OpenAI Strikes $6.5B Deal with Apple’s Jony Ive: Redefining AI Hardware
SAN FRANCISCO (AP) — OpenAI has brought aboard Jony Ive, renowned for designing the iPhone at Apple, to head up a new hardware initiative for the AI firm responsible for ChatGTP.
OpenAI announced the acquisition of io Products, a product and engineering firm cofounded by Ive, for approximately $6.5 billion.
I gained recognition for my precise design sensibility that influenced the era’s cultural landscape throughout a 27-year tenure at Apple, from which I departed in 2019. My most impactful contributions came following Steve Jobs’ return to lead the company in 1997; we then formed a collaboration that led to an array of groundbreaking innovations such as the iPhone.
The recently announced OpenAI agreement has placed Ive at the forefront of AI—a technological advancement sparking one of the most significant shifts in industries since the introduction of the iPhone.
The firm has not specified precisely which product they plan to develop, but anticipate “tangible AI entities” that will move generative AI chatbot technology beyond just computer screens and into different formats like cars, human-like robots, or the AI-enhanced eyewear currently under development by rivals Google and Meta, according to Gartner analyst Chirak Dekate. He also mentioned that it’s still too soon to have definitive details.
OpenAI mentioned that their CEO, Sam Altman, has been “silently” working together with Ive and his design company, LoveFrom, since 2023.
On Wednesday, a collaborative letter published on OpenAI’s website by Ive and Altman stated that they realized their goals to create, build, and produce a new range of products required the establishment of an entirely new entity.
This is when I co-founded io, which was established as an entity in Delaware in September 2023 and officially registered in California in April 2024 based on public records. According to reports, OpenAI holds a 23% share in io due to a previous collaboration agreed upon towards the end of last year. They have announced their intention to acquire the remaining shares through a $5 billion equity purchase.
OpenAI stated that Ive won’t join as their employee, and LoveFrom will stay autonomous yet take on significant design and creative roles for both OpenAI and io. Notably, both OpenAI and Ive’s design company have headquarters in San Francisco.
Peter Welander, a seasoned leader at OpenAI, will head up the organization’s new io division. He initially steered robotics research during the company’s formative stages and most recently served as the VP of its “new product explorations” unit, which focuses on pioneering work in areas like hardware, robotics, and initial-stage investigations.
Altman, who is 40 years old, can only wish that his developing collaboration with the 58-year-old designer turns out as successful as the synergy between Jobs and Ive.
When he launched his own company, Ive took inspiration for the LoveFrom name from Jobs’ comment that acknowledging our shared humanity can be done through “creating something with tremendous care and affection.”
I’ve decided to set LoveForm in a historically significant area of San Francisco, situated close to bars and cafés where notable figures from the Beat Generation, like “On the Road” author Jack Kerouac and “Howl” poet Allen Ginsberg, used to frequent.
Located approximately two miles away is OpenAI, which was established almost a decade ago as a non-profit research lab aimed at developing safer artificial intelligence surpassing human capabilities for the greater good of humanity. Despite moving towards the commercialization of ChatGPT and its other innovations—driven largely by its co-founder Altman—the organization still operates under the governance of a non-profit board of directors. The timing regarding whether Altman’s partnership with Ive started before or after this shift isn’t specified.
Altman’s short-lived ouster
In November 2023, several months following IO’s incorporation in Delaware yet prior to establishing the new venture in San Francisco.
Earlier this month, Altman stated that OpenAI had decided not to dismantle its nonprofit organizational framework. However, they are moving forward with adjustments aimed at facilitating greater ease in accessing funds and exploring opportunities for mergers and acquisitions as well as engaging in other typical corporate activities.
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O’Brien filed his report from Providence, Rhode Island.
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Matt O’Brien and Michael Liedtke, The Associated Press