OpenAI x Jony Ive: The $6.5B Bet That Could Kill the iPhone
Altman is calling their prototype the "coolest piece of technology the world has ever seen." Is this the iPhone moment for AI hardware?
Good morning AI entrepreneurs & enthusiasts,
While Google’s I/O dominated headlines across the AI community, OpenAI just landed an io of its own — acquiring Jony Ive’s AI hardware venture in a $6.5B all-stock deal.
Altman is calling their prototype the "coolest piece of technology the world has ever seen." Is this the iPhone moment for AI hardware?
Today’s AI news:
OpenAI acquires Jony Ive's AI device venture
Mistral debuts new open-source coding model
Shopify rolls out AI store builder & Sidekick upgrades
Top Tools & Quick News
OpenAI acquires Jony Ive’s AI device company
The News: OpenAI has officially acquired io, the AI hardware startup co-founded by legendary Apple designer Jony Ive, in a $6.5B all-stock deal — a strategic pivot toward AI-native hardware.
The Details:
Ive and OpenAI have been working together for two years on next-gen devices designed to move "beyond screens," with a launch target of 2026.
The acquisition brings in over 50 engineers and designers, many of whom helped shape the iPhone and iPad.
LoveFrom, Jony Ive’s design firm, will now lead creative work across OpenAI, influencing both hardware and software aesthetics.
In a 9-minute video, Altman praised Ive as the "deepest thinker" he's worked with, while Ive called Altman a "rare visionary."
Altman claims the prototype he’s tested is the "coolest piece of technology" he's ever seen, hinting at a new paradigm in user-AI interaction.
Why this matters: This is OpenAI’s most ambitious move into consumer tech — and it may also be Apple’s wake-up call. With Apple-caliber design leadership now in-house at OpenAI, and Siri falling behind while Apple’s product momentum wanes, the partnership between Altman and Ive could give rise to a new category-defining platform. If executed right, this duo might not just build beautiful AI-first hardware — they could redefine who leads the next era of consumer technology.
Mistral unveils compact open-source coding model
The News: Mistral AI, in partnership with All Hands AI, has launched Devstral — a compact open-source coding model that outperforms larger competitors like Gemma 3 27B and DeepSeek V3 on SWE-Bench Verified and other benchmarks.
The Details:
Excels at SWE-Bench Verified, scoring 46.8% and beating prior open-source state-of-the-art by 6%
Features agentic coding capabilities, including repo traversal, file editing, and integration with SWE-Agent and OpenHands
Supports a 128k context window to handle complex interdependencies across large codebases
Runs locally on hardware like an RTX 4090 or 32GB Mac — no cloud required
Licensed under Apache 2.0, enabling commercial use and modification
Why this matters: Following its closed Medium 3 release, Mistral’s open-source return reaffirms its commitment to accessible, high-performance developer tools. With real-world use cases and a larger agentic model in the works, Devstral shows that high-performing, private, and flexible AI coding agents are here to stay.
Shopify releases AI-powered storefront tools
The News: Shopify’s Summer ‘25 Edition just dropped, and it’s AI-packed. From AI-powered store generation to major Sidekick upgrades, this release pushes Shopify into next-gen commerce.
The Details:
Merchants can now describe their business in plain language, and Shopify’s AI Store Builder will generate a complete storefront — layout, copy, and visual assets — in seconds.
The new "Horizon" AI themes allow users to drag-and-drop content, generate banners or product highlights by prompt, and fully customize without code.
Sidekick, Shopify’s AI assistant, now supports voice input, screen sharing, multi-step reasoning, and native image generation for instant creative assets.
AI Shopping Agents allow merchants to deploy virtual assistants that search catalogs, manage carts, and complete purchases via chat platforms like Perplexity.
Why this matters: Shopify is quietly becoming one of the largest enablers of AI adoption for small businesses. These tools allow anyone to launch, personalize, and scale an online store — regardless of technical background — while automating key operations and enhancing customer experiences.
QUICK HITS
🎬 Flow — Google’s cinematic AI film engine
🎥 Veo 3 — Video model with synced audio
📱 Gemma 3n — Mobile-optimized open-source model
🎆 Imagen 4 — Advanced image generation with better text rendering
Quick News
ByteDance debuts BAGEL, a new open-source multimodal model capable of text, image, and video understanding
xAI rolls out Live Search API for real-time data access via Grok and web-based queries
OpenAI expands its Responses API with MCP server support, image generation, and enterprise-ready features
Sergey Brin claims Gemini may hit AGI before 2030, contrasting with DeepMind’s more cautious view
OpenAI secures $11.6B to expand Stargate Data Center in Texas
LMArena raises $100M and announces platform relaunch
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