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<keyword id="20069374" type="General" weightage="20" keywordseo="IT-services" source="keywords">IT services</keyword> firm <keyword id="19924892" type="General" weightage="20" keywordseo="Tech-Mahindra" source="keywords" meta.keywordsubtype="org" meta.entityname="Tech Mahindra" meta.hostid="261" meta.entityid="Tech Mahindra">Tech Mahindra</keyword> on Saturday reported a more than two-fold jump in its consolidated <keyword id="19942166" type="General" weightage="20" keywordseo="net-profit" source="keywords">net profit</keyword> to Rs 1,250 crore for the July-September quarter, driven by special income from the sale of assets. The Mahindra Group company posted a net profit of Rs 493.9 crore in the year-ago period, according to an exchange filing. Revenue rose by 3.49 per cent to Rs 13,313.2 crore in the second quarter of 2024-25 compared to Rs 12,863.9 crore in the same quarter of 2023-24. "Other income includes gain on sale of property of Rs 4,502 million which comprises of freehold land and its related buildings along with the furniture &amp; fixtures sold for a consideration of Rs 5,350 million, receivable over a period of four years along with interest of 8.2 per cent p.a," the company filing said. Sequentially, net profit rose by 46.81 per cent and revenue by 2.36 per cent. "We continue to progress on our strategic improvement efforts even as the overall IT services industry has remained soft. "We have focused on strengthening client relationships and expanding the partner ecosystem while maintaining a sharp focus on operational excellence through project Fortius, which has resulted in an expansion of margins for the third sequential quarter," Tech Mahindra CEO Mohit Joshi said. The CEO unveiled Project Fortius in April, a three-year plan to achieve a 15 per cent operating margin with a focus on organic growth. "This quarter we see consistent performance around increasing deal wins, <keyword id="19965932" type="General" weightage="20" keywordseo="revenue-growth" source="keywords">revenue growth</keyword>, cost optimisation and steady free cash flow generation as we continue our journey towards FY27 stated targets. In line with our capital allocation policy the board has declared an interim dividend of Rs 15 per share," Tech Mahindra CFO Rohit Anand said. The company's TCV (<keyword id="23580531" type="General" weightage="20" keywordseo="Total-Contract-Value" source="keywords">Total Contract Value</keyword>), or net new deal wins, stood at USD 603 million in the second quarter of FY25. Joshi further said the company is on the right path for a long-term sustainable transformation, with its leading indicators moving in the right direction, and its 'Scale at Speed' narrative resonating in the market. "We have invested in strengthening the capabilities in the focus service lines by broadening the leadership and investing in technical specializations. "We continue to invest in strengthening our fresher hiring program, building the right mindset and future skilling and associates, by building capabilities in AI-first and cloud-first skill sets," he told reporters. Investments shall continue in creating and sustaining an outcome-driven learning organisation and cultivating a high-performance culture based on the pillars of simplifying, clarifying, innovating and driving a high-performance orientation, he added. This year could be volatile because we are in the turnaround phase, Joshi said. "I am confident, however, that the platform is being set for a long-term, valuable franchise thanks to a high-calibre and united leadership team and a clearly articulated strategic plan," Joshi said. The Pune-headquartered firm added 6,653 employees during the quarter under review, bringing the total staff count to 1,54,273. Shares of Tech Mahindra settled at Rs 1,688 apiece on the BSE on Friday, down 0.68 per cent from the previous close. 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Tech Mahindra profit jumps over 2-times to ₹1,250 crore in Jul-Sep quarter

Kamala Harris had <a target="_blank" class="" href="https://www.businessinsider.com/tech-investors-raise-money-for-kamala-harris-over-zoom-2024-8">friends in high-tech places,</a> but it wasn't nearly enough to secure the presidency.Silicon Valley's progressive leaders, like <a target="_blank" href="https://www.businessinsider.com/silicon-valley-billionaires-investors-kamala-harris-mark-cuban-reid-hoffman-2024-8">Reid Hoffman, Laurene Powell, and Vinod Khosla,</a> raised millions for the Harris campaign, hoping for a Democrat in the White House for the next term. In the aftermath of <a target="_blank" class="" href="https://www.businessinsider.com/donald-trump-wins-presidential-election-race-2024-11">Donald Trump's clear win,</a> some of tech's denizens stewed on what will happen next for their industry. Even in their sadness following Wednesday's results, traces of cautious optimism started to appear.In conversations with over a dozen VCs and founders, there was a sense that the <a target="_blank" class="" href="https://www.businessinsider.com/openness-in-ai-is-necessary-ftc-lina-khan-2024-7">regulatory climate</a> might soften, potentially easing antitrust scrutiny and allowing a wave of mergers and acquisitions to proceed unfettered. The election result, coupled with the <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/trump-trade-us-presidential-election-dollar-treasuries-stocks-crypto-djt-2024-11">stock market's exuberant response,</a> could light up the exit market like the Fourth of July, signaling private companies to finally go public. While many Silicon Valley VCs and founders aren't huge Trump fans, their industry thrives when startups are getting acquired or going public quickly. The Biden administration clamped down heavily on tech M&amp;A, so Trump's win could be a financial boon for the sector. There's also hope and early signs of VC fund investors being more open to putting fresh money into the asset class.The outcome could be good for startups who have been sitting on the sidelines for the past few years hoping to go public (and their investors), said Jordan Nof, a managing partner of Tusk Venture Partners, an early-stage investor.Stephen Hays, the founder and managing partner of What if Ventures, said money is already moving again. He received two emails from investors on Wednesday morning about committing more capital to deals <a target="_blank" class="" href="https://www.businessinsider.com/stephen-hays-mental-health-vc-what-if-ventures-addiction-2024-7">his syndicate</a> can access. Both said they had waited for the election to pass to start writing bigger checks.Trump's <a target="_blank" class="" href="https://www.businessinsider.com/election-results-trump-harris-presidential-election-2024-11">return to the White House</a> will ripple through the technology sector in unpredictable and potentially transformative ways, though tech policy was largely an afterthought this election cycle. In his campaign, Trump played on people's anxieties about the economy to win over swing voters, while Harris cast herself as the candidate who would reach across the aisle on housing and immigration.In the short term, the election outcome is good for business, said a Bay Area-based investor. Trump is allied with some well-known tech people like Elon Musk, there's likely to be more permissive M&amp;A, and the price of bitcoin is at record highs. But there is longer-term uncertainty and questions remaining about whether Trump will shake the foundations of the US's economy and society, he added. <h2 id="747090b3-65d2-4542-aee5-ef26eab9cdcf">Big Tech returns to the table</h2>As president, Trump <a target="_blank" class="" href="https://www.businessinsider.com/donald-trump-presidency-affect-big-tech-2024-11">could roll back</a> some of the antitrust policies that his opponent would have continued. The Biden administration was a much tougher antitrust enforcer, putting many technology mergers and acquisitions on hold. That trickled down to little tech in the form of fewer deals closed.Federal Trade Commission Chair Lina Khan's status could be in jeopardy once Trump takes over in January. She has been one of the main drivers of tougher antitrust enforcement in tech deals. On Wednesday, Lulu Cheng Meservey, the communications whisperer to tech firms like Y Combinator, <a target="_blank" class="" href="https://x.com/lulumeservey/status/1854169233917100089">tweeted</a> a photo of Khan with LinkedIn's #OpenToWork badge."I believe we'll see the markets open back up for M&amp;A, a more business-first approach," said Brandon Brooks, a partner at the tech investment firm Overlooked Ventures. He added that having a former venture capitalist in the White House — Trump's heir apparent, <a target="_blank" class="" href="https://www.businessinsider.com/jd-vance-silicon-valley-tech-leaders-rally-around-harris-trump-2024-8">JD Vance</a> — could bring "a more private market focus" to the presidency.Investors such as SignalFire founder Chris Farmer and Mason Angel of Industrious Ventures said a more relaxed approach to antitrust enforcement could <a target="_blank" class="" href="https://www.businessinsider.com/more-startups-get-bought-up-by-private-equity-vc-2024-8">unlock billion-dollar exits</a> for a limited set of founders and venture capitalists who have a vested interest in acquisitions picking back up. That's how they return profits to investors.Louis Lehlot, a partner at Foley &amp; Lardner, expects a respite from the antitrust crackdown to "enable Big Tech buyers to return the table." He said, "They have been frozen out for nearly four years, essentially warned not to even try to acquire new companies, and in some cases, to prepare for their looming defenestration."The question of how a second Trump term affects the stock market also has far-reaching consequences for tech. Fewer dollars are flowing into the venture capital funds that keep tech firms flush with cash. Limited partners such as pensions and endowments that fund venture firms have been choosier over months of higher interest rates and a shortage of private company exits to the public market.<a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/trump-victory-stock-market-today-dow-tsla-djt-bitcoin-yields-2024-11?_gl=1*1z0y7qj*_ga*MTQ0NjYxMDEzMC4xNzIyMzAwMzYy*_ga_E21CV80ZCZ*MTczMDkwNTI4Ny4yMjEuMS4xNzMwOTEwMTk4LjYuMC4w">Markets rallied</a> on Wednesday as Trump's victory ended one of the most contentious presidential elections in modern history. It's unclear how long the "<a target="_blank" href="https://markets.businessinsider.com/news/stocks/trump-trade-us-presidential-election-dollar-treasuries-stocks-crypto-djt-2024-11?_gl=1*rc7o27*_ga*MTQ0NjYxMDEzMC4xNzIyMzAwMzYy*_ga_E21CV80ZCZ*MTczMDkwNTI4Ny4yMjEuMS4xNzMwOTEwMzc3LjE2LjAuMA..">Trump trade</a>" boom will last and whether conditions for venture firms seeking investment will improve anytime soon."I think the concerns around tariffs and the rising cost of capital make our asset class less attractive if people can earn better rates of return elsewhere," said Michael Greeley, a general partner at Flare Capital Partners.<h2 id="e24a95d8-c99b-496b-802b-cb9a8404aa33">Crypto wins, uncertainty for climate</h2>This election marked the first with artificial intelligence in play, and as president, Trump will have to contend with how to regulate it. Though he hasn't released a detailed policy agenda, <a target="_blank" class="" href="https://www.businessinsider.com/trump-harris-presidency-impact-ai-artificial-intelligence-2024-10">analysts expect</a> Trump will ease up-regulation. His campaign pledged to repeal a Biden-era executive order that set guardrails on the technology and that some conservatives in tech argued went too far.Trump is also seen as bullish for crypto.The blockchain sector, including many VCs who invest in the sector, <a target="_blank" rel="noopener noreferrer" class="c-link c-link--focus-visible" href="https://time.com/7173421/what-donald-trump-election-win-means-for-crypto/">poured $100 million</a> into elections this year. Trump <a target="_blank" rel="noopener noreferrer" class="c-link c-link--focus-visible" href="https://www.coindesk.com/policy/2024/11/06/trumps-triumph-is-also-cryptos-gensler-regulatory-clouds-likely-to-vanish/">positioned himself</a> as the pro-crypto candidate, promising to make the US <a target="_blank" rel="noopener noreferrer" class="c-link c-link--focus-visible" href="https://apnews.com/article/donald-trump-bitcoin-cryptocurrency-stockpile-6f1314f5e99bbf47cc3ee6fc6178588d">"the crypto capital of the world,"</a> and pledging he would fire Biden-appointed SEC chairman Gary Gensler, who has cracked down on the crypto regulation. Trump has also publicly said he <a target="_blank" rel="noopener noreferrer" class="c-link c-link--focus-visible" href="https://www.cnbc.com/2024/11/06/trump-claims-presidential-win-here-is-what-he-promised-the-crypto-industry-ahead-of-the-election.html">would</a> "keep all the bitcoin the US government currently holds or acquires into the future." Bitcoin surged to a record high of $75,000 after Trump's victory was confirmed.Investors in climate tech were more apprehensive about what a second Trump term means for clean energy. Trump's on-again, off-again support for nuclear energy could result in new legislation to "expand alternative energy sources, particularly by accelerating the deployment of advanced nuclear micro-reactors," said Brian Garrett, managing director at Crosscut Ventures.Meta, <a target="_blank" class="" href="https://www.nytimes.com/2024/10/16/business/energy-environment/amazon-google-microsoft-nuclear-energy.html">Google, </a>Microsoft and <a target="_blank" class="" href="https://www.businessinsider.com/amazon-nuclear-power-strategy-ai-2024-10">Amazon</a> are all exploring using nuclear energy to power their data centers. Garrett shared tech investor Jenny Fielding's concerns that the new administration could repeal the Inflation Reduction Act, a bill that fueled investment in the clean-tech sector by green-lighting $369 billion in subsidies to public and private actors. He said Trump could retract the unspent funds crucial to upgrading energy infrastructure in the country."While regulations were always more progressive in places like Europe, if the climate [regulation] under Biden and the Inflation Reduction Act are rolled back, this could be a significant setback for climate tech companies operating (hoping to sell) in the US," said Fielding, a managing partner at Everywhere Ventures, which invests globally.In other pockets of the Valley, investors rolled up their sleeves for a new day of dealmaking. "People are keeping to themselves and just getting on with their business," said Conrad Burke, a managing partner of MetaVC Partners.Leslie Feinzaig, a venture capitalist who <a target="_blank" class="" href="https://www.businessinsider.com/tech-investors-raise-money-for-kamala-harris-over-zoom-2024-8#the-group-vcs-for-kamala-which-published-an-open-letter-in-support-of-harris-a-week-ago-held-a-virtual-fundraising-party-with-about-600-guests-2">became one of tech's bundlers for Harris,</a> sent an email to members of the VCs for Kamala group on Wednesday morning. "It hurts, of course, but it's a hurt we are familiar with," she wrote. "I've been here enough times that I know what I'm supposed to do: Get back up, learn the lesson, and get back to work."

Silicon Valley is officially grieving over Trump but quietly gleeful over a coming tech deal resurgence

<ul class="summary-list"><li>Mark Zuckerberg and Jensen Huang showcased their friendship at SIGGRAPH 2024.</li><li>Meta is a major Nvidia customer, spending billions on GPUs for AI advancements.</li></ul><a target="_blank" class="" href="https://www.businessinsider.com/mark-zuckerberg-predicts-ai-smart-glasses-popular-meta-ray-bans-2024-7">Meta CEO Mark Zuckerberg </a>didn't let the tomatoes touch after he cut them into perfectly uniform slices."Just to let you know how OCD he is," Huang said as he ribbed Zuckerberg for his idiosyncratic food prep at a now <a target="_blank" href="https://www.businessinsider.com/mark-zuckerberg-meta-nvidia-jensen-huang-bromance-cooking-2024-4">infamous cookout</a> the two had at Huang's house this past spring. A photo of the founders <a target="_blank" class="" href="https://www.businessinsider.com/mark-zuckerberg-meta-nvidia-jensen-huang-bromance-cooking-2024-4">swapping jackets</a> on the day marked the beginning of a bromance, which was on further display Monday at SIGGRAPH 2024, a conference for the graphics industry that increasingly covers AI."Look, man, if you wanted them to touch you have to tell me that," said Zuckerberg.The meteoric rise of Nvidia's technology and market capitalization has meant the spotlight that follows the company's CEO shines on more niche industry events. SIGGRAPH has been serving the graphics industry since 1974, but it's only now that the technologies behind graphics, augmented reality, and self-driving cars are converging with Nvidia as a focal point, and drawing big names like Zuckerberg at Huang's invitation.The two CEOs have a lot in common. They're both notoriously meticulous. They're both all-in on AI. They are both keeping quiet on Presidential politics so far. And they've both survived many failed business ventures."Both of us have gotten kicked in our teeth plenty over the years," Huang said Monday. But behind the kinship of shared experiences and mutual flattery are billions of dollars of deals, and an increasingly tied future.<h2 id="7c84b6dd-e3e2-4740-8120-ea8642e43bd1">Meta is a very good customer</h2>Meta is one of Nvidia's largest customers. In January, AI-watchers got an early glimpse of the GPU spending spree that had already begun when Zuckerberg revealed the company had purchased roughly <a target="_blank" href="https://www.businessinsider.com/mark-zuckerberg-ai-flex-meta-nvidia-gpus-2024-1">350,000 of Nvidia's H100 GPUs</a> (or 600,000 GPUs of computing power including non-Nvidia GPUs). At $30,000-$40,000 per chip, a rough estimate puts the total spend around $18 billion. Zuckerberg then forecasted to TheVerge that Meta would likely own 600,000 by the end of this year.Meta uses those chips to improve its apps via AI-driven content rankings and recommendations, ads tools, and Meta's AI chatbot, which is fueled by its internal large language model Llama."I actually think we're in a place where we've shown that we can build leading models and be the leading AI company in the world," Zuckerberg told analysts on an April earnings call. "And that opens up a lot of additional opportunities beyond just the ones that are the most obvious for us."Meta will report second-quarter earnings on Wednesday afternoon.<h2 id="419cf688-5d82-437a-be86-f568d4cc8f00">Nvidia depends on Meta too</h2>Though there may not be nearly as much, cash flowing from Nvidia to Meta, Zuckerberg's company is increasingly influential in AI development — especially because it leans toward open-source tools."Remember, we all use PyTorch," Huang said. "That comes out of Meta." <a target="_blank" href="https://www.businessinsider.com/facebook-pytorch-beat-google-tensorflow-jax-meta-ai-2022-6">PyTorch</a> is the machine learning tool Meta invented and open-sourced in 2017. It has become the preferred method of building AI tools among machine learning engineers, beating out Google's TensorFlow. Huang also praised Meta's work in computer vision, LLMs, and real-time translation.Huang also mentioned one of Meta's open-source models, Segment Anything. At the conference, Meta released a new version of the model, which can automatically identify and segment objects and entities within images and videos to make altering graphics faster. Zuckerberg demonstrated the upgrades with a video showing the model selecting cows running across a field on his ranch in Hawaii.Zuckerberg demonstrated more of Segment Anything's capabilities later that day in an Instagram video featuring a <a target="_blank" href="https://www.businessinsider.com/zuckerberg-meta-new-streetwear-image-flaunts-large-gold-chain-instagram-2024-7">new gold chain</a>, gifted from artist T-Pain, in which Zuckerberg momentarily disappears from behind the necklace and centers various effects around the large pendant.Though Huang's fashion choices, or rather the singular choice of a <a target="_blank" href="https://www.businessinsider.com/jensen-huang-wardrobe-black-leather-jackets-signature-look-2024-3">black leather jacket</a>, are <a target="_blank" href="https://www.businessinsider.com/mark-zuckerbergs-style-evolution-in-photos-2024-6">equally iconic</a>, he discussed Segment Anything's use in robotics."Our use case is for robotics and industrial digitalization, and connecting these AI models into omniverse so we can model and represent the physical world better, and have robots operate in these omniverse worlds better," Huang said.Huang benefits from Meta's massive AI infrastructure buildup now, but its future depends on the financial results the tech giants can produce as a result of the immense spending on GPUs. And customers like Meta and Microsoft are at the top of that prove-it list."In our company, I want every engineer and every software developer to have an AI or many AIs," Huang said to Zuckerberg. "The thing that I love about your vision is you also believe that everybody and every company should be able to make their own AI."Huang and Zuckerberg have big stakes in that vision coming true, according to Paul Baier, CEO and principal analyst at GAI Insights. Huang needs to ensure LLMs keep building with Nvidia chips and Zuckerberg needs Huang's credibility to bolster his semi-open-source strategy."The bromance will last until the mutual advantage ends," Baier said.Got a tip or an insight to share? Contact Senior Reporter Emma Cosgrove at <a target="_blank" href="mailto:ecosgrove@businessinsider.com">ecosgrove@businessinsider.com</a> or use the secure messaging app Signal: 443-333-9088

Gold chains and leather jackets: The business deals behind the tech industry's most powerful bromance 

Last week, Donald Trump announced the creation of the <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-department-of-government-efficiency-donald-trump-ramaswamy-2024-11">Department of Government Efficiency</a>, which promises to "dismantle government bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies." And to run the new cost-cutting department, Trump tapped the businessman he calls the world's "greatest cutter" — <a target="_blank" class="" href="https://www.businessinsider.com/gop-senator-waste-list-influence-elon-musk-spending-cuts-2024-11">Elon Musk</a>.If you're looking to take a chainsaw to the federal government, Musk seems perfectly suited to the job. At <a target="_blank" class="" href="https://www.businessinsider.com/twitter-x-elon-musk-startup-competitition-town-square-election-2024-10">Twitter,</a> he eliminated a staggering 80% of the staff — over 6,000 people. At <a target="_blank" class="" href="https://www.businessinsider.com/tesla-salary-database-elon-musk-pay-strategy-2024-11">Tesla</a>, he cut 10% of the workforce, saying the company needed to be "absolutely hardcore about headcount and cost reduction." He also laid off 10% of employees at <a target="_blank" class="" href="https://www.businessinsider.com/spacex-jared-isaacman-interview-polaris-dawn-space-walk-2024-11">Space X</a>, insisting his teams need to be scrappy and nimble. Cutting, for Musk, is generally Job No. 1.For the most part, Musk's slash-and-burn tactics have paid off. Twitter usage, according to Musk, is at an all-time high. Tesla's stock is up 28% over the past year. And SpaceX — now valued at $250 billion — is grabbing rockets out of the sky with <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-spacex-starship-landing-super-heavy-2024-10">giant chopsticks</a>. In the world of business, fewer workers often translate into higher profits.The question is: Can the cost-cutting tactics Musk has employed in the private sector work to corral waste and bloat in the federal government? Musk and his DOGE cochair, the biotech billionaire <a target="_blank" class="" href="https://www.businessinsider.com/why-elon-musk-cutting-federal-spending-could-work-2024-11">Vivek Ramaswamy</a>, have said they're looking to hire "super high-IQ small government revolutionaries" to help make $2 trillion in cuts — about a third of all federal spending — and to slash the federal workforce by as much as 75%. It's a dream that has eluded every Republican administration since Ronald Reagan — and it's one that may prove elusive even for Musk, the man now anointed as America's cost-cutter in chief.There's certainly no shortage of waste and inefficiency in the federal government that cries out to be streamlined. In 2019, the Defense Department forked over $22 million for lobster tails. In 2020, the IRS sent $1.4 billion in tax refunds to dead Americans. Millions of square feet in federal buildings sit unoccupied.In theory, a bold, outside figure like <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-donald-trump-elected-shadow-president-2024-11">Musk</a> could be the very thing needed to downscale an operation as vast and intractable as the federal government. Large organizations need a force of "creative destruction" to change, says Michael Morris, a professor at Columbia Business School. "Things don't go away on their own. You have to have somebody with a willingness to deliberately dismantle things if you're going to have innovation." And when a new figure institutes a massive shock to the system — whether at the government or private level — "it often backfires," says Morris. "There's often very fierce, active resistance to change." As <a target="_blank" class="" href="https://www.businessinsider.com/joe-biden-corporate-gerontocracy-aging-ceos-retirement-succession-replacement-2024-8">CEO</a>, Musk has the latitude to push past that resistance and overhaul company culture. But things are going to be different with DOGE. Despite its branding as a "department," the new outfit will operate only in an advisory capacity: Congress holds the ultimate responsibility for authorizing spending and <a target="_blank" class="" href="https://www.businessinsider.com/doge-how-to-apply-dm-job-application-elon-musk-2024-11">eliminating agencies</a>. Government, by design, is an intensely collaborative process, intended to hammer out the competing needs of different constituencies. Musk, by contrast, is accustomed to ruling by fiat."Musk certainly exercises a great deal of control in his companies that he won't have in the environment of the federal government, where we have checks and balances," says Andy Wu, an associate professor of business administration at Harvard Business School. "Even if Musk had the right idea for things, it's not so clear he could implement any of them."The federal government is infamous for holding on to past practices, even when they no longer make sense. Linda Bilmes, a senior lecturer in public policy at the Harvard Kennedy School, cites the continued minting of the penny, each of which costs three cents to produce. Last year, in an economy that has largely moved away from cash, the government spent $179 million forging pennies and nickels. Yet past calls to get rid of the penny haven't amounted to one red cent."The danger is if Elon Musk were to somehow think he is the first person who has ever looked at cost cutting in government," says Bilmes. "Many people who know a lot about government have proposed many good ideas. The potential for usefulness would be if he could take some already reasonably good ideas and help them get implemented."The <a target="_blank" class="" href="https://www.businessinsider.com/watchdog-dod-must-speed-up-weapons-deliveries-to-maintain-advantage-2024-6">Government Accountability Office</a> and inspectors general have already recommended a variety of potential targets. They aren't always flashy: This year, the GAO recommended agencies use predictive models to schedule maintenance, saying they could save $100 million or more. It also urged the IRS to focus on collecting taxes owed by sole proprietors, which could generate hundreds of millions of dollars in revenue. If the government implemented all 5,480 of its suggestions, the GAO estimated, it would "produce measurable financial benefits" of up to $208 billion.But so far, Musk has seemed more interested in the kind of flashy, small-bore proposals that attract clicks on X. He's taken to resharing what he sees as examples of waste — everything from $3 million spent on drug research that involved watching "hamsters fight on steroids" to a $20,000 grant that funded drag shows in Ecuador — and crowdsourcing them on the platform. Those sorts of items might generate outrage on <a target="_blank" class="" href="https://www.businessinsider.com/twitter-donald-trump-elon-musk-2024-11">Fox News</a>, but eliminating them won't do much to trim the federal government's $6,200,000,000,000 in annual spending.Then there's the politics of budget cutting. The last time Republicans succeeded at slowing government spending, under <a target="_blank" class="" href="https://www.businessinsider.com/reagan-secret-service-agent-says-trump-shooting-failure-for-agency-2024-7">Ronald Reagan</a>, they made deep cuts to areas of government that proved unpopular — including social welfare programs, student loans, and job training. Musk may see plenty of areas he'd like to slash, but a wide range of constituencies will inevitably push back against cuts to programs they consider essential. When it comes to federal spending, one person's waste is another person's bread and butter."People support the idea of improving how the government delivers services," says Joel Friedman, the senior vice president for federal fiscal policy at the Center on Budget and Policy Priorities, a progressive think tank. "I think people would take a different view if you end up gutting programs they depend on and care about." Efficiency always sounds like a good thing, until it comes for something you love.Beyond the question of where to cut, Musk will face intense scrutiny over why he's targeting certain areas of government. His role at DOGE is rife with the potential for conflicts of interest. SpaceX, for example, has received nearly $20 billion in federal contracts since 2008, and Musk has been sharply critical of the Federal Aviation Administration, viewing it as an obstacle to launching his powerful <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-trump-spacex-starship-rocket-milestone-election-2024-10">Starship</a>. And his massive investments in electric vehicles and social media are dependent on all sorts of federal spending and oversight. When it comes to how the government interacts with the marketplace, the world's richest man inherently has a lot of skin in the game. Musk's companies did not respond to requests for comment. But Brian Hughes, a spokesperson for Trump's transition team, says it plans to ensure that those involved with DOGE "are compliant with all legal guidelines related to conflicts of interest."Those concerns also touch on the larger question of what Trump and his allies hope to accomplish by reducing the size of government. Calls for reducing "inefficiency" and "bureaucracy" have long been a euphemism for Republicans eager to reduce or eliminate federal oversight of everything from industrial pollution to airline safety. Less government is not necessarily better government, and there are plenty of federal agencies that remain so understaffed and underfunded, from the IRS to the Veterans Administration, that they're unable to perform even their most basic functions. The GOP's aim of cutting spending, a leading Reagan ally once acknowledged, is to shrink government to the size where conservatives can "drag it into the bathroom and drown it in the bathtub." On Friday, Ramaswamy directly linked DOGE to the Reagan-era dream of smaller government, promising that the new agency will finish its work by July 4, 2026 — the 250th anniversary of the Declaration of Independence.And even when conservatives have succeeded at cutting costs, it's done nothing to slow the pace of government spending. Reagan slashed $22 billion in social welfare programs during his first two years in office — savings that were more than offset by his tax cuts and military spending, which nearly tripled the national debt. And in 1981, when a deep recession hit, carving up the safety net left the millions of Americans who were mired in poverty with even fewer resources to get by.It's also important to remember that Musk did more than downsize X — he also used the platform to elevate far-right talking points and unfounded conspiracy theories. In short, he reshaped it to serve his own political ends, making it meaner as well as leaner. It remains to be seen if Musk will do the same with DOGE. There are plenty of places where Uncle Sam could spend America's hard-earned tax dollars more wisely. But there are also plenty of places where the man Trump's family now refers to as "Uncle" Elon could deploy what DOGE calls "unglamorous cost-cutting" to bend the federal government to serve his own financial needs.Musk has acknowledged that Americans will feel "hardship" as a result of the cuts he wants to see implemented. But that doesn't mean he won't be able to juice more performance out of fewer resources, as he did at his own companies. When Musk slashed the workforce at Twitter, critics predicted that the app would collapse without enough staff to maintain it. Two years later, after a few initial glitches, it works much the same as before — at a far lower cost. Doubting Musk, even when he seems to be operating at his most extreme, can be a fool's game.<a target="_blank" rel="" class="" href="https://www.businessinsider.com/author/amanda-hoover">Amanda Hoover</a> is a senior correspondent at Business Insider covering the tech industry. She writes about the biggest tech companies and trends.

Elon Musk downsized Big Tech. Can he do the same to Big Government?

<ul class="summary-list"><li>The tech sector is bracing itself for change under a second Trump presidency.</li><li>AI regulation is likely to change under Trump, but major antitrust cases are unlikely to be impacted.</li></ul><a target="_blank" class="" href="https://www.businessinsider.com/donald-trump-wins-presidential-election-race-2024-11">Donald Trump has won the presidency</a> — and the tech world is waiting to see what his administration will mean for key issues like AI regulation, immigration, antitrust issues, and mergers and acquisitions.Trump has promised to assemble a different cabinet for his second time around in the White House. His advisors are likely to include some of the <a target="_blank" class="" href="https://www.businessinsider.com/who-will-be-in-trump-cabinet-billionaires-buiness-leaders-2024-5#doug-burgum-6">business leaders</a> that backed his campaign, not least among them one of the most powerful figures in tech: <a target="_blank" class="" href="https://www.businessinsider.com/trump-praises-elon-musk-a-star-is-born-2024-11">Elon Musk.</a>In an election night speech, Trump showered praise on Musk, marveling at his SpaceX rockets."Elon, he is an amazing guy," Trump said early Wednesday morning.There's a lot at stake for the sector, with a slew of companies facing antitrust battles. And with immigration top of mind for many voters, H-1B visas could be impacted, experts said, dealing a potential blow to tech companies experiencing staffing shortages amid an AI hiring frenzy.Here's how Trump's second term could impact Big Tech.<h2 id="2575ea3e-191a-4962-89ed-6840c2d18465">On the campaign trail, Trump threatened prosecution if reelected</h2>Though Trump has cozied up to one major tech leader — Musk — others are in his crosshairs.While on the campaign trail, Trump threatened retribution against some tech companies, including jailing Meta chief Mark Zuckerberg.During the campaign, he threatened to imprison "election fraudsters," <a target="_blank" class="" href="https://www.businessinsider.com/donald-trump-mark-zuckerberg-sent-prison-elected-truth-social-2024-7">including Zuckerberg</a> — who has a <a target="_blank" class="" href="https://www.businessinsider.com/donald-trump-comments-about-facebook-mark-zuckerberg-feud-history-2024-7">long history with the president</a>; it's unclear whether Trump will follow through on his threats.Trump also <a target="_blank" class="" href="https://www.businessinsider.com/trump-google-break-up-china-comments-2024-10">heavily criticized Google throughout his campaign</a>, calling the tech giant "rigged" for not displaying positive stories about him, saying the company is "very bad" to him, and suggesting he would "do something" about its power.In September, Trump escalated his feud with the company by <a target="_blank" class="" href="https://www.businessinsider.com/donald-trump-threat-prosecute-google-2024-9">threatening to order the Justice Department to prosecute Google</a> "at the maximum levels" during his second term. He accused the tech giant of engaging in illegal behavior and interfering in the election with the stories it displayed on its search results page.The Justice Department usually operates independently of the president; Trump said on the campaign trail that the criminal justice system has been weaponized against him and threatened to do the same to his political rivals.That norm-breaking change could mean more regulatory issues for the likes of Google — if Trump makes good on his promise.<h2 id="65622481-fb0a-4550-93e2-61275ae53f93">Tariffs remain the biggest question mark</h2>Barclays warned in September that the <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/trump-tariff-trade-policy-stock-market-outlook-risk-election-china-2024-9?_gl=1*10bnpgv*_ga*MTA5NzkyNzEwMi4xNzA2NzE1NTM1*_ga_E21CV80ZCZ*MTczMDQ4MjMyMC4xMTAyLjEuMTczMDQ4ODIxNi41NS4wLjA.">tech industry would be one of the hardest hit</a> by Trump's plan for wide-ranging tariffs."While the new proposed tariffs would have a modest direct negative impact on corporate earnings if implemented, the second order effects from higher cost inflation and slowing economic growth would be an incremental headwind to corporate earnings and cause further pain," the bank said.Mark Lemley, professor and director of the Stanford Program in Law, Science &amp; Technology, warned that Trump's plan for huge tariffs on foreign goods could also harm tech companies during his second term."A Trump administration will involve a US withdrawal from the world and the imposition of giant tariffs," Lemley told BI. "That is likely to have devastating consequences for US tech companies that sell in foreign markets as well as crippling domestic consumption."Retail analysts told BI that the industry is following the question of tariffs extremely closely."You can look at that in two ways," Global Data's Neil Saunders said. "You can say it's a negotiating strategy, and it won't actually come to pass, or you can say it will come to pass, maybe in a diluted form and not that severe.""It's causing a lot of nervousness," he added.If Trump does follow through on his campaign proposals, it would mean significant changes to the way retailers do business."It would be a massive upheaval to most of the cost structures for these companies," said Chris Walton, a former Target executive.Given the expense of reorganizing supply chains, Walton said large retailers are still researching their options and making any simple adjustments, rather than committing early to a new strategy.<h2 id="a9e008d3-192d-41d1-b89d-665d46e9ce18">On antitrust, 'most of the low-hanging fruit has already been picked'</h2><a target="_blank" class="" href="https://www.businessinsider.com/biden-coporate-monopolies-antitrust-lawsuits-live-nation-amazon-google-meta-2024-5">Antitrust cases are already underway</a> for the major Big Tech companies — including <a target="_blank" class="" href="https://www.businessinsider.com/apple-antitrust-lawsuit-justice-department-2024-3#:~:text=The%20US%20Department%20of%20Justice,what%20they%20deem%20anticompetitive%20tactics.">Apple</a>, <a target="_blank" class="" href="https://www.businessinsider.com/google-doj-battle-best-worst-scenarios-2024-10">Google</a>, <a target="_blank" class="" href="https://www.businessinsider.com/ruling-ftc-meta-facebook-lawsuit-instagram-whatsapp-can-proceed-2022-1">Meta</a>, and <a target="_blank" class="" href="https://www.businessinsider.com/amazon-ftc-lawsuit-partially-dismissed-antitrust-competition-vendor-fulfillment-2024-10">Amazon</a> — but normally, there's not much an incoming president could, or would, do to alter these current cases, George Hay, an antitrust expert and law professor at Cornell University, told Business Insider."It's very rare that, at the presidential level, there's any attempt to influence the course of cases which have already been filed. Those have a life of their own," Hay told BI. "They depend on the judge, the courts, the lawyers who carry on a case. It's extraordinarily unusual for the administration to become at all active."Hay said that, while most presidents wouldn't have any say on existing cases, "Trump is a bit more of a wild card."But he added he couldn't think of "any reason why he would interfere with cases that have already been filed. It would be quite an extraordinary thing to do."While not much is expected to change for current antitrust cases, Hay said, Trump may take a less aggressive approach to antitrust enforcement than Vice President Kamala Harris would have.Besides, Hay said, "most of the low-hanging fruit has already been picked," meaning there are not many new antitrust cases that could be filed against the biggest tech companies.One factor that could change things is who Trump appoints as the Assistant Attorney General leading the antitrust division.Hay said that if Trump appoints an experienced, practicing lawyer, "even if that lawyer is relatively conservative, I don't think things are going to change very much.""The changes we've observed over history are when the Republicans appointed an academic," Hay added. "That's where you see some radical changes."But overall, not much is likely to change on the antitrust front under Trump's second administration, Hay said."So if I had very strong views about antitrust, I could sleep well at night regardless of who gets appointed," Hay said. "Because it's a system with laws and courts and people, and most of the people and most of the courts, and most of the laws are not going to change."<h2 id="91f4c525-6767-4d4e-90f3-4773e832f799">Republicans have historically been 'more merger-friendly'</h2>Hay expected that "more big mergers will be proposed under Trump" while Dan Romanoff, a senior equity research analyst at Morningstar, suggested that Trump was less likely to oppose major deals.More aggressive merger guidelines were put in place under President Joe Biden in 2023; now, under Trump, "those are going to go, and they'll be replaced," Hay said.But still, new guidelines won't have much impact on the biggest tech companies, Hay said.Anna Rathbun, chief investment officer at CBIZ, told Business Insider that M&amp;A activity has been low for the past two years because of low interest rates — not because of an antagonistic attitude from the Biden administration.And the notion that Republicans are more business-friendly could be due to "short-term memory," she said, noting that the first Trump administration sued to <a target="_blank" class="" href="https://www.businessinsider.com/trump-tried-to-block-the-att-time-warner-merger-to-spite-cnn-report-2019-3">block a merger</a> between AT&amp;T and Time Warner.While a Republican administration is usually considered to be more business-friendly, Walton said it might not be so straightforward under Trump."It can wax and wane to whatever the flavor of the month is in terms of where his administration wants to focus, or who he wants to benefit," he said.<h2 id="fa61ac75-e5d0-4af3-b58d-8b628e7f0f02">Restricting H1-B visas could damage America's competitive edge</h2>Trump made a widespread immigration crackdown a centerpiece of his 2024 campaign — and now that he's president, that could impact an <a target="_blank" class="" href="https://www.businessinsider.com/inside-the-ai-hiring-frenzy-big-tech-talent-war-2024-3">understaffed tech sector</a> relying on H1-B visas as the AI hiring wars rage on.National security concerns — with two current wars — are vastly different than when Trump wanted to restrict H1-Bs during his first term, Rathbun told BI. But at the same time, "we have a worker shortage," she added.Experts fear that, if H1-Bs are restricted under the second Trump administration, the US could lose its competitive edge on the world stage."You shouldn't ban exports on chips and then completely export the talented labor," Rathbun said. "That makes no sense."James Brundage, Ernst &amp; Young's global and Americas technology sector leader, added that any company relying on overseas hiring will be challenged in coming years.Three of the five largest companies in the world have immigrant CEOs, he said. He added that, while the US has built up a tech lead over decades, "you can see how that could slow."And as retailers like Walmart and Target become increasingly tech-like, a crackdown on high-skilled immigrant talent could complicate their business, Saunders and Walton said.Some think Trump may not follow through on his rhetoric once he takes office in January.Valerie Wirtschafter, a fellow at the Brookings Institution's Foreign Policy, Artificial Intelligence and Emerging Technology Initiative, told BI she thought the Trump administration would prioritize US leadership and "maintaining that lead at all costs."She added that, if bringing talent in through H1-B visas keeps the US competitive, even if it's at odds with Trump's campaign promises, "I think they'll find some way to reconcile or ignore some of those campaign promises, too."<h2 id="6145404f-90b3-4477-b7c6-aad82b231607">Trump's vow to rescind Biden's AI order could be 'double-edged'</h2>Trump has not provided many specific details about what AI policies he would pursue — though he did <a target="_blank" class="" href="https://www.businessinsider.com/trump-ai-dangerous-still-posts-ai-memes-truth-social-x-2024-8">call the technology "very dangerous"</a> after posting AI-generated images of "Swifties for Trump.""Our instinct is that Trump would be more hands-off and Harris would be more hands-on," Romanoff said of AI regulation.One thing Trump has <a target="_blank" class="" href="https://www.businessinsider.com/trump-harris-presidency-impact-ai-artificial-intelligence-2024-10">promised is to rescind Biden's executive order on AI</a>, which outlines policies around AI governance, promoting competition, and addressing AI-enabled threats. Trump had said the order challenges free speech.Wirtschafter told BI that repealing Biden's order would be a mixed bag for tech companies."I think it's double-edged in some sense where, of course, less regulation, less reporting, less bureaucratic hoops to jump through, that's all good and great," Wirtschafter said.But she added that rescinding the order could also be "somewhat unsettling," adding, "Some of these companies do want some sort of road map for this technology, and the more harmonized it can be, the better."

What's next for tech giants like Google, Apple, and Microsoft now Trump has won

<ul class="summary-list"><li>Brian Williams is close to a deal with Amazon to host an election-night special on Prime Video.</li><li>Amazon wants to attract big audiences with live events, similar to its NFL broadcasts.</li></ul>Veteran newscaster Brian Williams is nearing completion of a deal with <a target="_blank" class="" href="https://www.businessinsider.com/amazon">Amazon</a> to host an election-night special on <a target="_blank" class="" href="https://www.businessinsider.com/amazon-prime-video-preview-shake-up-tv-ad-marketplace-2024-1">Prime Video</a>, three people close to the situation told Business Insider. Two said they expected it be broadcast globally and ad-free.These people were granted anonymity to speak freely about private deal talks. Their identities are known to BI.Details of the special have been trickling out over the past few days in outlets like <a target="_blank" href="https://variety.com/2024/tv/news/amazon-brian-williams-election-night-special-streaming-1236158601/">Variety</a> and <a target="_blank" href="https://www.cnn.com/2024/09/29/media/brian-williams-amazon-prime-video-election-night/index.html?utm_term=17277006269107d550e2ab43a&amp;utm_source=cnn_Reliable+Sources+%E2%80%93+Sept.+30%2C+2024&amp;utm_medium=email&amp;bt_ee=vPubjlLkW1gs8yiBPmN%2BGqep71YTbD%2FkJvRQ5eU4n2Rv%2F3LufDHYaeQctXVPY211&amp;bt_ts=1727700626912">CNN</a>, although Amazon has not confirmed the deal and it's possible it won't come to fruition.News of the potential deal has sparked questions in the industry about whether the tech giant plans to expand as deeply into news as it has with <a target="_blank" class="" href="https://www.businessinsider.com/amazon-studios-expansion-challenges-jennifer-salke-citadel-lord-rings-2023-2">filmed entertainment</a> and <a target="_blank" class="" href="https://www.businessinsider.com/jay-marine-leading-amazon-sports-ambitions-nba-rights-2024-3">sports</a>.The people close to the deal talks rebuffed the idea that Amazon would build its own news operation, however. They said Amazon sees the special as another way to amass big audiences, as it has done with the <a target="_blank" href="https://www.businessinsider.com/amazon-nfl-thursday-night-football-advertising-strategy-new-brands-2023-9">NFL's "Thursday Night Football"</a> and other sports. The special has the potential to reach more than 200 million viewers, which is Prime Video's monthly reach, according to Amazon's most recent public disclosure.If it goes well, Amazon could repeat the approach with other big news events, one of the people close to the deal talks said. Those events could include the presidential inauguration or State of the Union address, this person predicted."It's a toe in the water for them in that they're trying to get beyond sports to other, seasonal special types of events," this person said. "There's news-adjacent programming they could do."Two of the people close to the deal talks said the election-night special was expected to be ad-free. No final decisions have been made, though. But Amazon and other tech-rooted streamers have seen how live programming, like comedy specials and awards shows, creates appointment viewing that can be highly attractive to advertisers. Advertisers, and especially marketers with time-sensitive product launches, have shown a willingness to pay high prices to reach large live audiences. Amazon this year <a target="_blank" href="https://www.businessinsider.com/amazon-prime-video-ads-early-success-with-advertisers-2024-4">turned on ads in Prime Video</a>, gunning for the nearly $70 billion in annual TV ad spending.For Amazon, specifically, filmed entertainment and sports programming — part of Prime Video — also serves to keep people subscribing to its lucrative Prime service and get people to shop more on the platform. Prime Video's 2023 Black Friday NFL game, for example, showed QR codes during breaks to promote deals on the site."It fits in with their interest in disruptions and amassing big audiences," the second person close to the deal talks said. "They want to be in the big-event business."<h2 id="7f7a9c20-5ffc-43f3-a0df-b0f758efb495">News has been slow to shift to streaming</h2>Big champions of the election-night special within Amazon include Mike Hopkins, senior vice president of Prime Video and Amazon MGM Studios, and his powerful No. 2, Albert Cheng, vice president of Prime Video US. Hopkins has played a role in Prime Video's aggressive expansion into sports, which has created tension with some on the entertainment side who <a target="_blank" href="https://www.businessinsider.com/jay-marine-leading-amazon-sports-ambitions-nba-rights-2024-3">see the sports investment coming at the expense of film and TV budgets</a>.If the deal goes through, the special would be produced by Jonathan Wald, a veteran TV news producer who executive-produced Williams' "11th Hour" on MSNBC and has lately focused on new news formats. He helped Don Lemon launch shows on social media, for example. Williams' reps at talent agency CAA have also been involved.While entertainment and sports have shifted to streaming, news has been slower to follow. Legacy broadcasters like NBC News and ABC News have invested in live-streamed content; CNN has planned a streaming subscription service, but it's had starts and stops.Tech companies with streaming services have generally steered clear of news — not surprisingly, given the high cost of operating a newsroom and how polarizing news can be.<a target="_blank" class="" href="https://www.businessinsider.com/netflix-ceo-ted-sarandos-ads-sports-originals-change-mind-2024-9">Netflix co-CEO Ted Sarandos</a>, in a recent interview, rejected the idea of the streamer covering breaking news. Apple TV+ drifted into news-adjacent programming in 2020 with Jon Stewart, who hosted a weekly comedy news show. But Stewart walked away after two seasons, <a target="_blank" href="https://www.theringer.com/2024/6/13/24177435/jon-stewart-talks-apple-split-corporate-constraints-media-regression">saying</a> Apple increasingly wanted more oversight of the show's editorial direction.Amazon, for its part, wants to bring a down-the-middle presentation of election results hosted by Williams with a lineup of exclusive contributors. To lend a nonpartisan feel, the plan is that the presenters won't call the race and will point viewers to third-party content (which could include sites like CNN and NBC News that are available through Amazon Channels). The event would be broadcast from LA, allowing it to run late into the night.And while some elements would be familiar to a news audience, Amazon is expected to put its own twist on the potential presentation, similar to how it souped up the production of "Thursday Night Football" with <a target="_blank" href="https://www.theverge.com/2023/8/24/23842818/amazon-thursday-night-football-ai-streaming">on-screen overlays</a> that predict what might happen next.

Amazon is jumping into news as it closes in on a deal with Brian Williams

<ul class="summary-list"><li>AI mostly outperformed human executives in an experiment by University of Cambridge researchers.</li><li>But AI wasn't as good at making decisions in unexpected "black swan" events.</li></ul>Can we throw <a target="_blank" class="" href="https://www.businessinsider.com/ceo-replace-ai-job-employees-executives-save-money-salary-2023-9">CEOs out of their offices and replace them with AI</a>? A new experiment from the University of Cambridge suggests the answer is no.Artificial intelligence actually outperformed human CEOs in most situations in a real-life simulation of running a business that pitted people against computers, but there was one thing AI couldn't handle, according to the experiment: so-called black swan events, like a pandemic.Because of that, AI got fired more quickly by a virtual board of directors than its human counterparts, which navigated unexpected situations better.Hamza Mudassir, one of the researchers behind the experiment, told Business Insider that AI outperformed the human participants on most metrics, including profitability, product design, managing inventory, and optimizing prices — but that its performance wasn't enough to save it from getting the boot."It did not do well on survival within the C-suite just because it was not very good at handling abrupt changes or changes that require a new way of thinking," Mudassir said.The Cambridge researchers conducted the experiment from February to July and included 344 people, some of whom were senior executives at a South Asian bank. It also included college students. And the last participant wasn't a person at all, but rather <a target="_blank" class="" href="https://www.businessinsider.com/everything-you-need-to-know-about-chat-gpt-2023-1">GPT-4o</a>, the large language model, or LLM, from OpenAI.The participants played a game designed to simulate real-world situations in which CEOs have to make decisions. The game had them take on the role of CEO of a car company. It was designed by the Cambridge researchers' ed-tech startup, Strategize.inc."The goal of the game was simple — survive as long as possible without being fired by a virtual board while maximizing market cap," the researchers wrote in the <a target="_blank" class="" href="https://hbr.org/2024/09/ai-can-mostly-outperform-human-ceos">Harvard Business Review</a>.Mudassir told BI that the LLMs were great at analyzing data, recognizing patterns, and making inferences. For example, when it came to designing a car based on factors like available parts, price, consumer preferences, and demand, there were 250,000 combinations participants could come up with. The cars that AI put together were significantly better than those the humans came up with, he said.In part, he said that's because humans have biases and personal taste in things like the shape of a car; for the AI, it was simply a "puzzle of finding out the most optimal value for what the customer wanted," Mudassir said.But that doesn't mean that AI was the optimal CEO. When a "black swan" event occurred, the bot couldn't address it as quickly — or as well — as the human executives and students. When there was a major shift in market conditions, like introducing a pandemic into the mix, the model flopped, he said."How do you react to COVID if you're dealing with it for the first time? A lot of people, and a lot of CEOs, have different strategies," Mudassir said. "In this case, it did not have enough information on how to react in time to prevent itself from getting fired," he said of the AI.So CEOs can rest easy for now. The researchers say that while AI's performance as the virtual head of a company was impressive, it wasn't good enough to replace a human. Still, AI performed so well that it can't be ignored in corporate strategy, Mudassir said.In the future, Mudassir said LLMs could be specifically tuned to a particular company with real-time data, in which case they'd likely perform even better than AI did in the experiment.He said perhaps the best use-case of AI would be in business "war gaming" — or using multiple LLMs to represent different stakeholders, such as competitors, lawmakers, or activists, and then testing how certain decisions would actually play out. Some of that could, in theory, replace the work of some <a target="_blank" class="" href="https://www.businessinsider.com/ai-questions-consulting-firms-are-answering-for-clients-2024-6">strategy and management consultants</a>, who often make recommendations to a CEO based on their own analysis of certain outcomes in certain situations.

AI largely beat human CEOs in an experiment that pitted computers against people — but it also got fired more quickly

Disney CEO Bob Iger has a message for <a target="_blank" href="https://www.businessinsider.com/apple">Apple</a>, Google, and every other tech company that distributes his company's streaming services: He wants a better deal.At least that seems to be what Iger wants from them. Speaking at an investor conference this week, Iger said he's giving up too much money to the Big Tech app stores that distribute Disney-owned streamers like Hulu and Disney+."We have to look at the way we're distributing," <a target="_blank" href="https://thewaltdisneycompany.com/bob-iger-ceo-of-the-walt-disney-company-to-participate-in-moffettnathansons-media-internet-communications-conference-2/">Iger told analyst Michael Nathanson at a MoffettNathanson-hosted conference.</a> "Unlike Netflix, we distribute largely through third-party app stores. There's obviously an advantage to that to some extent, but there's a cost to that, too. And we're looking at that."Iger is referring to arrangements Disney has with tech platforms that allow users to sign up and pay for his streaming services. Those deals vary from platform to platform: <a target="_blank" href="https://developer.apple.com/programs/video-partner/">Apple, for instance, has a deal for video companies like Disney that charges them 15% of revenue</a> for signups made within Apple-distributed apps; Roku, the connected TV company, can charge video companies a fee for signing up customers on its devices and may also demand a slice of those services' ad inventory.It may be telling that Iger referenced <a target="_blank" href="https://www.businessinsider.com/guides/streaming/netflix-price">Netflix</a>, which used to let consumers sign up for its service via third-party distributors like Apple, but <a target="_blank" href="https://help.netflix.com/en/node/25097">stopped doing that in 2018</a>. The move didn't seem to affect Netflix's growth, and has obvious benefits for the company's margins.I've asked Disney, as well as Apple, for comment.App stores and app distribution are a meaningful part of many tech companies' business plans. Apple, which can take up to 30% of revenue generated by in-app purchases and signups, has been <a target="_blank" href="https://www.businessinsider.com/apple-earnings-service-growth-iphone-drop-antitrust-google-app-store-2024-5">telling investors that the growth in "services" businesses like the App Store </a>is particularly important for its future.It's also possible that Disney won't need to leave third-party app stores — or threaten to leave — in order to save money. Apple's <a target="_blank" href="https://www.businessinsider.com/apple-app-store">App Store</a> policies, in particular, have been under <a target="_blank" href="https://www.businessinsider.com/apple-app-store-fight-regulators-rules-tim-cook-tax-2024-1">pressure</a> from <a target="_blank" href="https://www.businessinsider.com/apple-keeps-app-store-rules-after-supreme-court-decision-2024-1">regulators</a> around the world, and <a target="_blank" href="https://www.businessinsider.com/apple-app-store-open-first-time-eu-law-developers-ios-2024-1">Apple is grudgingly making some changes</a>.Maybe one of them will include a way to take a bit less from one of the world's biggest video companies.

Heads-up, Apple and the rest of Big Tech: Disney wants better app store deals.

<ul class="summary-list"><li>Paul Graham's essay on "founder mode" versus "manager mode" sparked conversation, memes, and merch.</li><li>Graham's essay, inspired by Airbnb CEO Brian Chesky, critiques traditional startup advice.</li></ul>As the internet puts <a target="_blank" class="" href="https://www.businessinsider.com/brat-summer-politicians-charli-xcx-kamala-harris-social-media-2024-7">brat summer</a> to bed, founder mode is taking center stage.On Sunday, <a target="_blank" class="" href="https://www.businessinsider.com/paul-graham-comments-on-startup-job-vs-big-company-2024-5">Paul Graham</a>, a writer and the <a target="_blank" class="" href="https://www.businessinsider.com/why-openai-ceo-sam-altman-left-y-combinator-paul-graham-2024-5">founding partner of startup accelerator Y Combinator,</a> penned a <a target="_blank" class="" href="https://paulgraham.com/foundermode.html">1,050-word essay</a> that has taken tech and business communities by storm.He asked: Why are <a target="_blank" href="https://www.businessinsider.com/life-of-startup-founder-no-vc-funding-money-2023-10">startup founders</a> directed to run their large companies like managers, delegating to their direct reports, rather than getting involved like they did in earlier stages of their companies?Graham said operating in "manager mode" over "founder mode" is anathema to companies."What this often means is to hire professional fakers and let them drive the company into the ground," he wrote.A prime example of a tech titan embracing founder mode is Nvidia cofounder and CEO Jensen Huang, who has <a target="_blank" class="" href="https://www.businessinsider.com/jensen-huang-nvidia-routine-management-leadership-style-ceo-founder-2024-4">60 direct reports and still eats in the company cafeteria</a>.Graham credited <a target="_blank" class="" href="https://www.businessinsider.com/airbnb-ceo-brian-chesky-30-billion-startup-2016-8">Airbnb cofounder and CEO Brian Chesky</a> for sparking the idea and most of the arguments in the blog. At a recent Y Combinator event, Chesky spoke about how conventional advice on building and scaling up a startup is broken. He said, <a target="_blank" class="" href="https://www.youtube.com/watch?v=ia6Di_ytiSE">as he has before</a>, that investors and outside managers just don't have the insights that founders do. He said that splitting companies into organizational chart tiers — isolating founders from anyone but their direct reports — often kills the business.While belittling manager mode might shock management consultants, Graham's post tracks with Silicon Valley's modus operandi. Tech culture has always venerated founders and lean teams. Venture capitalists try to outdo each other in funding rounds to appear the most "founder friendly" — investors who won't meddle much. Would-be founders dream of the day when they can peel away from drab Big Tech and start their own Next Big Thing, unconstrained by bureaucracy.And it's a long weekend with little else going on online. The internet craves buzzy nomenclature, dividing people into camps, and the chance to rake in the likes with a viral follow-on post.<h2 id="52a112a2-97fc-43f8-887f-623aa635a38c">'Gaslit' founders</h2>Chesky's talk hit another nerve with the founders in the room and then with Graham's online readers. The Airbnb exec said founders are constantly being "gaslit" — first by outside voices asking them to run the company like managers, and then by employees who don't like the manager's way.Chesky is the only remaining Airbnb cofounder at the company, and while much of his leadership has been praised — he led a major round of <a target="_blank" class="" href="https://www.businessinsider.com/airbnb-ceo-brian-chesky-layoffs-show-respect-compassion-for-employees-2020-5">pandemic-era layoffs</a> with empathy and has tried to refocus the hospitality giant — the stock has fallen over 15% since its 2020 initial public offering.There are also notable exceptions to positive founder mode: <a target="_blank" class="" href="https://www.businessinsider.com/ftx-crypto-king-sam-bankman-fried-rise-and-fall-2022-11">Sam Bankman-Fried</a> and <a target="_blank" class="" href="https://www.businessinsider.com/theranos-founder-ceo-elizabeth-holmes-life-story-bio-2018-4">Elizabeth Holmes</a> were both founders who operated with autonomy, then ignominy.On the other hand, Satya Nadella and Tim Cook are both outside managers touted with turning their companies around — in both cases, building on the legacies of strong founders.<h2 id="bcbb31a0-fabb-4163-bccb-7816fb0929dd">Thinkfluencers' time to shine</h2>Graham's essay brought Chesky's speech outside the <a target="_blank" class="" href="https://www.businessinsider.com/inside-y-combinator-new-headquarters-office-san-francisco-dogpatch-photos-2024-4">YC room</a> and into the rest of the world, where it exploded online. Now, investors, wannabe thinkfluencers, comedians, and founders are all weighing in.One basketball star-turned-investor, Baron Davis, likened being a founder to being an athlete.Another investor was quick to come up with one of the tastiest examples of founder mode: Costco's <a target="_blank" class="" href="https://www.businessinsider.com/costcos-hot-dog-combo-price-safe-cfo-2024-6">deal of the century</a>, which has withstood inflation thanks to one cofounder's clear instructions to his CEO: "If you raise [the price of] the effing hot dog, I will kill you."A tech newsletter writer pre-empted what <a target="_blank" class="" href="https://www.businessinsider.com/tech-bros-treat-dating-like-a-startup-2024-8">dating a tech bro would look like</a> this week.Some users rang warning bells about what's next for Tech Discourse, now that founder mode is officially a hit.Custom domains have been purchased.And of course, unofficial merch has already dropped.

Why everyone in tech is talking about 'founder mode'

<ul class="summary-list"><li>Despite return-to-office mandates at Amazon and Dell, the tech world still appears to favor hybrid work.</li><li>Research from Flex Index suggests that working from home is thriving in the tech industry.</li></ul>Some tech workers are being <a target="_blank" class="" href="https://www.businessinsider.com/amazon-return-to-office-backdoor-layoffs-rto-nick-bloom-2024-10">dragged back to the office</a> — whether they like it or not.<a target="_blank" class="" href="https://fortune.com/2024/09/24/amazon-employee-survey-rto-5-day-mandate-andy-jassy/">Unpopular return-to-office mandates</a> at Amazon and <a target="_blank" class="" href="https://www.businessinsider.com/read-memo-dell-sent-staff-rto-5-days-a-week-2024-9">Dell</a> have made headlines in recent months as workers <a target="_blank" class="" href="https://www.businessinsider.com/tell-dell-annual-survey-results-show-employees-frustration-rto-push-2024-7">protest the strict new rules.</a>But while it may seem like workers are losing the battle for remote work, research suggests that hybrid work is still the norm in the tech industry.<a target="_blank" rel="noopener noreferrer" class="c-link" href="https://affiliate.insider.com?h=2e80aac6068aad189c95f445d7befa91c2f65d6249a0dd6169828d66140a7ec1&amp;postID=66fc04b3d86164749858e533&amp;postSlug=hybrid-work-tech-companies-rto-amazon-dell2024-10&amp;site=bi&amp;u=https%3A%2F%2Fwww.canva.com%2Fdesign%2FDAGLBzph2Ro%2FN8J1ayHcoxw4RjdoAHjz2A%2Fview">A study from Flex Index</a>, a platform that tracks flexible work policies, found most tech companies still had hybrid or remote policies as of this summer.The research, which analyzed the policies of 2,670 companies, found that 79% of tech companies in June were "fully flexible," meaning they didn't mandate office time from employees — a slight increase from the same survey conducted in June 2023.A mere 3% of tech firms required employees to be back in the office full time, compared with the 18% of companies that were "structured hybrid," meaning some office days are mandated.The picture was slightly different at the largest tech companies. The more employees a company had, the more likely they were to adopt a structured hybrid system.Just shy of three-quarters of companies with more than 25,000 employees had adopted a structured hybrid policy, while 37% of tech firms with 500 to 5,000 employees had a hybrid work policy. The data suggests that Amazon and Dell are outliers in the tech world.In comparison to the same research published in June 2023, tech companies of all sizes have been shifting a least incrementally toward hybrid work, with larger firms leading the charge."On the employer's side, I think most of them would prefer going back to regular office hours," Peter Cappelli, a professor of management at Wharton Business School, told Business Insider."But it is a huge irritation to employees to pull back a benefit employees really appreciate, especially because employers are not giving them anything in return nor have made much of any effort to persuade them why it's necessary," he said.As Big Tech companies mull how far to take their RTO policies, one thing is clear — hybrid work is the perk to have in the race for top talent.<h2 id="aca82825-f21f-4daa-bf17-d1e0600f72bd">Talent wars</h2>Employees love flexibility at work. In a survey of 17,087 employees conducted by Stanford economist Nicholas Bloom, workers said they regarded the right to work two or three days a week from home as valuable as an 8% pay rise.Employees under strict RTO mandates at Amazon and Dell have been vocal about their lack of enthusiasm for the new rules, with some at <a target="_blank" class="" href="https://www.businessinsider.com/us-dell-workers-reject-return-to-office-hybrid-work-2024-6">Dell forsaking promotions in favor of remaining remote.</a>In the current landscape, this likely means that Big Tech companies with a hybrid work policy will have an advantage when it comes to recruiting and retaining top talent.Bloom, a world authority on remote work, told BI he didn't expect other Big Tech firms to follow Amazon's lead on RTO for this reason."Hybrid is too profitable to abandon," he said. "The evidence is that hybrid is about as efficient as fully in-person — but hybrid is better for recruitment and retention."He said forcing employees back into the office full time could drive higher turnover, which can <a target="_blank" class="" href="https://www.shrm.org/topics-tools/news/all-things-work/reducing-employee-turnover">be costly for companies.</a>The tech world is also engaged in a brutal battle for talent, especially for top AI researchers. Last month, Google reportedly <a target="_blank" class="" href="https://www.businessinsider.com/google-noam-shazeer-deal-ai-talent-hiring-star-quarterbacks-i2024-9">forked out $2.7 billion</a> in a deal largely intended to get AI scientist and startup founder Noam Shazeer back at the company.Cevat Aksoy, associate director of research at the EBRD and associate professor of economics at King's College London, told BI his research shows a substantial portion of the workforce highly values the option to work from home. Many are willing to quit or seek new employment if ordered to return to the office full-time, he said. "Companies adopting full RTO policies could face challenges in retaining talent," Aksoy said. "Given the increasing demand for flexibility and the strong preferences many employees hold, we can expect hybrid work to remain a critical tool for companies seeking to stay competitive in attracting top talent."However, five-day RTO initiatives have their supporters, too. John Rossman, an Amazon executive in the early 2000s, told BI that the company is <a target="_blank" class="" href="https://www.businessinsider.com/amazon-office-five-days-rto-exec-andy-jassy-2024-10">making the right move</a> to "jump-start growth again."<h2 id="35ef6780-204a-46ef-9d32-1d4de7593189">Efficiency, or else</h2>In the last year, tech companies have been getting tough on remote workers, monitoring office card swipes and disciplining those who don't follow the rules.While some large companies, such as Nvidia, have remained holdouts, most Big Tech companies have had hybrid policies of various degrees.But they are also making no promises it will stay this way.Microsoft and Google, which both have a hybrid policy that allows employees to work from home at least some of the time, recently issued a <a target="_blank" class="" href="https://www.businessinsider.com/google-hybrid-work-policy-amazon-rto-employees-workplace-remote-2024-10">thinly veiled threat</a> to workers: keep <a target="_blank" class="" href="https://www.businessinsider.com/microsoft-wont-follow-amazon-rto-unless-productivity-drops-exec-2024-9">productivity up</a> if you want to avoid a full-time office return.Aksoy said this worked as a way of ensuring accountability among tech workers."It's likely a reminder to employees that hybrid work isn't guaranteed—it's tied to continued performance. This kind of message helps keep everyone focused on delivering results while giving the companies room to tighten policies if they start seeing any productivity issues or collaboration challenges," he said.That said, Aksoy still thinks it's unlikely that Big Tech will bring employees back for five days a week."The benefits of hybrid work, both for companies and employees, are just too significant," Aksoy said. "Plus, the hybrid model allows these companies to tap into a wider talent pool without being limited by geography. So as long as productivity stays up, I think hybrid work is here to stay in the tech world."

Amazon's RTO push is an outlier — the tech world remains all-in on hybrid work

<ul class="summary-list"><li>There's an important stipulation on <a target="_blank" class="" href="https://www.businessinsider.com/openai-investors-softbank-ark-tiger-global-2024-10">OpenAI</a>'s historic $6.6 billion funding round.</li><li>The startup has two years to become for-profit, or it might have to give investors their money back.</li></ul>OpenAI's historically large $6.6 billion funding round is bringing in checks from some of the biggest <a target="_blank" class="" href="https://www.businessinsider.com/openai-investors-latest-funding-round-2024-10">technology and venture capital investors</a>.But there's reportedly one condition on the round that could undo it all.If the ChatGPT-maker doesn't complete its transition to a for-profit company within two years, investors in the latest round could ask for their money back, <a target="_blank" class="" href="https://www.axios.com/2024/09/26/openai-nonprofit-governance-shift">multiple</a> <a target="_blank" class="" href="https://www.nytimes.com/2024/10/02/technology/openai-valuation-150-billion.html">outlets</a> have said.When it was founded in 2015, OpenAI was a nonprofit. In 2019, it added a for-profit arm to raise money, but it said it would still focus on creating safe artificial general intelligence that benefits humanity.Then, OpenAI confirmed last month that the company would become an entirely <a target="_blank" class="" href="https://www.businessinsider.com/what-openai-needs-to-do-to-become-for-profit-altman-2024-9#">for-profit entity</a> over the next two years, ruffling some tech fans' feathers.Making that change could lead to government challenges to the process in court, Jill Horwitz, a professor at the University of California, Los Angeles School of Law, told Business Insider in an interview.Any assets that OpenAI holds right now under its nonprofit structure are "dedicated to a charitable purpose," Horwitz said. "Even if they're billions of dollars, as in OpenAI, they are perpetually dedicated to those purposes.""Assets that are legally required to be devoted to charitable purposes do not convert to for-profit purposes," Horwitz added. "In a sense, the for-profit needs to buy out the nonprofit interest."OpenAI is registered as a nonprofit in Delaware, a state where many nonprofits and for-profit companies choose to incorporate. But given OpenAI's assets and operations in California, that state's attorney general "has the power to ensure that charitable assets are not used for for-profit purposes," said Horwitz.And the Internal Revenue Service could also challenge the transition, Horwitz said."The regulators have a duty to protect the public interest, and the public has an interest in charitable assets remaining devoted to charitable ends," she said.Alexander Reid, a partner at the law firm BakerHostetler, sees OpenAI's transition to a fully for-profit company as a complex one that could be complicated further not only by regulators but also internally."If one director thinks the other directors are breaching the mission and making a decision that's not in the best interests of the nonprofit, they can sue" on behalf of the company, said Reid, who specializes in the regulation of nonprofit organizations.The biggest obstacle for OpenAI, Reid said, will be "getting clarity about how this helps" the company's mission "and getting unanimity and alignment on the board and with the regulators that this is the right thing to do."Reid said the SEC will focus on whether investors are informed of the risks, the IRS will look into whether tax laws are being followed, and the attorneys general will want to know if the transition for for-profit is fair, reasonable, and in the best interests of the nonprofit.But "if there's disagreement within the entity, then it's much harder for the regulators to approve it," he said.Still, the legal experts said that though OpenAI's transition to a for-profit company is a complicated one, it's doable.Reid said that it's possible OpenAI can get the transition done within the two-year timeframe."When things are this important, you can usually get the attention of the regulators in question," said Reid. "You can get the SEC and the IRS and the California attorney general and whoever else you might need to focus on the transaction and devote the resources to approving it in a way that more routine transactions can take longer."He continued, "When there's this much market interest, and the amounts are so significant, and the government's interest is so significant, I think you can expect things to move faster, potentially.""It really depends on what the regulators do," said Horwitz.OpenAI did not immediately respond to a request for comment.Earlier this year, <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-throws-down-gauntlet-sam-altman-openai-lawsuit-2024-3">Elon Musk</a>, a cofounder of OpenAI, sued the startup and two other cofounders, Sam Altman and Greg Brockman. Musk claimed that OpenAI wasn't sticking to its mission as a nonprofit. <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-drops-lawsuit-against-sam-altman-and-openai-2024-6">Musk dropped the lawsuit</a> in June.Employees, board members, and others associated with OpenAI have also clashed over how quickly the company should be developing and releasing its products and what kind of oversight its technology needs. Those debates intensified after OpenAI launched <a target="_blank" class="" href="https://www.businessinsider.com/chatgpt-may-be-fastest-growing-app-in-history-ubs-study-2023-2#:~:text=ChatGPT%20may%20be%20the%20fastest%2Dgrowing%20app%20in%20history%20with,easy%20access%20and%20faster%20responses.">ChatGPT</a>, which attracted 100 million users in about two months, in 2022.Last November, some members of OpenAI's board of directors removed Sam Altman as the company's CEO. But Altman got his job back, and <a target="_blank" class="" href="https://www.businessinsider.com/former-openai-board-members-challenge-self-governance-sam-altman-2024-5">two board members</a> who argued for his ouster left their roles.Since then, several <a target="_blank" class="" href="https://www.businessinsider.com/openai-leaders-who-left-since-2023-sam-altman-leadership-struggle-2024-9#helen-toner-1">high-level employees have left OpenAI</a>, including some of its co-founders.

There's a catch in OpenAI's $6.6 billion funding deal that no one is talking about

<ul class="summary-list"><li>Google is ready to go nuclear in the name of AI.</li><li>The search giant has struck a deal to bring new nuclear plants online to power its AI data centers.</li></ul>The energy demands of the data centers behind the generative AI boom are proving so great that they're pushing Big Tech firms into an unfamiliar position: becoming long-term customers to the nuclear industry.Google became the first tech giant to broker a deal for entirely new nuclear power plants after it <a target="_blank" class="" href="https://blog.google/outreach-initiatives/sustainability/google-kairos-power-nuclear-energy-agreement/?utm_source=tw&amp;utm_medium=social&amp;utm_campaign=og&amp;utm_content=&amp;utm_term=">unveiled a partnership with industry firm Kairos Power</a> on Monday. The deal will see the startup build "multiple" small modular nuclear reactors for the search giant.The first of these reactors — which includes the one Kairos began constructing in East Tennessee in July — is set to be online by 2030. The others should be ready by 2035 and will enable up to 500 megawatts of "new 24/7 carbon-free power" to US electricity grids. Assuming continuous operation and average consumption levels, that's enough to <a target="_blank" class="" href="https://www.carboncollective.co/sustainable-investing/gigawatt-gw">power about 438,000 US households</a> for one year.Google CEO Sundar Pichai hinted earlier this month that this was coming after <a target="_blank" class="" href="https://www.businessinsider.com/google-considering-nuclear-power-energy-hungry-ai-data-centers-2024-10">he said in an interview</a> that his company was "evaluating technologies like small modular nuclear reactors."<div type="image" title="Sundar Pichai speaking." height="2824" width="4071" msid="114258507" hostid="261" sizebytes="346004"></div>While deal terms have not been disclosed, the significance of the arrangement is hard to overstate — and not just because the US has brought only three nuclear reactors online over the past two decades.AI is pivoting Google and its rivals toward nuclear power as they signal the need for a new solution to the tech world's growing energy problem.<h2 id="cf443968-561f-498c-b239-87db8db26b6d">Generative AI strains the energy sector</h2>Big Tech companies are racing to build smarter AI, but this requires a lot of energy.Announcing the Kairos deal, Michael Terrell, senior director of energy and climate operations at Google, noted that the grid "needs new electricity sources" to support the energy needs of AI technologies the search giant is now heavily invested in.Google revealed just how energy-intensive its AI push has been earlier this year. Its <a target="_blank" class="" href="https://www.gstatic.com/gumdrop/sustainability/google-2024-environmental-report.pdf">annual environmental report</a>, published in July, showed its emissions had risen 13% year-on-year in 2023, driven by "increased data center energy consumption and supply chain emissions."That 86-page report didn't mention nuclear power, bar a single endnote. It shows that Google's Kairos deal is a sign that it is now ready to consider all options in its search for a supply of clean electricity to its data centers.That's particularly important as it looks to build smarter versions of its AI model, Gemini. Ethan Mollick, a professor at Wharton, <a target="_blank" class="" href="https://x.com/emollick/status/1846172006376419691">noted on X</a> that the Google-Kairos deal "increases the odds that we will see AI models scale through at least 3 more generations/orders of magnitude (post GPT-5) to 2030." Others have recognized this, too. Since OpenAI <a target="_blank" class="" href="https://www.businessinsider.com/everything-you-need-to-know-about-chat-gpt-2023-1">launched ChatGPT</a> in late 2022, the world's biggest tech companies have been forced to confront the fact that staying competitive in generative AI will require vast supplies of clean energy.By one estimate, a search request on OpenAI's buzzy chatbot <a target="_blank" class="" href="https://www.goldmansachs.com/insights/articles/AI-poised-to-drive-160-increase-in-power-demand">demands around 10 times as much electricity</a> as a general Google search. The large language models behind it make the computing power in data centers buzz and whirr intensively to produce cogent responses.While solar and wind power offer clean means of electricity generation, some in the tech industry have suggested that they are not enough to meet the demands of AI.For instance, Meta's chief AI scientist, Yann LeCun, said <a target="_blank" href="https://x.com/ylecun/status/1837875035270263014">last month</a> that AI data centers would have to be built next to nuclear power plants as, in his view, they can produce the continuous "gigawatt-scale, low-cost, low-emission electricity" needed."The advantage is that there is no need for expensive and wasteful long-distance distribution infrastructure," he wrote on X while suggesting solar and wind are "nice" but neither simple nor cheap.<h2 id="5a41f8b3-f715-466a-9f86-890e9c5348b6">Microsoft's nuclear moves </h2>Google rival Microsoft signaled interest in nuclear power in September after it struck a 20-year power supply agreement with Constellation — an agreement that would see the Baltimore-based energy company <a target="_blank" class="" href="https://www.businessinsider.com/three-mile-island-nuclear-plant-reopens-power-microsoft-ai-push-2024-9">reopen the nuclear plant on Three Mile Island.</a>The Island's second unit was shut down in 1979 after it became the site of the most serious nuclear meltdown on US soil, so the move from Microsoft to turn to the site is significant — even if it is reviving the island's first unit as opposed to the first one. It is expected to come online by 2028 and provide over 800 megawatts of power, about enough to keep a small-to-mid-sized city running.In March, Amazon bought a data center in Pennsylvania from Talen Energy for $650 million, which is powered by the nuclear Susquehanna Steam Electric Station.Meanwhile, <a target="_blank" class="" href="https://www.businessinsider.com/the-scope-of-sam-altmans-future-ai-empire-open-ai-2024-3">OpenAI boss Sam Altman said at Davos</a> earlier this year that an energy "breakthrough" driven by greater investment in nuclear fusion would be needed to accelerate future AI developments. Altman invested $375 million in a personal capacity into fusion power company Helion Energy in 2021.The prospect of the energy source taking on a greater role in Big Tech's operations becomes even more significant when considering the nuclear industry's decades of stagnation due to delayed projects.That doesn't seem like a deterrent, however. Big Tech firms look all in on AI. Expect them to be all in on energy sources that keep the technology ticking.

Google is taking the nuclear option to power soaring demand for AI. Here's why it's such a big deal.

<ul class="summary-list"><li>FTC Chair Lina Khan has led an aggressive antitrust fight against large corporations.</li><li>In a recent "60 Minutes" interview, she said Big Tech acquisitions have harmed Americans.</li></ul>The Federal Trade Commission's antitrust buster said Americans lost a lot of privacy protection because a handful of large tech companies were allowed to go on an acquisition spree without greater scrutiny.In a "60 Minutes" interview that aired Sunday, <a target="_blank" class="" href="https://www.businessinsider.com/ftc-chair-lina-khan-antitrust-critic-big-tech-amazon-2021-6">FTC Chair Lina Khan</a> said allowing Big Tech to go through hundreds of acquisitions in the past several decades was a mistake that hurt Americans."In the technology markets, we went through a couple of decades where we saw over 800 acquisitions by the five big players, not a single one of which was blocked, and some of those we realized ended up leading to significant harm," Khan said.She acknowledged <a target="_blank" class="" href="https://www.businessinsider.com/why-facebook-buying-whatsapp-2014-2">Facebook's purchase of messaging app WhatsApp</a> in 2014 for $19 billion as one example.The <a target="_blank" class="" href="https://www.businessinsider.com/what-ftc-facebook-antitrust-lawsuit-is-important-2020-12">FTC sued Facebook</a> in 2020, accusing Mark Zuckerberg's company of engaging in anticompetitive practices by buying Instagram and WhatsApp. A district judge in Washington, DC, dismissed the complaint in June 2021, stating that the agency did not provide enough evidence that <a target="_blank" href="https://markets.businessinsider.com/news/stocks/federal-court-dismisses-ftc-s-anti-trust-lawsuit-against-facebook-1030560379">Facebook</a> established a monopoly.The case was revived after the <a target="_blank" class="" href="https://www.businessinsider.com/ruling-ftc-meta-facebook-lawsuit-instagram-whatsapp-can-proceed-2022-1">FTC refiled the complaint</a> a month later. In another motion to dismiss the lawsuit in April, Facebook, <a target="_blank" class="" href="https://www.bloomberg.com/news/articles/2024-04-05/meta-asks-judge-to-throw-out-ftc-antitrust-case-before-trial">now Meta,</a> said it faces plenty of competition from rivals like TikTok, X, and YouTube. The company also said in a <a target="_blank" class="" href="https://about.fb.com/news/2024/04/meta-files-motion-for-summary-judgment-in-ftc-lawsuit-relating-to-instagram-and-whatsapp/">press statement</a> that the FTC reviewed the acquisition of Instagram and WhatsApp years ago."The decision to revisit done deals is tantamount to announcing that no sale will ever be final," the company said.An FTC spokesperson did not respond to a request for comment. A Meta spokesperson declined to provide comment.Khan argued in the "60 Minutes" interview that purchases like these weakened Americans' privacy guardrails."Just to give you a concrete example, there were companies that were offering Americans greater privacy, and they were promising that we're not going to use your data, we're not going to sell it, we're not going to spy on you, everywhere all the time," Khan said. "After some of those firms were bought up by one of the big guys, all of those data privacy policies changed overnight, and so Americans lost those privacy protections."In 2021, <a target="_blank" class="" href="https://www.businessinsider.com/whatsapp-forcing-users-to-share-personal-data-facebook-elon-musk-2021-1">WhatsApp changed its privacy terms</a> to force users to share their personal data with Facebook. Ireland's privacy watchdog fined the company <a target="_blank" class="" href="https://www.businessinsider.com/whatsapp-fined-sharing-data-facebook-privacy-communication-users-mesaging-2021-9">$266 million</a> for issues related to transparency around how WhatsApp shared its data with Facebook.A WhatsApp spokesperson told BI at the time that the company disagreed with the decision and that the penalties were "entirely disproportionate."Since her appointment by President Joe Biden in 2021, Khan has led an <a target="_blank" class="" href="https://www.businessinsider.com/why-lina-khan-wrong-about-hollywood-consolidation-market-structure-2023-8">aggressive antitrust fight</a> against large corporations, drawing the ire of Democratic and Republican business leaders. An FTC spokesperson told CNN in 2023 that, under Khan, the agency has investigated or sued to stop more than three dozen merger proposals.Some billionaire Democratic donors to <a target="_blank" class="" href="https://www.businessinsider.com/harris-lina-khan-balance-billionaires-silicon-valley-hoffman-progressives-ftc-2024-8">Kamala Harris' campaign</a>, including LinkedIn cofounder Reid Hoffman, have pushed to oust Khan under a potential new administration. But Khan's fight has also attracted unlikely supporters from the other side of the aisle, including Florida Rep. Matt Gaetz, who said in an interview with Newsmax that his party "can't be whores for big business and be the voice of the working class at the same time."Those supporters have billed themselves "Khanservatives," <a target="_blank" class="" href="https://www.wsj.com/politics/policy/lina-khan-ftc-antitrust-khanservatives-a6852a8f">The Wall Street Journal</a> reported.

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