CNBC's Arjun Kharpal discusses why OpenAI has decided to acquire Jony Ive's startup called io and what the ChatGPT-maker could be planning.

San Francisco

The release of Open AI's ChatGPT has accelerated the development of artificial intelligence and warnings about its impact on society.

Rise of AI

OpenAI has announced the acquisition of io, the startup founded by former Apple designer Jony Ive, for $6.4 billion. The move signals OpenAI’s intention to combine its artificial intelligence software, such as ChatGPT, with purpose-built hardware, taking inspiration from Apple's strategy of tightly integrating hardware and software for a seamless user experience.

The acquisition aims to allow OpenAI to create new touchpoints for consumers, mirroring the approach of companies like Google, which leverages its Android operating system to distribute AI technologies across a broad range of devices. By developing its own hardware, OpenAI may be able to expand the reach of its AI applications and facilitate daily interactions with users.

Industry developments in agentic AI, or AI assistants capable of handling complex tasks for users, have prompted technology firms to experiment with new device formats beyond smartphones. Recent examples include smart glasses partnerships and the launch of compact AI hardware like the HumanePin. OpenAI, under Jony Ive’s leadership and in collaboration with Sam Altman, is now positioned to explore and potentially shape the next generation of AI-driven hardware.



Explained: OpenAI's $6.4 billion acquisition of Jony Ive's startup

Well, let me start, Karen, with the rationale behind the deal and then we can talk about some of the hardware. I think OpenAI here feels that it has a shot at next-generation hardware for AI. Right now, the smartphone is very dominant in our daily lives. But as you alluded to, there's many who think that it may not be the future in a world of more advanced AI. And I think for OpenAI, it feels that it combined its software prowess with ChatGPT and its other AI applications that it eventually develops with the hardware, almost taking a leaf out of Apple's playbook here in terms of combining the software and hardware for a very integrated experience as well. Now, hardware is incredibly important because it's what we use every day. And I think there's many, many AI companies, including the likes of Google, who feel that in order for them to be successful, they need to have a touchpoint with us, the user. And so for Google, when you think about smartphones, they're the dominant player in terms of operating system with Android and so can put Gemini across all those devices. And I think there's a similar thinking here from OpenAI as well, that if it can get into the hardware game, it can push out its AI applications to a larger user base of people who will interact with it on a daily basis. Now, the key here is the kind of advances we're going to see in artificial intelligence. A lot of companies are talking about so-called agentic AI, this idea that there is an AI assistant for you at all times, being able to do very complicated tasks. For example, you're trying to book a restaurant. You may ask the AI to find a restaurant with very specific parameters, find it on a map and send it to a friend. And in theory, that AI will be able to carry out all of those kind of tasks. But the question is, what kind of devices are we going to see that come from? Right now, it's a smartphone, but you're seeing Google and others talk about the glasses form factor just this week at Google I.O. Google unveiled in partnership with XRail a brand new Google, not Google Glass, sorry, Project Aura glasses that run on Android XR and that will be equipped with Gemini. We saw last year the HumanePin, this viral piece of hardware, very small piece of hardware that fit on your lapel went viral, but didn't really commercialize. And so there's a lot of experimentation going on right now with what the future of hardware looks like. But clearly, it's Johnny Ives' job here at OpenAI in conjunction with Sam Altman to figure out what that is and to see if they can get into a hardware game and actually get on ahead of companies like Apple and like Google.

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Rise of AI