good morningAlexei Oreskovic is here, taking the baton from Features Editor Matt Heimer, who has been kind enough to fill in for me over the past few days. And then, amazing things happened one after another.
OpenAI has officially retired Sora, its highly touted video generation app. Arm Holdings, which has provided chip IP licenses for many years, has announced that it will begin selling its own silicon chips. Meta has lost a major legal battle accusing it of harming teenagers, with a jury awarding the plaintiffs $375 billion in damages (Meta says it will appeal).
All of these events are sure to reverberate throughout the tech industry over the coming days and weeks (we’ll discuss some of them in detail below). As with many surprises, there were signs that foreshadowed the news, but they either make more sense now or seem obvious in hindsight (and, as with all surprises, many customers are now shouting how they used to “call it that”).
Alexei Oreskovitch
@lexnfx
alexei.oreskovic@fortune.com
Want to send comments or suggestions to Fortune Tech? Type a line here.
Was this newsletter forwarded to you? Subscribe here!
OpenAI kills Sora
Talk about changing the script. OpenAI has announced it is “saying goodbye” to Sora, the AI video generation product it launched to much fanfare in 2025.
What makes this move even more surprising is that OpenAI and the Walt Disney Company just signed a landmark three-year deal in December, in which Disney committed to investing $1 billion in OpenAI and gave OpenAI exclusive rights to incorporate hundreds of famous Disney characters into its AI products. OpenAI looked like it was on its way to becoming a major Hollywood company, not to mention leapfrogging all other AI video startups.
So why is OpenAI announcing its closure? OpenAI hasn’t said much (shortly after OpenAI announced its closure in a 4-sentence post with few details) wall street journal (reported the plan on Tuesday).
It’s probably no coincidence that the move comes as OpenAI looks to focus on its most important products amid fierce competition from Anthropic and Google. OpenAI recently consolidated several of its products into a single desktop “super app” and told employees to stop spending time on “side quests.”
But if OpenAI saw the potential for a main quest somewhere in Sora’s future, it probably wouldn’t sideline it so quickly.
Some observers on X and Reddit have speculated that the energy and computing costs of producing hyper-realistic video clips are probably too great. This is especially true if Sora’s primary users are beginners who are unlikely to become paying subscribers to OpenAI. And with rumors of an IPO on the horizon, OpenAI needs its financials to shine.
It’s also possible that OpenAI has decided that the legal and reputational risks (deepfakes, IP infringement, etc.) associated with running a video generation app are too onerous. Yes, the deal with Disney was a big win for OpenAI. But I haven’t seen any other studios make similar deals with OpenAI.
The deal with Disney, signed by outgoing CEO Bob Iger, is now up in the air, according to various media reports.blue
Arm makes its own chips
Reinventing your identity after 40 years may sound like a tell-tale sign of a midlife crisis. And in the case of Arm Holdings, a 36-year-old chip design company, a surprise announcement about its business model on Tuesday raised eyebrows in the tech world. After decades of licensing its chip architecture to other companies (the processors inside Apple iPhones, Qualcomm’s Snapdragon processors, and the CPU portion of Nvidia’s GPU products, just to name a few), Arm is doing something it’s never done before. The idea is to manufacture and sell its own chips.
The chip, called the Arm AGI CPU, is specifically designed for data center AI workloads and is co-developed with Meta. This could put Arm in competition with a number of chip makers, including Nvidia, which pays licensing fees for its chip designs. Even as Mr. Arm said, this is a difficult line to walk. new york times—The new chip is something of a side hustle aimed at a very limited number of cloud giants with specialized needs.
The history of technology is full of examples of companies that tried to license their technology to customers, while also trying to sell their own products that competed with those same customers. Customers usually didn’t appreciate it, and experiments often proved short-lived (remember when Apple licensed its operating system to cloners in the 1990s?). Once again, we are entering the age of AI, and many assumptions about smart business practices are being reevaluated (or ignored). Think about all the “circular” deals that AI companies are making with each other.blue
Apple places ads on Maps
Apple plans to start selling ads on Apple Maps in the U.S. and Canada this summer. As part of a major expansion of its advertising business, the company is launching a new initiative that will give businesses with physical listings the ability to bid to appear next to relevant search results. Users will see one ad per search, with a blue halo on map pins and an “ad” label on suggested locations lists. Apple assures customers that user data will not be linked to Apple accounts, stored, or shared with third parties.
The Maps rollout is part of a broader reorganization that Apple is calling Apple Business, which will consolidate its existing suite of business tools (Apple Business Connect, Essentials and Manager) into a single platform. This integrated product also adds new productivity tools such as business email and calendars, employee directories, and a free MDM product for device management. The platform will be available in 200 countries and territories starting April 14th.beatrice nolan
More technology
—Mehta lost a major child safety case. $375 million in damages and a huge precedent.
—SpaceX IPO! It could be submitted as early as this week.
—Boring Co. is under scrutiny for “structural deficiencies” in Nevada. Lawmakers pressure the governor on oversight.
—Federal judge troubled by Pentagon’s treatment of people: “It looks like an attempt to neutralize humanity.”
—Epic will lay off 1,000 employees. “Fortnite’s low engagement.”
—Neal Stephenson talks about the death of the Metaverse: People don’t like wearing these things on their faces.
AI Handbook: The Future of Software Development
Will software developers become obsolete? AI is becoming increasingly capable of writing code, allowing non-programmers to get into the software game, making some junior programmers obsolete. However, as luck AI editor Jeremy Kahn explains that AI still hallucinates and makes mistakes, so experienced programmers are essential for quality control and reliability. Look at the playbook.
