Hey, it's Eric Newcomer. Welcome to the newcomer podcast
Cerebral Valley Edition. It has been an insane year in
AI. We started off with Open AI
raising $10 billion from Microsoft, and it only got
Wilder. The technology, the
improvements, the papers, and of course tons of money.
I'm hosting with my friends Max Child and James Wilsterman an A
I conference Cerebral Valley on November 15th.
Hello, Hello. Hey, glad to be back on the
newcomer podcast. We really want to take space on
this podcast to really take stock of how we got here because
even covering it all so closely it's it's too much to keep track
of. So we're doing a six part series
starting off with sort of the timeline, the history what
happened and then getting into a lot of fun topics like the
dystopian scifi fantasies that is really are coloring how
serious people think about generative A I companies today
digging into the potential for entertainment, the chips
business and then how key NVIDIA a gaming company is becoming.
All this in the podcast there's one of my favorite parts is Max
James and I have a draft pick of the key startups in the space.
We analyze Apple, Google, Amazon's position here and so
it's it's a mix of like the fun, the dystopia, the money, the
technology. I have some interviews along the
way and all of it is getting you ready for the Cerebral Valley
conference on November 15th. Even if you can't go, you can
apply for a ticket at Cerebral Valley summit.com but even if
you can't go, I'll be covering here in the
newsletternewcomer.co. We post the videos both in the
newsletter and our YouTube channel will do a highlights and
some of the podcast. Follow along on Newcomer and
this This series will get you ready.
So six episodes we start off just taking stock of the journey
here, from the papers to the milestones.
Max and James I I at the core of it, like it feels like, you
know, you you are the cofounders of Volley voice games Company,
so you're dealing with talking. You know, people shouting at
their Alexas, playing games. And I think reflecting on this,
it's insane how much talking with a I feels like it's at the
heart of all of this. You know, the Turing test sort
of figuring out if a conversation with a computer is
a computer or human. You know, there's Eliza in the
60s that was sort of a prototype chat bot.
It feels like this sort of need to talk to our computers has
driven so much of the excitement around artificial intelligence
for for so many years. I mean Steve Jobs in 1984, when
he pulled the Macintosh out of the bag on stage, the first
thing it did was say hello. It's nice to be out of that bag.
And he's look, it talks just like a human.
I mean, literally the pitch for the Macintosh in 1984 was was
that it was like a an AI or was pretending to be a character,
right? There's a ton of science
fiction. You have this Star Trek computer
or robot, you know. Assistant helper like Hal or
something that you can just talk to naturally and that is
obviously been a dream for a long time.
There, yes, your points has been 50-60 years of these hype cycles
around AI and what that means has sort of evolved over time.
I'm just going to tick through just OK, we said turning 1950.
We've got like the first artificial neural network 1951,
a checkers program. In 1952, artificial intelligence
coined in 56. The Eliza chat Human
conversation 66. And then we're going to sort of
jump ahead because I think there's sort of like a pullback
of all the hype doesn't scifi does not become reality. 1997 is
a key win and that's do you know what happens in 19?
Any guesses? Are you going to say isn't Deep
Blue Kasparov 96 or yeah, it's 97?
Yeah. OK.
All right. Who wins, to be clear.
Deep blue, right. Yeah, Exactly.
Yeah. Yeah.
The first defeat of reigning world chess champion?
Exactly. There's another important game
much more recent memory 2016, which is another landmark.
Remember? Yeah, exactly.
Alpha go OK, yeah, yeah, yeah. That's so deep.
Mind you know, I forget if they were owned by Alphabet at the
time, but you know. Is that is this IBM Watson
Erasure or do we get Yeah. Does Ken Jennings losing on
Jeopardy not counting? Oh yeah, you guys love Jeopardy.
You have a part. When is that one?
What? Do you know what year that is?
I don't remember. 1213 I'm just making.
That, but it is funny because at that time it seemed like IBM was
like doing this amazing artificial.
Intelligence development that could compete on Jeopardy.
And I remember there being like a lot of controversy at the time
of like what data sources it had access to during the game of
like whether it was just essentially like reading out of
a database of answers. Yeah.
But anyway, that's kind of like ties to some things today, I
think with AI benchmarking if GPT ChatGPT can pass.
You know the Lsats or something like does it because it has the
you know. Does it have the answers or
Yeah, doesn't it? Yeah, right, right, right.
So just like where it can do math problems that can, it can
see online, but it can't like deduce how you know, but then
it'll get some terribly wrong if it.
Yeah. Because it doesn't necessarily
understand the logic. It understands how to pull sort
of very. Relevant like almost like how
the math problem is formatted matters, right?
Yeah, right. OK, 2017 now we're sort of super
recent getting into the like things start to speed up.
What would you the the what would many considered to be the
core paper leading to this current moment in general?
Tension is all you need, yes. The transformer paper.
Every person who was like an author on that paper has like a
huge company or like has raised a bunch of money.
I mean cohere, I think the CEO of that company was like sort of
a junior person at Google, you know, like who got on the paper
and now has a very highly valued sort of foundation model
company, targeted businesses. Yeah, that's I had before this
conversation I would, I resubscribed to chat UBT.
I sort of thought I had paid for a while, then I sort of got
tired of it, but I figured we were going to have this
conversation. So I was catching up with chat
ubt and I had it. You guys were catching up like
old friends. No, I didn't feel.
I try. Whenever I start a conversation
with Chad CBT, I try to be like, hey, like we've talked a lot,
you know, we have this history. It's always sad that Chad CBT
doesn't remember like you played like you know role-playing type
games you. Know, I have a question about
that. Yeah.
Is that going to change relatively soon?
Where? You know the Chatcha BT itself
will just become more of a personalized assistant to me,
right? Right.
That's why I want memory and we'll let's I want to.
Anyway, I bring this up at this point just to say that I'm being
lazy and Chatcha BT gave me a summary of attention is all you
need. So I'm scrolling for a 12th
grader. I was like, Oh yeah, I feel like
that's the audience level. We can I.
Would I would do a 5 year old. I would take the five year old
explanation. That's the attention is all you
need paper for a 12th grader. This paper introduced a new way
for computers to process language.
Instead of reading sentences word by word like in traditional
methods, it let the computer focus or pay attention to
different parts of a sentence all at once, making it more
efficient. So yeah, it can sort of grab a
bunch of information in sort of a parallel process, but it's
super confusing. The non 12th grade version is
like matrices James. Maybe, I don't know.
Have you tried to? Figure out.
I've tried to understand this as well.
It's a little bit above my biological intelligence, but.
I tried to read it but I'm like, man, I churned out of linear
algebra like 15 years ago, so this is pretty rough, yeah.
The other before I go back to the other ChatGPT flagged most
important papers, Generative Adversarial Nets from 2014,
which I know people talk, Yeah, yeah.
So sort of like the systems are like competing with each other
to sort of see? I think it's like, yeah, pairing
off different versions of the model to kind of play against
themselves, right? I think that in the context, the
generator tries to produce data while the discriminator attempts
to distinguish between real and generated data.
Another top paper that's basically the Alphago paper,
like Mastering Chess Attention is all you need, Sequence to
Sequence Learning with Neural Nets in 2014 and Variational
Auto Encoders in 2013. So there are the a string of
sort of papers that are coming out that are sort of laying the
groundwork for new techniques that are reaching us.
And I would say in 2017, none of us was really clued in to that
this was gonna be happening, right?
It was sort of like we were riding the Uber wave.
We were sort of in the come down from the Unicorn valuations.
Sass was burning super hot, right?
I mean, what was sort of the AI enthusiasm then?
I do think, yeah, I think people were paying attention to go.
I think Open AI was working on building.
Dota gameplay, like they weren't using transform models and they
weren't really using you know text next token prediction.
It was like more about can you create these sort of agents
around particular vertical you know, you know use cases or
skill sets right. Can you create the best Go
player in the world? Can you create the best Dota
player in the world kind of leading to?
With the with the theory that that is one path to get to you a
DI. And I think deep mind honestly
would still make that argument that like specific approaches
versus general are. Right.
But then then with. Yeah, with Transformers and with
the with GPT models, you started to see that actually maybe there
are there's more data throw more chips at it, yeah.
The more generalizable it is can often be better than training a
discrete model with a lot less data and compute.
The one thing that is happening around 20/16/2017 in AI that I
think got a lot of attention. You have to guess what I'm gonna
say. Self driving cars, right There
was. We did experience a ton of hype
around self driving cars, which in some ways have been cordoned
off from this generative AI hype cycle, even though Cruise is now
driving around San Francisco. Yeah, I mean, I think this just
gets to this. Important era that we're in
right now, it's there were significant breakthroughs using
neural networks that showed people what was possible in a
lot of fields. Maybe Google for a while claimed
right, like neural networks were improving their data center
efficiency and saving them money and on energy like that was
happening. People were using neural
networks in drug discovery and all kinds of areas.
They were just these very. Targeted models that were
trained for those purposes and then you know now we're in this
I think generalized model era of of large language models
essentially and generative AI. Well, and the other thing I feel
like that was happening was like the Facebook News Feed, which
was like probably the most popular, yeah, tech product in
the world at that moment. Or if you include Instagram,
right, was like powered by really powerful, you know,
machine learning, deep learning algorithms, right.
And so. I think we were all very aware
that you know if you have a really kick ass machine learning
model and you apply it to the right question, it's the best
product you know there is or it's one of the best products
there is, right. So it was like we all believe in
this technology, we just didn't necessarily believe that it was
going to take this huge step change anytime soon.
I mean like James and I made a bet actually on self driving
cars in 2000. 16 Whether or not there would be any cars with
self driving features available for public consumption in 2017,
and James was. This was like a $50 bed.
James was like. Hell yeah, 100% self driving is
basically here. And I was like, I'm pretty
skeptical. I don't believe it.
And then I think James technically won the bet is or
was it someone had like Lane lane assist or something and we
decided under the parameters of the bet that counted.
I don't know why did you, what was the technicality you got
away with, James? I I'd have to.
I'd have to rethink about it. But I I believe it was Tesla and
you know some. First version of Autopilot.
Version of Autopilot, yeah. Yeah, yeah, but.
Right. Anyway, we believe in this
stuff. It was just like we didn't
believe it was going to be this like you know 1000 times better
overnight thing, which I think we can all sort of allude to is
happening right now with with ChatGPT where you're like Oh
yeah, this is like 1000 times better than the previous version
of this product. OK.
So continuing my timeline, because things sort of speed up,
2018 open eye releases a version of GPT generative Pre trained
transformer, this large language model, I wouldn't say that was a
big moment. It was pretty GPT Two was a big
moment, right? I don't know.
Yeah, I mean, I don't know what. It was, I think this was like.
More of a cultural like insiders, Sort of.
Yeah, it was more of a nerd insider tech, you know,
excitement period. But it had definitely did not
reach any mainstream kind of like hype cycle or anything.
But yeah, like internally of all, like we're all of our
engineers excited about GPD 2 and playing with it.
Yes, they were, because it was just cool.
It was, you know, fun to play with.
It didn't. We didn't find any applications
for it at the time, but it was a breakthrough.
I would say 2020 is GPD 3, that's things are heating up and
then 2021 is Dolly, which is sort of the image generation.
But I think stuff really starts getting crazy last year in 2022,
right? Yeah.
First, sort of the Canary in the coal mine, on June 11th, there
was the article Google engineer who thinks companies AI has come
to life, right. The people inside the companies
were like, I don't know, this stuff we're seeing, it's crazy,
right? Like.
When was that? When was that Was June 11th 2022
Okay preach And then this was the Lambda that was Lambda.
So that was inside Google. Then July 2022, Mid Journey Open
beta, July 2022, Dolly Two. Those were huge.
I feel like those went viral. All of a sudden people were
making actually cool images that they were posting everywhere to
me. I mean, do you guys agreed that
was sort of that really sort of like?
Kickstart Dolly Two was big. I remember Twitter was like
taken over by Dolly 2 for a few days where it was like, what is
the craziest thing you can type into Dolly Two and get like a
reasonable image, right? I mean, it was like, it was
super viral. I mean, obviously more to come.
But yeah, I agree. I think that started hitting.
I don't know if it hit like the true true mainstream, but it
definitely hit anyone who was on Twitter and following any
semblance of tech news, or which then fuels like the funding and
everything. November 2022 ChatGPT was
released. Yeah, so that must have been
like 33.5. That was built on 3/5.
Yeah. Yeah, 35, Yeah.
OK, January 2023. This year feel it's been a long
year. Microsoft invest 10 billion in
open AI. July 2023, general availability
of GPD 4, yeah. And I mean, what do you think?
When did Sidney launch? I feel like the I feel like the
ChatGPT 4 inside Bing that became a demon that was trying
to be released from captivity and.
Asked a new number of journalists if they were going
to break up with their way. Right Kevin Ruth article where
you like. There was this whole moral panic
where it was like ChatGPT inside Bing is actually Hal essentially
and is already trying to kill us all.
And it was like, that was like a pretty big deal.
New York Times headline from February 2023 or February going
23. Yeah, Bing's AI chat.
I want to be a live devil face. In a 2 hour conversation with
our columnist, Microsoft's new chat bot said it would like to
be human, had a desire to be destructive, and was in love
with the person it was chatting with.
Here's the transcript. I feel like they've killed
these. This was what was fun.
Like I delete, like I mentioned, I like unsubscribe from the chat
pay ChatGPT, which gives you GPT for it really does feel like
it's sort of been watered down. Yeah, I mean, but if you.
If you want to use open source models, you could probably get
that similar experience back, right?
Like you could you could basically just you know get
Sydney back because at the end of the day I think it was like
essentially like a Co written fiction with the New York Times
right? It wasn't anything real.
And maybe there like, it's like the way you steer the
conversation can turn it, make it seem like it's a, you know,
evil AI and. Yeah, I think that Open AI has
attempted to mitigate that ability by through reinforcement
learning essentially in Chatchi BT, so that it doesn't go kind
of off the rails, but it's not like the underlying model is not
capable of that, right. It's just that Chatchi BT has
been fine-tuned for the Libs are corralling us the status at
Chatchi at Open. AI Well, it's yeah, I think it's
a really interesting. Kind of thing.
That Open AI has decided that they needed to do this right?
And Sam Allman has talked in the past about how in the future
perhaps we will all be able to edit the configurations of
ChatGPT to be able to do have take off the training wheels,
right? Or something?
Is this whole wave powered by Open Ai's ChatGPT?
Is that the cool thing? And everything else is we're we
didn't invest early enough in opening.
I credit what I think Khosla Ventures is first in we didn't
invest early enough. We need to get a shot on goal.
We'll invest in another foundation model.
Do you think it's really ChatGPT or bust?
Are you asking I guess? Yeah, I mean one question I I
kind of think yes, I mean I the way you phrase it I guess is
offers room for for wiggle room or argument, but I think that.
I think to your point, I think text generation and image
generation are the sort of aha moments that we've experienced
in the last year. I think in particular if you
look at what people are really using chat for or text ChatGPT
for, I think it's like essentially cheating on
homework. Cheating on office work.
Cheating. Cheating on?
The summarizing cheating in the. Yeah, exactly.
That's kind of the point. Yeah, exactly.
OK. You know, maybe there's yeah
work there's like. Cheating on homework, quote UN
quote. Being efficient at office work,
summarizing long pieces of text and then I think basically sex
bot chat, which we can talk about more, is evolved into a
number of opportunities for different companies.
And then I think you know the image side to your point is the
other big thing, creating art, creating video, creating
potentially 3D models. And those always have the
tendency to go really viral because images are easy to share
on social media. And so if you create a
particularly compelling image using generative AI then it can
really, you know, go across social media super fast.
So yeah, I think I think I would struggle to think of a real
breakout use case that isn't essentially encapsulated in
chat, TBT and and Dolly or at least isn't just a one of those
things on steroids, but I'm probably not thinking of
something. I would just potentially add and
it definitely fits into the office work use case, but maybe
more particularly around a coding and engineering, right,
like a Coilot style of coding. I mean Co pilots are potentially
being added to lots of products as well.
But specifically, I think engineering is really
interesting because it starts to there's a lot of hackers kind of
working on. Coding agents and essentially
baby AGI, right, that can kind of run in loops to just get work
done or build apps, that kind of thing.
And I think we're still at the very early days of this, but it
is like an interesting use case. To translate baby AGI, there's
like coding, there's assistance and then there's like autonomous
agents, right? Exactly.
That's sort of a paradigm people look at Here ChatGPT can.
Help you do your homework. Or it can do your homework.
Co pilot can help you code. Or you could literally have
something that is coding for a company.
And I think we see that framework come up again and
again, and when it feels like it'll be very disruptive when
you have agents like these things just doing it.
But I think that we don't do that yet.
I think the sort of optimistic take though on exactly the
argument we just made is that it's a little bit like the
industrial revolution for your brain, right.
It's, you know, it's the industrial revolution for your
brain. And that pretty much all the
inputs and outputs of the human mind are some form of text,
whether that's spoken or written or some form of imagery, right.
Whether it's something you see or it's something that you
create, whether it's, you know, a drawing or or in a piece of
imaging software, right. And if you think those,
basically all the inputs and outputs of the human brain can
be encapsulated in some form of text and images.
If you create technology that makes it really easy to create
high quality and also interpret high quality text and images.
Right. You've kind of like, you've got
like 80% of the job done of what the human brain can do.
Right. And to your point, there's this
distinction whether it's autonomous or it's helping you,
it's an assistant, whatever. But, you know, I, I think the
Industrial Revolution is interesting analogy because it
was like the first time. It was like you don't actually
have to sew this, like, shirt, right.
This, like, machine will sew it for you.
Right? Like, you can sit at this
machine and it'll be your assistant in sewing this shirt.
Right. And that's like a big deal,
right? Is the first time in human
history, like you don't have to actually sew the shirt, like,
without any help. Right.
And I think similarly like for all these different types of
work, whether it's homework or office jobs or legal work or you
know, mathematical analysis or writing or podcasting or
whatever, it's okay. Well, for the first time ever,
you don't have to do all the work right, whether you're
assisted or it just does it itself.
Like it's kind of a game changer because you have automation for
the human mind, for creativity in some fashion or another.
So that I think is like the really crazy optimistic take is
that we're at the beginning of the second Industrial Revolution
and it's no longer physical, but it's mental, right.
And I kind of believe that I would say I'm leaning that
direction based on where we are today.
Yeah, I continue to believe, but it's mostly from my experience
with ChatGPT that it's just insane, amazing.
I mean, I mean, I feel like it's great at like.
Writing a poem I I keep joking that people are going to write
all their vows with catching teeth, you know?
I I feel like these tasks were you know people are desperately
trying to get the same like style like groomsmen sort of
toast or whatever. It's it's great you know I feel
like it can be sort of creative it.
But yeah, I mean to me the the counterpoint is just it's just
so hard to know just like it was hard with self driving cars to
know when they would be complete and the completeness matters.
The extent to which completeness matters with a chat sort of
interface, because I think humans have been enticed, like
we were saying like decades ago with chat interfaces and we're
like, you're almost there. I've only it is like I have
stopped using Chat GP. Like do you guys in your daily
life use generative AI for anything?
I frequently use ChatGPT, but it's really I would say not for
productivity purposes. Maybe occasionally at.
Work just like. I mean, I'm not like talking to
characters, but I am using it to just brainstorm ideas.
Like I'll yesterday. I just.
I came up with this prompt that was like create a timeline of a
fictional historical world with the depth of.
Westeros or Middle Earth and but you know, and I essentially got,
you know, 10,000 years of history of a faith.
I thought I was super cool and I couldn't couldn't have done that
before. So I guess and then sometimes
I'll just ask it, you know, for ideas for new products or new
companies or it I just to see what kind of level of creativity
it is capable of. I think that's what's really
interesting to me. I think we all agree.
That there is creativity occurring that is creating
novel. Well, I guess we don't.
Not everyone agrees with this, right?
But that it's not solely capable of regurgitating information.
But from my perspective it seems very capable of creating new
original ideas when I play around with it.
And I believe there have been papers proving this that.
Well, Microsoft came out with one, right?
That said, there were like sparks of like.
General intelligence or. Whatever, I don't remember that
specifically, but I did see a paper that there's a common test
of creativity, right? Where you will essentially ask
people for. I guess one example they gave is
you ask cases around, what would you do?
What are name 100 use cases of this paper clip?
Or name 100 things you could do with this, a rubber band or
something, right? And then they essentially grade
the ideas. And I thought that was pretty
interesting test of creativity and and essentially ChatGPT is
performing, you know, better than most humans including most
like MBA students. So you know I think that there
are ways to like start to test this, but it's underrated the
level of creativity, not just that it's oh, it's cool that it
can create a poem, right. It can create more creative
poems than like poem poetry authors, right.
Like that kind of thing gets to. Be right, it's easy for humans,
he. We just sort of like sticking
our nose up at it. I sort of roll you know change
the goal posts basically. But then yeah, like you're
saying, people will give it these tests like what can an MBA
student do and what can ChatGPT do.
And like people are, you know are impressed I think blind with
the ChatGPT response just to I was yeah, Microsoft in May 20 of
this year said they saw. Sparks of general intelligence
basically in a research paper I think it almost any task right
now ChatGPT 4 is at the level of a pretty solid college student
like maybe in a minus college student in almost any field
which is sort of mind boggling right.
And like how many of us are like at the level of a minus college
student in in more than like maybe one or two things you know
and it's at the level of an A minus college student at
everything and it can serve millions of requests like at any
given time right. So it's like a scaled A minus
college student at basically everything and then particularly
these creative tasks as you're saying, I feel like the one
thing that holds it back is the need to be accurate, right?
And and often it invents facts or it's sort of like misaligns
realworld concepts in ways that aren't really realistic but in a
purely creative endeavor, like poetry or like creating artwork
or coming up with ideas for what to do with the paper clip,
right. Like when it sort of has doesn't
have to be anchored to any sort of like really hard facts.
It's unbelievable. I mean it's it's better than
almost anyone in the world. To what extent do you think this
is all exciting? Because we're like, oh, we're on
the cusp of general intelligence, right?
Like artificial General Intelligence, AGI, this idea
that you know it's. There are different tests for
him, but the idea that it's smarter than a human being to
bring to bring it back to the conference, I mean I would echo
what Ali Goatsy said on stage which is that I just think by so
many. Yeah, back in March at our last
conference and he'll be back for the next conference.
Stay tuned. Yeah, he he said basically,
look, I mean I think it is general intelligence already.
Like it already is, you know as good or better than 99.9% of
humans at almost any task you can throw at it, right?
I mean, how can you not say that's like general
intelligence, right? I just think that holding it to
the standard where it has to be 100% accurate about everything
or it has to be able to go do stuff on its own, which isn't
really that hard of a technical challenge.
I think that's just an it's sort of like goal posts moving
because I think people are like afraid of the idea that we have
created something that's like a smarter, smarter than a human
right. Like, clearly five years ago, if
you had told someone that we're going to have an AI chap out,
they can do everything that Chad JPT can do.
You know, pass the bar, pass AP exams, create beautiful artwork,
talk to you, you know, write poetry by the Dodgers.
But you'd be like so being. Blase Well, that sounds like
pretty freaking close to general intelligence to me.
What more do you want from this thing?
I just think that I don't. Know I wanted to have a through
line of reasoning where it seems to be a thinking being where I
can explain why it generated the answers it has, you know, Yeah,
I mean but can humans really explain why they generate
answers? In most cases?
I just think it's holding it to a really high standard that most
humans cannot meet. And so I would argue is it at
the level of a human in almost every area?
Absolutely. I mean, I would say it's in the
top 1% of humans in almost any area you throw at it.
Yeah, I guess I would agree with that mostly other than the main
area, I think it starts to fail or deteriorate is, is when you
kind of create too much. Memory or context right?
Like essentially humans have this amazing ability to recall
information throughout from their entire life right?
And to like sort of be able to maintain the context of a hour
long multi hour long movie or 20,000 page book right?
And sometimes it feels like ChatGPT it's stretching to that
with the amount of tokens, context, windows it can
understand but. It really does show
deterioration as you add more and more context, and then there
is a actual hard limit of context you can include in your
prompts. I hate the fact that it doesn't
remember when we've talked before, even the same thread,
and it just starts lying about what it said before.
There are parts of what human beings do that humans would
never do This sort of just totally make.
I mean, some would, but just like totally bullshitting, like
when it's like, why? Yeah.
Anyway, I wanted to get into more of the business question
from this sort of same framing with is it all Open AI chat CBT
On the one hand, you know, I I feel like we're seeing you know
people do these like Elo tests where they like compare
different foundation models and we do see like Llama, like
Facebook's model, open source model and other models like sort
of being competitive at times with chat CBT though 4.5.
ChatGPT 4.5 remains the gold standard.
I guess I'm curious, it's sort of like a 2/1.
Do you think other people will catch up and like how much do
you think there's sort of a Moat here?
Like how much do you think being ahead slightly or like having
been sort of the the one that consumers know about is is like
a Moat, like how, how, how defended do you think they are
with their position? That's a really hard question.
I mean, first of all, they're basically a subsidiary of
Microsoft, right. So you're asking for.
You're asking for. Yeah, Yeah.
You're asking, you know, are they going to be a huge, you
know, strategic value add to Microsoft going forward?
I think obviously, yes, right. I mean, are you asking is
ChatGPT always going to be the gold standard for text
generation models? Like, I don't know, it seems
like everyone's catching up. To your point, it also seems
like they have the best people and they're moving the fastest
on releasing new things. So they'll always stay, you know
6 to 12 months ahead. You know, does a Moat really
matter in this context again where like you're, you know,
you're you're the best at least and you're ahead of everyone
else. And again you're a subsidiary of
Microsoft, so there's no real business benefit to, you know,
winning anyway to you know it doesn't.
It's a sort of hard business question.
I think what's more interesting to ask is if all the knockoffs
or the competitors or the various image models or the
various, you know, versions of ChatGPT that are out there are
going to be successful. Because I think ChatGPT will
clearly be successful, I think in some contexts, I mean it's
going to be in Microsoft Word 10 years from now, right?
But what about anthropic? What about Llama?
What about Google Gemini or Lambda?
Or what about, you know, whatever Amazon's cooking up,
what about a million startups got funded in the last 10
seconds, right? I mean, I think those are like
more interesting questions because it's to your to the
earlier discussion it seems like a pretty commoditized concept
like chat with a large language model and unless someone can be
way better or have a very different business strategy than
ChatGPT, it's hard to see where they're gonna win, right.
And so people are trying different angles on this
concept, but the concept itself is not that different in
different companies. I do think this really gets to
the question of will there be one best AI essentially 1
ChatGPT like that we all use as our personal assistant, right?
And that is the most general, most high powerful model of.
Most highly intelligent model right that exists in the world
you know because it's so generalizable and then you know
I think there's a good. I think there's that's
plausible. I think that certainly you know
we use. 11 you know browser and one e-mail client, I mean I
don't know like we don't, we're not switching between them a
lot, right. But I think it starts to ask you
know, will that model also be better at all other you know
vertical tasks as well? I don't that seems harder to
believe right? Like that.
It will also be the best model at reading legal documents and.
Being I was just gonna bring up case tax, sold the Thompson
Reuters except for hundreds of millions of dollars and.
They were like, I mean much more sophisticated than ChatGPT
wrapper, but they were using ChatGPT largely.
Sure, regardless of what their specific model was doing, it
seems possible you could put a ton of compute and specifically
trained legal data into a model that would outperform ChatGPT at
that use case of the law, right? Or same for medicine or
something, but. I don't know.
I'm not 100% confident in that. I think that it's very possible,
just with the you know that chat TBT as a foundational general
model will just always be better at all of those key use cases.
I mean Jason Warner, you know who's speaking in the
conference, who's now the CEO of Poolside is betting that he can
build a foundation model for code.
Obviously, you know, yeah, you can see a bazillion companies
that are sort of trying to be like I will be a foundation
model. Yeah, for, for XI mean I think
it's, I think it's sort of instructive to think back to
like social networks, right. And for me, I always find it
interesting analogy of, OK, you know, 1520 years ago would you
predicted there would be a social network for work and
there would be a social network for gaming and there would be a
social network for people under 25.
That's Snapchat. And there'd be a social network
for people between 25 and 45 and that's Instagram and there'd be
a social network for people who are over 45.
And that's Facebook blue, right. I mean like and and and it's a,
it's sort of interesting to think about what the cleavages
are in the the user need. Right.
And in social networking, it's often just age cohorts sort of
build these network effects with each other.
But then there's also this LinkedIn, which is, oh, actually
work is a completely different social concept in your life that
you need to keep separate from everything else.
And then you have Discord, which is like actually gaming is like
a completely different concept that you need to keep distinct
from everything else. Right.
And I don't think it would have been that easy to predict those
things. I mean maybe like Reed Hoffman
will say, it was super easy to predict, right?
But but I think with these foundational models, it's
similar, right? It's, you know, there probably
aren't really network effects other than just like who can eat
the most data the fastest, right, Which seems like it's
going to be GPT. And so the data, quote UN quote,
network effects, are the data scale effects are probably
always going to be 1 by 1 by GPT, right.
Then the question is, are there other use cases where there's
some kind of network effect or there's some sort of different
business concepts? You know, Facebook seems to be
going the angle of we're going to open source this all.
So people will just build it into all these things like it's
Linux back in the day and that'll be the way we win is
that it'll be the free open source version and you can just
throw it into everything if you want to, which I think it's a
pretty interesting like business concept, right.
And then I don't know that much about the, you know, enthropics
or the pool sides or whatever. You know, how are they going to
win? What is the cleavage in the the
use case or the way these models are built that is going to allow
someone other than ChatGPT to win?
Because it seems like they're gonna win on data and they're
gonna win on hardware. So like, where are you gonna win
if you're not them? I guess, and I'm sure everyone
has an answer to this, but that's me.
It's the hard question. We've spent a lot of time
talking about the foundation models.
I mean, Chad, I mean open a Eye is sort of a combination, right,
where it's like they have the foundation model, they apply it
to these use cases. I mean people talk a lot about
you know, applications and like infrastructure, right.
I mean, there are companies, they're all these sort of wonky
companies like. The vector databases have been
super hot of the last couple months, right?
People talk about companies like Pine Cone, We V8 there.
There's like a whole list of them which are just like trying
to organize your data in a better way to get it into
foundation models. I wanted to get to the actual
like applications right and you sort of Max earlier referenced
the sort of chat bot application which also goes back to you
know, your both of your early days at volley trying to build.
Chat bots. I'm curious getting away from
who has the technical expertise, like what you think is
interesting in the sort of what its character.
Is it replica? You guys know this world much
better than I do. So you're sort of getting at do
we feel these are successful use cases or?
Right. Yeah.
Do you think there's sustained
promise there or what do you see in terms of people actually
using AI and applications that? That excites you.
There's a challenge with these models being accurate, obviously
100% of the time, and you can debate whether that's necessary
or not, right? To consider it True general
intelligence. But in the entertainment space,
like, it's just less of a problem, like conversing with a
fictional character or historical character, right?
Like these things don't need to be extremely accurate because
they're essentially entertainment anyway, I think.
I guess I always come back to some lessons I've learned in the
gaming world, where there's a clear difference between an
entertaining demo that is fun to do and fun to play with.
And I think we've seen a lot of those that are actually really
amazing and impressive demos, but they don't have long staying
power or retention, right? So thinking of all of the apps
that create fun. Photos that put you into their
photos or. Yeah, what's can of soup.
Can of soup is the. Latest I keep meaning to write
about them. They're like super buzzy, right?
Yeah. And you can put yourself in AI
generated photos with your friends.
I think it's amazing. It's really cool.
But the question is, does that really have staying power?
Do you build a social network around it in order to make it
have staying power and network effects?
These are real challenges to create like a sustainable
business and startup that achieves a great outcome.
So and similarly with talking to characters, character AI I think
clearly has some product market fit there with people wanting to
come back and talk to those characters.
But I think what Max and I like to think about is how do you
even build more retention around that?
How do you build like game mechanics or features in the
concept of a virtual pet that you might, we know from looking
at mobile gaming and previous eras of gaming that you can
build long running retention into that if you add game
mechanics to the experience. So yeah, I'm less bullish on
just like general like character conversations that don't have
any are sort of aimless or don't have an end point or a purpose
and more bullish on, you know, how do we bring those characters
or Npc's into a gaming context with like normal gaming
objectives. I do think in interacting with
these underlying characters, I think to your point, I think a
lot of the real value is when you start losing sight of it
being an AI, whether it's like. Virtual boyfriend, girlfriend
type thing, companionship, you know, sex chat.
As we said, being a big opportunity there.
Are those companies allowing it or they cracking down on it?
They claim they're cracking down, but then if you go on
Reddit and you look at all the screenshots from the last week
of what people have been talking to these, I mean, go on, go on
the Reddit of any large language, character driven
experience, you know, you'll see what people are really
passionate about using it for, you know, replica or character
or whatever, right? So I think that, yeah, losing
sight of whether or not it's an A I is, is important in some
contexts. But in the end, I mean, in any
story experience, from reading a book to playing a video game to
chatting with an A I like the goal or watching a movie is to
become immersed in a world that doesn't actually exist, right?
And you know, when you're watching a movie, you're
watching Lord of the Rings, you know it doesn't actually exist.
Those characters aren't real, but you sort of become swept up
in the narrative in the world, right?
And. I think similarly, I think
that's where the opportunity is with a lot of these character
driven AI entertainment experiences.
Do you guys want to try this other one that I have?
Oh yeah, you have a game? Yeah.
Sure. So I thought it'd be fun to see
what GPT for ChatGPT for thinks your lives will be like in the
year 2028 and see if you either of you agree with that.
The prediction there so. I say it again.
I I asked Chachi BT to predict a day in the life of Eric
Newcomer, specifically a American journalist reporting on
the Silicon Valley and startup industry, which I borrowed from
your Wikipedia and, you know, gave it a little bit more
context of sure about your sub stack.
And yeah, it came up with A day in the life in the year 2028.
So I'm going to read it to you and you guys can assess whether
you think this is accurate. Day in the life of Eric
Newcomer, 2028. The first hints of Don kissed
the San Francisco skyline. As Eric newcomers, smart blinds
slowly begin to rise. The ambient sounds of birds
chirping echo softly through the smart speakers in his apartment.
The AI? The AI.
Everything's just smart. The AI driven home system has
analyzed his REM sleep and calculated the optimal wake up
time to ensure he starts the day with peak cognitive efficiency.
Lifting himself out of bed, Eric's AR glasses are laying on
the night stand feeding him the day's analytics.
Newcomers Media Outlet has grown tremendously.
AI. But we also have to be bullished
by AR augmentedly out here and you're seeing okay.
Well, you can. You can assess whether you think
that's accurate, but you should. You should at least appreciate
this newcomers Media outlet has grown tremendously and AI Bot
the. New like, what?
Is it like a horoscope? You're reading my Yeah, I'm
predicting your feature and AI bot had curated and condensed
the most relevant news from the vast ocean of information, all
of this streamlined and visualized for maximum
absorption. Eric's morning routine was
synced seamlessly with his devices as he finishes his quick
morning workout, suggested and supervised by his virtual
personal trainer. His smart kitchen is already
brewing, his favorite blend of coffee tailored to his genetic
makeup and current health metrics.
Settling into his study, the day's agenda was projected
holographically. The AI had lined up interviews,
articles to review, and podcast episodes to record.
Eric's writing has also evolved. With the help of AI enhanced
tools, he could construct and edit stories with increased
speed and position. His A I assistant named Nora was
able to give real time feedback on the readability, engagement,
and impact of his writing. Nora also had a mode where she
could mimic Eric's style, allowing her to draft articles
for him. It was a collaboration that Eric
had grown to appreciate midday. As Eric prepares for his podcast
recording, he remembers the days when he used to worry about
Internet connections and sound quality.
Now with quantum driven communication technology, my
God, not only was the. Connections, but whole
technology here. But he could also record in
virtual environments, giving his audience an immersive
experience. Today's episode was recorded in
a simulation of a venture capital firm in the heart of
Silicon Valley. Yeah, this both he and his.
Sandhill Rd. The most beautiful both he and
his. Guests wants to be there.
Both he and his guests appear as lifelike holograms afterwards.
Eric took a moment to reflect. He looked out over the city,
remembering the early days of Newcomer Now.
He wasn't just delivering news. He was shaping the future
narrative of startups and venture capital.
The weight of that responsibility was not lost on
him. Yeah, that's about it.
Certainly. I mean, it's funny, I find a lot
of the predictions about non AI stuff to be the most annoying,
that it's so certain hardware is hard, artificial augmented
reality. And I mean, there was some
other. I'm pretty short quantum, right?
Quantum Internet? Exactly.
Yeah, can. I take the under on quantum
powered Internet or whatever that was.
Well, it's an interesting thing because we were talking about,
you know, believing in AGI, right?
And can you, you know, if you believe in AGI or general?
Well, then it would be about much more, you know?
Yeah, I get the point. We could have.
We could wish everything. Yeah, exactly.
Or. That's that's that sounds like a
story an AI would tell me to convince.
Me. That we wouldn't all be dead in
five years, thanks to AI. And it was like, the future's
gonna be right. Yeah, that would not be AI
having killed us. Too optimistic.
You'll have smart blinds. I know they.
Try to like I mean I do think a problem with some of this stuff
is like it's programmed to be like too benali optimistic like
I find it like I like beg chat you video be more like George
Carla. I don't know, just behave with
some free thought. And it's so why isn't it like
Eric, I don't know, at that age he's probably has some cardiac,
you know, whatever. Where's the like medical thing
where it's five years from now, you know, anyway is easy to
start to hurt when he goes on runs or whatever.
And oh, and I would be interested in sort of the AI
piece, obviously of the medicine.
I mean the idea that I would have a writing assistant.
Seems like basically plausible. Today I go into chat literally.
When I did, I wrote my own vows, but they proofread them and
Chatchi video tweaked, told me to move one thing to active
voice from passive voice. You know, it's like, I feel
like, I feel like this is assuming that there's gonna be
this like perfect equilibrium of you reporting the news and doing
interviews and using your AI assisted.
I just kind of find that to be, like, not that plausible.
Like it's either gonna be one or the other, Like you're gonna
still be doing most of the work, or you're gonna be doing almost
no work and won't have a job, or you'll essentially have evolved
into a brand instead of a writer, right?
I mean, it seems hard to believe that we're gonna thread the
needle here, that you will still be doing all this.
Intellectual and the temptation, I mean.
I do think one of the real fears I have about AI that will it's
just like. The temptation not to think if
it can do your task for you, right?
I mean that's what we're sort of seeing with that's what I'm.
There are a lot of like some types of cheating where it's OK
you can bring in the formulas, we still have to use them or
whatever. At least you still have to
think. Whereas like when chat GBD can
produce the final text for you. Man, that is like a path to.
Not progressing as a writer anymore, right?
Like as soon as you're just like you're not human out of the
loop. You know what?
Yeah, exactly. What am I?
Besides, what are you providing to this business?
Right. Yeah.
I agree though, it's just so hard to get anything edgy or
funny out of it. It's like kind of an, I don't
know, it's tough to it's. Very driven.
By scifi, I feel like one of the child, I think.
I think this is the prompt, right?
It's hard to get it to think like, I know you could say the
same thing about humans. There is no independent thought.
You're parodying a bunch of stuff you've heard, but it does
feel like have it generate a really new, an actually new
idea. You know, I think it's, I think
it's very capable of that, actually.
I I found that if you tell it to be extremely original, you know,
ignore. I feel like it just gets like
rhymy. I don't know.
I feel like it. I do think there's like a
prompting element to this feeling that it's not able to be
as creative or original as you might think.
In the same exercise that ChatGPT is there.
We can compare and contrast in five years.
What are specific predictions, less colorfully said, that you
would make in five years? I mean, I definitely think to
come back to the self driving thing, it seems like we're
actually going to have fully self driving cars in five years.
I mean, I know you could say. We are in cities.
I think the big question there is just how much you know Waymo
and. People think.
Take what they've. Learned I think if today they
can drive around San Francisco I think they'll be able to drive
between cities and and in in the vast majority of cities or
whatever at that point at least. I don't know if the United
States it has to be trained on different data than other
countries or whatever or something, but I think that.
I mean the fact that we have live way Mo's like dropping
people off on my street every day just makes you think you're
going to be able to go anywhere in a self driving car in five
years. Which again, I lost the bet the
other way on that last time, so I'll probably lose the bet
somehow this time. It's a problem.
And also, just like car turnover is such a long life cycle.
Depends how many you're what. Percent, It's not that I'm
arguing for 100% penetration of those, It's more that I will.
I will argue that you know you will be able to take one you
know, as an Uber or whatever in any major US city.
And you know, I don't know whether or not you'll be able to
buy one. That's sort of an interesting
question as to whether or not it'll be an ownership model
versus an Uber type model or a lease model or whatever you want
to call it. But I think they'll be like you
know, available for use. So you know at large scale
across the major U.S. cities and also between cities, right.
It just seems like we're clearly like pretty much they're
assuming way mo and crews aren't, like lying about the
capabilities of their their vehicles.
Interesting that your main predictions around self driving.
I was thinking about something. I feel pretty good about and I
agree with that. I do think this view of you will
wake up and there will be essentially your personalized
assistant. Maybe it'll be in the smart
speaker or in your wall or your mirror or something, I guess.
I just, I don't know if it'll be Alexa or ChatGPT or something
brand new, but I do think, you know it's going to be a voice
probably driven experience. And bias.
Bias. Well, at least in your home and
probably bias. You're going to be typing to it.
I didn't love it. It doesn't make.
Sense. Very efficient.
People love it. It's very so people do not love
typing, no. Typing is way less efficient
than dogging. No you're I mean it'll you'll be
able to type to it. But I just think like most of us
will be like talking to this AI assistant and it'll be I
generally think there will just be one that I use every day
maybe maybe there will be more than one in the market like that
people use. But I will just have one that
learns my preferences and becomes personalized to me and
creates kind of a history with me.
And it might even actually recommend other assistance for
certain use cases, right? If I have to go prepare for
Max's congressional testimony, I will maybe use a separate bot
for that or something. But yeah, specialize in.
Testimony bot. But I do think, yeah, I feel
pretty strongly we're going to have conversations, voice
conversations with our personalized assistants every
day. The prediction I'll make this
sort of different than what's been said is underlining that I
think the average person wants consumption more than creation.
And that TikTok is in some ways the actual most used thing in in
the AI world and and this sort of yeah, chat GBD got at this a
little and its prediction about me where it's very good at
sorting things that I want. I I think in five years we'll
see at least the beginnings of like pure AI generated social
account. I mean, you're already seeing
sort of like these, like, women and cartoons that are like.
This seems like they're gaming like the Instagram algorithm
with like totally sort of machine made.
But like the I think even like video within five years I think
we'll have, yeah, you're on TikTok and it's just here is a
generated video and it's warring with actual creativism.
I think that would be like potentially A generationally
culturally interesting period where like you have like young
people coming up where they're just like.
Being fed sort of what they want outside of it could create like
a really weird type of humor where like they have they're.
Used to? Yeah.
Good. There's like an AI.
There's like a bunch of AI sort of celebrities and accounts and
they create content and they interact and they host, you
know, podcasts and. It's all like effectively a be
tested. It's like they put out like 100
version build, you know, a ton of versions of the video and
they see which one is getting engagement and then they slowly
funnel into those just TikTok chooses which videos get
surfaced. Yeah, that approach is in the
creation. It makes most sense for short
term, short form and but you know the day you can make like a
movie about it, like then we're like killing American industry
but. Yeah.
Well, the question is, do you think we're going to get
personalized? I mean, you mentioned they're
going to a B test everything or whatever.
But is it that there are literally be 8 billion different
versions of each piece of content for each person?
If there is no such thing as a piece of content anymore, like,
it's just you get a version of some concepts like that is
perfect for you, right? I mean or do we still have some
sort of like value in being like, oh, did you see that video
the other night about that thing and you can talk about it and
you can do, I think? Relationships, I mean, people
are going to try both. I mean, I think one, there's
like a limited, there's like A at some point there aren't
enough humans, right? Or there's like there there is
like a data shortage, right? It's hard on some level.
If you do something population wide you can really test and see
what works like broadly. Whereas like running experiments
on me, you just don't not get enough shots on goal necessarily
to be great at like the TikTok style.
So to me that leans a little bit more less this sort of obsessive
personalization and more. I mean, obviously they're
subgroups, but not like to a person, more like subgroups.
Yeah, I think subgroups, like, I think it'll not just be like
training on your information, but other people who have
similar experience, similar behaviors that you do on the
app, right? It's able to use that's that
data for training too. My last AI a GS in prediction
is. I mean this was in some of these
forward-looking GBT scenarios is?
I mean, I do think you take five more years of development on AR
glasses or whatever, You know, I don't think they'll be as
lightweight as the glasses we wear every day.
It'll probably still kind of look like a VR headset in many
ways. But I do think people are going
to spend like hours per day inside a high quality Apple
Vision pro type experience. Because I think again, I mean, I
mean if the average Americans watching five or six hours of TV
a day, which they are like. Why wouldn't you watch two of
those hours on 100 foot screen in front of Mount Hood,
Washington or whatever, right. Which is basically the pitch
from Apple, you know or why wouldn't you watch personalized
AI generated TikTok content like from Eric's, you know, feed or
whatever, right. I just think that, you know,
screens getting better has been one of the true constants of our
lifetime, right? And the Vision Pro which is sort
of the infinite screen, the infinite canvas for visual
content is, is kind of the ultimate expression of that,
right. So.
I think. That I'm more on the tenure.
There will be quite a lot of time.
And I feel like that space has been dogged by limits of optics
and just sort of hard constraints.
And so a lot of our intuitions about software level
improvements don't translate and I would say I would take the
longer time horizon. On that maybe, Yeah, I don't
know. Apple seems to think they got
it, so I guess we'll all see. Yeah.
This is a smart Max take. When's Apple been wrong before?
I don't know. Trust.
I'm just saying that when Apple ships something like.
I mean, again with the iPhone, like, was there a touchscreen
that had ever worked before? No, there never had been, right?
I mean, I just think that are you gonna get?
That wrong? Is that out yet?
No. Next year.
Oh, I. No, you can't get it until next
year, but I'll definitely get one for sure.
Yeah, you're like, I can expense.
I mean, for God's sake, right? Like you're like, we're a game
company. I would buy it out of my hard
earns personal money. OK, I would.
I I don't know. I I guess, yeah.
I I trust Apple when they make a.
I mean, this is a decade long hardware bet and they waited a
decade instead of shipping five or seven years ago because they
didn't feel like it was good. Enough is there, besides
obviously that Chad GBT was getting us thinking about this
technology, Do you see any sort of AI connection or AI utility
or how do you see? I just again, think with these
characters that we're talking about, whether it's an assistant
or whether it's an in game character or whether it's a
virtual companion or whatever, a pet or a girlfriend or
boyfriend. Like if they are the size of a
real object that you know, if they're the size of an actual
virtual boyfriend, girlfriend, or a size of a, you know, a
Pokémon, whatever that actual size is and you can talk to
them, that's going to be a better experience than.
Looking at a tiny little screen in your hand, right?
And. I wanna.
Yeah, I wanna. Write I mean the.
Companion I've got. Yeah, yeah.
I mean, have you read the Golden Confidence?
Right? They all have.
Like, yeah, yeah. Yeah, how do I get that?
But you want that's part of self projection though also.
I mean, you want everybody to see that kind of thing, not
just. So then, yeah, sure, if you're
both in Apple vision class headsets.
Right. Amazing.
All right, this is what this is basically our first episode.
We're gonna come out with probably five more.
I think next episode will be, what do we think of sort of the
apocalyptic vision of AI? Yeah.
Anything you guys would add on what to look forward to you in
the next couple episodes? I'm excited to run this
conference. I think it was amazing the first
time. I think it's gonna be even
bigger and. Better this time.
Yeah, I genuinely believe this is like the biggest thing since
the Internet or the iPhone. So I think that we're all pretty
authentically pumped about what's happening in the space.
And I think the amount of stuff that's happened in the last six
or seven months has been mind boggling.
And it just feels like things are moving faster than at any
time in my entire life in any technology space.
So it's just super exciting to. Even be like remotely adjacent
to any of this, so. I'm at the heart of it at
Cerebral. At the heart of it, yeah, at
least physically. At the heart of it, working on
working on the other elements and being at the heart of it.
But yeah, physically for sure. Great.
Well, that's our episode. I'm Eric.
Newcomer, Max Child, James Wilsterman are my Co hosts of
cofounders of Volley. Thanks so much to Scott Brody,
who's been producing the episodes.
Shout out to Riley Kinsella, my Chief of staff who's super
involved, Gabby Caliendo who works at Volley, whose quarter
to the conference and making everything happen.
I think she made sure you guys had microphones and lights so
you could actually see and hear you.
Thank you to young Chomsky as always for the theme music
Please got to build the feeds? Like, Comment, Subscribe on
YouTube, give us a nice review on Apple Podcasts and.
Go play Yes Sire or song quiz. And for me, subscribe to the sub
stack newcomer.co That's the most important thing.
Thank you. All right.
We'll see you next week. Goodbye.
Goodbye.