OpenAI bets huge on {hardware} with $6.5 billion acquisition of Jony Ive’s startup
One thing to stay up for: As OpenAI and Ive’s crew put together to unveil their first system, the expertise world is watching to see if this collaboration can ship the breakthrough that has thus far eluded others. “It is a loopy, formidable factor to make,” Sam Altman mentioned.
OpenAI is making a dramatic leap into the {hardware} enterprise, saying an almost $6.5 billion all-stock acquisition of io, the bogus intelligence system startup co-founded by legendary Apple designer Jony Ive. The deal, the biggest in OpenAI’s historical past, indicators a brand new period for the corporate because it goals to maneuver past software program and into bodily shopper expertise.
Ive, whose a long time at Apple produced iconic merchandise just like the iPhone, iPad, and Apple Watch, described the second as probably the most significant level in his profession thus far. “I’ve a rising sense that the whole lot I’ve discovered over the past 30 years has led me to this place and to this second,” he mentioned in a joint Bloomberg interview with OpenAI CEO Sam Altman.
The acquisition brings collectively a formidable crew. Alongside Ive are Apple alumni Evans Hankey, Tang Tan, and Scott Cannon, who helped form Apple’s {hardware} and software program legacy. Hankey succeeded Ive as Apple’s {hardware} design chief, Tan led iPhone and Apple Watch product design till 2024, and Cannon co-created the Mailbox app after his time at Apple.
The io crew, which incorporates about 55 engineers, builders, and manufacturing specialists – many former Apple staff – will be part of OpenAI.
OpenAI is paying $5 billion in fairness for io, with the rest of the $6.5 billion valuation reflecting a earlier partnership: OpenAI acquired a 23 p.c stake in io in late 2024. The deal is predicted to shut this summer season, pending regulatory approval.
The partnership’s aim is formidable: to create a brand new household of AI-powered units for an period of synthetic common intelligence, basically rethinking how individuals work together with expertise.
Ive and Altman have been exploring {hardware} ideas for about two years, with their first system anticipated to debut in 2026. Whereas they haven’t revealed specifics, they’re clear that their aim is to not substitute the smartphone outright. “In the identical means that the smartphone did not make the laptop computer go away, I do not suppose our very first thing goes to make the smartphone go away,” Altman mentioned.
LoveFrom, Ive’s design collective, will stay unbiased however will now take over all design for OpenAI, together with software program. The group contains veterans who helped outline the look of the Mac and iPhone working programs.
The acquisition comes as Apple faces stress for lagging behind in AI, with its personal platform relying partly on OpenAI’s ChatGPT. The broader AI {hardware} market remains to be younger, with few obvious successes.
Meta’s Ray-Ban sensible glasses have gained traction, however different efforts have stumbled. Ive was blunt in his evaluation of latest AI {hardware}: “These have been very poor merchandise,” he mentioned, referring to the Humane AI Pin and Rabbit R1 private assistant system. “There was an absence of recent methods of pondering expressed in merchandise.”
Rabbit founder Jesse Lyu responded to the criticism, telling The Verge, “It is an honor to get talked about by Jony Ive and Sam Altman about rabbit and rabbit r1. Nonetheless, we do not wish to be put facet by facet with Humane, an organization that stopped making an attempt, bought acquired, and shut down.”
Humane, one other startup led by former Apple staff, was not too long ago acquired by HP and shut down its AI Pin operations in February. Rabbit’s R1 stays in the marketplace, with latest updates together with a reminiscence log for improved context and a free trial of its upgraded AI-native working system, Intern, as the corporate works on rabbitOS 2.0.
For Ive and his crew, the transfer to OpenAI represents an opportunity to form the following chapter of shopper expertise. “I’ve felt that my most necessary and helpful work is forward,” Ive mentioned.
