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AI is Becoming A Major Focus For Venture Capital Investors

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AI is Becoming A Major Focus For Venture Capital Investors

Silicon Valley investors have gone crazy with artificial intelligence after ChatGPT’s seismic breakthrough a year ago. They’re constantly searching for the next big thing amid a sea of hype and overpromising.

With ChatGPT, which can develop computer code, write stories, draw drawings, and more with simple text inputs, OpenAI ignited a generative AI frenzy.

Venture investors have immediately doubled down on artificial intelligence (AI), a new promised land in the never-ending chase for massive tech riches, after being hurt by the failures of cryptocurrencies and other failed Silicon Valley fads in recent years.

After meeting with a number of investment fund directors, Denis Barrier, co-founder of the venture capital firm Cathay Innovation, told AFP that for the large investors, “if it’s not AI, it’s not worth it.”

“Funds are looking to make big moves,” Barrier said.

“And that’s pretty unlikely outside AI in the next few years.”

While budget cuts and layoffs became commonplace at internet companies last year, according to market tracker Crunchbase, startups in the AI space attracted close to $50 billion from investors.

During the initial phase of the AI boom, a lot of capital was allocated to businesses creating the massive language models that enable generative AI capabilities.

PitchBook reports that a record $29 billion was invested in generative AI in 2023.

“Cost lives”

However, the computational requirements of creating foundational models from scratch are quite high, and the majority of funding for this kind of work can only come from the wealthiest investors, like Google, Microsoft, Amazon, and Nvidia, and goes to select groups like Anthropic and OpenAI.

This week, Microsoft announced that Mistral, a burgeoning French startup creating its own models, had raised further funding from some of Silicon Valley’s wealthiest investors, including Nvidia and Andreessen Horowitz, one of the industry’s most assertive companies.

“We believe that any slowdown in AI will cost lives,” wrote the rock star venture capitalist Marc Andreessen last year in his “Techno-Optimist Manifesto.”

However, many venture capitalists have shifted their focus to more narrowly focused AI businesses that have the potential to disrupt the banking, healthcare, energy, and other industries because they are intimidated by the cost of entry.

Recently, Bioptimus, a French biotech startup using AI to develop novel medications, received funding from Cathay.

Barrier indicated in his downtown office with a view of San Francisco Bay that Cathay looked at engineering skill, data access, cost restrictions, and a goal to alter a sector while searching for promising startups.

Barrier stated, “You have to have a little faith.”

‘For real’

Last week, Loora, an Israeli firm that teaches English through generative AI, raised $12 million.

With a price tag that is comparable to a Netflix membership, over 15,000 users have downloaded Loora’s mobile applications, which teach English through conversation.

From his Tel Aviv headquarters, Loora co-founder Roy Mor told AFP that simply embracing AI is not going to attract investors.

According to him, what businesses really need is more of the appropriate data to enhance the app and user experience.

“I think the use cases where AI really brings value, where it solves problems, are not yet widespread,” he stated.

As of right now, the business sector holds the greatest promise for returns on investment, which is why a lot of startups are concentrating there.

The leader in large-scale data analysis, or the core of artificial intelligence, Alembic, recently raised $14 million.

The startup assesses marketing campaign efficacy using methods initially created to analyze health data during the coronavirus outbreak.

Jeffrey Katzenberg, the co-founder of DreamWorks and former chairman of Walt Disney Studios, founded WndrCo, a venture capital firm that is supporting Alembic.

“AI is real,” the former high-ranking Hollywood official told AFP.

“It’s not an evolution, but a revolution, a positive revolution.”

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Threads uses a more sophisticated search to compete with Bluesky

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Instagram Threads, a rival to Meta’s X, will have an enhanced search experience, the firm said Monday. The app, which is based on Instagram’s social graph and provides a Meta-run substitute for Elon Musk’s X, is introducing a new feature that lets users search for certain posts by date ranges and user profiles.

Compared to X’s advanced search, which now allows users to refine queries by language, keywords, exact phrases, excluded terms, hashtags, and more, this is less thorough. However, it does make it simpler for users of Threads to find particular messages. Additionally, it will make Threads’ search more comparable to Bluesky’s, which also lets users use sophisticated queries to restrict searches by user profiles, date ranges, and other criteria. However, not all of the filtering options are yet visible in the Bluesky app’s user interface.

In order to counter the danger posed by social networking startup Bluesky, which has quickly gained traction as another X competitor, Meta has started launching new features in quick succession in recent days. Bluesky had more than 9 million users in September, but in the weeks after the U.S. elections, users left X due to Elon Musk’s political views and other policy changes, including plans to alter the way blocks operate and let AI companies train on X user data. According to Bluesky, there are currently around 24 million users.

Meta’s Threads introduced new features to counter Bluesky’s potential, such as an improved algorithm, a design modification that makes switching between feeds easier, and the option for users to select their own default feed. Additionally, it was observed creating Starter Packs, its own version of Bluesky’s user-curated recommendation lists.

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Apple’s own 5G modem-equipped iPhone SE 4 is “confirmed” to launch in March

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Tom O’Malley, an analyst at Barclays, recently visited Asia with his colleagues to speak with suppliers and makers of electronics. The analysts said they had “confirmed” that a fourth-generation iPhone SE with an Apple-designed 5G modem is scheduled to launch near the end of the first quarter next year in a research note they released this week that outlines the main conclusions from the trip. That timeline implies that the next iPhone SE will be unveiled in March, similar to when the present model was unveiled in 2022, in keeping with earlier rumors.

The rumored features of the fourth-generation iPhone SE include a 6.1-inch OLED display, Face ID, a newer A-series chip, a USB-C port, a single 48-megapixel rear camera, 8GB of RAM to enable Apple Intelligence support, and the previously mentioned Apple-designed 5G modem. The SE is anticipated to have a similar design to the base iPhone 14.

Since 2018, Apple is said to have been developing its own 5G modem for iPhones, a move that will let it lessen and eventually do away with its reliance on Qualcomm. With Qualcomm’s 5G modem supply arrangement for iPhone launches extended through 2026 earlier this year, Apple still has plenty of time to finish switching to its own modem. In addition to the fourth-generation iPhone SE, Apple analyst Ming-Chi Kuo earlier stated that the so-called “iPhone 17 Air” would come with a 5G modem that was created by Apple.

Whether Apple’s initial 5G modem would offer any advantages to consumers over Qualcomm’s modems, such quicker speeds, is uncertain.

Qualcomm was sued by Apple in 2017 for anticompetitive behavior and $1 billion in unpaid royalties. In 2019, Apple purchased the majority of Intel’s smartphone modem business after the two firms reached a settlement in the dispute. Apple was able to support its development by acquiring a portfolio of patents relating to cellular technology. It appears that we will eventually be able to enjoy the results of our effort in four more months.

On March 8, 2022, Apple made the announcement of the third-generation iPhone SE online. With antiquated features like a Touch ID button, a Lightning port, and large bezels surrounding the screen, the handset resembles the iPhone 8. The iPhone SE presently retails for $429 in the United States, but the new model may see a price increase of at least a little.

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Google is said to be discontinuing the Pixel Tablet 2 and may be leaving the market once more

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Google terminated the development of the Pixel Tablet 3 yesterday, according to Android Headlines, even before a second-generation model was announced. The second-generation Pixel Tablet has actually been canceled, according to the report. This means that the gadget that was released last year will likely be a one-off, and Google is abandoning the tablet market for the second time in just over five years.

If accurate, the report indicates that Google has determined that it is not worth investing more money in a follow-up because of the dismal sales of the Pixel Tablet. Rumors of a keyboard accessory and more functionality for the now-defunct project surfaced as recently as last week.

It’s important to keep in mind that Google’s Nest subsidiary may abandon its plans for large-screen products in favor of developing technologies like the Nest Hub and Hub Max rather than standalone tablets.

Google has always had difficulty making a significant impact in the tablet market and creating a competitor that can match Apple’s iPad in terms of sales and general performance, not helped in the least by its inconsistent approach. Even though the hardware was good, it never really fought back after getting off to a promising start with the Nexus 7 eons ago. Another problem that has hampered Google’s efforts is that Android significantly trails iPadOS in terms of the quantity of third-party apps that are tablet-optimized.

After the Pixel Slate received tremendously unfavorable reviews, the firm first declared that it was finished producing tablets in 2019. Two tablets that were still in development at the time were discarded.

By 2022, however, Google had altered its mind and declared that a tablet was being developed by its Pixel hardware team. The $499 Pixel Tablet was the final version of the gadget, which came with a speaker dock that the tablet could magnetically connect to. (Google would subsequently charge $399 for the tablet alone.)

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