Hi Reader,

Here are three things I found interesting in the world of AI in the last week:

Google feels the first crack in search dominance as Safari users drift to AI - testimony​

In a courtroom bombshell that sent $150 billion of Google’s market value up in smoke, Apple’s Eddy Cue casually mentioned that for the first time in over 20 years, Safari search volume has declined. Tech analysts immediately went into overdrive, frantically updating their valuation models. The 7.3% stock nosedive wasn’t just a blip - it was the market’s collective “oh shit” moment about AI finally landing the first real blow against Google’s search monopoly.

This testimony came during the Google antitrust remedies trial, where the DOJ is pushing to block Google from paying its way to default search status ($20 billion annually to Apple alone). Google immediately fired back, insisting they’re seeing “overall query growth” and “an increase in total queries coming from Apple’s devices” - which tells me they’re parsing carefully. Both statements can be true if users are bypassing Safari for the Google app or Chrome.

The real story isn’t about one day’s stock movement (it rebounded 2% the next day), but the first concrete evidence that generative AI is actually eroding traditional search behaviors. Apple is now openly discussing integrating Perplexity, OpenAI, or Anthropic directly into Safari. Good luck Google.

Google’s been frantically bolting AI features onto search with its AI Overviews and experimental AI Mode, but this feels like watching Blockbuster adding a streaming section after Netflix took off. Can you effectively transition a $175 billion advertising business model while simultaneously cannibalizing yourself? The history of tech disruption doesn’t offer many successful examples.

Trump fires Copyright Office head days after AI report - article​

In an unprecedented move, Trump just fired the US Register of Copyrights, Shira Perlmutter, via email - just two days after she released a report on AI and copyright that failed to give tech companies a blanket license to train on anything they want.

The timing is somewhat suspicious. The Copyright Office had just dropped a 100+ page report examining whether AI companies can legally train their models on copyrighted works without permission or payment. While the report didn’t actually recommend significant government intervention, it did raise concerns about fair use applying to mass ingestion of creative works. Apparently that was too much nuance for an administration where Elon Musk (who has publicly called to “delete all IP law”) has (had?) significant influence.

The report itself was pretty reasonable in my opinion: "making commercial use of vast troves of copyrighted works to produce expressive content that competes with them in existing markets, especially where this is accomplished through illegal access, goes beyond established fair use boundaries." sort of stuff. But I'm guessing anything that fell short of "train on whatever you want" would have had a similar result.

OpenAI and Microsoft in “tense negotiations” over partnership future - report​

The AI power couple is hitting a rough patch. OpenAI and Microsoft are reportedly locked in tense negotiations over their partnership, with a Microsoft executive complaining that OpenAI just wants Microsoft to “give us money and compute and stay out of the way,” calling it “a bad partner attitude” that “shows arrogance.” OpenAI being accused of arrogance, shocking!

The relationship status update comes as OpenAI tries to restructure itself, scrapping plans to separate nonprofit and for-profit arms in favor of converting its commercial operations to a Public Benefit Corporation. Microsoft, having dropped $13-13.75 billion into OpenAI, unsurprisingly wants a say in how this all shakes out.

The partnership already shifted significantly in January when Microsoft lost its exclusive cloud provider status, downgraded to a “right of first refusal” arrangement. This opened the door for OpenAI’s massive Stargate Project with Oracle, SoftBank, and MGX - a joint venture that’s supposedly targeting $500 billion in infrastructure investment over 4 years (though that number is looking increasingly dubious amid funding struggles).

Microsoft literally named OpenAI as a competitor in its 2024 annual report while continuing to build Copilot on top of OpenAI’s tech. Meanwhile, OpenAI is aggressively targeting enterprise customers that would otherwise be Microsoft’s territory, and also bought Windsurf for $3 billion.

Is this heading toward a messy public breakup? I dunno, probably not. They’re locked in a “frenemies with benefits” situation with too much mutual dependency to fully separate. Microsoft needs OpenAI’s tech to power Copilot, and OpenAI still needs Microsoft’s cloud infrastructure and enterprise sales channels. But the days of Microsoft writing blank checks while staying silent about strategic direction appear to be over.

Cheers,
JV

PS: We're in the final stages of private beta for the NZ launch of fundsorter.com with 70 customers onboarded so far. Still room for a few more if you know any charities that want early access. I'm expecting we'll be moving out of beta in a week or two. Just a few more features to ship...