Tech
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Jon Keegan
2/27/25

OpenAI’s Altman: Good news: GPT-4.5 has been released! Bad news: It’s huge and expensive

A few weeks ago, CEO Sam Altman announced a “roadmap update” for OpenAI’s upcoming AI model releases, to address how confusing the company’s model and product offerings have become.

Today, the company announced that it’s released its next model, GPT-4.5, as a “research preview” for developers and Pro users.

But you get the sense from the announcement that it is kind of a weird release for the company. In a tweet announcing the release, Altman wrote:

“good news: it is the first model that feels like talking to a thoughtful person to me... bad news: it is a giant, expensive model.”

Altman even apologized for running out of GPUs, which will delay the model’s wider release. Altman said there are “hundreds of thousands coming soon, and i’m pretty sure y’all will use every one we can rack up.”

In a video announcing its release, research lead Mia Glaese said that it’s OpenAI’s “largest and most knowledgeable model yet.”

And don’t call it a “frontier model.”

Glaese said the GPT-4.5 is “generally useful and inherently smarter,” but Altman has already said this model is the last of its kind. GPT-4.5 doesn’t use multistep “reasoning” like its o3 models and DeepSeek’s R1, despite an emerging consensus in the industry that this technique is the way forward.

This model might be the last one to be created with the method that powered the first wave of generative AI: shoveling larger and larger amounts of data into larger and larger computing clusters (the kind powered by hundreds of thousands of Nvidia GPUs).

This scaling of “unsupervised learning” leads to fewer hallucinations and a more natural tone, the company said. The press release for the model said:

“By scaling unsupervised learning, GPT‑4.5 improves its ability to recognize patterns, draw connections, and generate creative insights without reasoning.”

Next up is GPT-5, which is expected sometime this year.

But don’t expect this model to blow away the competition. Altman said, “this isn’t a reasoning model and won’t crush benchmarks.”

But you get the sense from the announcement that it is kind of a weird release for the company. In a tweet announcing the release, Altman wrote:

“good news: it is the first model that feels like talking to a thoughtful person to me... bad news: it is a giant, expensive model.”

Altman even apologized for running out of GPUs, which will delay the model’s wider release. Altman said there are “hundreds of thousands coming soon, and i’m pretty sure y’all will use every one we can rack up.”

In a video announcing its release, research lead Mia Glaese said that it’s OpenAI’s “largest and most knowledgeable model yet.”

And don’t call it a “frontier model.”

Glaese said the GPT-4.5 is “generally useful and inherently smarter,” but Altman has already said this model is the last of its kind. GPT-4.5 doesn’t use multistep “reasoning” like its o3 models and DeepSeek’s R1, despite an emerging consensus in the industry that this technique is the way forward.

This model might be the last one to be created with the method that powered the first wave of generative AI: shoveling larger and larger amounts of data into larger and larger computing clusters (the kind powered by hundreds of thousands of Nvidia GPUs).

This scaling of “unsupervised learning” leads to fewer hallucinations and a more natural tone, the company said. The press release for the model said:

“By scaling unsupervised learning, GPT‑4.5 improves its ability to recognize patterns, draw connections, and generate creative insights without reasoning.”

Next up is GPT-5, which is expected sometime this year.

But don’t expect this model to blow away the competition. Altman said, “this isn’t a reasoning model and won’t crush benchmarks.”

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OpenAI and Microsoft reach agreement that moves OpenAI closer to for-profit status

In a joint statement, OpenAI and Microsoft announced a “non-binding memorandum of understanding” for their renegotiated $13 billion partnership, which was a source of recent tension between the two companies.

Settling the agreement is a requirement to clear the way for OpenAI to convert to a for-profit public benefit corporation, which it must do before a year-end deadline to secure a $20 billion investment from SoftBank.

OpenAI also announced that the controlling non-profit arm would hold an equity stake in the PBC valued at $100 billion, which would “making it one of the most well-resourced philanthropic organizations in the world.”

The statement read:

“This recapitalization would also enable us to raise the capital required to accomplish our mission—and ensure that as OpenAI’s PBC grows, so will the nonprofit’s resources, allowing us to bring it to historic levels of community impact.”

Settling the agreement is a requirement to clear the way for OpenAI to convert to a for-profit public benefit corporation, which it must do before a year-end deadline to secure a $20 billion investment from SoftBank.

OpenAI also announced that the controlling non-profit arm would hold an equity stake in the PBC valued at $100 billion, which would “making it one of the most well-resourced philanthropic organizations in the world.”

The statement read:

“This recapitalization would also enable us to raise the capital required to accomplish our mission—and ensure that as OpenAI’s PBC grows, so will the nonprofit’s resources, allowing us to bring it to historic levels of community impact.”

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BofA doesn’t expect Tesla’s ride-share service to have an impact on Uber or Lyft this year

Analysts at Bank of America Global Research compared Tesla’s new Bay Area ride-sharing service with its rivals and found that, for now, its not much competition for Uber and Lyft. “Tesla scale in SF is still small, and we dont expect impact on Uber/Lyft financial performance in 25,” they wrote.

Tesla is operating an unknown number of cars with drivers using supervised full self-driving in the Bay Area, and roughly 30 autonomous robotaxis in Austin. The company has allowed the public to download its Robotaxi app and join a waitlist, but it hasn’t said how many people have been let in off that waitlist.

While the analysts found that Tesla ride-shares are cheaper than traditional ride-share services like Uber and Lyft, the wait times are a lot longer (nine-minute wait times on average, when cars were available at all) and the process has more friction. They also said the “nature of [a] Tesla FSD ‘driver’ is slightly more aggressive than a Waymo,” the Google-owned company that’s currently operating 800 vehicles in the Bay Area.

APPLE INTELLIGENCE

Apple AI was MIA at iPhone event

A year and a half into a bungled rollout of AI into Apple’s products, Apple Intelligence was barely mentioned at the “Awe Dropping” event.

Jon Keegan9/10/25
tech
Jon Keegan
9/10/25

Oracle’s massive sales backlog is thanks to a $300 billion deal with OpenAI, WSJ reports

OpenAI has signed a massive deal to purchase $300 billion worth of cloud computing capacity from Oracle, according to a report from The Wall Street Journal.

The report notes that the five-year deal would be one of the largest cloud computing contracts ever signed, requiring 4.5 gigawatts of capacity.

The news is prompting shares to pare some of their massive gains, presumably because of concerns about counterparty and concentration risk.

Yesterday, Oracle shares skyrocketed as much as 30% in after-hours trading after the company forecast that it expects its cloud infrastructure business to see revenues climb to $144 billion by 2030.

Oracle shares were up as much as 43% on Wednesday.

It’s the second example in under a week of how much OpenAI’s cash burn and fundraising efforts are playing a starring role in the AI boom: the Financial Times reported that OpenAI is also the major new Broadcom customer that has placed $10 billion in orders.

Yesterday, Oracle shares skyrocketed as much as 30% in after-hours trading after the company forecast that it expects its cloud infrastructure business to see revenues climb to $144 billion by 2030.

Oracle shares were up as much as 43% on Wednesday.

It’s the second example in under a week of how much OpenAI’s cash burn and fundraising efforts are playing a starring role in the AI boom: the Financial Times reported that OpenAI is also the major new Broadcom customer that has placed $10 billion in orders.

Large companies have started to drop AI from their businesses

Census data shows drop in large companies using AI

AI appears to be everywhere, but that doesn’t mean big companies have fully embraced the use of the technology in their day-to-day business.

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