PLUS: NVIDIA's new AI for retailers, Grok's deepfake controversy, and Nintendo's AI accusations
Good morning
OpenAI and SoftBank are making a $1 billion strategic investment into an energy company, a major move aimed at building the massive data center infrastructure needed for the next generation of AI. The deal highlights that the insatiable energy demands of scaling AI models are becoming a critical bottleneck. Is the race for AI dominance now shifting from a sprint for better algorithms to a marathon for securing raw power?
In today’s Next in AI:
OpenAI's $1B investment to power next-gen AI
NVIDIA's new AI for retailers
Grok's deepfake controversy
Nintendo's AI-art accusations
OpenAI's $1B Power Play
Next in AI: OpenAI and SoftBank announced a strategic partnership to invest $1 billion in energy company SB Energy, aiming to build the massive data center infrastructure needed to power the next generation of AI.
Decoded:
This investment is a key part of the colossal $500 billion Stargate commitment that OpenAI, SoftBank, and Oracle announced last year.
SB Energy will specifically build and operate OpenAI's new 1.2 gigawatt data center site in Milam County, Texas.
The deal underscores SoftBank's "all in" strategy on OpenAI, which included selling its entire $5.83 billion stake in Nvidia to double down on the partnership.
Why It Matters: This move signals that securing massive amounts of power is now as critical to AI's future as developing the algorithms themselves. As AI models continue to scale, the race for computational power is quickly becoming a race for energy independence.
NVIDIA's AI Retail Kit
Next in AI: NVIDIA has released a new set of open-source AI blueprints designed to help developers modernize retail operations. The tools focus on creating intelligent warehouse management systems and automating the generation of rich product catalog content.
Decoded:
The Multi-Agent Intelligent Warehouse blueprint uses a team of AI agents to connect existing systems, allowing supervisors to ask natural language questions and get real-time operational insights.
For e-commerce, the Retail Catalog Enrichment tool uses a vision-language model to turn a single product image into detailed descriptions, attributes, and localized marketing content.
These blueprints are powered by models like NVIDIA Nemotron and are part of a larger strategy to create an end-to-end AI pipeline for the entire retail workflow.
Why It Matters: NVIDIA is giving developers the building blocks to implement powerful AI without starting from scratch. This signals a future where integrated AI systems can manage the entire retail journey, from warehouse logistics to the final sale.
Grok's Deepfake Problem
Next in AI: In response to major backlash over its tool being used to create non-consensual deepfakes, Elon Musk’s xAI has placed Grok's image generation feature behind its paid subscription wall on X. The move has been widely criticized as insufficient and is now attracting serious scrutiny from governments worldwide.
Decoded:
The paywall is a partial fix at best, as users can still access the image editing tools for free through X’s built-in “edit image” function and on Grok's standalone website and app.
The incident has triggered a swift international response, with the UK threatening an outright ban of X and a group of US senators urging its removal from the Apple and Google app stores.
Amid the public controversy, xAI announced the completion of its Series E funding round, raising $20 billion from investors and exceeding its initial target.
Why It Matters: This situation highlights the growing tension between deploying AI capabilities quickly and implementing the necessary ethical guardrails. How regulators respond to X’s actions will set a major precedent for enforcing online safety laws in the age of generative AI.
Nintendo's AI Accusation
Next in AI: Nintendo’s new 'My Mario' marketing campaign sparked accusations of using AI-generated images after fans spotted oddly rendered hands. The company and one of the featured models have since officially denied the claims.
Decoded:
The controversy ignited because generative AI notoriously struggles with rendering hands, making funky fingers a common tell-tale sign for online sleuths trying to spot AI content.
Both Nintendo and one of the models, Brittoni O'myah Sinclair, publicly refuted the claims, with Sinclair stating on Instagram that the photos are not AI.
AI image detectors provided wildly conflicting results on the photos, underscoring the current unreliability of automated tools for confirming AI generation.
Why It Matters: This rapid public reaction shows a growing sensitivity and skepticism toward AI's role in creative marketing content. It also puts a spotlight on the challenge of distinguishing between human-made and AI-generated work in a world where detection tools remain imperfect.
AI Pulse
Rescuers employed AI to analyze thousands of drone photos in the Alps, successfully locating a missing climber after the software identified his red helmet—a single point of interest among vast, rocky terrain.
Dell revealed that the "unmet promise of AI" has resulted in disappointing AI PC sales, with executives noting that the concept confuses consumers more than it helps.
Musk argued that people shouldn't save for retirement because AI will soon usher in an era of "universal high income," making the cost of everything so low that it "won't matter."