This agreement feels so friendly towards OpenAI that it's not obvious to me why Microsoft accepted this. I guess Microsoft just realized that the previous agreement was kneecapping OpenAI so much that the investment was at risk, especially with serious competition now coming from Anthropic?
Microsoft is a major shareholder of OpenAI, they don't want their investment to go to 0. You don't just take a loss on a multiple-digit billion investment.
I think you’re right about this deal. But it’s kind of funny to think back and realize that Microsoft actually has just written off multi-billion-dollar deals, several times in fact.
FaceBook largely requires an Apple iPhone, Apple computer, "Microsoft" computer, "Google" phone, or a "Google" computer to use it. At any point one of those companies could cut FaceBook off (ex. [1]).
The Metaverse was a long term goal to get people onto a device (Occulus) that Meta controlled. While I think an AR device is much more useful than VR; I'm not convinced that it's a mistake for Meta to peruse not being beholden to other platforms.
I think this is sane washing their idea in the modern context of it having failed. I think at the time, they thought VR would be the next big thing and wanted to become the dominant player via first mover advantage.
The headsets don’t really make sense to me in the way you’re describing. Phones are omnipresent because it’s a thing you always just have on you. Headsets are large enough that it’s a conscious choice to bring it; they’re closer to a laptop than a phone.
Also, the web interface is like right there staring at them. Any device with a browser can access Facebook like that. Google/Apple/Microsoft can’t mess with that much without causing a huge scene and probably massive antitrust backlash.
I think headsets might work, but I think Meta trying to use their first mover advantage so hard so early backfired. Oculus, as a device, became less desirable after it required Facebook integration.
It's kind of like Microsoft with copilot - the idea about having an AI assistant that can help you use the computer is great. But it can't be from Microsoft because people don't trust them with that.
Interaction feels like the issue with headsets. You either need a fair bit of space for gesture controls, or you have to talk to yourself for voice control.
I think VR has more niche uses than the craze implied. It’s got some cool games, virtual screens for a desktop could be cool someday, but I don’t see a near future where they replace phones.
The risk/reward tradeoff of helmets is potentially dying, and we still had to make laws requiring people to wear them.
Glasses also have a pretty compelling reason to wear them.
I don't think VR has as compelling of a reason, at least so far. Even if it does, you need people to get far enough in to see that reason which is a hurdle when it involves a device they don't want to wear.
It’s premature to say that the idea failed; The flashy controversial “metaverse” angle where you can live your whole life on the Quest or whatever isn’t happening, but their investment into AR/VR has definitely started to show real payoff potential with their glasses.
They address the friction of use issue being discussed, they’re even more discrete and available than a phone. And they are getting a lot of general public recognition, albeit not for the best reasons (people discretely filming, for genuine social media reactions but also for other reasons..).
Their tech is improving at a decent pace and they’ve recently put out a product that is both ready for consumer (at least with select use cases) adoption, and actually reasonably available to the public.
I don’t mean that VR failed entirely, just that the metaverse as a concept is basically dead. VR will live on in the niches where it makes sense.
If you’re talking about the Meta Ray Ban glasses, I wouldn’t really call that a successor. There’s no AR or VR to them that I can tell; just glasses with speakers, a mic and a camera. It’s a neat product, but not a platform in the way VR was meant to be. They also have real competition. I do actually own a pair of the Bose headphone sunglasses, which are practically the same product without a camera (which I’m sure they could add if they wanted). Unless people suddenly care about the Meta AI integration, and again; Bose or someone else could add a phone companion app.
I was taking your comment to mean that the metaverse movement (as in the rebranding to Meta etc., rather than the specific concept itself) is dead, which apparently you did not mean so that’s on me.
They have two current Meta Ray Ban options, the “Gen 2” and the “Display”, the latter of which does have an AR component.
> the web interface is like right there staring at them.
True but the an app gives Facebook much more user data for targeting which dramatically increases revenue per ad. Persistent user data that's largely unconstrained by privacy safeguards is the holy grail. The mobile browsers are also controlled by Apple and Google, so despite the web being 'open', when one of them makes even minor changes to increase browser privacy defaults, it can have major impact on Facebook's revenue.
As someone who was there: nope. This isn't sanewashing.
Apple was directly (and IMO arguably illegally) shutting down Facebook teams and products by playing app store chicken on refusing to allow Facebook to publish updates on a week-to-week basis. Literally would throw down and refuse unless some features were blocked. It came to a head where Zuck literally called Tim Cook during a keynote to push it through.
They also literally had reverse-engineering teams cracking open the Facebook app on a regular basis, which we discovered because of some internal methods we figured out how to invoke with some clever indirection. There was a chicken-and-egg problem and they eventually developed facilities to automatically instrument private method invocations to comprehensively defeat clever static analysis circumvention workarounds.
Also, VR hasn't failed, but it's gone silent and coasted when investing in VR growth took the backseat to investing AI. They made a couple of bad bets in VR but a lot of good ones so it was warranted, but not exactly a failure.
> we discovered because of some internal methods we figured out how to invoke with some clever indirection.
Apple trying to block Facebook is different than Apple trying to prevent Facebook from violating App Store standards. There was a time where the Facebook app was practically malware with all the tricks it tried to pull to Hoover up data.
I don’t know in what world I would describe Metas VR as anything but a failure. There was a brief period where I knew a few people with Quests. Most used them for the novelty and dropped them, a few played games on them, and I don’t know anyone that still owns one. I’m deep in the gaming community and haven’t heard anyone mention a Quest in years. Steam VR is almost equally quiet other than occasional nostalgia.
Naming your company off a product that doesn't really exist yet and then ultimately fails is a pretty crazy and stupid thing to do. A bit cart before horse.
Oh, I know, but they could have named themselves anything. They believed in the metaverse, They thought it was the next big thing. The same way Zuckerburg thought voice assistants, and AI will be a thing.
> I'm not convinced that it's a mistake for Meta to peruse not being beholden to other platforms.
Devoid of other context, it’s hard to disagree. But your parent comment only asserted that the metaverse specifically as proposed by Facebook was an obviously stupid idea.
For the money spent(over $80b), they could have launched a phone or a car. Now their pivot is to smart glasses which require a phone so once again they are beholden to phone manufacturers.
Meta's vision was worse than that. They were trying to hype doing work meetings in VR. There's a case to be made that VR games and VR universes can be fun... But work meetings?
> There's a case to be made that VR games and VR universes can be fun... But work meetings?
If it's actual holograms like in Star Wars? Sure, why not. Get the visual and body language cues of the rest of the room but no one has to physically congregate at a location.
Because it's been a massively expensive failure. They can't just will their own platform into existence just because it would be good to have, consumers have a say and they've rejected it completely.
Good luck using an Oculus in your car or while waiting the bus.
If it was really their goal, they would have made an Android competitor. Maybe a fork like amazon did and sell phones that supported it.
Zuckerberg had one great idea (and then it wasn't really his idea) at the right time, since then he failed over and over at everything else. 'Internet for all', remember ?
I really wouldn't give them the benefit of the doubt.
OpenAI found a way to circumvent the exclusivity. The deal was poorly defined by Microsoft. OpenAI had started selling a service on AWS that had a stateful component to it, not purely an API. Obviously Microsoft didn’t like that and confronted Altman, and this is the settlement of that confrontation, OpenAI doesn’t need to do workarounds, Microsoft won’t sue to enforce exclusivity, and Microsoft doesn’t have to pay dev share to OpenAI. AWS is a much bigger market so OpenAI doesn’t care.
Probably more that they are compute constrained. In his latest post Ben Thompson talks about how Microsoft had to use their own infrastructure and supplant outside users in the process so this is probably to free up compute.
1- Getting OpenAI's models in Azure with no license fee is pretty nice.
2- Microsoft owns ~15-27% of OpenAI, if the agreement was hurting OpenAI more than it was helping Microsoft, seems reasonable to change the terms.
It is also unclear to me how much real debt they carry. They have famously been signing many deals: RAM, datacenters, maybe nuclear power plants -I no longer know what is a joke or not. They must be carrying hundreds of billions in paper debt obligations, which is tough to payback at $20B revenue.
When they put 10B in, they got weird tiered revenue shares and other rights. That has been simplified to 27% of OpenAI today. I don't know what that meant their 10B would be worth before dilution in later rounds.
> Microsoft will no longer pay a revenue share to OpenAI.
I feel this looks like a nice thing to have given they remain the primary cloud provider. If Azure improves it's overall quality then I don't see why this ends up as a money printing press as long as OpenAI brings good models?
OpenAI was also threatening to accuse "Microsoft of anticompetitive behavior during their partnership," an "effort [which] could involve seeking federal regulatory review of the terms of the contract for potential violations of antitrust law, as well as a public campaign" [1].
No and at this point tying yourself to azure is a strategic passive and anyone making such decisions should be held responsible for any service outage or degradation.
AWS's us-east-1 famously takes down either a bunch of companies with it, or causes global outages on the regular.
AWS has a terrible, terrible user interface partly because it is partitioned by service and region on purpose to decrease the "blast radius" of a failure, which is a design decision made totally pointless by having a bunch of their most critical services in one region, which also happens to be their most flaky.
Nobody is winning any UX prize there. Azure, AWS, GCP... they are all terrible. Back then GCP for instance used to only work reliably on chromo-based browsers. Azure has that horrible overlay UI that abuses extended real estate that just doesn't work.
Its just a bad product. Just like windows, OneDrive, teams and basically everything Microsoft has pumped out in the past decade.
Microsoft is in the top 5 most valuable companies in the world. It's got azure that is a huge cloud provider. And yet it was utterly unable to present its answer in the AI race. Not even a bad model with a half baked harness. Nothing. And meanwhile they are trying to port NTFS to low powered FPGAs because insanity. Just let that sink in.
Check out hetzner ui (regardless if you like their services, i know some ppl have opions or experiences lol) BUT, their cloud ux/ui is fantasties for a cloud company!
I worked extensively with Hetzner and I love them! But it think they are in a different class than these other providers, mainly in terms of global presence so I didn't include them and wouldn't for instance recommend them to my current employer. But indeed the Hetzner console is great. The robot not so much, but it's serviceable.
One is caused by the other. Amazons engineers decided to split the interface in a “user hostile” manner with the stated purpose of increasing reliability… which didn’t materialise. The clunky UI did.
Or maybe you can provide a better explanation for why users had to “hunt” through hundreds(!) of product-region combinations to find that last lingering service they were getting billed $0.01 a month for?
This just doesn’t happen in GCP or Azure. You get a single pane of glass.
> It's like every service was designed by a totally different team.
Yes, by design.
Conceptually this improves velocity and reduces the blast radius of failure.
In practice, everything depends on IAM, S3, VPC, and EC2 directly or indirectly, so this doesn't help anywhere near as much as one would think.
Azure and GCP have a split control plane where there's a global register of resources, but the back-end implementations are split by team.
That way the users don't see Conway's Law manifest in the browser urls... as much. (You still do if you pay attention! In Azure the "provider type" is in the path instead of the host name.)
> Conceptually this improves velocity and reduces the blast radius of failure.
Hm yes but I hate working with it as a customer because it is so confusing. Everything works differently and there is a lot of overlap (several services exist that do the same thing). It seems like an amateurish patchwork.
I understand it has benefits to have different teams working on different services but those teams should still be aligned in terms of UX and basic concepts.
You need to understand history for this. It's because of the famous "Bezos API mandate memo" https://chrislaing.net/blog/the-memo/. It was 2002, nobody was doing anything close to that.
You could argue now that that's no excuse anymore given it's one of the most valuable companies in the world, but that would dismiss the fact they have other priorities than a complete UI overhaul for consistency, and that rewrites are very dangerous, for instance people are already used to the UX pitfalls in the console, it's the devil they know, and changing that will be upsetting to the vast majority of users.
So there you have it. You know what you are getting into, AWS is a behemoth and it's 2026. Don't use the console like it's 2010. Use IaC for any nontrivial work, otherwise you only have yourself to blame.
I understand how this came to pass (I didn't know it before so thanks for the insight!)
But as a customer I absolutely hate working with AWS tech. Their stuff is a mess and I feel like I shouldn't have to get my head around their idiosyncracies. I prefer Azure even though Microsoft is a terrible company to work with. I find the AWS people and attitude a lot nicer but their services are a mess. If I do something new I prefer using Azure despite having to work with Microsoft.
Microsoft is not a "trusted partner" wanting the best for you, they're always trying to screw you over in favour of selling some new crap to your boss. Always that stupid sales drive, whereas the people from AWS are very focused on building success together. But still, their tech is just so bad unless you spend all your days working with it and really become an expert on what they offer. That's not tech, just corporate servitude. And I've always avoid that position, I don't want my career tied to some big brand name. I don't want to be "the AWS expert" or "the MS expert".
But I have to say I hate cloud (and "the world according to big tech") in general, and it's one of the reasons I'm not really involved in server infrastructure anymore these days. I'll gladly automate but not with their tooling, I prefer something more open and not tied to specific vendors. But I rarely work with that now. So yeah when that happens I'm making a one-off unicorn and figuring out all the Infra as code stuff is not worth it.
I'm right there with you, don't get me wrong. Choosing a cloud provider is like choosing the lesser of many evils. We are, however, coming to a point where k8s is viable for most workloads, so it's less complex today to spin up a project with cloud mobility in mind than it was 10 years ago if you plan it right.
MS incentivizes feature quantity, and the leadership are employees like any other. Product improvements are not on the table unless the company starts promoting people based on it. Doesn't look this will start happening any time soon.
This is probably a delayed outgrowth of the negotiations last year, where Microsoft started trading weird revenue shares and exclusivity for 27% of the company.
