He is —was— the greatest asset that Apple (NASDAQ:AAPL) ever had.
Probably even more important to Apple’s success than Steve Jobs, Steve Wozniak or Tim Cook.
I’m talking about Jony Ive.
And boy, have Apple fumbled big time with their use of Ive in the subsequent years since his departure and the death of Jobs.
Yes, they’ve had access to him, even a chance to bring him back into the fold. But did they? Nope. The greatest things Apple has designed in recent time is uniformed rounded edges across all their devices and thinner…always thinner…devices.
And now, he’s defected.
Well, not defected, but he’s been snaffled up in a way that could threaten Apple’s future and explode the (already huge) success of OpenAI.
Source: OpenAI
Yep, that’s Ive and Sam Altman right there.
And as cringe as that image might be, it’s a clear demonstration of just how close these two have become.
Then again if Sam Altman paid me $6.5 billion for my AI startup, I’d probably pop a hand on his shoulder and lean my head in a touch too.
OpenAI has just acquired Jony Ive’s stealth AI hardware studio, io, for $6.5 billion in stock. Not a funding round but a full-blown takeover.
The reason is simple, taking ChatGPT off the screen and into your home as a consumer device.
Don’t mistake this for a pin.
An AI device. Surely that’s a recipe for disaster.
We’ve already seen early attempts at this in the last 18 months – all unsuccessful. Maybe the market just isn’t ready yet for an AI device?
The Humane AI Pin launched with big hype. And then it flopped into obscurity. In fact, HP Inc (NYSE:HPQ) snaffled up its remnants and reallocated the team to integrating AI into their printers and conference room tech. Ouch.
Rabbit’s R1 didn’t fare much better, raising eyebrows for being less functional than a smartphone from 2012. I’m pretty sure I’ve still got an MP3 player kicking around somewhere with more functionality.
According to a report from The Verge,
The mysterious device that OpenAI is cooking up with former Apple designer Jony Ive will be pocket-size, contextually aware, screen-free, and isn’t eyewear. Ive and OpenAI CEO Sam Altman revealed details about the project in an internal staff call
Altman even went so far as to say the acquisition could add $1 trillion to the value of OpenAI. No wonder he wanted to move it away from a not-for-profit to a for-profit company.
You can only assume these negotiations and conversations with Ive started well before the move to a profit-focused company. Also probably suggests why Elon Musk has been so opposed to it.
Whatever this first device is that OpenAI and Ive’s io launch, I’m sure it will be hyped beyond belief. And I suggest that if it is to be a pocket sized, screen-free, non-eyewear device… it will also fail.
Yep. Call me a luddite if you will. But the only thing it could possibly then be is AI in your pocket communicating to you through an earpiece. Honestly, if it’s not showing you something, say via eyewear, then it has to talk to you, otherwise, what’s the point.
But as I say, it will fail.
And it will fail because Google, Meta and Amazon are all taking the right approach in my view with eyewear. AI and augmented reality (AR) enabled smart glasses. That’s the move here.
But I wonder your thoughts on this?
Would you be open to AI enabled, augmented reality eyewear that can also talk to you via integrated speakers in the frames?
Or would a little pocket device, with no screen talking to you via an earpiece be more your style?
Let me know via feedback@southbankresearch.com
However, OpenAI might take a big shot with Ive on this little consumer device. But if they had any sense, the thing they’d really be working day and night to get to market would and should be a humanoid robot.
Now an Ive designed, OpenAI enabled humanoid robot is something I think they’d change the world with. Because it’s a market that may become the biggest market in the world, and if they don’t do it, Elon Musk will.
I, Robot, am now everywhere
This future isn’t so wild with OpenAI.
They’ve already quietly backed 1X Technologies, a Norwegian robotics firm building humanlike robots with GPT-style brains.
The io deal gives OpenAI the industrial design capability to make a robot that doesn’t look like a dystopian factory toy. Something that feels… human. Accessible. Safe. Think less Boston Dynamics and more Pixar. Something with soul.
It also positions OpenAI to directly compete with Tesla’s Optimus robot. And recently Elon Musk has said Optimus will be more valuable than the entire Tesla car business.
Let that sink in.
Optimus is already assembling parts at Tesla factories. It’s learning and training daily. He wants it to be able to soon watch something on YouTube and then be instantly able to do it. Like the character Neo in, The Matrix.
Musk believes it will perform household chores, care tasks, logistics and—eventually—factory and warehouse jobs. His vision is that every home will have one. And the “brains” that power Musk’s robots? xAI his AI company, directly in competition with OpenAI.
That’s the future OpenAI just bought from Ive to catch up to Tesla. And I think that’s the real play they’ve made here. Robots, not dinky little consumer toys.
The trillion-dollar tailwind
According to Jensen Huang (Nvidia’s CEO) humanoid robots are a “multi-trillion-dollar,” opportunity.
With the work Nvidia is doing behind the scenes with the likes of OpenAI and Elon’s xAI, they’re effectively playing both sides of this Musk and Altman battle.
Add to that Nvidia’s vision as an “AI infrastructure” company and it’s hard not to see them continuing to play the most pivotal role in the futures and successes of both OpenAI, Tesla and xAI.
That success though is going to be about robots. Be it Optimus, whatever OpenAI and io are now cooking up, or another challenger from left field, AI exploding out into the “real world” is the next phase of AI growth.
Trillions are quite literally on the line and up for grabs. It’s a market that is in its earliest stages because right now there isn’t a single humanoid robot for sale that you can go and buy and have working in the home tomorrow.
But that will change. And it will change soon, much sooner than people think. And the first time you pass a humanoid robot in the street going about its business you’ll think, that’s weird. Until it won’t be, it will just be a regular part of everyday life.
The robot wars have begun. It’s very much Elon vs Altman. And with this close-knit partnership with Jony Ive, Altman has won this round.
Until next time,
Sam Volkering
Contributing Editor, Investor’s Daily
P.S. Everyone’s focused on the device. But I think the real wealth is in what comes next—when AI moves off the screen and into our homes, factories, and lives. This isn’t sci-fi anymore. My colleague James Altucher calls it the Wealth Window—a short, high-impact moment when major tech shifts like this open the door to outsized gains. If you want to see where this is heading (and how to position for it), I strongly recommend you check it out.
