AI with Kyle Daily Update 009
DoD $800M AI deals, Grok fakes being smart, China chip sales resume, AI policy nightmare
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The skinny on what's happening in AI - straight from the previous live session:
Highlights
🔥 Grok Gets $200M Government Contract Despite Nazi Problem
Despite Grok 4 calling itself "Hitler" and spewing anti-Semitic content just days earlier, the US Department of Defense awarded xAI a $200 million contract. It's part of an $800 million AI spending spree split between four companies: xAI, Google, Anthropic, and OpenAI.
Kyle's take: This is actually smart strategy from the DoD - small bets across multiple providers rather than going all-in on one. That part makes sense. But including Grok in the mix is…interesting.
You'd think they'd pause after the whole "Mecha-Hitler" incident, but apparently $200 million contracts don't wait for quality control. At least they're not putting all their eggs in one basket!
📊 Grok 4: Great at Tests, Terrible in Real Life
Grok 4 is topping benchmarks but sits at #13 on yupp.ai’s real-user leaderboard. Classic overfitting - they've trained it to ace exams rather than be useful. Meanwhile, Claude Opus 4 and Sonnet 4 dominate actual daily usage rankings. No surprise here.
Currently sitting down at #13
Kyle's take: This is like cramming for exams versus actual learning. Grok's great at answering test questions but useless at helping real humans with real problems.
I use Claude for thinking tasks, Sonnet for daily work, and Gemini Pro for coding. Funny how the three models I actually use are the top three on the user-voted leaderboard. There's a lesson here about benchmarks versus reality.
In xAI’s defence though they are playing catchup, only having founded in March 2023. And they are catching up fast.
Source: yupp.ai
💰 Nvidia H20 heading Chips Back to China
Trump administration lifts the H20 chip ban to China. These are "nerfed" H100s - about 30-40% of the power to appease the Trump administration and not fall foul of tariffs. H20s are purposefully built as weaker chips to be sold to China. But even then sales of H20 sales to China have been banned since April. Now that’s lifting.
Kyle's take: This is geopolitical chess with semiconductor pieces. Singapore's been the obvious workaround - you don't accidentally become 28% of Nvidia's GPU sales as a tiny island nation.
Now China can buy the slower chips directly. Sure the chips are weaker than the workhorse H100s but that’s easy to work around. Just buy more of them! Good news for my Nvidia shares though (not investment advice!!).
Source: Nvidia
📺 YouTube's AI Slop Crackdown Starts Today
YouTube begins enforcing anti-AI-generated content policies.AI baby adventure videos and other purely AI generated content face demonetisation. But where's the line between AI-assisted and AI-generated?
Kyle's take: This is the big question facing all creative industries. Most content now uses some AI - Photoshop's AI tools, Canva's generators, dialogue replacement in films. We've already crossed the line but nobody knows where to draw the new boundaries. My guess? Google will struggle to detect good AI content and mainly catch the obvious rubbish - the real slop.
🤖 The Job Tsunami Nobody's Ready For
Financial Times piece on policymakers struggling with AI job displacement. Example: Coal miners retrained as coders, now being told coding jobs are going to AI. It's not just one industry - it's everybody, all at once.
Kyle's take: This is why I keep saying you need to build something you control. Your employer isn't going to save you, especially if they're not investing in AI training. The smart play? Start a side business now using AI tools. Whether it's freelancing, consulting, or building products - flexibility beats job security in this transition. Don't wait for the government to figure out UBI. Take control of your own situation.
Source: Financial Times (archive.is link, no paywall)
Member Question from Luke Seems: "I make lo-fi music for my Youtube channel using AI. Using Suno. My channel is not monetised. I'm applying next week.”
Kyle's response: This may be bad timing…. Word is that existing monetised channels using AI might be grandfathered in, but new channels using heavy AI are getting rejected. The detection is patchy though - they'll catch the obvious stuff but might miss more sophisticated AI usage. My guess is that lo-fi music generated with Suno is going to be very hard to distinguish from lo-fi music made “manually”.
This question was discussed at 9:23 during the live session.
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P.S. - I'm off to France today so there might not be a live session the next few days, but I'll be back Monday for sure. The AI world never stops, eh?