Author: Eldin Yovlz

  • A Major Rocket Explosion Sparks Talk of Delays — Are Musk’s Mars Goals More Distant Than They Appear?

    A Major Rocket Explosion Sparks Talk of Delays — Are Musk’s Mars Goals More Distant Than They Appear?

    The explosion of a SpaceX Starship vehicle during a routine ground test Wednesday sent out a shock wave of fire and smoke that appeared to engulf the company’s testing facilities in Starbase, Texas. The mishap raised questions about the company’s ability to hash out significant design and engineering challenges on a vehicle considered crucial to SpaceX’s founding goal of eventually carrying convoys of people to Mars.

    When SpaceX CEO Elon Musk spoke to employees in South Texas in late May, aiming to once again stoke support for his Mars ambitions, he emphasized the metric by which he would gauge success: “Progress is measured by the timeline to establishing a self-sustaining civilization on Mars.”

    Later in his speech — which Musk gave two days after the company’s most recently launched Starship prototype failed upon reentry, marking the third premature ending for a test flight this year — he spelled out the exact timeline SpaceX would chase. The road map hinges on specific deadlines dictated by the laws of physics, thanks to just how far Earth is from the red planet.

    The distance between Earth and Mars can range from about 35 million miles to 250 million miles (56 million kilometers to 400 million kilometers), depending on where each planet lies in its orbital path around the sun. To save time and fuel costs, missions aiming to visit the red planet must wait until it’s at its ideal point relative to Earth — prime alignment opportunities, otherwise known as a “Mars transfer windows,” that span a few weeks and occur only about every 26 months.

    Missions save time and fuel costs by launching when Mars is at its ideal point relative to Earth. (SpaceX)

    The next window, during which the travel time to Mars is cut down from over a year to just six to nine months, is coming up in late 2026. Musk’s road map suggests SpaceX hopes to send up to five uncrewed Starship vehicles loaded with cargo to Mars during that time. But there are several major concerns that SpaceX will need to address before its first cargo ship sets out for the red planet, and Wednesday’s explosion — Starship’s fourth so far this year — may be evidence of that.

    Anticipated upgrade for Starship

    Musk spoke to the feasibility of reaching Mars in 2026 during that May speech, saying that he imagined there was only a “50/50 chance” SpaceX could get a Starship spacecraft to Mars next year.

    Before the 2026 Mars transfer window opens, SpaceX plans to debut another upgraded version of the Starship spacecraft and Super Heavy rocket booster — which together make up the most powerful launch system ever constructed.

    On the new Starship system, both the first-stage booster and upper-stage ship will be slightly larger and together will be able to carry 661,387 pounds (300 metric tons) of propellant.

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    The SpaceX Starship rocket launches on its ninth uncrewed test flight from Starbase, Texas, on May 27. (Sergio Flores/AFP/Getty Images)

    It’s a substantial upgrade similar to the one SpaceX debuted earlier this year, Starship Version 2, which added 25% more propellant capacity compared with earlier test flight models.

    And SpaceX has struggled to get Version 2 to perform as expected: The first two test flights, carried out in January and March, each failed minutes after takeoff, raining debris near populated islands east of Florida.

    The last test flight in May made it farther into flight, but the Starship spacecraft lost control before reentry, leading to a nail-biting, uncontrolled descent into the Indian Ocean.

    And Wednesday’s explosion during a routine ground test raises even more concerns about how long it will take SpaceX to fine-tune Starship’s design and guarantee it can transport cargo or humans safely. The company hasn’t revealed how much of a setback it might be for the vehicle or its launch facilities.

    Preliminary data suggested the explosion was caused by a gas tank that exploded, Musk said in a social media post. The tank “failed below its proof pressure,” he said, meaning that prior stress tests and the known properties of the tank suggested it should have survived the scenario. It’s potentially a unique problem that has never been observed before.

    During his May 29 speech, Musk emphasized that introducing even more upgrades and further stretching Starship’s size is crucial to long-term success.

    “It takes three major iterations of any major new technology to have it really work well,” Musk told employees during his Starship update.

    An unprecedented challenge

    Musk has said he hopes the updated Starship will make its flight debut by the end of the year.

    But even if the new version pulls off a pristine test flight along the same suborbital route where SpaceX has carried out previous Starship test missions, it won’t guarantee the vehicle is ready for an interplanetary excursion.

    That’s because, even with added fuel capacity, Starship must be topped off with more propellant after it reaches space to make the long trip to Mars.

    SpaceX plans to do this by launching a series of tankers, or Starship vehicles designed to carry batches of fuel and oxidizer. Those tankers would rendezvous with the Starship while it idles in Earth’s orbit, transferring thousands of pounds of propellant and delivering the fuel the vehicle needs to continue its journey deeper into the solar system.

    Notably, transferring fuel between two vehicles in space has never been done before.

    “We’ve never done that. Nobody’s done that — transferring fuel from one spacecraft to another in orbit autonomously,” said Bruce Jakosky, a professor emeritus of geological sciences at the University of Colorado Boulder’s Laboratory for Atmospheric and Space Physics.

    “That’s difficult,” Jakosky added, especially considering the Starship vehicle runs on cryogenic fuels — essentially oxygen and methane that are kept at temperatures so cold they liquify. And in the microgravity environment of orbit, that fuel can float about in its tank rather than settling in one place. So, among myriad other technical difficulties, SpaceX will likely have to devise pumps or motors that can effectively funnel the fuel from one ship to another.

    Currently, it’s not even clear how many tankers SpaceX would need to launch to give one Starship vehicle enough gas for a trip to Mars. (In prior estimates, NASA personnel and third-party experts projected it may take roughly one dozen Starship tankers for a moon mission.)

    In his speech, Musk said that he believed in-space fuel transfer would be “technically feasible.”

    SpaceX will not attempt to carry out its first tanker flight test before next year, Musk added.

    Barriers to reentry

    Even after SpaceX sorts out the propellant transfer problem, they’ll face another significant technological question: How will Starship survive the trip down to the surface of Mars?

    Musk last month called this issue “one of the toughest problems to solve.”

    “No one has ever developed a truly reusable orbital heat shield so that is extremely difficult to do,” he said. “This will be something that we’ll be working on for a few years, I think, to keep honing.”

    Vehicles that need to safely land on planetary bodies while traveling at orbital speeds must have a component called a heat shield — a special coating on the vehicle’s exterior that serves as a buffer to the scorching temperatures generated by the process of entering a planet’s atmosphere.

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    Workers survey the SpaceX Starship rocket on March 3 ahead of its eighth uncrewed test flight. (Brandon Bell/Getty Images)

    On Mars, one crucial problem is the air: It’s almost entirely made up of carbon dioxide.

    When Starship slams into Mars’ atmosphere, it will violently compress the air in front of it and create searing temperatures. And the conditions of reentry are so intense that the process literally rips electrons away from atoms and splits molecules, turning the carbon dioxide into carbon and oxygen — the latter of which may start to “oxidize” or essentially incinerate the spacecraft’s heat shield, Musk said.

    Reentry on Mars will actually produce more heatshield-destroying oxygen than the process of returning to Earth, Musk noted. Starship’s heat shield will ultimately need to be durable enough to survive both types of reentry, potentially multiple times.

    The human problem

    While the odds of SpaceX solving all the necessary technical quandaries in time to send a cargo-filled Starship to Mars at the end of next year are likely small, even larger problems must be solved later down the road.

    If SpaceX wants to send humans to the red planet, for example, the company must figure out how to ensure Starship’s exterior can keep people safe from the deadly radiation that will shower down throughout the six-month journey. Life support systems with plenty of breathable air would need to be on board.

    As Musk put it, every single human need must be accounted for. “You can’t be missing even, like, the equivalent of vitamin C,” he said.

    Once a Starship vehicle reaches its destination, it would likely need to top off its fuel at a Martian depot before returning home — another feat that presents enormous technological challenges.

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    Starship’s heat shield will need to be durable enough to survive a trip to the surface of Mars. (NASA/JPL/Cornell)

    The idea that enough infrastructure will exist on Mars by 2029 — or 2031, as Musk has said in prior social media posts — to make such a crewed mission possible is outlandish.

    Still, industry experts say SpaceX’s bold ambitions spark both excitement and skepticism.

    “I am a fan of what SpaceX is trying to do. I totally subscribe to this vision of a multi-planetary society,” said Olivier de Weck, the Apollo Program Professor of Astronautics and Engineering Systems at the Massachusetts Institute of Technology. “But it’s a logistical problem first and foremost. And what’s lacking to me is the thought about the cycling, the fuel production — and the return to Earth.”

    But Phil Metzger, a planetary physicist with the Florida Space Institute, emphasized that SpaceX does tend to deliver on its promises, even if it’s a few years behind schedule.

    “I feel like they got unlucky on some of their (Starship test flight failures), having the types of failures they had the last three in a row,” Metzger said. “Considering their design and development philosophy, I think they’re still within the window of expected outcomes.”

    But, Metzger added, “we’re reaching the point where you start to worry.”

  • Trump Gives TikTok Another 90-Day Extension to Comply With Sale-or-Ban Order

    Trump Gives TikTok Another 90-Day Extension to Comply With Sale-or-Ban Order

    TikTok just got another lifeline from the White House, with President Donald Trump set to delay enforcement of the sale-or-ban law by another 90 days.

    “President Trump will sign an additional Executive Order this week to keep TikTok up and running,” Karoline Leavitt, White House press secretary, said in a statement on Tuesday. “As he has said many times, President Trump does not want TikTok to go dark. This extension will last 90 days, which the Administration will spend working to ensure this deal is closed so that the American people can continue to use TikTok with the assurance that their data is safe and secure.”

    On Thursday, Trump confirmed that he’d signed an executive order delaying enforcement of the law by 90 days in a Truth Social post. The deadline for TikTok parent company ByteDance to hand over control of TikTok’s US operations is now September 17.

    It’s been about five months since a law requiring TikTok to be banned in the United States unless it’s sold off by its China-based parent company technically went into effect. But thanks to President Donald Trump’s promises not to enforce the law, neither of those things have happened, aside from an approximately 14-hour blackout in January. Tuesday’s announcement marks Trump’s third extension of the ban.

    The announcement means that the app will remain accessible for its 170 million American users despite the legislation that passed last year with bipartisan support over concerns that TikTok’s Chinese ownership poses a US national security risk. And it comes as both the United States and China seek leverage in tense trade talks, in which TikTok appears to have become a bargaining chip.

    The TikTok sale-or-ban law went into effect on January 19 after it was signed by former President Joe Biden last year. TikTok briefly took itself offline, sparking outcry from creators, but quickly came back after Trump signed an order delaying the ban’s enforcement by 75 days. It was one of his first acts as president, made in hopes of reaching a deal to keep the app “alive.”

    In April, a deal that would have transferred majority control of TikTok’s US operations to American ownership was nearly finalized. But it fell apart after Trump announced additional tariffs on China, forcing the president to announce another 75-day delay to keep the app operational in the United States.

    “There are key matters to be resolved. Any agreement will be subject to approval under Chinese law,” TikTok parent company ByteDance said after Trump’s tariff policy stalled progress on the deal in April.

    That pause was set to expire on June 19, before Trump’s Thursday executive order. .

    Trump’s latest enforcement delay raises questions about the status of a deal that could secure TikTok’s long-term future in the United States. The Chinese government has offered little public indication that it would be willing to approve a sale beyond suggesting that any deal could not include TikTok’s “algorithm,” which has been called the app’s secret sauce.

    In a statement on Thursday, TikTok indicated that it is still in talks with the office of Vice President JD Vance — who Trump appointed to oversee the effort — on a deal that would secure the popular short-form video platform’s future in the United States.

    “We are grateful for President Trump’s leadership and support in ensuring that TikTok continues to be available for more than 170 million American users and 7.5 million U.S. businesses that rely on the platform as we continue to work with Vice President Vance’s Office,” TikTok said in a statement.

    The new extension comes after the United States and China agreed on a framework to ease export controls, a move that’s expected to ease tensions and prevent further escalation of export and other restrictions between the two countries. It’s not clear whether a TikTok deal is included in the framework, but cooperation between the two sides could make an agreement to transfer control of the app to a US buyer more likely.

    Earlier on Tuesday, Trump told reporters that a TikTok deal would “probably” require approval by the Chinese government and said, “I think we’ll get it.”

    “I think President Xi will ultimately approve it, yes,” the US president added.

    The deal that had been in the making earlier this year would have involved several American venture capital funds, private equity firms and tech giants investing in a company that would control TikTok’s US operations. TikTok’s China-based owner, ByteDance, would have retained a 20% stake in the spinoff company — a key stipulation of the law.

    Several other high-profile bidders had also put their hands up to acquire the platform, including a group led by billionaire Frank McCourt and “Shark Tank”-famous investor Kevin O’Leary, Amazon, AI firm Perplexity and a separate group of investors that included YouTube and TikTok star Jimmy Donaldson, known online as MrBeast.

    It was Trump who first tried to ban TikTok during his previous administration, but he has said he changed his mind after he “got to use it.” TikTok CEO Shou Chew attended Trump’s inauguration, seated on stage alongside Cabinet secretaries and other tech CEOs.

  • Trump Threatens 25% Tariff on Apple, Says Samsung and Other Tech Firms Could Be Targeted Next

    Trump Threatens 25% Tariff on Apple, Says Samsung and Other Tech Firms Could Be Targeted Next

    President Donald Trump on Friday demanded Apple and other smartphone makers like Samsung make their phones in the United States or face a 25% tariff.

    “I have long ago informed Tim Cook of Apple that I expect their iPhone’s that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else,” Trump posted Friday morning on Truth Social. “If that is not the case, a Tariff of at least 25% must be paid by Apple to the U.S.”

    Speaking to press in the Oval Office on Friday after signing executive orders, Trump said the tariff would apply to any phone maker selling devices in the US.

    “It would be more. It would be also Samsung and anybody that makes that product,” Trump told reporters. “Otherwise it wouldn’t be fair.”

    Trump last week during his Middle East trip said he was displeased with Cook, Apple’s CEO, over the company’s plan to manufacture iPhones set to be sold in the United States at newly built plants in India.

    Over the past several years, Apple had been working to diversify its production capabilities. Some iPhone production had already moved to India, and Cook on Apple’s earnings call with investors earlier this month said he expected “the majority of iPhones sold in the US will have India as their country of origin.”

    On that call, Cook said he expected Apple would face a tariff burden of up to $900 million this quarter. However, it could have been significantly worse: Apple and other US tech companies scored a big win last month when Trump exempted electronics from his massive tariffs on China.

    Unlike Apple, Samsung doesn’t rely on China for smartphone production. The South Korea-based tech giant closed its last phone factory in China in 2019 after losing market share to domestic rivals, though it still has operations there. Sources within Samsung previously told CNN that the vast majority of its smartphone manufacturing takes place in South Korea, Vietnam, India and Brazil.

    Despite lowering his tariff to at least 30% on most Chinese goods — down from 145% earlier this month — a 10% universal tariff remains on the majority of goods entering the United States. Roughly 90% of Apple’s iPhone production and assembly is based in China, according to Wedbush Securities’ estimates.

    Trump met with Cook in Riyadh at the beginning of the president’s Middle East trip last week. In Qatar, he called out Cook for his plan to build US-bound iPhones in India.

    “I had a little problem with Tim Cook,” Trump said last week in Qatar. “I said to him, ‘Tim, you’re my friend. I treated you very good. You’re coming in with $500 billion.’ But now I hear you’re building all over India. I don’t want you building in India.’”

    Cook met with Trump once again at the White House on Tuesday, an administration official told CNN. The official did not divulge the subject matter of the meeting.

    Treasury Secretary Scott Bessent said in an interview with Fox News on Friday morning that Trump is trying to “bring back precision manufacturing to the US.”

    “I think that one of our greatest vulnerabilities are these, is this external production, especially in semiconductors, and a large part of Apple’s components are in semiconductors,” Bessent said. “So we would like to have Apple help us make the semiconductor supply chain more secure.”

    Some of Apple’s chips are already made in the United States, thanks to its partnership with TSMC, which recently opened a chipmaking plant in Arizona. The company did not immediately respond to a request for comment.

    ‘Those jobs aren’t coming back’

    The world’s most valuable publicly traded company is flush with cash and rakes in tremendous profit — more than any company in history. But Apple has long contended that it cannot manufacture iPhones in America.

    Apple has invested billions of dollars training millions of skilled engineers abroad. China and India, with their massive populations, simply have more skilled engineers than the United States does. And it costs Apple significantly less to pay those workers.

    Steve Jobs, Apple’s late CEO, famously brought up the issue during an October 2010 meeting with former President Barack Obama. He called America’s lackluster education system an obstacle for Apple, which needed 30,000 industrial engineers to support its on-site factory workers.

    “You can’t find that many in America to hire,” Jobs told Obama, according to his biographer, Walter Isaacson. “If you could educate these engineers, we could move more manufacturing plants here.”

    In a 2012 interview with tech journalists Kara Swisher and Walt Mossberg, Apple CEO Tim Cook said he agreed with Jobs’ assessment. When asked if the day would ever come when an Apple product is made in the United States, he said: “I want there to be … and you can bet that we’ll use the whole of our influence on this.”

    The notion Apple can reshore iPhone production is a “fictional tale,” Dan Ives, global head of technology research at financial services firm Wedbush Securities.

    US-made iPhones could cost more than three times their current price of around $1,000, he said, because it would be necessary to replicate the highly complex production ecosystem that currently exists in Asia.

    “You build that (supply chain) in the US with a fab in West Virginia and New Jersey, they’ll be $3,500 iPhones,” he said, referring to fabrication plants, or high-tech manufacturing facilities where computer chips that power electronic devices are normally made.

    And even then, it would cost Apple about $30 billion and three years to move just 10% of its supply chain to the US to begin with, Ives told Burnett.

    Ives reiterated that stance in a statement following Trump’s Friday tariff threat, saying, “the concept of Apple producing iPhones in the US is a fairy tale that is not feasible.” He estimated moving all of Apple’s iPhone production to the United States would take five to 10 years.

    An additional 25% tariff on Apple products could result in higher prices for US iPhone buyers. Rumors have already been swirling that Apple is considering raising prices when it releases its new lineup of iPhones in the fall — a move that could further irk Trump, although the company will likely avoid directly attributing the increases to tariffs.

    Gene Munster, managing partner at Deepwater Asset Management, estimates it would be difficult for Apple not to raise iPhone prices if it faces tariffs of 30% or higher.

    “Anything below 30, they will probably carry the vast majority of that increase,” he said. “But I think at some point they’re going to have to start to share it.”

    While moving iPhone production to the United States may not be possible, Apple did announce a $500 billion investment to expand its US facilities earlier this year, in an apparent effort to appease Trump.

    The company said the investment would create a new facility to produce servers — previously made outside the United States — in Houston to support Apple Intelligence, its new brand of artificial intelligence products. It will also expand data center capacity in several states, and plans to invest in corporate facilities and production of Apple TV+ shows in 20 states, among other efforts.

  • iPhone Price Could Soar to $3,500 if Made in the U.S.

    iPhone Price Could Soar to $3,500 if Made in the U.S.

    US President Donald Trump boasted “jobs and factories will come roaring back” when he unleashed unprecedented tariffs around the world during his “Liberation Day” address last month.

    But there’s one product the president is particularly eager to produce in the US: iPhones.

    “I have long ago informed Tim Cook of Apple that I expect their iPhone’s that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else,” Trump posted Friday morning on Truth Social. “If that is not the case, a Tariff of at least 25% must be paid by Apple to the U.S.”

    But Dan Ives, global head of technology research at financial services firm Wedbush Securities, told in April that idea is a “fictional tale.”

    US-made iPhones will likely cost more than three times their current price of around $1,000, Ives said, because of the costs associated with replicating the highly complex production ecosystem that currently exists in Asia.

    “You build that (supply chain) in the US with a fab in West Virginia and New Jersey. They’ll be $3,500 iPhones,” he said, referring to fabrication plants, or high-tech manufacturing facilities where computer chips that power electronic devices are normally made.

    And even then, it would cost Apple about $30 billion and three years to move just 10% of their supply chain to the US to begin with, Ives told Burnett.

    The making and assembly of smartphone parts shifted to Asia decades ago, as American companies largely focused on software development and product design, which generate much higher profit margins. That move has helped make Apple one of the world’s most valuable companies and cement itself as a dominant smartphone maker.

    Since Trump’s inauguration in late January, Apple’s shares have lost more than 14% of their value due to concerns about the impact of tariffs on its sprawling supply chain, which is highly dependent on China and Taiwan. About 90% of Apple’s iPhone production takes place in China, according to Ives.

    “That’s why I think you see what’s happened to the stock, because no company is more caught up in this tariff front and center in this category five storm than Cupertino and Apple,” he said in April. “It’s an economic Armageddon, but especially for the tech industry.”

    The chips that power iPhones are mainly manufactured in Taiwan, while its screen panels are supplied by South Korean companies. Some other components are made in China, and final assembly mostly takes place in the country.

    The administration’s exemption of smartphones and other electronics containing semiconductors from the elevated “reciprocal” tariffs on China has spared iPhones from the harshest levies, but Apple still faces a 20% tariff on Chinese goods for the country’s role in the fentanyl trade. Apple CEO Tim Cook said on the company’s most recent earnings call that “the majority” of iPhones coming into the United States will now be shipped from India, adding that tariffs could add $900 million to Apple’s costs this quarter.

    In February, Apple announced it would invest $500 billion in the United States over the next four years as part of its effort expand production outside China and to avoid Trump’s tariffs on the country.

    Apple has been seeking to diversify its production bases from China to India and Brazil. But Gene Munster, managing partner at Deepwater Asset Management, estimates it would be difficult for Apple not to raise iPhone prices if it faces tariffs of 30% or higher.

    “Anything below 30, they will probably carry the vast majority of that increase,” he said. “But I think at some point they’re going to have to start to share it.”

  • Trump advocates for Apple to pay a 25% tariff on iPhones manufactured outside the U.S.

    Trump advocates for Apple to pay a 25% tariff on iPhones manufactured outside the U.S.

    President Donald Trump said in a social media post Friday morning that Apple will have to pay a tariff of 25% or more for iPhones made outside the United States.

    “I have long ago informed Tim Cook of Apple that I expect their iPhone’s that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else. If that is not the case, a Tariff of at least 25% must be paid by Apple to the U.S.,” Trump said on Truth Social.

    Shares of Apple fell about 2% on Friday after the post.

    Production of Apple’s flagship phone happens primarily in China, but the company has been shifting manufacturing to India in part because that country has a friendlier trade relationship with the U.S.

    Some Wall Street analysts have estimated that moving iPhone production to the U.S. would raise the price of the Apple smartphone by at least 25%. Wedbush’s Dan Ives put the estimated cost of a U.S. iPhone at $3,500. The iPhone 16 Pro currently retails for about $1,000.

    This is the latest jab at Apple from Trump, who over the past couple of weeks has ramped up pressure on the company and Cook to increase domestic manufacturing. Trump and Cook met at the White House on Tuesday, according to Politico.

    Treasury Secretary Scott Bessent said in an interview with Fox News on Friday that he was not part of the meeting at the White House but the Apple situation could be part of the Trump administration’s push to bring “precision manufacturing” back to the U.S.

    “A large part of Apple’s components are in semiconductors. So we would like to have Apple help us make the semiconductor supply chain more secure,” Bessent said.

    Cook gave $1 million to Trump’s inauguration fund and attended the inauguration in January. Apple has announced a $500 billion spend on U.S. development, including AI server production in Houston.

    Apple declined to comment for this story.

    The company said during its May 1 earnings report that it expects about $900 million in additional costs for tariffs in the current quarter. Cook said on the company’s earnings call that the tariff outlook was “very difficult to predict” past June.

    Foxconn, one of Apple’s main iPhone assembly partners, is spending $1.5 billion on expanding its India facilities, the Financial Times reported Thursday.

    Trump has made public criticisms of other major U.S. companies, including Walmart, during his trade war push, but the levies on a specific consumer product is a new step. The exact legal mechanism for the tariff is unclear.

    Trump followed up his post about Apple with another calling for a 50% tariff on products from the European Union. Taken together, the posts point to trade tensions increasing again after the U.S. had temporarily lowered many of its levies, including in an agreement with China.

    Apple also had to navigate tariff threats during Trump’s first term, when a 15% tariff on Chinese imports was being considered in 2019. At that time, Cook had a strong relationship with Trump and the final trade deal excluded core Apple products from the duties.

    As Apple is caught in the U.S. president’s crosshairs, the company is also seeing weak demand in China. On Friday the company hiked trade-in incentives for iPhones in China.

  • Steve Jobs Once Described Designer Jony Ive as His ‘Spiritual Partner’ at Apple — Now OpenAI Has Acquired Ive’s Tech Startup for $6.4 Billion

    Steve Jobs Once Described Designer Jony Ive as His ‘Spiritual Partner’ at Apple — Now OpenAI Has Acquired Ive’s Tech Startup for $6.4 Billion

    OpenAI CEO Sam Altman called Jony Ive “the greatest designer in the world” on Wednesday after announcing his company’s plan to buy Ive’s artificial intelligence device startup io, in a deal worth $6.4 billion.

    The deal signals OpenAI’s intention to build consumer devices, likely meant to get more people using its AI services regularly. Altman and Ive have stayed mum on the specific products they’re planning to roll out, and when, but their partnership shows that OpenAI is taking a big swing: Steve Jobs once described Ive as his “spiritual partner at Apple” and a “wickedly intelligent person in all ways,” according to Walter Isaacson’s 2011 biography of the Apple co-founder.

    Ive, 58, served as Apple’s chief design officer until 2019 and spent nearly three decades designing some of the tech giant’s most iconic pieces of hardware, from the iMac and MacBook to the iPhone, iPod and iPad. Born in London, he joined Apple in 1992, five years before Jobs returned as CEO to the company he co-founded.

    Jobs quickly found a kindred spirit in Ive, later telling Isaacson that the pair typically conceived most of Apple’s new products together, before pulling in other collaborators: ”[Ive] understands business concepts, marketing concepts … He gets the big picture as well as the most infinitesimal details about each product.”

    When Jobs died in 2011, Ive delivered his eulogy, calling his former boss his “closest and most loyal friend.”

    Ive’s first collaboration with Jobs came on the colorful line of iMac personal computers released in 1998, for which the designer created striking features like a translucent plastic case and a handle on the back of the computer. Later, Ive’s focus shifted toward making products like the iPod and iPhone sleek, stylish and easy to use.

    Ive also led the design of the Apple Watch and Apple’s AirPod earbuds. “The difference that Jony has made, not only at Apple but in the world, is huge,” Jobs told Isaacson.

    When Ive left Apple in 2019 to launch his own independent design firm, LoveFrom, analysts at Deutsche Bank told CNBC News that the tech company was losing “one of [its] most important people.”

    What could Ive design for OpenAI?

    Altman is tasking Ive with trying to capture some of Apple’s magic, writing in a statement that Ive “will assume deep design and creative responsibilities across OpenAI and io.” The pair first agreed to work together on building a piece of AI-powered hardware two years ago, The New York Times reported in September.

    It’s unclear exactly what types of products will result from the partnership. Their vision is for “a product that uses AI to create a computing experience that is less socially disruptive than the iPhone,” the Times wrote. They also want to “help wean users from screens,” and are wary of tech wearables like smart glasses, The Wall Street Journal reported on Wednesday.

    Altman was an investor in startup Humane’s AI pin, a small, voice-controlled device users could wear on their lapel and use for phone calls, texts and search queries. The product was released in 2023 to a poor reception, and discontinued before the company began winding down operations in February.

    Ive and Altman could be working on something similar to the AI pin, but slightly larger and worn around users’ necks, Apple analyst Ming-Chi Kuo wrote on social media platform X on Thursday. The product, which would connect with smartphones but have no display — not unlike AirPods, in that way — could begin production in 2027, Kuo predicted.

    In the past, Ive has said that he relishes the opportunity to design new types of devices that don’t already exist in the world.

    “I love working within such a relatively new product category. The opportunities are remarkable as you can be working on just one product that can instantly shatter an entire history of product types and implicated systems,” Ive told the British Council’s Design Museum in a 2005 interview. He pointed to the iPod as an example of a product that “clearly [turned] our users’ previous experience and understanding of storing and listening to music upside down.”

  • Anthropic CEO Predicts First $1 Billion Business Run by a Single Person Will Emerge in 2026

    Anthropic CEO Predicts First $1 Billion Business Run by a Single Person Will Emerge in 2026

    AI can perform tasks such as writing, coding, reasoning, and researching with great accuracy — all tasks that are key to starting your own company. That begs the question: can AI help people start their own billion-dollar business? Anthropic CEO Dario Amodei believes the answer is yes, and the point at which it happens is sooner than you may think.

    When asked at Anthropic’s first developer conference, Code with Claude, when the first billion-dollar company with one human employee would happen, Amodei confidently responded, “2026.”

    At the same event, Anthropic unveiled its most powerful family of models yet — Claude Opus 4 and Sonnet 4 — which can code, reason, and support agentic capabilities better than ever before. These new AI agents should unlock new opportunities for people to optimize how they work, develop products, and even build startups. 

    According to Amodei, the first industries to see this type of efficiency will be those that don’t need human institution-centric stuff to make money, or industries in which the core of the business model isn’t reliant on human interaction.

    For example, he says proprietary training or dev tooling companies are examples of where this solo-preneur work, aided by AI, could be done. People just need to adopt the product, and customer service can be as simple as asking a question and having the model answer it. 

    The claim that the first person to build a billion-dollar company is a year away is merely a prediction. While it is possible that the timeline doesn’t exactly pan out, Anthropic CPO Mike Krieger, who co-founded Instagram and later Artifact, said it doesn’t seem as far-fetched as people may think.

    “It seems not crazy to me. I built a billion-dollar company with 13 people, and that was 13 years ago,” said Krieger in a press Q&A. 

    With tools like Claude Opus, Krieger said he likely could have just built Instagram with his co-founder Kevin Systrom because AI could have helped with much of what they had to scale with Instagram, particularly moderation and engineering. 

    One of the most prominent trends in the field today is AI agents — AIs that can do tasks for you autonomously with little human intervention, and this technology is becoming more capable. 

    Anthropic’s most advanced model — Claude Opus 4 — was built to deliver sustained performance on complex, long-running tasks. One of Anthropic’s clients, Rakuten, ran an open-source refactor independently for seven hours of sustained performance.

    That timeframe is especially noteworthy because it represents about a full day’s work for a human, completed by an AI agent without breaks or a drop in performance. As agents advance, it’s easy to see how these technologies could drive innovation and empower the next wave of startups.

    “Our famously small team had to make really painful either/or decisions. We either explore adding video to the product or focus on core creativity,” said Krieger. “With AI agents, startups can now run experiments in parallel.” 

  • New Claude Model Prompts Tighter Safeguards at Anthropic

    New Claude Model Prompts Tighter Safeguards at Anthropic

    Today’s newest AI models might be capable of helping would-be terrorists create bioweapons or engineer a pandemic, according to the chief scientist of the AI company Anthropic.

    Anthropic has long been warning about these risks—so much so that in 2023, the company pledged to not release certain models until it had developed safety measures capable of constraining them.

    Now this system, called the Responsible Scaling Policy (RSP), faces its first real test.

    On Thursday, Anthropic launched Claude Opus 4, a new model that, in internal testing, performed more effectively than prior models at advising novices on how to produce biological weapons, says Jared Kaplan, Anthropic’s chief scientist. “You could try to synthesize something like COVID or a more dangerous version of the flu—and basically, our modeling suggests that this might be possible,” Kaplan says.

    Accordingly, Claude Opus 4 is being released under stricter safety measures than any prior Anthropic model. Those measures—known internally as AI Safety Level 3 or “ASL-3”—are appropriate to constrain an AI system that could “substantially increase” the ability of individuals with a basic STEM background in obtaining, producing or deploying chemical, biological or nuclear weapons, according to the company. They include beefed-up cybersecurity measures, jailbreak preventions, and supplementary systems to detect and refuse specific types of harmful behavior.

    To be sure, Anthropic is not entirely certain that the new version of Claude poses severe bioweapon risks, Kaplan tells The Budgets. But Anthropic hasn’t ruled that possibility out either. 

    “If we feel like it’s unclear, and we’re not sure if we can rule out the risk—the specific risk being uplifting a novice terrorist, someone like Timothy McVeigh, to be able to make a weapon much more destructive than would otherwise be possible—then we want to bias towards caution, and work under the ASL-3 standard,” Kaplan says. “We’re not claiming affirmatively we know for sure this model is risky … but we at least feel it’s close enough that we can’t rule it out.” 

    If further testing shows the model does not require such strict safety standards, Anthropic could lower its protections to the more permissive ASL-2, under which previous versions of Claude were released, he says.

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    Jared Kaplan, co-founder and chief science officer of Anthropic, on Tuesday, Oct. 24, 2023. (Chris J. Ratcliffe/Bloomberg/Getty Images)

    This moment is a crucial test for Anthropic, a company that claims it can mitigate AI’s dangers while still competing in the market. Claude is a direct competitor to ChatGPT, and brings in over $2 billion in annualized revenue. Anthropic argues that its RSP thus creates an economic incentive for itself to build safety measures in time, lest it lose customers as a result of being prevented from releasing new models. “We really don’t want to impact customers,” Kaplan told TIME earlier in May while Anthropic was finalizing its safety measures. “We’re trying to be proactively prepared.”

    But Anthropic’s RSP—and similar commitments adopted by other AI companies—are all voluntary policies that could be changed or cast aside at will. The company itself, not regulators or lawmakers, is the judge of whether it is fully complying with the RSP. Breaking it carries no external penalty, besides possible reputational damage. Anthropic argues that the policy has created a “race to the top” between AI companies, causing them to compete to build the best safety systems. But as the multi-billion dollar race for AI supremacy heats up, critics worry the RSP and its ilk may be left by the wayside when they matter most. 

    Still, in the absence of any frontier AI regulation from Congress, Anthropic’s RSP is one of the few existing constraints on the behavior of any AI company. And so far, Anthropic has kept to it. If Anthropic shows it can constrain itself without taking an economic hit, Kaplan says, it could have a positive effect on safety practices in the wider industry.

    Anthropic’s new safeguards

    Anthropic’s ASL-3 safety measures employ what the company calls a “defense in depth” strategy—meaning there are several different overlapping safeguards that may be individually imperfect, but in unison combine to prevent most threats.

    One of those measures is called “constitutional classifiers:” additional AI systems that scan a user’s prompts and the model’s answers for dangerous material. Earlier versions of Claude already had similar systems under the lower ASL-2 level of security, but Anthropic says it has improved them so that they are able to detect people who might be trying to use Claude to, for example, build a bioweapon. These classifiers are specifically targeted to detect the long chains of specific questions that somebody building a bioweapon might try to ask. 

    Anthropic has tried not to let these measures hinder Claude’s overall usefulness for legitimate users—since doing so would make the model less helpful compared to its rivals. “There are bioweapons that might be capable of causing fatalities, but that we don’t think would cause, say, a pandemic,” Kaplan says. “We’re not trying to block every single one of those misuses. We’re trying to really narrowly target the most pernicious.”

    Another element of the defense-in-depth strategy is the prevention of jailbreaks—or prompts that can cause a model to essentially forget its safety training and provide answers to queries that it might otherwise refuse. The company monitors usage of Claude, and “offboards” users who consistently try to jailbreak the model, Kaplan says. And it has launched a bounty program to reward users for flagging so-called “universal” jailbreaks, or prompts that can make a system drop all its safeguards at once. So far, the program has surfaced one universal jailbreak which Anthropic subsequently patched, a spokesperson says. The researcher who found it was awarded $25,000.

    Anthropic has also beefed up its cybersecurity, so that Claude’s underlying neural network is protected against theft attempts by non-state actors. The company still judges itself to be vulnerable to nation-state level attackers—but aims to have cyberdefenses sufficient for deterring them by the time it deems it needs to upgrade to ASL-4: the next safety level, expected to coincide with the arrival of models that can pose major national security risks, or which can autonomously carry out AI research without human input.

    Lastly the company has conducted what it calls “uplift” trials, designed to quantify how significantly an AI model without the above constraints can improve the abilities of a novice attempting to create a bioweapon, when compared to other tools like Google or less advanced models. In those trials, which were graded by biosecurity experts, Anthropic found Claude Opus 4 presented a “significantly greater” level of performance than both Google search and prior models, Kaplan says.

    Anthropic’s hope is that the several safety systems layered over the top of the model—which has already undergone separate training to be “helpful, honest and harmless”—will prevent almost all bad use cases. “I don’t want to claim that it’s perfect in any way. It would be a very simple story if you could say our systems could never be jailbroken,” Kaplan says. “But we have made it very, very difficult.”

    Still, by Kaplan’s own admission, only one bad actor would need to slip through to cause untold chaos. “Most other kinds of dangerous things a terrorist could do—maybe they could kill 10 people or 100 people,” he says. “We just saw COVID kill millions of people.”

  • Hong Kong has enacted a stablecoin law, reflecting the growing global acceptance of digital assets by governments

    Hong Kong has enacted a stablecoin law, reflecting the growing global acceptance of digital assets by governments

    Hong Kong passed a stablecoin bill on Wednesday to expand its cryptocurrency licensing regime as more governments recognize the digital asset.

    Unlike volatile digital assets like bitcoin, the value of stablecoins is tied to a real-world asset like fiat currencies or commodities like gold.

    The new law — focused on fiat-referenced stablecoins — will require stablecoin issuers to obtain a license from the Hong Kong Monetary Authority and comply with a range of requirements, including proper management of asset reserves and segregation of client assets.

    It will “enhance Hong Kong’s existing regulatory framework on virtual-asset (VA) activities, thereby fostering financial stability and encouraging financial innovation,” the central banking body said. It added that it would conduct further consultations on the detailed regulatory framework.

    The Hong Kong government said in a statement that the stablecoins policy is expected to come into effect this year, with “sufficient time” allowed for the industry to understand the requirements.

    In 2023, Hong Kong introduced its virtual asset licensing regime, which requires cryptocurrency firms with an official presence in the city to apply for licenses and meet specific standards and requirements to offer digital assets to retail investors in the city. However, the existing policy did not include stablecoins in its purview. 

    “Hong Kong’s new stablecoin policy sets a global benchmark by mandating full reserve backing, strict redemption guarantees, and HKMA oversight,” YeFeng Gong, risk and strategy director of HashKey OTC, told CNBC. HashKey OTC is a trading arm of the HashKey Group, which has a licensed crypto platform in Hong Kong.

    The policy “ensures institutional-grade reliability for traders while positioning Hong Kong as a leader in compliant digital finance,” he added. 

    Crypto adoption and legitimacy

    The move from Hong Kong comes just days after the U.S. Senate advanced the GENIUS Act, which would establish the first regulatory framework for issuers of stablecoins if implemented.

    A push to regulate stablecoins has been intensifying globally, with other jurisdictions having also implemented their own regulatory frameworks, including the European Union, Singapore, the United Arab Emirates and Japan, blockchain intelligence firm Chainalysis said in a report on Wednesday.

    Chengyi Ong, head of Asia-Pacific policy at Chainalysis, told CNBC that the latest regulations are expected to help with crypto adoption and legitimacy. 

    ″[Stablecoins] form the backbone of the crypto ecosystem, but their stability also opens the door to their use in overcoming frictions dogging traditional finance, such as slow cross-border payments and settlement,” Ong said.

    “This potentially transformative utility is what has driven governments around the world, from Europe to Asia, to take steps toward regulatory regimes that will facilitate the emergence of high-quality stablecoins,” she added.

    According to Chainalysis, the total market cap of stablecoins is around $232 billion as of this month.

  • Dell Aims to Be the Go-To Source for Enterprise AI Infrastructure

    Dell Aims to Be the Go-To Source for Enterprise AI Infrastructure

    Michael Dell is pitching a “decentralized” future for artificial intelligence that his company’s devices will make possible.   

    “The future of AI will be decentralized, low-latency, and hyper-efficient,” predicted the Dell Technologies founder, chairman, and CEO in his Dell World keynote, which you can watch on YouTube. “AI will follow the data, not the other way around,” Dell said at Monday’s kickoff of the company’s four-day customer conference in Las Vegas.

    Dell is betting that the complexity of deploying generative AI on-premise is driving companies to embrace a vendor with all of the parts, plus 24-hour-a-day service and support, including monitoring.

    On day two of the show, Dell chief operating officer Jeffrey Clarke noted that Dell’s survey of enterprise customers shows 37% want an infrastructure vendor to “build their entire AI stack for them,” adding, “We think Dell is becoming an enterprise’s ‘one-stop shop’ for all AI infrastructure.”

    Dell’s new offerings include products meant for so-called edge computing, that is, inside customers’ premises rather than in the cloud. For example, the Dell AI Factory is a managed service for AI on-premise, which Dell claims can be “up to 62% more cost-effective for inferencing LLMs on-premises than the public cloud.”

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    Dell Technologies

    Dell brands one offering of its AI Factory with Nvidia to showcase the chip giant’s offerings. That includes, most prominently, revamped PowerEdge servers, running as many as 256 Nvidia Blackwell Ultra GPU chips, and some configurations that run the Grace-Blackwell combination of CPU and GPU.

    Future versions of the PowerEdge servers will support the next versions of Nvidia CPU and GPU, Vera and Rubin, said Dell, without adding more detail. 

    Dell also unveiled new networking switches running on either Nvidia’s Spectrum-X networking silicon or Nvidia’s InfiniBand technology. All of these parts, the PowerEdge servers and the network switches, conform to the standardized design that Nvidia has laid out as the Nvidia Enterprise AI factory.

    A second batch of updated PowerEdge machines will support AMD’s competing GPU family, the Instinct MI350. Both PowerEdge flavors come in configurations with either air cooling or liquid cooling.

    Complementing the Factory servers and switches are data storage enhancements, including updates to the company’s network-attached storage appliance, the PowerScale family, and the object-based storage system, ObjectScale. Dell introduced what it calls PowerScale Cybersecurity Suite, software designed to detect ransomware, and what Dell calls an “airgap vault” that keeps immutable backups separate from production data, to “ensure your critical data is isolated and safe.” 

    The ObjectScale products gain support for remote data access (RDMA), for use with Amazon’s S3 object storage service. The technology more than triples the throughput of data transfers, said Dell, lowers the latency of transfers by 80%, and can reduce the load on CPUs by 98%.

    “This is a game changer for faster AI deployments,” the company claimed. “We’ll leverage direct memory transfers to streamline data movement with minimal CPU involvement, making it ideal for scalable AI training and inference.”

    Dell AI Factory also emphasizes the so-called AI PC, workstations tuned for running inference. That includes a new laptop running a Qualcomm circuit board, the AI 100 PC inference card. It is meant to make local predictions with Gen AI without having to go to a central server. 

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    Dell Technologies

    The Dell Pro Max Plus laptop is “the world’s first mobile workstation with an enterprise-grade discrete NPU,” meaning a standalone chip for neural network processing, according to Dell’s analysis of workstation makers.

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    Dell Technologies
    qualcomm discrete npu
    Dell Technologies

    The Pro Max Plus is expected to be available later this year.

    A number of Dell software offerings were put forward to aid the idea of the decentralized, “disaggregated” AI infrastructure. 

    For example, the company made an extensive pitch for its file management software, Project Lightning, which it calls “the world’s fastest parallel file system per new testing,” and which it said can achieve “up to two times greater throughput than competing parallel file systems.” That’s important for inference operations that must rapidly intake large amounts of data, the company noted.

    Also in the software bucket is what Dell calls its Dell Private Cloud software, which is meant to move customers between different software offerings for running servers and storage, including Broadcom’s VMware hypervisors, Nutanix’s hyper-converged offering, and IBM Red Hat’s competing offerings. 

    The company claimed Dell Private Cloud’s automation capabilities can allow customers to “provision a private cloud stack in 90% fewer steps than manual processes, delivering a cluster in just two and a half hours with no manual effort.”

  • Wolfspeed Expected to File for Bankruptcy in the Coming Weeks

    Wolfspeed Expected to File for Bankruptcy in the Coming Weeks

    Wolfspeed Inc., a once high-flying U.S. semiconductor company known for its silicon carbide technology, is preparing to file for bankruptcy protection within weeks after months of failed out-of-court negotiations with creditors, according to people familiar with the matter.

    The Durham, North Carolina-based chipmaker is working with legal and financial advisers on a prepackaged Chapter 11 filing, a move that would allow the company to continue operating while restructuring more than $2.1 billion in debt. The filing could come as early as mid-June, barring a last-minute breakthrough with lenders, sources said.

    The company’s preparations mark a dramatic turn for a business that had been central to the U.S. push for domestic semiconductor manufacturing, especially in the high-voltage components needed for electric vehicles, data centers, and renewable energy systems.

    Creditors, led by Apollo Global Management and BlackRock, have made several attempts over the past two months to restructure Wolfspeed’s debt out of court, including debt-for-equity swaps and maturity extensions, but those efforts were rejected by the company’s board, sources said.

    Instead, Wolfspeed is pursuing a prepackaged bankruptcy that would allow it to eliminate a large portion of its unsecured debt while preserving day-to-day operations and shielding critical assets like its Mohawk Valley chip fabrication facility in upstate New York.

    “Wolfspeed believes a court-supervised process is the most efficient path forward to stabilize its capital structure and protect its long-term strategic goals,” a person familiar with the matter said.

    The company has reportedly secured debtor-in-possession (DIP) financing from existing lenders, which would provide short-term liquidity during the restructuring process.

    Wolfspeed, formerly known as Cree Inc., had been riding a wave of enthusiasm for its silicon carbide semiconductors, which enable more efficient power conversion in EVs and industrial applications. The company signed supply deals with Tesla, General Motors, and other automakers, and received over $1.2 billion in federal and state incentives to expand U.S. production.

    But aggressive expansion, cost overruns at its Mohawk Valley facility, and global supply chain disruptions have strained its finances. Wolfspeed burned through $800 million in free cash flow in fiscal 2024, and recent earnings showed declining gross margins and ballooning losses.

    As of March 31, Wolfspeed reported $280 million in cash and $2.1 billion in total debt, including $1.3 billion in convertible notes and $600 million in term loans maturing in 2026.

    The company’s bonds trade at deeply distressed levels, with some notes quoted at below 40 cents on the dollar, signaling widespread investor skepticism about recovery prospects.

    A Wolfspeed bankruptcy could reverberate beyond Wall Street. The company was a flagship recipient of U.S. CHIPS Act incentives, touted by the Biden administration as part of efforts to reduce reliance on Chinese suppliers and on traditional silicon-based chips.

    The Department of Commerce awarded Wolfspeed a $500 million grant in 2023, and New York State pledged nearly $750 million in subsidies to support its factory expansion. A bankruptcy could trigger clawback provisions or lead to political scrutiny of how CHIPS Act funds were deployed.

    “This would be a blow to U.S. semiconductor reshoring ambitions,” said Stacy Rasgon, chip analyst at Bernstein Research. “Wolfspeed was seen as a homegrown solution to China’s dominance in power semiconductors.”

    News of the pending filing sent Wolfspeed shares down nearly 22% in after-hours trading, wiping out more than $400 million in market capitalization. The stock, which traded above $130 in 2021, closed Monday at $14.35 and is now down over 85% year-to-date.

    The news also weighed on shares of other silicon carbide suppliers, including ON Semiconductor and STMicroelectronics, though both companies have broader product lines and more diversified customer bases.

    Private equity firms and strategic buyers have reportedly expressed interest in acquiring parts of Wolfspeed’s operations in bankruptcy, including its device packaging business and legacy LED lighting unit.

    Wolfspeed is expected to file its Chapter 11 plan in the U.S. Bankruptcy Court for the District of Delaware. The plan will likely include a debt-to-equity conversion that hands control of the company to its senior lenders, while wiping out existing equity holders.

    The filing could also prompt labor negotiations and contract revisions at its New York plant, which employs more than 900 workers.

    Until then, Wolfspeed continues to ship product and fulfill customer orders, though some automakers have reportedly begun diversifying their sourcing amid the uncertainty.

    Wolfspeed’s pending bankruptcy underscores the risks of capital-intensive industrial bets in a volatile macroeconomic and geopolitical environment—even when backed by federal dollars.


    Wolfspeed at a Glance

    • Headquarters: Durham, NC
    • Founded: 1987 (as Cree Inc.)
    • Specialty: Silicon carbide semiconductors
    • Debt Load: $2.1 billion
    • Cash Reserves: $280 million (as of March 2025)
    • Federal/State Subsidies: $1.2 billion+
    • Planned Bankruptcy Filing: June 2025 (expected)
    • Key Customers: Tesla, GM, Lucid Motors
  • Washington Resists Apple’s A.I. Plans for China

    Washington Resists Apple’s A.I. Plans for China

    Apple believes the future success of the iPhone depends on the availability of new artificial intelligence features. But tensions between Washington and Beijing may cripple the tech giant’s plans to deliver A.I. in its second-most-important market, China.

    In recent months, the White House and congressional officials have been scrutinizing Apple’s plan to strike a deal with Alibaba to make the Chinese company’s A.I. available on iPhones in China, three people familiar with the deliberations said. They are concerned that the deal would help a Chinese company improve its artificial intelligence abilities, broaden the reach of Chinese chatbots with censorship limits and deepen Apple’s exposure to Beijing laws over censorship and data sharing.

    The scrutiny is the latest example of the challenges that Apple has run into as it tries to sustain its businesses in the United States and China at a time of rising geopolitical tensions. Three years ago, the U.S. government succeeded in pressuring the company to abandon a deal to buy memory chips from a Chinese supplier, the Yangtze Memory Technologies Corporation, or YMTC. More recently, the company has been challenged by U.S. tariffs on Chinese-made products like the iPhone, threatening to cut into the company’s profits.

    Walking away from an Alibaba deal would have far graver consequences for Apple’s business in China, which accounts for almost a fifth of the company’s sales. The partnership with the Chinese tech company is critical to bringing A.I. features to iPhones in one of the world’s most highly regulated and competitive markets. Without the Alibaba partnership, iPhones could fall behind smartphones from Chinese rivals like Huawei and Xiaomi.

    Officials at the White House and the House Select Committee on China have raised the deal directly with Apple executives, said the three people, who spoke on the condition of anonymity because they were not authorized to speak to the media. During meetings in Washington with senior Apple executives and lobbyists, government officials asked about terms of the deal, what data Apple would be sharing with Alibaba and whether it would be signing any legal commitments with Chinese regulators. In the meeting with the House committee in March, Apple executives were unable to answer most of those questions, two of these people said.

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    Alibaba would help Apple compete with homegrown competitors in China. (Qilai Shen/Bloomberg)

    Washington’s concern about the deal has been heightened by a deepening conviction that A.I. will become a critical military tool. The technology, which can write emails and develop software code, has the potential to coordinate military attacks and control autonomous drones. Worried about a future U.S.-Chinese conflict, Washington officials have tried to limit Beijing’s access to A.I. technology, cutting off its ability to make and buy A.I. chips.

    Representative Raja Krishnamoorthi of Illinois, the ranking Democrat on the House Permanent Select Committee on Intelligence, said in a statement that it “is extremely disturbing that Apple has not been transparent about its agreement.”

    “Alibaba is a poster child for the Chinese Communist Party’s military-civil fusion strategy, and why Apple would choose to work with them on A.I. is anyone’s guess,” he said. “There are serious concerns that this partnership will help Alibaba collect data to refine its models, all while allowing Apple to turn a blind eye to the fundamental rights of its Chinese iPhone users.”

    Apple, the White House and Alibaba did not provide comment. Apple hasn’t publicly acknowledged the A.I. deal in China, but Alibaba’s chairman, Joe Tsai, confirmed it publicly in February.

    There is concern in Washington that an Apple deal with Alibaba would set a problematic precedent. U.S. companies could help Chinese A.I. providers reach more users and use the data they collect from those users to improve their models. The risk would be that Baidu, Alibaba, ByteDance and other Chinese companies could then use those improvements to help China’s military.

    To limit U.S.-Chinese collaboration, the Trump administration has discussed whether Alibaba and other Chinese A.I. companies should be put on a list prohibiting them from doing business with U.S. companies, the people familiar with the deliberations said. Defense Department and intelligence officials have also been scrutinizing Alibaba’s ties to the Chinese Communist Party and the People’s Liberation Army.

    Greg Allen, the director of the Wadhwani A.I. Center at the Center for Strategic and International Studies, a think tank, said Apple’s partnership ran counter to the bipartisan efforts in Washington to slow China’s A.I. development. Apple could be motivated to help Alibaba improve its artificial intelligence system because its A.I. could make iPhones in China more useful, valuable and easier to sell.

    “The United States is in an A.I. race with China, and we just don’t want American companies helping Chinese companies run faster,” Mr. Allen said.

    In addition to this scrutiny, Apple’s chief executive, Tim Cook, has faced new criticism from President Trump. During Mr. Trump’s trip across the Middle East this past week, he said he had “a little problem” with Mr. Cook because Apple was beginning to build products in India rather than the United States.

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    Apple’s chief executive, Tim Cook, at the China Development Forum in Beijing last year. (Tatan Syuflana/Associated Press)

    “We’re not interested in you building in India,” Mr. Trump said he had told Mr. Cook. “India can take care of themselves. They’re doing very well. We want you to build here.”

    Last year, Apple revamped the iPhone with new A.I. abilities that it called Apple Intelligence. It said iPhone users would be able to use its A.I. product to summarize notifications and gain access to writing tools that could improve emails and other messages. It also revealed an improved Siri virtual assistant that could combine information on a phone, like a message about someone’s travel itinerary, with information from the web, like a flight arrival time.

    Apple struck a partnership with OpenAI to support some of its A.I. abilities. OpenAI’s chatbot, ChatGPT, is currently answering questions when prompted on iPhones in the United States.

    Because OpenAI doesn’t operate in Beijing, Apple needed to find a local partner to give iPhones in China the same performance as those in the United States. The company spoke with several Chinese tech companies before striking a deal with Alibaba. This year, it asked Chinese regulators to approve the A.I. features.

    Congressional officials were alarmed that Apple had requested approval from Chinese regulators for the Alibaba partnership, two people familiar with their concerns said. Because A.I. is an emerging field, the committee worried that Apple might make concessions or sign an agreement that would make it subject to Chinese laws.

    Apple hasn’t provided an update on when the A.I. features will become available on its iPhones in China. During calls with analysts this year, Mr. Cook said sales of iPhones had been better in markets where Apple Intelligence was available.

    If the deal with Alibaba collapses, there is also a potential knock-on effect because Alibaba is a major e-commerce retailer that could sell and market iPhones, said Richard Kramer, a senior analyst at Arete Research, an investment advisory firm. He said that kind of partnership had the potential to boost the iPhone after Apple’s share of smartphone sales in China fell to 15 percent last year from 19 percent in 2023.

    Without Alibaba, Chinese iPhone users could download A.I. apps, Mr. Kramer said. It would make for a more difficult experience than rivals might offer.

    “People will still buy their phones, but it will make it harder,” he said.

  • Data centers’ high energy consumption has the potential to increase electricity costs for all consumers

    Data centers’ high energy consumption has the potential to increase electricity costs for all consumers

    Individuals and small business have been paying more for power in recent years, and their electricity rates may climb higher still.

    That’s because the cost of the power plants, transmission lines and other equipment that utilities need to serve data centers, factories and other large users of electricity is likely to be spread to everybody who uses electricity, according to a new report.

    The report by Wood MacKenzie, an energy research firm, examined 20 large power users. In almost all of those cases, the firm found, the money that large energy users paid to electric utilities would not be enough to cover the cost of the equipment needed to serve them. The rest of the costs would be borne by other utility customers or the utility itself.

    The utilities “either need to socialize the cost to other ratepayers or absorb that cost — essentially, their shareholders would take the hit,” said Ben Hertz-Shargel, who is the global head of grid edge research for Wood MacKenzie.

    This is not a theoretical dilemma for utilities and the state officials who oversee their operations and approve or reject their rates. Electricity demand is expected to grow substantially over the next several decades as technology companies build large data centers for their artificial intelligence businesses. Electricity demand in some parts of the United States is expected to increase as much as 15 percent over just the next four years after several decades of little or no growth.

    The rapid increase in data centers, which use electricity to power computer servers and keep them cool, has strained many utilities. Demand is also growing because of new factories and the greater use of electric cars and electric heating and cooling.

    In addition to investing to meet demand, utilities are spending billions of dollars to harden their systems against wildfires, hurricanes, heat waves, winter storms and other extreme weather. Natural disasters, many of which are linked to climate change, have made the United States’ aging power grids more unreliable.

    That spending is one of the main reasons that electricity rates have been rising in recent years.

    American homes that use a typical 1,000 kilowatt-hours of electricity a month paid, on average, about $164 in February, according to the Energy Information Administration. That was up more than $30 from five years ago.

    Dominion Energy, a large investor-owned utility based in Richmond, Va., is one of those that Wood MacKenzie expects will spend more on new infrastructure than it will be able to recover from selling electricity to data centers and other large users. More data centers have opened in Virginia than in any other state.

    Asked about Wood MacKenzie’s filings, Dominion said that on April 1 it filed a proposal to electricity regulators in Virginia for requiring large-load customers to pay their “fair share” of utility costs.

    “Ensuring a fair allocation of costs and mitigating financial risk are not new concepts to the company,” Edward H. Baine, president of Dominion Energy Virginia, said in testimony that Dominion submitted to state regulators and provided to The New York Times. “Addressing both the needs and the risks associated with growth in high-load electric customers with high-load factors is both a public policy and a regulatory priority for Virginia.”

    A 2024 analysis by Virginia officials concluded that data centers paid the full cost of the service they received. But that report warned that the addition of many more large users of electricity could raise rates for all users if the state did not make policy changes to protect individuals and small businesses.

    Wood MacKenzie’s report found that some states do have policies to protect individuals and small businesses from higher rates. Chief among them is Texas, where customers can pick a power source that is different from the utility that maintains the lines that deliver electricity to their homes.

    This arrangement, according to Wood MacKenzie, helps protect individuals from having to pay for grid upgrades that mainly or entirely benefit large users.

    Mr. Hertz-Shargel said many utilities also had programs that allowed large electricity users to buy emissions-free energy directly from power producers like solar and wind farms. Such programs, he said, could be refashioned to help ensure that the cost of new power projects is largely or entirely borne by the users responsible for major grid upgrades.

    The policies that states and utilities have put in place will significantly reduce risks of spreading the costs of improvements for the large-load customers, but “they do not provide complete protection,” Mr. Hertz-Shargel said. “Only by removing data-center-caused infrastructure from utilities books, such as by allowing large loads to contract with third parties for generation via clean transition tariffs, are both ratepayers and utility shareholders fully protected.”

  • M&S says customer data stolen in cyber attack

    M&S says customer data stolen in cyber attack

    Marks & Spencer has revealed that some personal customer data was stolen in the recent cyber attack, which could include telephone numbers, home addresses and dates of birth.

    The High Street giant said the personal information taken could also include online order histories, but added the data theft did not include useable payment or card details, or any account passwords.

    M&S was hit by the cyber attack three weeks ago and is struggling to get services back to normal, with online orders still suspended.

    The retailer said customers would be prompted to reset account passwords “for extra peace of mind”.

    The ongoing problems are costing the retailer £43m a week in lost sales, according to analysis from Bank of America Global Research.

    M&S chief executive Stuart Machin said the company was writing to customers to inform them that “unfortunately, some personal customer information has been taken”.

    “Importantly, there is no evidence that the information has been shared,” he added.

    However, it is understood that the hackers could yet share or sell on the stolen data as part of their attempts to extort M&S, which still represents a risk of identity fraud.

    The retailer has not revealed how many of its customers have had their data stolen, but said it had emailed all website users to inform them, reported the case to the relevant authorities and was working with cyber security experts to monitor any developments.

    According to its last full-year results, the company had some 9.4 million active online customers in the year to 30 March.

    Mr Machin said M&S was “working around the clock to get things back to normal” as quickly as possible.

    Marks and Spencer was not the only retailer to suffer a cyber incident of this nature.

    The Co-op, which experienced a similar attack, is expected to resume online ordering services for its suppliers, on Wednesday.

    Media reports, first cited in The Grocer magazine, say the retailer has told suppliers to prepare for some “volatility”..

    What has been taken?

    M&S confirmed the contact information stolen could include:

    • name
    • date of birth
    • telephone number
    • home address
    • household information
    • email address
    • online order history

    The retailer added any card information taken would not be useable as it does not hold full card payment details on its systems.

    What should you do?

    M&S has said people do not need to take any action, but has also said:

    • users will be prompted to reset their password for their online account
    • customers should be cautious as they “might receive emails, calls or texts claiming to be from M&S when they are not”
    • M&S will never contact you and ask for personal account information like usernames or passwords

    Lisa Barber, tech editor at consumer group Which?, said it was concerning that criminals had gained access to information that could be used for identity fraud.

    “It’s always a good idea to change your password as soon as possible if there’s been a security breach and to ensure your new password is unique from any other online accounts,” she said.

    Matt Hull, head of threat intelligence at cyber security company NCC Group, said attackers who have stolen personal information can use it to “craft very convincing scams”.

    “If you’re unsure about an email’s authenticity, don’t click any links. Instead, visit the company’s website directly to verify any claims.”

    How did the hack happen?

    Problems at M&S began over the Easter weekend when customers reported problems with Click & Collect and contactless payments in stores.

    The company confirmed it was dealing with a “cyber incident” and while in-store services have resumed, its online orders on its website and app have been suspended since 25 April.

    There is still no word on when online orders will resume.

    M&S’ announcement that customer data had been stolen as part of the ongoing cyber attack was expected due to the nature of the attack.

    The hackers behind it, who also recently targeted Co-op and Harrods, used the DragonForce cyber crime service to carry out the attacks.

    DragonForce operates an affiliate cyber crime service on the darknet for anyone to use their malicious software and website to carry out attacks and extortions.

    The group is known to use a double extortion method, which means they steal a copy of their victim’s data as well as scramble it to make it unusable.

    They can then effectively ask for a ransom for both unscrambling the data and deleting their copy.

    However, if the person or business hacked does not want to pay a ransom, criminals can in some cases start leaking the stolen data to other cyber criminals, who could look to carry out further attacks to gain more sensitive data.

    At the moment, DragonForce’s darknet website does not have any entries about M&S.

    ‘It’s costing them fortunes’

    Jackie Naghten, a business consultant who has worked with big retailers including M&S, Arcadia and Debenhams, told the BBC that the hierarchy at M&S would be taking the data breach “very seriously”, but warned modern logistics in retail were “massively complex”.

    “I feel they have been keeping their powder dry. If they have not got anything positive to say then they are not saying anything,” she said.

    Ms Naghten said on the whole customers were showing a lot of support and sympathy to the retailer.

    But she added it was likely M&S had “another week” before it would have to provide information on when normal service would resume.

    “It’s absolutely costing them fortunes,” she said.

    Shares in M&S are down some 12% over the past month.

  • Tesla’s Board Chairman Made $198 Million Selling Shares While Profit Dropped

    Tesla’s Board Chairman Made $198 Million Selling Shares While Profit Dropped

    In March, after a steep decline in Tesla’s share price, Elon Musk told employees, “Hang on to your stock.”

    The chair of Tesla’s board, Robyn Denholm, has not heeded his advice. Ms. Denholm has made $198 million in the past six months selling Tesla stock that she earned for serving on the board, according to a New York Times analysis of securities filings.

    That brings her total profit on the sale of Tesla stock to more than $530 million since becoming the board’s leader in late 2018, far more than her peers have made at the most valuable U.S. companies during that time, the analysis shows.

    The share sales raise questions about Ms. Denholm’s confidence in Tesla’s prospects. Her most recent sales, executed under a prearranged trading plan filed last summer, came as Mr. Musk, the company’s chief executive, took a time-consuming role in the Trump administration. Tesla’s car sales have plunged partly because Mr. Musk’s political activities have turned off some car buyers. The company’s quarterly profit fell in the first three months of 2025 to its lowest level in four years.

    Ms. Denholm earned the right to buy those shares, known as stock options, for serving on the board, a part-time position. Tesla granted the options between 2014 and 2020, and its share price has soared since then, giving Ms. Denholm the right to buy shares for a lot less than their current price. Last week, for example, she bought more than 112,000 shares for $24.73 apiece and sold them the same day for more than $270.

    Stock Sales Aligned With Surging Share Prices

    Robyn Denholm filed a stock sale plan soon after Elon Musk endorsed Donald Trump for president. The first sale came the week after Mr. Trump was elected.

    “To dump her stock, it doesn’t send a message that this is a board chair who is invested in the future of the company,” said the New York City comptroller, Brad Lander, who oversees the city’s five public pension funds. As of March, those funds held more than three million Tesla shares, valued at the time at roughly $817 million.

    A spokesman for Ms. Denholm said Tesla paid board members in a manner that was “completely aligned with shareholder interests.”

    “The reason the value of the Tesla directors’ options has increased is because Tesla has outperformed its industry peers and created outsized returns for the owners of the company, the shareholders,” he said in a statement.

    Stock options, which for years made up the bulk of Tesla directors’ compensation, are valuable only if the company’s share price rises, as Tesla’s did. Those who exercise their options to buy company stock can sell or hold on to their new shares.

    Ms. Denholm has sold more than 1.4 million Tesla shares and continues to hold 85,000 of them and roughly 49,000 stock options, according to the Times analysis. Equilar, a compensation research firm, reviewed the methodology. Her latest wave of stock sales were carried out under the plan she set into motion in July, soon after Mr. Musk endorsed Donald J. Trump for president.

    Under securities regulations, executives and other insiders can use such plans to trade shares in their companies. They are not required to disclose many details of their plans, including the reason for them or the conditions under which shares will be sold. They also have a lot of leeway to cancel the plans.

    A native of Australia and veteran technology executive, Ms. Denholm has maintained a low profile and rarely speaks publicly about Tesla or Mr. Musk. She was recruited to the Tesla board in 2014 and appointed chair in 2018 after Mr. Musk agreed to step down from the position under a settlement with the Securities and Exchange Commission.

    She and other board members have been criticized by some investors, activists and a Delaware judge for not serving as counterweights to Mr. Musk, who is widely seen as brash and impulsive. Tesla directors have also been faulted for failing to ensure that he remains focused on Tesla.

    “Musk operates as if free of board oversight,” Chancellor Kathaleen St. J. McCormick of the Delaware Court of Chancery wrote last year when she ruled in favor of a shareholder who had challenged Mr. Musk’s 2018 pay package, valued at around $56 billion. Judge McCormick, in that ruling, described Ms. Denholm’s style of overseeing Mr. Musk as “lackadaisical.”

    Tesla has appealed the decision, which voided Mr. Musk’s pay package, and Ms. Denholm has pushed back on Judge McCormick’s critique.

    “Anybody who knows me, knows that I am not lackadaisical, now that I know what that word means,” Ms. Denholm told The Financial Times last year. “It is probably the furthest from the truth. I am really intense and very diligent in what I do.”

    During the trial over Mr. Musk’s pay, Ms. Denholm described the money she had made from her Tesla board service as “life-changing.” Director pay at Tesla was subject to a separate lawsuit that Ms. Denholm and other board members settled in 2023.

    Mr. Musk, who has long been a part-time chief executive of Tesla, has taken on even more responsibilities over the years. He has become a regular presence in Washington, leading President Trump’s efforts to slash government spending and dismiss federal government employees.

    Mr. Musk said recently he would cut back his time in Washington to one or two days a week. His attention is likely to remain divided, however, because he also leads several other businesses, including SpaceX and X, the social media site he owns.

    Ms. Denholm’s first sales under her recent trading plan took place in November, the week after the presidential election, as Tesla’s share price was climbing. The stock reached a new high a few weeks later, in December. She continued to sell through early May, as the company faced consumer backlash over Mr. Musk’s political activities and the stock price fell.

    The stock is now down around 34 percent from its peak after recovering some of its losses over the last few weeks.

    Mr. Musk acknowledged Tesla’s difficulties during a meeting with company employees in March. “If you read the news it feels like, you know, Armageddon,” he said half-jokingly.

    He went on to advise workers not to sell their stock, saying Tesla would become the most valuable company in the world as it perfected self-driving taxis and robots that resembled and moved like humans. “The future is incredibly bright,” he said.

    Ms. Denholm’s sales have far outstripped those by other Tesla directors, with the exception of Mr. Musk, who remained on the board after stepping down as chair.

    She and other current and former Tesla board members agreed to settle a shareholder lawsuit over their pay in 2023, collectively agreeing to return compensation valued at $735 million. They denied wrongdoing. Stock options valued at more than $130 million were canceled on May 1 to satisfy Ms. Denholm’s obligations under that settlement, securities filings show.

    Board members agreed in June 2021, after that lawsuit was filed, to forgo new equity grants.

    Ms. Denholm also made more money selling her company’s stock than the leaders of other corporate boards during the same period. The Times reviewed stock sales by board chairs at the most valuable U.S. companies who, like Ms. Denholm, are not executives at those companies.

    The nonexecutive chair with the next-highest profit from selling shares in the company he oversees was Stephen Hemsley of UnitedHealth Group. Mr. Hemsley has earned more than $100 million from the sale of UnitedHealth shares since November 2018, though he received all of that stock while he was chief executive of the health care company.

    UnitedHealth Group confirmed the findings, but declined to comment. On Tuesday, the company announced that Mr. Hemsley would retake the chief executive job in addition to serving as chairman.

    Share sales by executives and directors often predict poor performance by the companies they lead, some academic research has found.

    Leaders like Ms. Denholm have access to nonpublic information and a deep understanding of how broader economic forces may affect company performance. That can make their trades especially profitable, according to Nejat Seyhun, a professor of finance at the University of Michigan.

    Insiders “set up plans when they have information,” Professor Seyhun said. If conditions change, “they can cancel those plans.”