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Good morning. Next time we send this newsletter, it will be September. How that statement is true, we cannot say.
In today’s edition:
 Large language models
 Crypto tax
—Hayden Field, Ryan Duffy, Dan McCarthy
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Francis Scialabba
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This month, the Stanford Institute for Human-Centered Artificial Intelligence (HAI) announced a brand-new research arm, the Center for Research on Foundation Models. Typically known as large language models, these powerful AI techniques have been the subject of both intense scrutiny and lofty praise.
Last week, during the CRFM’s first-ever workshop, the debate bubbled up again.
Rewind: After a dispute over a research paper about large language models, Google fired its AI ethics co-leader Timnit Gebru in December 2020. The decision prompted massive backlash and directed a spotlight on the AI technique.
- These massive algorithms are trained on large swaths of the internet, causing them to both produce highly accurate approximations of natural language but also to replicate some human biases.
The models already fuel a wide range of popular tools and services, including Gmail’s Smart Compose. An increasing number of startups are powered by OpenAI’s GPT-3, and Google recently announced it will double down on the use of large language models to underpin services like Search.
Names and frames
As commercialization of these algorithms moves full steam ahead, some leaders, researchers, and academics in the AI community continue to warn that the tech warrants a much more cautious approach. Some saw HAI’s decision to refer to large language models as “foundation models” as an attempt to give the technology a clean slate of sorts—or as a reframing that awards the models too much credit.
“They renamed something that already had a name; they’re called large language models,” Meredith Whittaker, faculty director of the AI Now Institute, told us. “This move constitutes an attempt at erasure; very literally—if someone Googles ‘foundation model,’ they’re not going to find the history that includes Timnit’s being fired for critiquing large language models. This rebrand does something very material in an SEO’d universe. It works to disconnect LLMs from previous criticisms.”
In a recent report, Stanford researchers wrote they chose “foundation models” as a term “to connote the significance of architectural stability, safety, and security: poorly-constructed foundations are a recipe for disaster and well-executed foundations are a reliable bedrock for future applications.”
Big picture: The models also require significant computing resources and funding—GPT-3, for instance, reportedly cost $12 million to train. This can limit the tech’s ownership, for the most part, to the world’s largest tech companies.
Click here to read the full story.—HF
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Getty Images
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The US House of Representatives is set to vote on the White House-backed, $1 trillion infrastructure bill by the end of September.
It already passed the Senate earlier this month, but in a quintessentially 2021 twist, a single clause about cryptocurrency has become the 2,702-page bill’s most contentious provision. It held the legislation up in the Senate for several days in early August.
The clause asks a simple question, which the crypto community says will make or break crypto development in the US: Who counts as a crypto broker?
How we got here
The US government must, in theory, find a way to pay for the hundreds of billions that the infrastructure bill allocates to high-speed broadband, transportation infrastructure, bridge repairs, and more.
One such “pay-for” in the must-pass bill is a proposal to implement stricter tax-reporting requirements for cryptocurrency brokers. The thought process: Crypto “brokers” should report transactions to the IRS just like traditional stockbrokers. This measure could bring ~$28 billion into government coffers over the next decade, per the Joint Committee on Taxation.
The catch? The bill’s original language, authored by Sen. Rob Portman, widens the definition of “broker” in the US Tax Code to cover any entity “regularly providing any service effectuating transfers of digital assets.” Those nine words could be interpreted to mean virtually everyone in the cryptocurrency ecosystem.
Pushback
In early August, when the bill hit the Senate floor, the crypto language prompted a fusillade of blowback across the US. A common argument against the new crypto rules is that by forcing all these newly minted “brokers” to send 1099 tax forms to their “clients”—a technically impossible measure—the US would not outright destroy the crypto industry, but instead force development to foreign shores.
Trying to rectify the perceived issue at the last hour, two groups of senators proposed a pair of dueling amendments, but neither amendment was accepted due to procedural constraints. The original language of the crypto provision prevailed and was sent to the House.
Looking ahead... In any event, if the House signs the bill into law, the rule wouldn’t go into effect until 2023. If the past two months are anything to go by, the crypto community will continue to fight tooth and nail, even if that means legal challenges in court.
Click here to read the full story. —RD
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So, you know what’s needed to take your business to the next level. But if you’re not sure how to give that baby wings, it could feel like, "Houston, we have a problem.”
That’s why we made a quiz for you to test your ability to implement products that can scale without the pressure.
Plus, SAP has provided tips throughout to help along the way—they’re committed to helping businesses all around the world run at their best, every day.
Who knows? Maybe you eventually launch an IRL product that is a rocket ship. If that’s the case, we’d like 98 tickets please and thank you.
Take the quiz.
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In case you missed it, we published a bunch of explainers on crypto across August. In addition to the piece earlier in this newsletter, here’s what we wrote throughout the month:
Oh, and it wasn’t just us. The team over at the flagship newsletter wrote a bunch of stories about crypto, too—you can find it all at this hub.
Looking ahead… We’re going to take a look at the intersection of emerging technologies and the cannabis industry across September. Stay tuned!—DM
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Stat: Google’s Play store made $11.2 billion in 2019, with $8.4 billion in profit.
Quote: “We’ve got great momentum, and the whole Biden plan definitely served as a tailwind for us. ... If there is money to start adopting some of these projects...people are going to take those chances.”—Ryne Shetterly, VP of sales and marketing at electric bus maker GreenPower Motor Company, to Emerging Tech Brew
Read: Is it too late to save our planet without geoengineering?
How to get unstuck in your career: Founder’s Journal just released an awesome podcast miniseries called "Accelerate Your Career” filled with useful advice on becoming a top performer, learning how to learn, and more. Listen here.
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12,000 brands are their biggest fans. Help Scout is the customer support platform built specifically for growing businesses. For over 10 years, they’ve been turning customers into loyal advocates—all while saving you 30% on annual customer service costs. But here’s another number for you: Brew readers get an extended 60 day free trial. Build better relationships with customers, starting today.
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The EU plans to begin a formal probe of Nvida’s proposed $54 billion takeover of Arm.
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Rivian filed paperwork to go public via the genuinely surprising and conventional route of an IPO. It’s reportedly seeking an $80 billion valuation.
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Palantir invested $25 million in EV startup Faraday Future, which reportedly agreed to use Palantir’s software—part of a previously identified pattern.
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Waymo will stop selling lidar sensors, but continue building them for its own autonomous vehicles.
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Microsoft informed thousands of its Azure cloud computing clients that their databases were vulnerable.
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THREE THINGS WE’RE WATCHING
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All week: Last night, Apple analyst Ming-Chi Kuo reported that the iPhone 13 could have satellite connectivity capabilities—meaning it can work in areas without 4G/5G access. We’re keeping an eye out for additional details around this report.
Tuesday: Jury selection begins for the Elizabeth Holmes trial. The trial starts next Tuesday, and we’ll be watching because we simply cannot look away from the Theranos story.
Friday: The Brew has a half day ahead of Labor Day weekend. And, looking ahead to next week, that also means no newsletter next Monday—mark your calendars.
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The global smartwatch market grew 27% year over year in Q2, per Counterpoint Research. Obviously, Apple remains on top, but its market share did slip from 30.1% in Q2 2020 to 28% today.
Meanwhile, Samsung saw its slice of the pie expand from 6.8% to 7.6%—an upward trend that could continue thanks to its newly unveiled Galaxy Watch4, made in partnership with Google.
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Catch up on the top Emerging Tech Brew stories from the past few editions:
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Written by
Hayden Field and Ryan Duffy
Illustrations & graphics by
Francis Scialabba
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