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Microsoft unveiled two chips at its Ignite conference in Seattle on Wednesday.

The first, its Maia 100 artificial intelligence chip, could compete with Nvidia’s highly sought-after AI graphics processing units. The second, a Cobalt 100 Arm chip, is aimed at general computing tasks and could compete with Intel processors.

Cash-rich technology companies have begun giving their clients more options for cloud infrastructure they can use to run applications. Alibaba, Amazon and Google have done this for years. Microsoft, with about $144 billion in cash at the end of October, had 21.5% cloud market share in 2022, behind only Amazon, according to one estimate.

Virtual-machine instances running on the Cobalt chips will become commercially available through Microsoft’s Azure cloud in 2024, Rani Borkar, a corporate vice president, told CNBC in an interview. She did not provide a timeline for releasing the Maia 100.

Google announced its original tensor processing unit for AI in 2016. Amazon Web Services revealed its Graviton Arm-based chip and Inferentia AI processor in 2018, and it announced Trainium, for training models, in 2020.

Special AI chips from cloud providers might be able to help meet demand when there’s a GPU shortage. But Microsoft and its peers in cloud computing aren’t planning to let companies buy servers containing their chips, unlike Nvidia or AMD.

The company built its chip for AI computing based on customer feedback, Borkar explained.

Microsoft is testing how Maia 100 stands up to the needs of its Bing search engine’s AI chatbot (now called Copilot instead of Bing Chat), the GitHub Copilot coding assistant and GPT-3.5-Turbo, a large language model from Microsoft-backed OpenAI, Borkar said. OpenAI has fed its language models with large quantities of information from the internet, and they can generate email messages, summarize documents and answer questions with a few words of human instruction.

The GPT-3.5-Turbo model works in OpenAI’s ChatGPT assistant, which became popular soon after becoming available last year. Then companies moved quickly to add similar chat capabilities to their software, increasing demand for GPUs.

“We’ve been working across the board and [with] all of our different suppliers to help improve our supply position and support many of our customers and the demand that they’ve put in front of us,” Colette Kress, Nvidia’s finance chief, said at an Evercore conference in New York in September.

OpenAI has previously trained models on Nvidia GPUs in Azure.

In addition to designing the Maia chip, Microsoft has devised custom liquid-cooled hardware called Sidekicks that fit in racks right next to racks containing Maia servers. The company can install the server racks and the Sidekick racks without the need for retrofitting, a spokesperson said.

With GPUs, making the most of limited data center space can pose challenges. Companies sometimes put a few servers containing GPUs at the bottom of a rack like “orphans” to prevent overheating, rather than filling up the rack from top to bottom, said Steve Tuck, co-founder and CEO of server startup Oxide Computer. Companies sometimes add cooling systems to reduce temperatures, Tuck said.

Microsoft might see faster adoption of Cobalt processors than the Maia AI chips if Amazon’s experience is a guide. Microsoft is testing its Teams app and Azure SQL Database service on Cobalt. So far, they’ve performed 40% better than on Azure’s existing Arm-based chips, which come from startup Ampere, Microsoft said.

In the past year and a half, as prices and interest rates have moved higher, many companies have sought out methods of making their cloud spending more efficient, and for AWS customers, Graviton has been one of them. All of AWS’ top 100 customers are now using the Arm-based chips, which can yield a 40% price-performance improvement, Vice President Dave Brown said.

Moving from GPUs to AWS Trainium AI chips can be more complicated than migrating from Intel Xeons to Gravitons, though. Each AI model has its own quirks. Many people have worked to make a variety of tools work on Arm because of their prevalence in mobile devices, and that’s less true in silicon for AI, Brown said. But over time, he said, he would expect organizations to see similar price-performance gains with Trainium in comparison with GPUs.

“We have shared these specs with the ecosystem and with a lot of our partners in the ecosystem, which benefits all of our Azure customers,” she said.

Borkar said she didn’t have details on Maia’s performance compared with alternatives such as Nvidia’s H100. On Monday, Nvidia said its H200 will start shipping in the second quarter of 2024.

WATCH: Nvidia notches tenth straight day of gains, driven by new AI chip announcement

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Inside one of the first all-female hacker houses in San Francisco

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Inside one of the first all-female hacker houses in San Francisco

For Molly Cantillon, living in a hacker house wasn’t just a dream, but a necessity.

“I had lived in a few hacker houses before and wanted to replicate that energy,” said Cantillon, 20, co-founder of HackHer House and founder of the startup NOX. “A place where really energetic, hardcore people came together to solve problems. But every house I lived in was mostly male. It was obvious to me that I wanted to do the inverse and build an all-female hacker house that created the same dynamic but with women.”

Cantillon, who has lived in several hacker houses over the years, saw a need for a space dedicated exclusively to women. That’s why she co-founded HackHer House, the first all-female hacker house in the San Francisco Bay Area.

“A hacker house is a shared living space where builders and innovators come together to work on their own projects while collaborating with others,” said Jennifer Li, General Partner at Andreessen Horowitz and sponsor of the HackHer House. “It’s a community that thrives on creativity and resource sharing, making it a cost-effective solution for those in high-rent areas like Silicon Valley, where talented founders and engineers can easily connect and support each other.”

Founded by Cantillon, Zoya Garg, Anna Monaco and Anne Brandes, this house was designed to empower women in a tech world traditionally dominated by men. 

“We’re trying to break stereotypes here,” said Garg, 21, a rising senior at Stanford University. “This house isn’t just about living together; it’s about creating a community where women can thrive in tech.”

Located in North Beach, HackHer House was home this summer to seven women, all of whom share the goal of launching successful ventures in tech. 

Venture capital played a key role in making HackHer House possible. With financial backing, the house offered subsidized rent, allowing the women to focus on their projects instead of struggling with the Bay Area’s notoriously high living costs.

“New grad students face daunting living expenses, with campus costs reaching the high hundreds to over a thousand dollars a month,” said Li. “In the Bay Area, finding a comfortable room typically starts at $2,000, and while prices may have eased slightly, they remain significantly higher than the rest of the U.S. This reality forces many, including founders, to share rooms or crash on friends’ couches just to make ends meet.” 

Hacker houses aren’t new to the Bay Area or cities like New York and London. These live-in incubators serve as homes and workspaces, offering a collaborative environment where tech founders and innovators can share ideas and resources. In a city renowned for tech advancements, hacker houses are viewed as critical for driving the next wave of innovation. By providing affordable housing and a vibrant community, these spaces enable entrepreneurs to thrive in an otherwise cutthroat and expensive market.

Watch this video to see how Hacker House is shaping the future of women in tech.

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Elon Musk’s X will be allowed back online in Brazil after paying one more fine

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Elon Musk's X will be allowed back online in Brazil after paying one more fine

The Federal Supreme Court (STF) in Brazil suspends Elon Musk’s social network after it fails to comply with orders from Minister Alexandre de Moraes to block accounts of those being investigated by the Brazilian justice system. 

Cris Faga | Nurphoto | Getty Images

X has to pay one last fine before the social network owned by Elon Musk is allowed back online in Brazil, according to a decision out Friday from the country’s top justice, Alexandre de Moraes.

The platform was suspended nationwide at the end of August, a decision upheld by a panel of judges on Sept. 2. Earlier this month, X filed paperwork informing Brazil’s supreme court that it is now in compliance with orders, which it previously defied.

As Brazil’s G1 Globo reported, X must now pay a new fine of 10 million reals (about $2 million) for two additional days of non-compliance with the court’s orders. X’s legal representative in Brazil, Rachel de Oliveira, is also required to pay a fine of 300,000 reals.

The case dates back to April, when de Moraes, the minister of Brazil’s supreme court, known as Supremo Tribunal Federal (STF), initiated a probe into Musk and X over alleged obstruction of justice.

Musk had vowed to defy the court’s orders to take down certain accounts in Brazil. He called the court’s actions “censorship,” and railed online against de Moraes, describing the judge as a “criminal” and encouraging the U.S. to end foreign aid to Brazil.

In mid-August, Musk closed down X offices in Brazil. That left his company without a legal representative in the country, a federal requirement for all tech platforms to do business there.

By Aug. 28, de Moraes’ court threatened a ban and fines if X didn’t appoint a legal representative within 24 hours, and if it didn’t comply with takedown requests for accounts the court said had engaged in plots to dox or harm federal agents, among other things.

Earlier this month, the STF froze the business assets of Musk companies, including both X and satellite internet business Starlink, operating in Brazil. The STF said in court filings that it viewed Starlink parent SpaceX and X as companies that worked together as related parties.

Musk wrote in a post on X at that time that, “Unless the Brazilian government returns the illegally seized property of and SpaceX, we will seek reciprocal seizure of government assets too.”

On August 29, 2024, in Brazil, the Minister of the Supreme Court, STF Minister Alexandre de Moraes, orders the blocking of the accounts of another company, Starlink, of Elon Musk, to guarantee the payment of fines imposed by the STF due to the lack of representatives of X in Brazil. 

Ton Molina | Nurphoto | Getty Images

As head of the STF, de Moraes has long supported federal regulations to rein in hate speech and misinformation online. His views have garnered pushback from tech companies and far-right officials in the country, along with former President Jair Bolsonaro and his supporters.

Bolsonaro is under investigation, suspected of orchestrating a coup in Brazil after losing the 2022 presidential election to current President Luiz Inacio Lula da Silva.

While Musk has called for retribution against de Moraes and Lula, he has worked with and praised Bolsonaro for years. The former president of Brazil authorized SpaceX to deliver satellite internet services commercially in Brazil in 2022.

Musk bills himself as a free speech defender, but his track record suggests otherwise. Under his management, X removed content critical of ruling parties in Turkey and India at the government’s insistence. X agreed to more than 80% of government take-down requests in 2023 over a comparable period the prior year, according to analysis by the tech news site Rest of World.

X faces increased competition in Brazil from social apps like Meta-owned Threads, and Bluesky, which have attracted users during its suspension.

Starlink also faces competition in Brazil from eSpace, a French-American firm that gained permission this year from the National Telecommunications Agency (Anatel) to deliver satellite internet services in the country.

Lukas Darien, an attorney and law professor at Brazil’s Facex University Center, told CNBC that the STF’s enforcement actions against X are likely to change the way large technology companies will view the court.

“There is no change to the law here,” Darien wrote in a message. “But specifically, big tech companies are now aware that the laws will be applied regardless of the size of a business and the magnitude of its reach in the country.”

Musk and representatives for X didn’t immediately respond to a request for comment on Friday.

Late Thursday, X Global Government Affairs posted the following statement:

“X is committed to protecting free speech within the boundaries of the law and we recognize and respect the sovereignty of the countries in which we operate. We believe that the people of Brazil having access to X is essential for a thriving democracy, and we will continue to defend freedom of expression and due process of law through legal processes.”

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OpenAI sees roughly $5 billion loss this year on $3.7 billion in revenue

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OpenAI sees roughly  billion loss this year on .7 billion in revenue

Sam Altman, CEO of OpenAI, at the Hope Global Forums annual meeting in Atlanta on Dec. 11, 2023.

Dustin Chambers | Bloomberg | Getty Images

OpenAI, the creator of ChatGPT, expects about $5 billion in losses on $3.7 billion in revenue this year, CNBC has confirmed.

The company generated $300 million in revenue last month, up 1,700% since the beginning of last year, and expects to bring in $11.6 billion in sales next year, according to a person close to OpenAI who asked not to be named because the numbers are confidential.

The New York Times was first to report on OpenAI’s financials earlier on Friday after viewing company documents. CNBC hasn’t seen the financials.

OpenAI, which is backed by Microsoft, is currently pursuing a funding round that would value the company at more than $150 billion, people familiar with the matter have told CNBC. Thrive Capital is leading the round and plans to invest $1 billion, with Tiger Global planning to join as well.

OpenAI CFO Sarah Friar told investors in an email Thursday that the funding round is oversubscribed and will close by next week. Her note followed a number of key departures, most notably technology chief Mira Murati, who announced the previous day that she was leaving OpenAI after six and a half years.

Also this week, news surfaced that OpenAI’s board is considering plans to restructure the firm to a for-profit business. The company will retain its nonprofit segment as a separate entity, a person familiar with the matter told CNBC. The structure would be more straightforward for investors and make it easier for OpenAI employees to realize liquidity, the source said.

OpenAI’s services have exploded in popularity since the company launched ChatGPT in late 2022. The company sells subscriptions to various tools and licenses its GPT family of large language models, which are powering much of the generative AI boom. Running those models requires a massive investment in Nvidia’s graphics processing units.

The Times, citing an analysis by a financial professional who reviewed OpenAI’s documents, reported that the roughly $5 billion in loses this year are tied to costs for running its services as well as employee salaries and office rent. The costs don’t include equity-based compensation, “among several large expenses not fully explained in the documents,” the paper said.

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