Breaking News: Apple Abandons Car Project, Google AI Falters, Bumble Experiences Setback

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Elsewhere, Mistral, the French AI startup, launched a new model to rival OpenAI’s GPT-4 — and its own cheekily named chatbot dubbed Le Chat. NewsApple car canceled: Apple has scuttled its secretive, long-running effort to build an autonomous electric car. Bumble stumbles: Bumble posted weak Q4 results showing a $32 million net loss and $273.6 million in revenue — below Wall Street expectations. Google’s AI goes awry: Google has apologized for an embarrassing AI blunder this week: An image-generating model that injected diversity into pictures with a farcical disregard for historical context. PodcastsOn Equity, the crew talked through startup news from Microsoft and Mistral AI, Thrasio and Glean — and also covered happenings over at COTU Ventures and Zacua Ventures.

Elon Musk Takes Legal Action Against OpenAI and Sam Altman for Breaching Non-Profit AI Agenda

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The lawsuit says that OpenAI has shifted to a for-profit model focused on commercializing its AGI research with Microsoft, the world’s most valuable company. “This was a stark betrayal of the Founding Agreement.”The lawsuit follows Musk voicing displeasure with OpenAI’s shift in priorities in the past year. For the first several years, Musk was the largest contributor to OpenAI, the lawsuit adds. He alleges OpenAI and Microsoft have improperly licensed GPT-4 despite agreeing OpenAI’s AGI capabilities would remain non-profit and dedicated to humanity. Musk is seeking to compel OpenAI to adhere to its original mission and bar from monetizing technologies developed under its non-profit for the benefit of OpenAI executives or partners like Microsoft.

New Plugins and Skills Enhance Copilot Intelligence in Microsoft’s Windows 11

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You may not have a Copilot key on your PC’s keyboard yet, but if you’re a Windows 11 user, you’ll soon be able to use Copilot for a lot more everyday tasks on your desktop. Starting today, Microsoft is adding skills that will allow the Copilot to change more Windows 11 settings for you and plugins for services like OpenTable, Shopify and Kayak. Restaurant reservations through OpenTable, travel reservations through Kayak and a Shopify integration are surely only the start here, too. At the same time, Microsoft is now also integrating more AI features into its existing Windows apps. The second is a feature that automatically removes silence from videos in the Clipchamps video editor.

Microsoft’s Latest Venture: A Significant Investment in Another AI Firm

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Listen here or wherever you get your podcasts. Hello, and welcome back to Equity, the podcast about the business of startups, where we unpack the numbers and nuance behind the headlines. This is our Wednesday show, focused on startup and venture capital news that matters. We pull the top stories from the week thus far, and give them the Equity treatment to put them into proper context. On the show today:

Mistral AI receives $16 million investment from Microsoft

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But Microsoft and Mistral AI buried the news — or at least an important part. At the time, the company raised €385 million (around $415 million) with Andreessen Horowitz (a16z) leading the investment round. Unlike previous Mistral AI releases, Mistral Large isn’t open source. With this investment, Microsoft is now an investor in OpenAI’s capped profit subsidiary and Mistral AI. As for Mistral AI, the so-called European AI champion looks more and more like its American competitors with a closed-source approach and a long list of American backers.

Microsoft Unveils ‘AI Accessibility Guidelines’ in Response to OpenAI Rivalry Fears

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It also includes a commitment to let customers change cloud providers, or services within the cloud, if they choose to. It also details a focus on building cybersecurity around AI services; attention to building data centers and other infrastructure in an environmentally-sound way; and education investments. Brad Smith, the president and vice chair of Microsoft, announced the framework today at the Mobile World Congress in Barcelona. The announcement comes at the same time that Microsoft is coming under increasing regulatory scrutiny for its $13 billion investment in OpenAI, which currently gives it a 49% stake in the startup that is leading the charge for generative AI services globally. In January, the European competition watchdog said that it was assessing whether the investment falls under antitrust rules.

Mistral AI unveils cutting-edge competitor to GPT-4 alongside revolutionary chat assistant

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Paris-based AI startup Mistral AI is gradually building an alternative to OpenAI and Anthropic as its latest announcement shows. Founded by alums from Google’s DeepMind and Meta, Mistral AI originally positioned itself as an AI company with an open-source focus. Mistral AI’s business model looks more and more like OpenAI’s business model as the company offers Mistral Large through a paid API and usage-based pricing. Mistral AI claims that it ranks second after GPT-4 based on several benchmarks. The first benefit of that partnership is that Mistral AI will likely attract more customers with this new distribution channel.

PhonePe Launches Android App Store in India Featuring Amazon, Meta, and Microsoft Apps

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Microsoft, Amazon and Meta are among the top brands whose apps are available on the Indian fintech PhonePe’s Indus Appstore, an app store for the Android mobile operating system, launched Wednesday in challenge to Google’s monopoly in its largest market by users. To fight Google Play Store, PhonePe has armed Indus Appstore with a range of unique and personalized features and developer-friendly terms. Indus Appstore supports 12 regional languages (as well as English) and round the clock support service. PhonePe is making the app store available to download to consumers from its website. “Indus Appstore embodies our commitment to building a truly inclusive digital ecosystem where every Indian user feels at home.”Ivan Mehta contributed to this report.

Russian Hackers Also Targeted Other Organizations, According to Microsoft

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On Friday, Microsoft revealed that it had been the victim of a hack carried out by Russian government spies. In a new blog post, Microsoft said that “the same actor has been targeting other organizations and, as part of our usual notification processes, we have begun notifying these targeted organizations.”At this point, it’s unclear how many organizations the Russian-backed hackers targeted. Microsoft, however, said that the hackers specifically targeted the company’s senior executives, as well as people who work in cybersecurity, legal, and other departments. The hackers were able to steal “some emails and attached documents.”Curiously, the hackers were interested in finding out information about themselves, specifically what Microsoft knows about them, the company said. On Thursday, Hewlett Packard Enterprise (HPE) disclosed that its Microsoft-hosted email system was hacked by Midnight Blizzard.

Cutbacks at Microsoft’s Activision Blizzard and Xbox Divisions Claims 1,900 Jobs.

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Three months after completing its $68.7 billion acquisition of gaming company Activision Blizzard, Microsoft is laying off 1,900 employees in its gaming divisions. This amounts to about 8.6% of 22,000 Microsoft employees in gaming. Blizzard president Mike Ybarra also announced he will step down, now that the acquisition is finalized. According to game developer and consultant Rami Ismail, about 5,600 gaming employees have been laid off so far in 2024. Thats more than half of all gaming layoffs from 2023.