OpenAI is laying the groundwork for a potential initial public offering (IPO) that could value the company at up to $1 trillion, making it one of the largest IPOs in history. The company is considering filing with securities regulators as early as the second half of 2026, with the potential to raise $60 billion or more. This move follows a major restructuring that reduces OpenAI's reliance on Microsoft and positions it to tap public markets more efficiently. That restructuring has transformed OpenAI into a public benefit corporation, with its nonprofit arm, now called the OpenAI Foundation, holding a 26% stake in the for-profit entity. This change aims to balance the company's mission of "advancing artificial general intelligence (AGI)" with the need to attract substantial investment.
The company's recent restructuring has also unlocked $30 billion in additional funding from SoftBank, contingent on its completion. Microsoft, one of OpenAI's most prominent backers, now holds a 27% stake in the company. The revamped structure allows OpenAI to raise more capital and make larger acquisitions, supporting CEO Sam Altman's ambitious plans to invest trillions into AI infrastructure. This strategic shift coincides with the recent IPO of AI cloud company CoreWeave and Nvidia reaching a market value of $5 trillion.
Find more details at Forbes and Reuters.
OpenAI has launched ChatGPT Atlas, an AI-powered web browser designed to compete directly with Google Chrome. Atlas integrates ChatGPT into every tab, allowing users to perform tasks such as shopping, scheduling, and searching without switching pages. The browser, available globally on macOS with versions for Windows, iOS, and Android coming soon, aims to provide a personalized browsing experience by tailoring responses based on user activity. This move marks OpenAI's latest effort to capitalize on its 800 million weekly active ChatGPT users and expand into more aspects of online life, potentially intensifying competition with Google.
Google has been adapting to these changes by integrating its Gemini AI model into Chrome, offering a chatbot-like experience alongside traditional search results. Despite the increasing competition, Google Chrome maintains a dominant market share of 71.9% as of September. However, analysts suggest that OpenAI's entry into the browser market could introduce fresh competition for ad dollars, as integrating chat into a browser could pave the way for OpenAI to start selling ads. Alphabet shares subsequently fell nearly 5% following Atlas' debut.
More info at AdWeek and Reuters.
Meta, the parent company of Instagram, Facebook, and WhatsApp, has significantly increased its capital expenditure forecast to between $70 billion and $72 billion, primarily to enhance its data centers and compensate AI researchers. This marks a substantial rise from previous years, with expenditures projected to reach up to $100 billion next year. Despite a notable drop in profit due to a significant income tax charge, Meta's revenue from online advertising remains robust, fueling its ambitious AI investments. The company claims that its AI spending has already improved its advertising business and social media algorithms, particularly for Instagram Reels, though specifics remain sparse.
CEO Mark Zuckerberg has been intensely focused on AI, evidenced by a $14.9 billion investment in Scale AI and the appointment of its CEO, Alexandr Wang, as Meta's new chief AI officer. The company has undergone multiple reorganizations within its AI division, including recent layoffs targeting employees associated with underperforming AI models. Meta has also introduced new AI products, such as Meta Ray-Ban Display glasses and the Vibes video app, but analysts like Andrew Rocco emphasize that the primary concern is how AI spending will impact Meta's core business – advertising. The company's future revenue projections and the effectiveness of its AI investments will remain under close scrutiny.
Read more at The New York Times.
Meanwhile, in adtech news, Google has officially retired its Privacy Sandbox initiative, which was launched in 2019 to develop privacy-protecting technologies as alternatives to third-party cookies. A Google spokesperson stated that while the company will continue to work on improving privacy across Chrome, Android, and the overall web, it will move away from the Privacy Sandbox branding. The decision to retire these tools was influenced by ecosystem feedback and low adoption rates, as noted by Anthony Chavez, the vice president of Privacy Sandbox.
Despite retiring the Privacy Sandbox, Google will maintain tools like the Cookies Having Independent Partitioned State (CHIPS), which allows websites to store cookies separately for each site a user visits, and the Federated Credential Management API (FedCM), which enables users to sign in to websites with existing accounts while limiting personal data sharing. Additionally, Google will continue to support Private State Tokens, a tracking-free authentication tool designed to mitigate online fraud.
More info at AdWeek.
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