Good morning. Okay, we’re doing it. We are diving into a bit of quantum computing on this fine Thursday.

If you want to give yourself a bit of a refresher on what quantum even is, check out this recent chat I had with Dr. Jerry Chow, IBM’s director of quantum infrastructure.

— Ian Krietzberg, Editor-in-Chief, The Deep View

In today’s newsletter:

AI for Good: Plastic management 

There are a lot of different types of plastic, a reality that makes plastic recycling both time-consuming and expensive. See, the plastic needs to get sorted first, something that requires both people and time. 

What happened: The National Institute of Standards and Technology has been developing a plastic-sorting method that combines machine learning with lasers to improve efficiency. 

Why it matters: Though it’s still early days, the promise, according to NISt, is simple: “If we can sort those effectively, we can reuse them with fewer processing problems, and recycling will become much more profitable. Then, hopefully, the profits can drive even better recycling habits, and we can start bending our linear economy into a circular one.”

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Microsoft says it made a huge quantum breakthrough

The news: Microsoft on Wednesday announced Majorana 1, its first quantum computing chip. According to Microsoft, the chip, leveraging a new type of material called a topoconductor, will allow Microsoft to build a “truly meaningful” quantum computer in years, not decades. 

This approach of Majorana-based topological qubits is one that Microsoft has been pursuing for nearly 20 years. 

(Apologies in advance for all the physics-y jargon. Here we go). 

A quick note on quantum: Unlike classical computers, quantum computers use quantum processors and qubits, rather than silicon processors and bits. Simply, since quantum computer are based on the physics of quantum mechanics, researchers believe that quantum computers will be able to conduct calculations that classical computers can’t. 

So far, Microsoft has placed eight topological qubits on a chip designed to hold one million. 

Microsoft is far from the only tech giant playing in quantum. Google recently announced its own breakthrough quantum chip, and IBM’s been pushing advances in quantum for years, now; its latest quantum processor can fit 156 qubits.

Here’s where it gets complicated: Dr. Michael Jarret, the associate director of George Mason University’s Quantum Science and Engineering Center, told me that the Majorana particles Microsoft has been chasing “are inherently robust against errors, which is a major bottleneck in scaling existing quantum technology.” 

Jarret said that it seems like a “major advancement in Microsoft's quantum agenda,” though added that he’s left with a “lot of questions.” 

It’s a possibly promising step deeper into quantum; it’s not a solution that itself, today, makes quantum work at scale. 

Still, shares of Microsoft lifted more than 1% on Wednesday, amid affirmations from Jason Zander, a Microsoft executive vice president, that when the legitimate quantum computers arrive, we’ll be able to “invent some new molecule, invent some new drug.”

Humane’s devolution and a retreat from ‘revolution’

In 2023, Humane’s AI Pin was featured in Time Magazine’s roundup of the best inventions of the year. The promise — even before it was officially released — was “a screen-free future.” 

Then, in 2024, the Pin — described as a “true game-changer” — won RedDot’s award for Best Innovative Product. The future, they said, was here. 

But it isn’t anymore. 

On Tuesday, HP acquired Humane for $116 million — the legacy tech firm is taking Humane’s talent, patents and “key AI capabilities” and merging them into a new unit called HP IQ, an AI innovation lab. 

The AI Pin itself didn’t make the cut. 

Humane said in a separate note that, “effective immediately, we are winding down the consumer AI Pin as our business priorities have shifted.” The Pin is no longer for sale; Pins that have already been purchased will be disconnected from Humane’s servers on Feb. 28, the same day that all customer data will be deleted. 

The company will only offer refunds on Pins that are still within their 90-day return window from their original shipment date. So, get ready for an influx of high-tech e-waste.

None of this is really that surprising. 

“I think the main lesson is that distribution matters a lot,” Bain Capital Ventures partner Rak Garg told me. “Humane tapped into what could be possible, but it was mired by execution challenges (slow, buggy, etc etc). Customers, especially consumers, have very little tolerance for AI products that aren’t able to live up to the marketing reel.”

With this all in mind, let’s look back at a different side of 2023. Fintech firm Klarna halted its hiring in late 2023, letting its workforce shrink by about 20%. See, Klarna’s CEO — Sebastian Siemiatkowski — figured that generative AI chatbots were good enough to replace human customer service agents, so the company replaced around 700 of them with GenAI. 

Siemiatkowski said a few months ago that “AI can already do all of the jobs that we, as humans, do. It's just a question about how we apply it and use it.”

But it seems that, on the ground, that reality has not played out.

So, AI didn’t kill customer service, after all. 

And AI didn’t kill the iPhone, either. 

As predicted, I would say that this marks the beginning of the bubble burst. I think we’ll see a lot more of this. 

From the very beginning, the challenge with the business of AI was twofold: one, massive capital requirements, and two, technical limitations that make efficacy and usability hazy at best. 

As Garg told me last year, “the way we think about the bubble is, is there a market big enough to sustain whatever valuation that we invest at?” 

We’ve got companies raising enormous amounts of money at enormous valuations, despite the fact that the actual market for these products likely can’t sustain companies of that size, despite the fact that, two years and hundreds of billions of dollars into this race, we don’t have any sort of significant returns. 

There was so much hype around Humane’s AI Pin. But the market couldn’t sustain it, due to some combination of poor efficacy, little interest and/or high costs. This theme of tremendous costs and challenging implementation is one that repeats up and down the AI ecosystem; the major developers are not immune to it. 

I think the AI bubble will be slowly bursting for a long time, and on the other side of it, I think we’ll see a calmer iteration of generative AI that gets implemented into software layers in targeted ways. I think in many cases, it simply cannot stand on its own.

🤔 Your thought process:

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💭 A poll before you go

Thanks for reading today’s edition of The Deep View!

We’ll see you in the next one.

Here’s your view on Grok 3:

33% of you think it’s about even with the SOTA.

17% think it’s the best LLM out there and 15% think it sucks.

And 20% (like me) are so, so bored of chatbots.

Seems even:

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