OpenAI, the company co-founded by Sam Altman, is reportedly considering a full acquisition of a startup led by renowned former Apple designer Jony Ive. The potential deal, which is estimated to be worth at least $500 million, centres around the startup known as io Products, which has been developing an artificial intelligence-powered personal device since 2023.
Ive, famed for his collaboration with the late Steve Jobs on iconic products such as the iPhone, has been working with Altman on the AI initiative. According to The Information, OpenAI has explored various options regarding the acquisition and has discussed integrating the design team responsible for the AI hardware device should the deal proceed.
The AI-enabled device from io Products has been described as a personal technology that might rival existing offerings from Apple, which has also been heavily promoting AI features in its smartphones. While specifics about the design remain in development, sources indicate that the product could resemble an AI-powered smartphone without a screen, although some have asserted it is "not a phone."
OpenAI has recently achieved a valuation of $300 billion after securing $40 billion in new financing. The acquisition of io Products would expand OpenAI's portfolio, which currently includes various AI software services, server chips, and humanoid robots. The venture could enable OpenAI to reach a wider consumer base and increase competition with tech giants like Apple.
Jony Ive officially left Apple in 2019 to establish his design firm, LoveFrom. During an interview with The New York Times, he confirmed that he had been collaborating with Altman on the AI hardware project. Their discussions have revolved around how the device might harness AI for tasks such as travel booking and plant identification using images, promising capabilities beyond those of traditional smartphones.
io Products has also attracted talent from Apple, recently hiring Tang Tan, who was instrumental in the design of the iPhone and Apple Watch, alongside Evans Hankey, who succeeded Ive as Apple's lead designer before departing in 2023.
In parallel, Apple has been addressing delays in its AI enhancements for the Siri digital assistant, with the head of the team responsible for Siri recently describing the situation as “ugly." He added that employees may be feeling "embarrassed" about the postponement of AI upgrades as the company continues to rectify issues before relaunching the features.
Meanwhile, OpenAI is navigating a complex financial landscape, with recent reports indicating that its funding may be contingent on restructuring into a for-profit entity. The ongoing negotiations and requirements for restructuring approval from major stakeholders like Microsoft illustrate the intertwined challenges faced by OpenAI as it seeks to expand its technological footprint in a competitive market.
Source: Noah Wire Services