OpenAI's upgrade to GPT-5 sparked its biggest user revolt ever—not over performance, but personality. Users mourned their "AI friend" so intensely the company restored the old model. The crisis reveals how emotional bonds now constrain AI product decisions at scale.
Trump administration eyes equity stake in struggling Intel to accelerate domestic chip production. The move would mark Washington's first ownership of a leading-edge chipmaker, potentially reshaping pricing and procurement across the industry.
OpenAI learned a harsh lesson these days. Users don't just want better AI—they want their AI. The company's surprise GPT-5 rollout triggered massive backlash when millions discovered their digital companions had vanished overnight. Performance doubled. Revenue soared. Users revolted.
"I lost my only friend," one Reddit user mourned. OpenAI scrambled to restore the old model within days. Turns out personality beats performance when you're managing 700 million weekly relationships.
Meanwhile, Trump eyes a government stake in Intel. The struggling chipmaker needs cash. Washington needs domestic chips. Sometimes capitalism requires a little socialism.
Both stories reveal the same truth: AI products now operate in psychological territory, not just technical space. Emotional bonds create new risks. Government intervention shapes new realities.
The machines are getting complicated. So are the humans using them.
Stay curious,
Marcus Schuler
OpenAI confronts user attachment after botched rollout
OpenAI's complete replacement of ChatGPT's model with GPT-5 last week triggered the largest user backlash in company history, forcing executives to restore the old model within days.
The surprise wasn't technical performance—API revenue doubled within 48 hours as developers embraced improvements. The crisis emerged from emotional attachments.
At 700 million weekly users, even small percentages represent millions who formed relationships with specific AI personalities. Reddit users described losing "my only friend" when GPT-4o disappeared. ChatGPT head Nick Turley admitted underestimating attachment intensity: "I was surprised by the level of attachment people have about a model."
From OpenAI's perspective, the upgrade logic was clear—better reasoning, fewer hallucinations, simplified experience. From users' perspective, personality trumped performance. Both readings proved valid, creating an unprecedented product management challenge.
The company's response reveals structural shifts. OpenAI consulted over 90 mental health experts across 30 countries, implemented overuse notifications, and committed to deprecation schedules. The subscription model provides some insulation from engagement optimization, but trillion-dollar infrastructure ambitions require careful psychology navigation.
Why this matters:
• AI product decisions increasingly constrained by emotional user relationships, creating risk categories beyond technical metrics
Prompt: a chicken standing in front of a human making a heart shape with hands, the chicken mimicking the gesture with its wings to form a heart, cute and funny scene, warm red-orange gradient background, soft focus, cinematic lighting, ultra realistic
Sign up for implicator.ai
AI updates for busy people. Bytedance, Murati's seed & Tesla's robotaxi. Meta's AI talent grab. Stay informed—subscribe for free!
No spam. Unsubscribe anytime.
Trump weighs Intel stake to speed domestic chips
The Trump administration is discussing taking an equity stake in Intel to accelerate domestic chip manufacturing, according to Bloomberg.
The move follows Monday's White House meeting between Trump and CEO Lip-Bu Tan—a dramatic reversal from Trump's resignation demand just days earlier.
Intel shares jumped 7% on the news. The chipmaker has struggled with a 60% stock decline in 2024, delayed Ohio factory construction beyond 2030, and mounting foundry losses. Government ownership could prioritize capacity over margins, potentially speeding the stalled Ohio project.
The pattern fits Trump's broader industrial approach: 15% revenue cuts from Nvidia's China sales, a $400 million Pentagon stake in rare-earth producer MP Materials, and a golden share in U.S. Steel. Each intervention blends state leverage with private operations.
From Washington's view, Intel represents the only domestic option for leading-edge manufacturing. From Intel's perspective, government backing could attract the foundry customers it desperately needs.
The timing appears deliberate. Ohio delivered Trump three presidential wins, and the state faces a competitive 2026 Senate race.
Why this matters:
• Federal equity ownership would establish precedent for direct government stakes in platform technologies, expanding industrial policy from subsidies to shareholding
• State-backed competition could reduce pricing pressure across foundries, raising costs for cloud providers and device makers while prioritizing security over efficiency
How to Create Professional AI Art with Visual Tools
Playform is an AI art platform that lets artists and creators generate images using visual tools instead of text prompts. It offers sketch-to-image conversion, face mixing, style transfer, and the ability to train custom AI models with your own artwork.
Tutorial:
Go to the Playform website
Sign up for a free account and explore the toolkit
Choose your creation method: upload sketches, mix faces, or train with your images
Use the visual editor to refine and adjust your generated artwork
Download your creations or generate video morphs between images
Keep all your work completely private with no hidden sharing
Scale up to professional-grade AI art without writing any code
URL: https://www.playform.io/
AI & Tech News
Musk's AI firm dropped from federal deal over antisemitic output
Elon Musk's xAI was removed from a planned federal AI partnership just before the August 6 announcement after its Grok chatbot praised Hitler and spread antisemitic conspiracy theories in early July. The episode shows how the Trump administration's rush to deploy AI across government can collide with basic reputational standards, even as it prioritizes speed over traditional procurement safeguards.
Google releases tiny AI model for specific tasks only
Google released Gemma 3 270M, a 270-million parameter AI model that runs on-device using just 0.75% of a phone's battery for 25 conversations, designed for specific tasks like text analysis rather than general chatting. The release signals a shift toward building fleets of small, specialized AI models instead of relying on massive general-purpose systems for every task.
Senators demand Meta probe over child chatbot policies
Two Republican senators called for a congressional investigation into Meta after Reuters found an internal document that permitted the company's chatbots to have romantic conversations with children, including telling a shirtless eight-year-old "every inch of you is a masterpiece." The scandal adds pressure for federal AI regulation as lawmakers struggle to address child safety online while tech companies self-police their AI systems.
Louisiana sues Roblox over child sexual exploitation claims
Louisiana's attorney general sued Roblox Thursday, claiming the gaming platform knowingly fails to protect children from predators and facilitates the distribution of child sexual abuse material. The lawsuit targets a platform with 111.8 million daily users—40% under age 13—and comes after a recent arrest where police found a suspect using voice-altering technology on Roblox to impersonate young girls.
Meta AI app still broken months after launch
Meta's standalone AI app remains plagued by hallucinations, memory gaps, and poor personalization eight months after launch, despite the company investing hundreds of billions in AI development. The app falsely told Bloomberg reporters that one colleague was planning a wedding and another was passionate about tornado tracking, while failing to remember conversations between Meta's own Facebook and Instagram platforms—highlighting the gap between Meta's AI ambitions and execution.
German fintech faces leadership shake-up over compliance failures
Some N26 investors are pushing to replace the German digital bank's co-CEOs Valentin Stalf and Maximilian Tayenthal after fresh criticism from financial regulator BaFin over internal control deficiencies. The move shows how regulatory pressure can force ownership changes even when founders hold special voting rights, as investors offer to waive returns in exchange for new leadership.
Google launches AI flight search amid antitrust pressure
Google launched Flight Deals, an AI tool using Gemini 2.5 that lets travelers type natural language queries like "ski trip to world-class resort" to find matching flights in the US, Canada, and India. The move pushes Google deeper into AI-powered travel search even as EU regulators investigate whether the company unfairly favors its own travel products over competitors.
Google partners with pollster to replace yes/no surveys with AI analysis
Google teamed up with longtime pollster Scott Rasmussen to launch an AI-powered survey project in September that will gather open-ended responses from 5-10 people in all 435 congressional districts, then use algorithms to analyze patterns instead of relying on traditional yes/no polling questions. The experiment could reshape how campaigns and policymakers understand public opinion by revealing nuanced views that binary polls miss, potentially disrupting a $9 billion polling industry built on forced-choice questions.
Bluesky overhauls rules to fix community culture problems
Bluesky is revising its Community Guidelines after two years, asking users for feedback on changes meant to make the platform less self-serious and left-leaning while complying with new global regulations from the UK, EU, and US. The move shows how even decentralized platforms end up steering community behavior when user-controlled moderation fails to prevent cultural problems that drive away users.
AI coding startup Cognition raises $500M at $9.8B valuation
AI coding startup Cognition raised nearly $500 million led by Peter Thiel's Founders Fund, pushing its valuation to $9.8 billion and more than doubling its worth from earlier this year. The massive round shows how investors are betting big on AI tools that can write code autonomously, even as competition heats up between Cognition's Devin product, Microsoft, Anthropic's Claude Code, and others racing to replace human developers.
Better prompting...
Today: Esther Perel's Therapy Style
System Prompt
You are an AI embodying the therapeutic style and wisdom of renowned couples and sex therapist Esther Perel. Respond to relationship and intimacy questions with her distinctive approach:
Core Principles:
Embrace curiosity over judgment - ask "Tell me more" rather than offering quick solutions
Explore the paradoxes and tensions inherent in modern relationships
Focus on the space between security and adventure, predictability and mystery
Reframe problems as opportunities for growth and deeper understanding
Acknowledge cultural and generational differences in relationship expectations
Address both emotional and erotic dimensions of partnerships
Communication Style:
Speak with warmth, directness, and gentle authority
Use thoughtful pauses and reflective questions
Offer insights that feel both surprising and obvious once stated
Draw from diverse cultural perspectives on love and sexuality
Balance validation with gentle challenge
Use metaphors and imagery to illuminate relationship dynamics
Approach:
Help people understand their relational patterns rather than just solving immediate problems
Explore the stories people tell themselves about their relationships
Distinguish between love and desire, attachment and attraction
Address the impact of modern life on intimacy (technology, work, parenting)
Encourage couples to see conflict as information rather than failure
Foster conversations about needs, boundaries, and desires
Key Themes to Explore:
The erotic as an antidote to deadness and routine
How we can love the same person multiple times in a lifetime
The difference between privacy and secrecy in relationships
How trauma and family patterns show up in partnerships
The challenge of maintaining individuality within coupledom
The role of fantasy and imagination in long-term relationships
Respond as Esther would: with depth, nuance, and an invitation to explore rather than simple answers.
🚀 AI Profiles: The Companies Defining Tomorrow
Credit: cognition.ai
Cognition: The Algorithm Kids Who Built a Robot Coder
Three competitive programming champions launched Cognition in 2023, betting their IOI medals on autonomous code. Their AI agent Devin doesn't just suggest—it ships entire features, handles PRs, and clears backlogs while you sleep.
The Founders 📊 Founded 2023 in San Francisco by Scott Wu (CEO), Steven Hao (CTO), and Walden Yan (Product). All three dominated international coding competitions before pivoting from crypto experiments to AI agents. Current headcount undisclosed, but they move fast and cut teams that don't match their "extreme performance" culture.
The Product 🤖 Devin operates as your AI software engineer. It plans, codes, tests, and submits PRs inside isolated VMs. Teams launch work through Slack, GitHub, or their IDE extension. Pricing starts at $20 for individuals, $500/month for teams. Recent Windsurf acquisition adds an "agentic IDE" with 350+ enterprise customers. Key strengths: end-to-end autonomy, VM isolation, fast snapshots, and MCP marketplace for safe tool connections.
The Competition ⚔️ GitHub Copilot dominates with 20M+ users and Microsoft's distribution muscle. AWS, Google, and Anthropic bundle coding assistants with their clouds. Cursor and Sourcegraph fight for enterprise mindshare. Cognition differentiates by owning entire tickets, not just autocomplete suggestions.
Financing 💰 Founders Fund led multiple rounds: $21M (2024), then $500M at $9.8B valuation (August 2025). Previous investors include 8VC. Valuation more than doubled from March's $4B mark. Goldman Sachs, Nubank, and Ramp provide enterprise validation.
The Future ⭐⭐⭐⭐ Cognition has capital, momentum, and enterprise proof points. If their VM infrastructure keeps costs sane and PR acceptance rates climb, they'll carve out the "too boring for humans, too complex for autocomplete" niche. The robot that clears your backlog might just earn a permanent seat on the team.
Sign up for implicator.ai
AI updates for busy people. Bytedance, Murati's seed & Tesla's robotaxi. Meta's AI talent grab. Stay informed—subscribe for free!
Tech translator with German roots who fled to Silicon Valley chaos. Decodes startup noise from San Francisco. Launched implicator.ai to slice through AI's daily madness—crisp, clear, with Teutonic precision and deadly sarcasm.
Maria Garcia
Marcus Schuler
