Squawk on the Street+ OpenAI COO Brad Lightcap 10/7/24

David Faber (0:00)

OpenAI raising $6.6 billion. It's a close of one of the largest funding rounds ever for a private company. Now valuing OpenAI at $157 billion. Joining us now, it's the CNBC exclusive. OpenAI's Chief Operating Officer, Brad Lightcap. Brad, good to see you.

Brad Lightcap (0:17)

Good to see you, too.

David Faber (0:17)

And nice to learn that you're a Mets fan as well.

Brad Lightcap (0:20)

That I am.

David Faber (0:20)

I could spend the entire interview on that, but I think the rest of our viewers might be a bit disappointed. You know, you have a fairly large remit as COO, but certainly partnerships are one of the key things I know you focused on. So, I'd love to start with Apple. A lot of questions there, exactly what the relationship is in terms of your help with Apple Intelligence. What can you tell us about what the partnership means for OpenAI and what Apple conceivably will get out of it?

Brad Lightcap (0:45)

Yeah. Well, hey, it's great to be here. Good to see you again. Apple's obviously an amazing company. We're really thrilled to be part of Apple Intelligence. We think it's a big step forward both for Apple. It's a first step, but it's a big step. It's the first time that we're going to have AI really start to integrate into the device. If you think about how people have used AI to date, it's mostly been accessing it through apps and really simple services. But for the first time now, you can do really interesting things on the device. So you can actually take a picture, for example, through the camera and actually have ChatGPT understand what's going on in that image.

And we think that's going to create tremendous value for consumers. And for the 250 million people that use ChatGPT every week, we think it's just going to be another way for them to experience it.

David Faber (1:35)

Yeah. So from a perspective, obviously, revenues of your company continue to go up sharply, but investors, your private investors, certainly are also focused on margins over time. So how do you benefit economically here? This is not a relationship, for example, the Google search relationship where Google is paying Apple an enormous amount of money every year. That's not the case here, correct?

Brad Lightcap (1:56)

Correct. Yeah. Look, the way we think about it is really around product. We don't yet know, I think, what the great product experiences with AI are going to look like. I think those are yet to be created. I said to our team the other day, I think it's the most dynamic time in technology and the history of technology that I can think of to be building product. It's a phase shift, right? We're at the beginning of an entirely new era for how software works. And so I think exploring that frontier and what it means to actually be able to interact with these devices in this very human-like way, all of that is yet to be discovered and that's where we're focused.

David Faber (2:28)

Right, and I understand that, but I'm trying to understand. I pay you guys $20 a month now. You're welcome. And I'm enjoying it, but if I have Apple Intelligence on this phone, am I still gonna wanna pay you the 20 bucks a month?

Brad Lightcap (2:40)

I think so. I think there's gonna be a range of workloads that you're gonna want AI to be able to take off your plate. Some of those are gonna be very simple. They're gonna be on device, but a lot of them are gonna be really big, complex workflows that you're gonna wanna ship off to more powerful models. Good example, we recently released a new model called O1. It's a different type of model. So in contrast to GPT-3, GPT-4, O1 is the first model that can actually reason. And so it actually, what that means is, it actually can think about a problem. It can break down a complex problem into different steps. And so if you think about even giving your AI a simple task, like help me plan a trip, that's a series of actual underlying tasks that you actually want more complex, higher sophistication intelligence to be able to handle. So that's the type of experience we're gonna bring to you.

David Faber (3:28)

So that would be more for the pay model for GPT as opposed to potentially for Apple Intelligence. But you're still gonna be using it there. I wonder when you think about, when so many people who own Apple, for example, stock think about, well, how's this gonna change the nature of the interaction with the device, with the use of apps? How do you think about it? Is it going to change significantly?