop in the Nasdaq.

Veza’s technology runs across a variety of security areas tied to identity and access. In access management, Microsoft is the leader, and Okta is the challenger. Veza isn’t directly competing there, and is instead focused on visibility, an area where other players in and around the space lack technology, said Brian Guthrie, an analyst at Gartner.

Tarun Thakur, Veza’s co-founder and CEO, said his company’s software has become a key part of the ecosystem as other security vendors have started seeing permissions and entitlements as a place to gain broad access to corporate networks.

“We have woken up a sleeping industry,” Thakur, who helped start the company in 2020, said in an interview.

Thakur’s home in Los Gatos, California, doubles as headquarters for the startup, which employs 200 people. It isn’t disclosing revenue figures but says sales more than doubled in the fiscal year that ended in January. Customers include AMD, CrowdStrike and Intuit.

Guthrie said enterprises started recognizing that they needed stronger visibility about two years ago.

“I think it’s because of the number of identities,” he said. Companies realized they had an audit problem or “an account that got compromised,” Guthrie said.

AI agents create a new challenge. Last week Microsoft published a report that advised organizations to figure out the proper ratio of agents to humans.

Veza is building enhancements to enable richer support for agent identities, Thakur said. The new funding will also help Veza expand in the U.S. government and internationally and build more integrations, he said.

Peter Lenke, head of Atlassian’s venture arm, said his company isn’t yet a paying Veza client.

“There’s always potential down the road,” he said. Lenke said he heard about Veza from another investor well before the new round and decided to pursue a stake when the opportunity arose.

Lenke said that startups benefit from Atlassian investments because the company “has a large footprint” inside of enterprises.

“I think there’s a great symbiotic match there,” he said.

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IBM pledges $150 billion to boost U.S. tech growth, computer manufacturing

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IBM pledges 0 billion to boost U.S. tech growth, computer manufacturing

Arvind Krishna, chief executive officer of International Business Machines Corp. (IBM), during a Bloomberg Television interview at the World Governments Summit in Dubai, United Arab Emirates, on Tuesday, Feb. 11, 2025.

Christopher Pike | Bloomberg | Getty Images

International Business Machines Corporation on Monday announced it will invest $150 billion in the U.S. over the next five years, including more than $30 billion to advance American manufacturing of its mainframe and quantum computers.

“We have been focused on American jobs and manufacturing since our founding 114 years ago, and with this investment and manufacturing commitment we are ensuring that IBM remains the epicenter of the world’s most advanced computing and AI capabilities,” IBM CEO Arvind Krishna said in a release.   

The company’s announcement comes weeks after President Donald Trump unveiled a far-reaching and aggressive “reciprocal” tariff policy to boost manufacturing in the U.S. As of late April, Trump has exempted chips, as well as smartphonescomputers, and other tech devices and components, from the tariffs.

IBM said its investment will help accelerate America’s role as a global leader in computing and fuel the economy. The company said it operates the “world’s largest fleet of quantum computer systems,” and will continue to build and assemble them in the U.S., according to the release.

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IBM competitor Nvidia, the chipmaker that has been the primary benefactor of the artificial intelligence boom, announced a similar push earlier this month to produce its NVIDIA AI supercomputers entirely in the U.S. 

Nvidia plans to produce up to $500 billion of AI infrastructure in the U.S. via its manufacturing partnerships over the next four years.

Last week, IBM reported better-than-expected first-quarter results. The company said it generated $14.54 billion in revenue for the period, above the $14.4 billion expected by analysts. IBM’s net income narrowed to $1.06 billion, or $1.12 per share, from $1.61 billion, or $1.72 per share, in the same quarter a year ago.

IBM’s infrastructure division, which includes mainframe computers, posted $2.89 billion in revenue for the quarter, beating expectations of $2.76 billion.

The company announced a new z17 AI mainframe earlier this month.

CNBC’s Jordan Novet contributed to this report.

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Meta’s AI spending comes into focus amid Trump’s tariff policies

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Meta’s AI spending comes into focus amid Trump’s tariff policies

Meta CEO Mark Zuckerberg looks on before the luncheon on the inauguration day of U.S. President Donald Trump’s second Presidential term in Washington, U.S., Jan. 20, 2025. 

Evelyn Hockstein | Reuters

Mark Zuckerberg’s plan is to make Meta the market leader in artificial intelligence. Investors will want to know how President Donald Trump’s tariffs-heavy trade policies will impact that strategy. 

Those answers could start to come as soon as this week as Meta’s AI strategy takes center stage when the company hosts its first Llama-branded conference for AI developers on Tuesday then reports its latest quarterly earnings the next day.

Already, tech companies are starting to talk about the potential impact they’re bracing for as a result of the Trump tariffs. 

Intel Chief Financial Officer David Zinsner said Thursday during the chip giant’s first-quarter earnings call that U.S. trade policies “have increased the chance of an economic slowdown, with the probability of a recession growing.” Meanwhile, Google CFO Anat Ashkenazi said that day during a first-quarter earnings call that the tech giant remains committed to its $75 billion investment in capital expenditures, or capex, this year, but also acknowledged that the “timing of deliveries and construction schedules” could cause some quarter-to-quarter spending fluctuation. 

For now, analysts expect Meta to follow Alphabet’s lead and remain firm in its plan to spend as much as $65 billion in capex for AI infrastructure this year when it reports earnings Wednesday. Some analysts believe Meta could even raise the figure because AI is a core priority for the company.

“We do not expect META to cut its CapX guidance of $60B-$65B in 2025, for its GenAI infrastructure,  because they see this as an important 10-year investment, we believe,” Needham analysts wrote in a research note published Wednesday. “However, tariffs add risks of upward cost revisions.”

Investors will also be monitoring Meta’s LlamaCon event at its Menlo Park, California, headquarters for any signs that its AI investments are having an immediate business impact. This will be the first time Meta hosts a developer conference specifically for its Llama family of AI models.

“Investors want to see ROI on all these AI investments, and while Meta has shown clear benefits from leveraging AI to improve its products and drive faster revenue growth, it’s been hard to quantify those benefits,” Truist Securities analyst Youssef Squali told CNBC.

Meta in April released a couple of its new Llama 4 models, which Meta Chief Product Officer Chris Cox previously said can help power so-called AI agents that can perform tasks for users via web browsers and other online interfaces.

It’s critical that Meta keep improving Llama to create a major business involving AI agents that companies can use to interact with their customers within apps like Facebook and WhatsApp, William Blair research analyst Ralph Schackart said.

Meta has an early mover advantage at scale in a multi-trillion dollar market,” Schackart said in an email. “We believe Meta is very well positioned to leverage its billions of global users across multiple platforms.”

Meta is unlikely to curb its Llama investment any time soon, but should eventually consider doing so if it fails to generates enough money to justify its costs, said Ken Gawrelski, a Wells Fargo managing director of equity research.

“We do believe that over time Meta needs to continue to evaluate whether Llama needs to be competitive with the leading-edge models,” Gawrelski said. “This is a very expensive proposition and thus far, unlike Google, Meta does not directly monetize its model in any material way.”

Chris Cox, Chief Product Officer at Meta Platforms, speaks during The Wall Street Journal’s WSJ Tech Live Conference in Laguna Beach, California on October 17, 2023. 

Patrick T. Fallon | AFP | Getty Images

Meta AI and the consumer

Analysts are also following the Meta AI digital assistant. That’s because the ChatGPT rival represents the second pillar of Zuckerberg‘s AI strategy. 

Zuckerberg in January said he believes 2025 “is going to be the year when a highly intelligent and personalized AI assistant reaches more than 1 billion people, and I expect Meta AI to be that leading AI assistant.”

In February, CNBC reported that Meta was planning to debut a standalone Meta AI app during the second quarter and test a paid subscription service, in which users could pay monthly fees to access more powerful versions like users can with ChatGPT. 

Although Meta’s enormous user base across its family of apps gives Meta AI an advantage over rivals like ChatGPT in terms of reach, they may not interact with Meta AI in the same way they do with rival chat apps, said Cantor Fitzgerald analyst Deepak Mathivanan.

Gawrelski said that people may not want to use Meta AI within Facebook and Instagram if all they want to do is passively watch the short videos that Meta algorithmically recommends to their feeds.

“This is why a separate Meta AI, where Meta could clearly articulate its use case and value proposition, could be helpful,” Gawrelski said.

A standalone Meta AI app could help the company better market the digital assistant and distinguish it from rivals, said Debra Aho Williamson, founder and chief analyst for Sonata Insights.

“ChatGPT has such wide brand awareness, that it’s become a moat that is soon going to be very hard to overcome,” Williamson said.

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