Technology

➚ MOVE FAST: Chip away. From the Biden administration asking the Dutch government to halt sales of ASML semiconductors to China, to Japan trying to block Merck’s takeover of JSR, governments continue to tighten their grip on chip production everywhere.

➘ BREAK THINGS: Chip off. It’s not usually the kind of issue that gets the electorate worked up. But by blocking access to its site in Montana and North Carolina, Pornhub is hoping deprived voters will put pressure on elected officials to reverse new state rules. The measures force users to provide identification to verify their age before looking at adult sites.

Samsung’s Galaxy smartphone launches have traditionally received less attention than Apple’s iPhone events, but artificial intelligence might change things. The company announced its annual “Unpacked” gathering in San Jose in two weeks, when the focus will be on “Galaxy AI.”

Samsung is usually a few years ahead of Apple in terms of new features. (Folding phones came out five years ago). Those features, though, don’t change the fundamental nature of the phone. AI could be different. Samsung has the advantage of running Android, which means it could deeply integrate some of the most advanced AI technology out there.

Samsung, which also manufactures semiconductors, could also do some interesting things with on-device AI models. Then the big question becomes: Will iPhone users be enticed to make the switch?

Dan Gwak is a managing partner at Point72 Private Investments, where he leads investing in defense tech.

Q: What are the hardest problems to solve in defense tech?

A: AI, especially autonomy. Outside of Shield AI, it’s pretty hard to find a truly successful company like that. A lot of commercial autonomy startups are struggling. That is truly difficult technology. I have full confidence the defense primes are not going to crack that. That’s why we are willing to fund a startup to do that. If we can get autonomy right, that’s absolutely going to be game changing in a near-peer conflict. And it’s something that, if you get right, the government will basically have no choice but to buy. Air, land, and sea autonomy are all areas that are super important.

Another area is large language models. Great power competition is much more likely to be like a Cold War, and then it’s about decisive technologies that deter adversaries’ actions. What really matters in that scenario is intelligence. What is the adversary thinking? What are they currently publishing about? What can we glean from what people in that country are saying. Even within our own country, sometimes it’s very hard to figure out fact from fiction because there’s such a prevalence of misinformation. But misinformation is going to be a huge part of future conflicts.

What LLMs can do in creating a whole bunch more, or identifying a whole bunch more, information campaigns is truly profound. It’s not just like LLMs can save you the writing of the thing. They’re starting to actually be able to log into SaaS products like Twitter, and go through the workflows themselves. It’s like a 100x, 1,000x productivity increase for human beings. These cutting edge technology waves that are the big game changers, the primes aren’t well positioned to address.

Q: When you talk about autonomy, that’s fairly broad. Do you have examples?

A: The hard part is actually the autonomy software. That’s the control system that can take in the sensor data, and make sense of it to control the vehicle. I can imagine a world where there’s a software adoption pathway, where software ends up going into the existing platforms. You’re probably not going to build a whole new nuclear submarine just for the autonomy capability. So that software adoption pathway is important. You’re starting to see that in, for example, grounded autonomy. There’s a program with robotic combat vehicles [RCVs]. Primes compete for the hardware component of it and then they’re having a separate acquisition process for the control software part of it.

Those things are separated purposefully because the defense primes have a lot more experience building that tank body or whatever. And the startups have a lot more experience building the autonomy software.

But the biggest impact of autonomy isn’t just taking the existing platforms, and then making them autonomous. What’s truly game changing is things you can do that you previously couldn’t. An example of that is the Marine Corps NMESIS program. They have an idea of creating an autonomous vehicle that can launch missiles, launch artillery, and then autonomously get out of there.

Why is that so important? My father is actually an artilleryman. When you launch artillery, it goes through the air, gets caught on radar, and they know where that’s coming from right away. They’re sending artillery back instantly. Oftentimes, that means an artilleryman can get one round and then they’ve got to pack up and get out of there as soon as they can. If we can autonomously do that, it’s 100x better.

Q: Do you need lobbyists to sell to the government?

A: The fundamental reason that it is so hard to sell to the government is what I call the Triangle of Death. The users, the budget, and the authority all live in different places in [the Defense Department]. To make matters worse, they don’t know about each other. That’s the crazy thing. The user is the uniformed military service person who is facing off against the enemy, maybe a drone pilot or an intelligence officer who needs to understand what’s being said in the Chinese Twittersphere.

That user usually loves talking to tech companies because they can tell right away what’s going to be massively game changing and really help them in their job. But if you ask that user how they would go about purchasing something, they have no idea.

When I was a Marine, I got issued a rifle. I could not tell you who made the decision that was the rifle we were going to carry. So for startups, the users are usually fairly easy to identify and get to, but identifying where that budget and where the authority lives are the really hard part about defense tech sales into government.

Of all the tech giants, Apple may be the most vulnerable to antitrust enforcement in the U.S. and Europe, the FT pointed out in a well-researched article.

Apple has signaled to Wall Street that it can counter flattening smartphone sales with increasing revenue from its services, like Apple Music and AppleCare. But the biggest chunk of the $26 billion Google pays to mobile phone companies to be the default search engine goes to Apple, and that makes up a quarter of the iPhone maker’s services sales, according to the article. That payment has come under intense scrutiny of late, both in the U.S. and Eurupe.

Apple’s App store is also being targeted for forcing app makers to use the company’s payment processing, which charges up to 30% on every digital transaction.

And more recently, Apple has drawn criticism for taking aim at a startup called Beeper, which figured out an ingenious way to allow Android users to use iMessage.

SpaceX just launched 21 new Starlink satellites into space. The cool part, though, is that six of them are made to connect directly to cell phones. The fact that this isn’t a bigger deal is a testament to the insane amount of tech news these days. It wasn’t long ago that experts in this field would tell you beaming a cell signal directly from space to an unmodified cell phone was impossible.

SpaceX founder Elon Musk pointed out on X that this is mainly for areas where there’s no signal. It’s not going to replace traditional cell service; SpaceX is partnering with T-Mobile on the project. But given how fast this technology is moving, it probably won’t be long before we have an internet that is space-based.

Maybe it won’t be as fast or robust as our current terrestrial backbone, but it could be incredibly powerful, especially in places where internet access is controlled by authoritarian governments.

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