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Google is bullish on the prospect of its more advanced artificial intelligence models coming to smartphones in the next year.  

The internet giant expects that its currently available Gemini large language model (LLM), which competes with Microsoft-backed OpenAI’s most powerful GPT-4 AI model, will begin to get embedded into devices starting next year.  

Google already offers Gemini Nano, which is the company’s most efficient model for “on-device” AI, across its Pixel devices and on all other capable Android devices. 

Brian Rakowski, vice president of product management for Google’s Pixel unit, said that he expects the company’s most advanced large language models, which are currently only accessible via remote data centers via an internet connection, to begin arriving on smartphones directly next year. 

“There are smaller versions of our Gemini model on the cloud,” Rakowski told CNBC. “There’s been quite a few breakthroughs to compress these models to get them to run on device.” 

“Some have already been proven and some are being explored for some applications. It’d be great having all models on device. It still has wondrous applications.” 

“Gemini Nano is performing at a level that our online models were at less than one year ago,” Rakowski added. “You can do a lot with these distilled small versions of the models on device.” 

“If you just follow that trajectory, some of that stuff we thought we would have had to go to the cloud for next year will be on device, which is pretty exciting, which is instantaneous without requiring a connection or subscription.” 

Large language models, or LLMs, are AI models capable of understanding and generating language in a humanlike way. Gemini Ultra is Google’s top LLM, clocking in at a whopping 1.56 trillion parameters. For comparison, OpenAI’s GPT-4 consists of 1.76 trillion parameters. 

Dreaming of a smartphone ‘supercycle’

Smartphone makers have been dreaming of a “supercycle” in their industry, driven by artificial intelligence, after a bruising few years that saw device sales slow aggressively. In 2023, smartphone sales fell to 1.16 billion units, the lowest point for unit shipments in a decade.  

Analysts say a supercycle is unlikely to occur within the next few years as there’s not enough going on in the market in terms of novel features and innovation that will convince people holding their aging smartphones to upgrade. 

“Unfortunately, we don’t expect that boom,” Francisco Jeronimo, vice president of data and analytics at research firm IDC, told CNBC. 

“The last supercycle we saw was between 2010 and 2015, where in five years the market grew five times from around 300 million smartphones per year to 1.5 billion.” 

Nonetheless, more and more smartphone makers are making big investments in AI in the hope that it will drive some more excitement around mobile technology. 

The likes of Humane, Rabbit, and China’s Meizu are betting on a future for smartphones that doesn’t even look like a traditional smartphone. These are devices that would be smaller and more compact, and that we could interact with via voice activation, like an Amazon Echo speaker but on the go. 

Google has been making huge bets on AI in an effort to gain an edge over its rivals like OpenAI, the Microsoft-backed company behind ChatGPT.

Google recently announced a major rebrand of Bard, its ChatGPT alternative, including a fresh app and subscription options. Bard was renamed Gemini, the same name as the suite of AI models that power the chatbot.

Android users can download a dedicated Android app for Gemini, while iPhone users can use Gemini in the Google app on iOS.

Alphabet CEO Sundar Pichai highlighted the firm’s commitment to AI during the company’s Jan. 30 earnings call. Pichai said he eventually wants to offer an AI agent that can complete more and more tasks on a user’s behalf, including within Google Search, although he said there is “a lot of execution ahead.”

Likewise, chief executives at tech giants from Microsoft to Amazon have underlined their commitment to building AI agents as productivity tools. 

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Why a new UK internet safety law is causing an outcry on both sides of the Atlantic

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Why a new UK internet safety law is causing an outcry on both sides of the Atlantic

As of July 25, porn sites are required to implement effective age verification methods for U.K. users.

Jack Taylor | Getty Images

It was well intentioned but a U.K. law mandating age verification on adult sites and a number of other platforms has sparked a backlash from both internet users in the country, and U.S. politicians and tech giants.

Last month, new provisions in the Online Safety Act requiring large online platforms to implement age checks to prevent children from accessing pornographic and appropriate material came into force.

The measures have led PornHub, RedTube and other porn sites to force U.K. visitors to sign up and verify their age to gain access to their services.

What is the Online Safety Act?

Broadly, the Online Safety Act is a law that imposes a duty of care on social media firms and other user-generated content sites to ensure they take responsibility for harmful content uploaded and spread on their platforms.

In particular, the legislation aims to prevent children from being exposed to pornographic content and material that promotes suicide, self-harm, eating disorders or abusive and hateful behaviour.

The regulation has been years in the making and faced numerous delays in its development — not least due to concerns that it may infringe internet users’ right to privacy and result in censorship.

Why has it led to backlash?

The latest measures have been imposed with the aim of ensuring children aren’t able to view harmful and inappropriate content.

However, they have led to complaints from internet users due to the requirement of having to share personal information such as their ID, credit card details and selfies — in some cases for platforms that don’t even qualify as porn sites.

Spotify, Reddit, X and a number of other platforms have introduced their own respective age verification systems to stop users under the age of 18 from consuming explicit content.

These moves have subsequently led to providers of virtual private networks (VPNs) to report that their services, which allow users to mask their location, are surging in the U.K.

Meanwhile, on Monday, Wikipedia was dealt a legal blow in the U.K. as a High Court judge ruled the platform should be treated as a “category one” service, which would subject to certain user verification requirements.

The Online Safety Act requires category one platforms to offer users the ability to verify their identity and access tools that reduce their exposure to content from non-verified users.

Wikimedia, the parent company of Wikipedia, has said previously that it could limit visitor numbers from the U.K. in order to exempt it from category one status.

U.S. politicians weigh in

A number of U.S. politicians have blasted the new rules in recent days. Last week, Vice President JD Vance — who has previously criticized the U.K.’s internet safety rules — again raised concerns with the law, fearing it could unfairly restrict American tech companies.

“I just don’t want other countries to follow us down what I think was a very dark path under the Biden administration,” Vance told reporters during a trip to the country last week.

House Judiciary Chairman Jim Jordan, R-Ohio, who also visited the U.K. recently, said in a statement after his return that sweeping online safety laws in Europe are having “a serious chilling effect on free expression and threaten the First Amendment rights of American citizens and companies.”

There has been speculation over whether the U.S. may press Britain to relax the regulations during trade talks — however, U.K. officials say the issue is not open to debate.

Could other countries follow suit?

Other countries are already adopting their own respective internet age verification laws.

Australia and Ireland have both passed similar age verification measures, while Denmark, Greece, Spain, France and Italy have started testing a common age verification app to protect users online.

In the U.S., Louisiana passed a law in 2022 requiring age verification on websites where at least a third of the content is of an adult nature, while several other states are seeking to pass similar legislation.

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Circle shares rise as second-quarter revenue jumps 53% on strong stablecoin growth

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Circle shares rise as second-quarter revenue jumps 53% on strong stablecoin growth

Circle CEO Jeremy Allaire: The internet is colliding with the financial system

Circle Internet Group shares jumped Tuesday after reporting its first quarterly earnings as a publicly listed company.

While charges related to the stablecoin issuer’s debut contributed to a second-quarter loss, it reported a 53% increase in revenue, driven by strong growth in stablecoins. Revenue rose to $658.1 million from $430 million in the same period a year ago.

Shares rose more than 7% in premarket trading. The stock has soared nearly 420% since it went public on June 5.

“The validation that we’ve seen in Circle, and the sentiment around circle is really about people understanding that the internet is colliding with the financial system,” Circle CEO Jeremy Allaire told CNBC’s “Squawk Box” Tuesday. “Just like open internet, software, networks and utilities changed media, communications, retail and education, it’s happening in the financial system and stablecoin money and blockchains are foundational to that future.”

Circulation of USDC, the stablecoin Circle issues and manages, grew 90% from the previous year to $61.3 billion. Stablecoins are cryptocurrencies whose values are pegged to that of another asset, usually the U.S. dollar.

Circle said it swung to a net loss of $482.1 million, or $4.48 a share, from earnings of $32.9 million, or breakeven per share, a year ago. The net loss included non-cash IPO-related charges of $424 million for stock-based compensation and $167 million to adjust the fair value of its convertible debt.

The company issued guidance projecting between $75 million and $85 million in other revenue for the rest of 2025, as well as adjusted operating expenses of $475 million to $490 million. It anticipates the amount of USDC in circulation will grow at a 40% compound annual growth rate through the cycle.

Circle also announced the forthcoming launch of a new blockchain called Arc, designed to be a network for stablecoin payments, FX, and capital markets applications. It will be integrated across Circle’s platform and services and will begin testing among developers in the fall.

Circle, led by CEO Jeremy Allaire, is one of the earliest companies in the crypto industry and the issuer of USD Coin, commonly referred to by its ticker, USDC. It’s the second largest stablecoin in the world, making up about 26% of the dollar-backed stablecoin market, behind Tether’s USDT, which makes up about 67%, according to CryptoQuant.

Traditionally used as bridge currencies for crypto traders, stablecoins today are benefiting from increased interest by banks and payment firms as the Trump administration rolls back restrictive Biden-era crypto policies in favor of more supportive crypto legislation, like the stablecoin bill known as the GENIUS Act, which Trump signed into the first U.S. crypto law last month.

“Since our IPO and since the GENIUS Act passed, the number of major financial institutions that are engaging with us in banking, payments, capital markets [and] so many categories has surged,” Allaire said. “We’re seeing this incredible interest in working with us, including from some of the names that people have thrown out there as maybe doing their own thing” by perhaps launching their own stablecoins.

Don’t miss these cryptocurrency insights from CNBC Pro:

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Trump says he’s open to letting Nvidia sell a downgraded version of its most advanced chip to China

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Trump says he's open to letting Nvidia sell a downgraded version of its most advanced chip to China

Nvidia CEO Jensen Huang, right, speaks alongside President Donald Trump about investing in America, at the White House in Washington, on April 30, 2025.

Jim Watson | AFP | Getty Images

U.S. President Donald Trump has signaled that he’d be open to allowing Nvidia to sell a downgraded version of its most advanced artificial intelligence chip to China.

Speaking at a press conference on Monday, Trump said that he could make a deal with Nvidia if it could reduce the performance of its Blackwell system.

“It’s possible I’d make a deal” on a “somewhat enhanced — in a negative way — Blackwell” processor, Trump said. “In other words, take 30% to 50% off of it.”

Trump indicated that he will meet with Nvidia CEO Jensen Huang regarding the Blackwell.

“On the Blackwell, I think he [Huang] is coming to see me again about that,” Trump said, adding that the Blackwell system is the “latest and the greatest in the world.”

Last month, Huang, who has lobbied Trump for access to the Chinese market after effectively being shut out, said he hopes to sell more advanced chips to China.

The flurry of activity around semiconductors comes after Nvidia and AMD agreed to a deal to pay the U.S. government a 15% cut of revenue from chip sales to China in exchange for export licenses. Trump said he initially asked for a 20% cut but that the number came down to 15% after Huang negotiated.

If the downgraded Blackwell chips were approved for export, it “would be a big deal going forward,” said Paul Triolo, partner and senior vice president for China at advisory firm DGA-Albright Stonebridge Group.

“The idea here is to addict China to substandard, or non-cutting edge technology, Triolo added.

Access to Nvidia's H20 won't hand China an AI advantage: Analyst

Nvidia’s Huang has often touted the idea that if China is cut off from American chips then domestic tech firms like Huawei will fill the void. He has argued that U.S. chips should be sold in China so that Chinese firms are dependent on them when developing their AI technology.

Washington’s chip export regime has evolved over the past few years. Nvidia was blocked in 2022 from exporting its A100 and H100 chips to China — chips that are crucial for training large AI models. In 2023, the U.S. placed additional export curbs on more Nvidia semiconductors.

Chinese firms stockpiled these chips and have been using them to build their AI models. These chips were acquired legally and are still being used to train models, according to Triolo.

It’s not yet clear what kind of capabilities a downgraded Blackwell system for China would have and if it would be suitable for training more advanced models. In the meantime, Huawei is continuing to develop its Ascend series of processors, which it is trying to position as an Nvidia alternative.

“We are in sort of a transition point of running out of those stockpiles of earlier acquired Nvidia GPUs and hoping that Huawei’s new Ascend series of processors will be capable of replacing those but they are not quite capable of doing that yet,” Triolo said.

“Probably next year Huawei will have a new version of its 910 processors that will be more competitive with Nvidia.”

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