Can OpenAI really go the way of Apple and capture lightning in a bottle?
Gus Carlson is a U.S.-based columnist for The Globe and Mail.
After OpenAI's series of embarrassing stumbles – including disruptive outages, pesky glitches in its ChatGTP platform, and the bizarre ousting and rehiring of its chief executive officer in a matter of days – the popular artificial-intelligence platform finally got one right.
So right, in fact, that the company has manoeuvred itself into a position to put some blue water between itself and deep-pocketed rivals in the development of AI devices, the way Apple did with rivals in the computer and mobile phone world.
The Apple comparison is not coincidental. Late last month, OpenAI said it planned to acquire an AI device company called io in an all-equity deal valued at about US$6.4-billion. Embedded in the purchase is a secret weapon that goes well beyond the technology: the design legend and io co-founder Jony Ive.
OpenAI recruits legendary iPhone designer Jony Ive to work on AI hardware in $6.5B deal
Mr. Ive is not just another smart techie. He is the design genius responsible for creating Apple's most iconic products, including the iPod, iPhone, iPad and MacBook Air. He also helped design Apple's ultra-modern California headquarters.
It was Mr. Ive's eye for combining elegant simplicity and functionality that set Apple's products apart from all others, first in the world of PCs and then in handheld devices. Even Apple's packaging reflects Mr. Ives's commitment to reinforcing the brand's sleek beauty in every way it touches customers.
So influential was Mr. Ive that Apple co-founder Steve Jobs said he considered him to be his 'spiritual partner' who saw things the same way he did. Mr. Ive was among Mr. Jobs's first hires when he returned to Apple in 1997 after being fired from the company more than a decade earlier. Mr. Ive had a direct and unfettered reporting relationship with Mr. Jobs.
Few would question Mr. Ive's enormous influence on the devices we all use every day. In a post about the io acquisition on X, OpenAI CEO Sam Altman wrote that Mr. Ive is 'the greatest designer in the world.'
OpenAI needs a win. The acquisition of Mr. Ive and io is a crucial strategic play for OpenAI to stay ahead in the generative AI race, where competitors including Google, Anthropic and Elon Musk's xAI are making significant investments and quickly pushing new products to market.
The showdown in AI devices is seen as the next big inflection point for the sector that may drive consolidation and some flame-outs – fates OpenAI seems determined to avoid.
The purchase of io – OpenAI already owns about 23 per cent of the company – is the latest in a recent shopping spree that has seen OpenAI shore up its hardware assets. Just a few weeks ago, it agreed to buy AI-assisted coding tool Windsurf for US$3-billion. OpenAI also acquired analytics database company Rockset last year.
OpenAI has also hired the former head of Meta's Orion augmented reality glasses initiative to lead its robotics and consumer hardware efforts.
OpenAI CFO says new structure opens door for potential IPO
Despite the asset and talent accumulation, OpenAI has some hurdles to clear with its current offerings, as well some reputation issues that continue to dog its credibility.
The company has been plagued by high error rates in its application programming interface (API) and performance problems in ChatGTP.
Users have reported a wide range of gremlins, including slow response times, trouble mining information from source documents, contextual problems and generic responses to queries.
But perhaps OpenAI's biggest black eye came in November, 2023, when its board ousted Mr. Altman as CEO because of concerns about his leadership capabilities and lack of transparency in his communications with directors.
Then, just a few days later, after employees protested the firing and threatened a mass walk-out, Mr. Altman was reinstated as CEO.
An independent investigation concluded that the board's initial concerns about Mr. Altman did not rise to the threshold for termination.
But the damage was done. The chaos in the governance structure dealt a blow to OpenAI's reputation at a time in its young life when it was breaking new ground and trying to establish credibility in the fast-emerging AI space.
If history is any guide, Mr. Ive's eye for the kind of elegant, simple and unique device designs that separated Apple from the pack will give OpenAI an advantage over its bigger rivals.
The big questions are: Can he capture lightning in a bottle again, the way he did at Apple, and will he be given the latitude to pursue the unique creative path that has made him a tech legend?
Based on OpenAI's past governance bungling, Mr. Altman's biggest job is to keep the board out of Mr. Ive's hair and let him work his magic.
If they can manage that, oh, the places they'll go.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Globe and Mail
an hour ago
- Globe and Mail
Think It's Too Late to Buy AMD? Here's the Biggest Reason Why There's Still Time.
Advanced Micro Devices (NASDAQ: AMD), better known simply as AMD, is often overlooked by investors, as it has a distant second-place market share to leading chipmaker Nvidia (NASDAQ: NVDA) in the AI-fueled data center accelerator market. There are several reasons why AMD stock should be on your radar right now. CEO Lisa Su has established a long track record of outperforming expectations. The company's recent data center chips are gaining impressive traction. And AMD has been steadily taking PC market share from long-time leader Intel (NASDAQ: INTC) for years. However, the biggest reason why it's not too late to buy AMD right now is because of the long-tailed growth potential in some of its core markets. AMD's market growth Here are a few projections for AMD's core markets from reputable analytical firms: Data center capital expenditure is expected to roughly double over the next three years, and according to Grand View Research; the data center accelerator market is expected to grow from about $34 billion in revenue last year to $166 billion by 2030. The gaming GPU market is estimated to be a $5 billion opportunity today, but is expected to more than 6x in size by 2030, according to Mordor Intelligence. The automotive GPU market is expected to be a $45 billion market by 2030, according to Virtue Market Research, a 33% annualized growth rate. Overall, the global GPU market (which is only one type of chip AMD makes) is expected to grow from $62 billion in 2024 to over $460 billion by 2032, a 29% annualized growth rate. The bottom line is that even if AMD simply maintains its current market share, revenue growth could be extremely strong for the foreseeable future. Should you invest $1,000 in Advanced Micro Devices right now? Before you buy stock in Advanced Micro Devices, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Advanced Micro Devices wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $966,931!* Now, it's worth noting Stock Advisor 's total average return is1,062% — a market-crushing outperformance compared to177%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of June 23, 2025
Globe and Mail
an hour ago
- Globe and Mail
$1,000 Invested in VUG Could Turn Into $50,000
High-flying growth stocks receive a lot of attention, thanks to their high return potential. However, it doesn't take picking generational companies to make good money in the stock market. Broad exchange-traded funds (ETFs) have shown they can also do the trick with enough time on your side. ETFs allow you to invest in dozens, hundreds, and even thousands of companies with a single investment. And although they may not be as sexy as individual stocks, many go on to outperform the broader market (based on S&P 500 returns). The Vanguard Growth ETF (NYSEMKT: VUG) is a great example of this. Focusing on large-cap growth stocks, VUG has been a rewarding investment and has the potential to turn a $1,000 investment into $50,000 if it continues at its current rate. Stability and growth all mixed into one ETF Large-cap growth stocks have the potential to be the best of both worlds. On the one hand, large-cap companies (those with a market cap of at least $200 billion) typically have established business models, are market leaders, and are in good financial health. This helps provide a bit of stability because these companies have diversified revenue streams and the resources to weather rough times in the economy. On the other hand, these companies are still considered growth stocks because of their strong revenue and earnings growth and their considerable expansion and return potential. Below are the ETF's top 10 holdings: Company Percentage of the ETF Apple 11.61% Microsoft 10.59% Nvidia 9.04% Amazon 6.16% Meta Platforms 4.04% Broadcom 3.44% Alphabet (Class A) 3.24% Tesla 2.95% Eli Lilly 2.93% Alphabet (Class C) 2.63% Data source: Yahoo! Finance. The ETF is a bit top-heavy, but that's because it's weighted by market cap, and megacap tech stocks have skyrocketed in valuation over the past half-decade or so. The tech sector represents over 58% of VUG. How a $1,000 investment can turn into $50,000 This ETF doesn't have superpowers that can turn $1,000 into $50,000 overnight, but it does have returns that can do so if they continue. Since hitting the stock market in January 2004, the VUG ETF has averaged around 10.4% annual returns. Over the past decade, its average annual returns have been an impressive 14.7%. VUG data by YCharts. Using 10% and 14% average annual returns, here's how much a one-time $1,000 investment could go to in different numbers of years: Years Invested 10% Annual Returns 14% Annual Returns 10 $2,580 $3,690 15 $4,150 $7,100 20 $6,670 $13,640 25 $10,730 $26,230 30 $17,260 $50,410 Calculations by author. Values are rounded down to the nearest ten and take into account VUG's expense ratio. Let compound earnings do the hard work for you Anytime your investment grows a few times over, it's a good thing, but the real value is created when you continue contributing to VUG instead of a one-time investment. For the sake of illustration, let's meet in the middle and assume VUG averages 12% annual returns. Here's how your investment could stack up based on how much you add monthly: Years Invested $100 Added Monthly $250 Added Monthly $500 Added Monthly 15 $50,000 $116,900 $228,400 20 $95,600 $224,700 $439,800 25 $175,800 $414,300 $811,900 Calculations by author. Values are rounded down to the nearest hundred and take into account VUG's expense ratio. It's important to remember that these are all assumptions and there's no way to predict how VUG (or any stock) will perform going forward. However, the most important thing this shows is just how effective compound earnings can be at creating wealth in the stock market. What you may lack in a lump sum to invest, you can make up for with consistency and time. Don't underestimate the power of both. Should you invest $1,000 in Vanguard Index Funds - Vanguard Growth ETF right now? Before you buy stock in Vanguard Index Funds - Vanguard Growth ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vanguard Index Funds - Vanguard Growth ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $966,931!* Now, it's worth noting Stock Advisor 's total average return is1,062% — a market-crushing outperformance compared to177%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of June 23, 2025 John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Stefon Walters has positions in Apple and Microsoft. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, Tesla, and Vanguard Index Funds-Vanguard Growth ETF. The Motley Fool recommends Broadcom and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
Globe and Mail
an hour ago
- Globe and Mail
SDY Is a Popular Dividend ETF for Passive Income. But Is It the Best?
When it comes to investing, it makes a lot of sense for many of us to opt for exchange-traded funds (ETFs), which are funds that trade like stocks. With classic mutual funds, if you want to buy into one, you place your order and it gets filled at the end of the day, at a price based on the closing prices of its components that session. With an ETF, you can place an order to buy at any time during the trading day and that order can be executed immediately. ETFs come in a wide variety, and many are low-fee index funds, including the popular Vanguard S&P 500 ETF (NYSEMKT: VOO). It's worth considering dividend-focused ETFs, too, as they can deliver valuable income for decades, without your having to research and choose individual dividend-paying stocks. One popular fund of this type is the SPDR S&P Dividend ETF (NYSEMKT: SDY). Would it be a good fit for your portfolio? Why dividends? Dividend-paying stocks are a more powerful tool for building investors' wealth than many people realize. Part of the reason is that in order to commit to paying a regular dividend, a company's management must be fairly confident in the reliability of cash flows, finding them sufficient to support the dividend. No company wants to have to shrink or eliminate a dividend, as that would be a red flag to investors. Consider this tidbit from the folks at Hartford Funds: "Going back to 1960, 85% of the cumulative total return of the S&P 500 Index can be attributed to reinvested dividends and the power of compounding." Meet the SPDR S&P Dividend ETF SPDR S&P Dividend ETF tracks the S&P High Yield Dividend Aristocrats index, which restricts its components to companies in the S&P Composite 1500 that have increased their payouts annually for at least 20 consecutive years. The ETF recently yielded a solid 2.59%. Here's how it has performed in recent years Over the Past... Average Annualized Gain 3 years 6.31% 5 years 11.34% 10 years 9.24% 15 years 11.12% Source: Morningstar. Figures as of June 25, 2025. You'll note that those are not the fattest returns -- but they come along with some durability, as not every company is so solidly built that it can not only pay dividends for at least 20 years, but increase them annually, too. The SPDR S&P Dividend ETF recently held positions in 149 companies, and its top 10 holdings made up about 18% of its total value. Those recent top holdings were: Stock Percent of ETF Microchip Technology 2.41% Verizon Communications 2.36% Realty Income 2.19% Target 1.80% Chevron 1.70% Texas Instruments 1.62% Archer-Daniels-Midland 1.39% Eversource Energy 1.38% Kimberly Clark 1.36% NextEra Energy 1.34% Source: Morningstar. Figures as of June 24, 2025. Is the SPDR S&P Dividend ETF the best dividend ETF? So -- is the SPDR S&P Dividend ETF the best dividend ETF? Well, sure, for some people. But there are other solid dividend-focused ETFs to consider. Here are some, along with an S&P 500 index fund, for comparison. JPMorgan Equity Premium Income ETF (NYSEMKT: JEPI) 8.01% 11.73% N/A iShares Preferred & Income Securities ETF (NASDAQ: PFF) 6.68% 3.22% 3.21% Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD) 3.97% 13.34% 10.92% Fidelity High Dividend ETF (NYSEMKT: FDVV) 3.02% 17.91% N/A Vanguard High Dividend Yield ETF (NYSEMKT: VYM) 2.86% 14.60% 10.08% SPDR S&P Dividend ETF 2.59% 11.77% 9.29% iShares US Real Estate ETF (NYSEMKT: IYR) 2.55% 7.26% 6.09% iShares Core Dividend Growth ETF (NYSEMKT: DGRO) 2.23% 13.94% 11.75% Vanguard Dividend Appreciation ETF (NYSEMKT: VIG) 1.79% 14.07% 11.83% First Trust Rising Dividend Achievers ETF (NASDAQ: RDVY) 1.67% 17.61% 12.68% Vanguard S&P 500 ETF (NYSEMKT: VOO) 1.25% 16.54% 13.15% Source: Yahoo! Finance and Morningstar. Figures as of June 24, 2025. Before you jump at the fattest yield you see, remember that dividend growth is important, too. An ETF with a yield of 4% today might be more tempting than one with a yield of 3%, but the fund with the 3% yield might be growing its payouts faster, and wind up delivering more actual income than the other within a few years. Remember that the SPDR S&P Dividend ETF is focused on dividend growers. Its quarterly payout in June 2025 was $0.927 per share, up from $0.68 in June 2020 and $0.503 in June 2015. Note, too, that the JPMorgan Equity Premium Income ETF is a different kind of fund, not purely a holder of dividend-paying stocks. And the iShares Preferred & Income Securities ETF is focused on preferred stock, which tends to appreciate in value more slowly. So dig in deeper into any ETF that intrigues you. Any of the ones above may serve you well, delivering increasing passive income to you and your portfolio for many years or decades. Should you invest $1,000 in SPDR Series Trust - SPDR S&P Dividend ETF right now? Before you buy stock in SPDR Series Trust - SPDR S&P Dividend ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and SPDR Series Trust - SPDR S&P Dividend ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $966,931!* Now, it's worth noting Stock Advisor 's total average return is1,062% — a market-crushing outperformance compared to177%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of June 23, 2025 Selena Maranjian has positions in NextEra Energy, Realty Income, Schwab U.S. Dividend Equity ETF, and Verizon Communications. The Motley Fool has positions in and recommends Chevron, NextEra Energy, Realty Income, Target, Texas Instruments, Vanguard Dividend Appreciation ETF, Vanguard S&P 500 ETF, and Vanguard Whitehall Funds-Vanguard High Dividend Yield ETF. The Motley Fool recommends Verizon Communications. The Motley Fool has a disclosure policy.
