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Can an Apple lawsuit derail OpenAI’s hardware plans?

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Apple recently filed a trade secrets lawsuit against OpenAI, accusing the AI company of a pattern of misconduct aimed at getting current and former Apple employees to share confidential information. (In response, OpenAI said it is “not aware of any evidence that this complaint has merit.”)

On the latest episode of TechCrunch’s Equity podcast, Kirsten Korosec, Sean O’Kane, and I debated whether this lawsuit will cast a shadow over OpenAI’s much-discussed plans to get into the hardware business (starting with a mobile smart speaker) and go public.

“Even setting aside whether or not the court grants any kind of injunctive relief or any kind of restraining order over what OpenAI is doing, it just naturally can lead to that sort of situation where it’s going to cause some delays in what OpenAI is working on,” Sean suggested. “Which I’m sure was probably part of the reasoning behind Apple doing this. They don’t do this stuff willy nilly.”

With all those plans on the line, will OpenAI try to settle this as quickly as possible, or did it learn from its recent courtroom victory against Elon Musk that it can endure the cost and embarrassment of a trial? Kirsten, at least, predicts the latter.

Keep reading for a preview of our conversation, edited for length and clarity.

Kirsten Korosec: Sean, how do you feel about Sam Altman listening to you with a little device maybe in your pocket?

Sean O’Kane: I’m good. Maybe that’s predictable, but I’m good. No thanks.

We’ll get into it, I’m sure, but this is allegedly the first product that OpenAI has been working on in its hardware division with Jony Ive and company. They’ve been really coy ever since that weird video they put out last year of them sitting at that coffee shop or bar in San Francisco and sort of talking very vaguely about hardware and legacy devices, meaning laptops and phones. And so if this is the direction they’re headed in, all power to people who want to have somebody like that always listening to them. This is not going to be for me.

Anthony Ha: Part of what we have to remember about those kinds of devices is also that, depending on how mobile it is, it’s not just listening to you, it’s listening to the people around you. I might be fine with it — I’m not fine with it, but let’s say I was — but then if we met up in-person at Disrupt, then suddenly it might be listening to all of us. 

There’s all kinds of social norms that are going to have to be renegotiated if these things become widespread. I think we should make fun of and criticize people who record other people without consent.

Kirsten: Well, I bring up the device that has been speculated about for a really long time, and we’ll see what it really ends up being once it’s officially introduced, but it’s important in the context of this lawsuit that Apple filed last Friday. 

It was the biggest news of the week, certainly, and this is a trade secret lawsuit. It has some pretty wild allegations and we should very much emphasize these are allegations that have been filed in a complaint by Apple. But what it is accusing OpenAI of is a pattern of misconduct at the highest levels, specifically directed towards OpenAI employees who used to work at Apple. And in fact they’ve named the chief hardware officer Tang Tan in this lawsuit.

This is all important because Apple is accusing OpenAI of essentially stealing their trade secrets, but in the context of that, this could be then used for a competing hardware product. I’m wondering if maybe we don’t get into whether this lawsuit has merits, because we haven’t gone through full discovery, but what are your initial impressions of the lawsuit aside from the fact that wow, this is going to be entertaining?

Sean: Two things. One, this is a pretty big risk potentially to whatever it is OpenAI is working on. Even setting aside whether or not the court grants any kind of injunctive relief or any kind of restraining order over what OpenAI is doing, it just naturally can lead to that sort of situation where it’s going to cause some delays in what OpenAI is working on, which I’m sure was probably part of the reasoning behind Apple doing this. They don’t do this stuff willy nilly.

The other is that we think that OpenAI is — we know that they’ve filed confidentially for an IPO. We think it might happen as early as the end of this year, or early next year, if you believe Sam Altman’s cautious language around the IPO. And this just raises a whole bunch of questions around that because, on the one hand, we think their business right now is probably overwhelmingly the software; they’re not really factoring in any hardware business into that picture at the moment.

They’re about to go to the markets and they’re going to be pitching bankers and investors on where they think their addressable market should be, and if they have a big amount of that pegged to a potential hardware division and hardware products, this could be a huge risk to that and changes a lot of the calculus of sort of how the IPO gets priced. So that’s where my head’s at.

Anthony: One [allegation] that I assume that Apple must have pretty solid like numbers on is, they said more than 400 Apple employees now work at OpenAI. Granted, both of them are very large companies with many thousands or tens of thousands of employees. So as a percentage, it’s not necessarily huge. But that seems like a lot of people and a pretty serious talent drain. 

And the other thing I’m wondering is related to Sean’s point. With the context of the potential IPO, how much damage did OpenAI ultimately take from a marketing and brand perspective from the trial it already went through? That it seemed to basically win, but there was a lot of not-terrible-but-kind-of-embarrassing dirty laundry that came out in the testimony. To what extent are they just like, “We do not want to go through that again”? Or did they take the lesson of, “Hey, we went through it and we survived and we’ll be okay if we have to do another trial with Apple”?

Kirsten: I fully predict the latter, by the way.

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Primate Ayodele Predicts APC Risks Defeat in Kano, Eight Other States in 2027

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The Leader of INRI Evangelical Spiritual Church, Primate Elijah Ayodele, has warned the ruling All Progressives Congress (APC) that it could lose control of nine states in the 2027 governorship elections if the party and its governors fail to strengthen their political structures ahead of the polls.

Ayodele gave the warning in a statement released by his media aide, Osho Oluwatosin.

The minister said the APC should not assume that its current dominance in many states would automatically translate into victory in the next general election.

According to the cleric, the political landscape ahead of 2027 will be more challenging than previous elections, with technology expected to play a major role in shaping the outcome.

“APC cannot sweep the whole states in the coming election; it’s not possible, there will be some things that will happen in the process of the election. The election will be complicated in some ways, and technology will be one of the ways,” Ayodele said.

APC; Nentawe Yilwatda
APC; Nentawe Yilwatda

He identified Sokoto, Benue, Plateau, Kano, Kaduna, Yobe, Adamawa, Niger and Nasarawa as the states where the ruling party must work harder to retain power.

“Any governor who doesn’t stand well will lose, and APC must work very hard in the following states if they want to win: Sokoto, Benue, Plateau, Kano, Kaduna, Yobe, Adamawa, Niger, Nasarawa. APC must watch these states well,” he added.

Ayodele further cautioned that the APC should not take any of the states for granted, warning that the opposition was positioning itself to make significant gains.

“These states are not certain for APC governorship candidates to win and retain; they must work extraordinarily hard if they want to get it otherwise, it will be swept away from them,” he said.

The APC emerged from the 2023 governorship elections as the party with the highest number of governors, winning states including Lagos, Kogi, Imo, Ogun, Sokoto, Cross River, Niger, Jigawa and Yobe. However, the political atmosphere has changed considerably since then, with defections, internal party disputes and the emergence of new alliances expected to reshape the battle for many states in 2027.

Some of the states listed by Ayodele are already regarded as highly competitive. Kano, for instance, remains one of Nigeria’s biggest political prizes because of its large voting population. The APC lost the 2023 governorship election in the state, and although the state’s governor is a now a member of the APC, it is believed that Kano will remain one of the toughest battlegrounds in the next election.

Plateau and Benue have also witnessed political competition recently, while Sokoto, Kaduna, Adamawa, Nasarawa and Niger have all experienced closely fought elections that suggest no party can safely assume victory in 2027.

Political observers have also noted that even states traditionally considered APC strongholds may no longer be guaranteed victories. During the 2023 general elections, the party retained the governorship in Lagos, but lost the presidential vote in the state to Labour Party candidate Peter Obi.

Analysts say the outcome of the 2027 elections will depend not only on incumbency but also on candidate selection, party unity, campaign organisation, voter turnout and the strength of opposition parties.

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New Strategic Football Development Partnership Between Kazakhstan and Lagos

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Today marks the beginning of a new era in international football collaboration as the Aktobe Regional Football Association of Kazakhstan and the Lagos State Football Association (LSFA) engaged in strategic discussions to establish a long-term football development partnership.

This meeting, facilitated by GSL Global Network, reinforces its dedication to fostering significant global football relationships.

Askhat Sagitzhanuly Kalzhanov, the President of the Aktobe Regional Football Association, traveled to Lagos to meet with Hajji Gafar Liameed, the Chairman of the Lagos State Football Association.

Their discussions aimed to identify areas of mutual cooperation that would enhance football development in both regions.

Key topics included the establishment of sustainable opportunities through technical exchanges, youth development initiatives, coach education, talent identification, club partnerships, and providing international exposure for players and football administrators.

As Nigeria’s commercial capital and a prominent center for football, Lagos offers vast opportunities for collaboration. With more than 2,000 football academies, 10 professional clubs, a variety of grassroots competitions, and one of Africa’s richest reservoirs of football talent, Lagos stands out as a premier location for football development, player cultivation, and innovation.

The Lagos State Football Association has consistently positioned itself as a forward-thinking governing body by implementing strategic initiatives that support grassroots football, enhance capacity building, promote women’s football, organize youth competitions, foster international partnerships, and ensure sustainable football administration.

During his visit, President Kalzhanov participated in the ongoing Train The Trainers programme, where Serbian football instructors are conducting an intensive coaching development course for coaches in Lagos.

He conveyed his admiration for the programme’s quality and the FA’s dedication to ongoing coach education and technical excellence. This initiative strengthens the belief that investing in coaches is one of the most effective strategies to enhance the overall standard of football development.

President Kalzhanov is set to stay in Lagos for an additional week to observe further football activities, visit selected football academies and professional clubs, and continue discussions with the Lagos State Football Association regarding practical collaboration areas.

Both Associations are hopeful that this partnership will facilitate exchange programmes for coaches, players, and technical experts, while also paving the way for new avenues of international cooperation and football investment.

The Lagos State Football Association is dedicated to forging global partnerships that generate opportunities for its football ecosystem and further position Lagos as Africa’s leading centre for football excellence.

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