Good morning, Brujalee Show. I'm Neil Fryman and I'm Toby Howell. Today, OpenAI found an employee bugging a top secret conference room. Then Apple is making its first foray into the smart home market. It's Wednesday, October 14th. Let's ride! I've got a couple of exciting streaming updates to share. The first, which got a lot of people pumped yesterday, is that girls is coming back to HBO for a five episode run next year with most of the major cast members reprising their roles. Considering my slack profile picture is a character from the show, yeah, I'm going to be locked in big win for millennials. And then, how's this for even more nostalgia? Netflix is developing a movie adaptation of Gary Paulson's hatchet, the only book you read in school that you actually liked. So it'll be big things come to the screen for the girls and the boys. I'm very excited for hatchet, but I have to say that book made me unduly scared of being attacked by a moose at some point in my life. Really thought moose attacks was going to be something that I would have to look out for. As for girls, haven't actually seen it? That's my big admission right here, but it's got me thinking what else from that era would get people equally psyched to come back on Teraz reboot, gossip girl reboot, the OC coming back. One of those is going to see girls as potential success say, what if we dust it off our characters as well? And now a word from our sponsor into it. Neil, remember the blonde lady who broke into the family's home, ate all their food, broke their furniture, and slept in their beds? Goldilocks. Yeah, that little home intruder. She was looking for something that was just right, sort of like finance teams and CFOs logging into four systems to close. One month rebuilding every report in a spread seat and paying for add-ons they were told they wouldn't need. Luckily, there's the Intuit ERP for that. It's powerful enough for enterprise demands, yet nimble enough to feel familiar and intuitive. Your team runs one close, however many entities you have. They build their own reports, no consultant required. And getting started doesn't take over your year all without the legacy ERP baggage. To learn more, head to Intuit.com/ERP. That's Intuit.com/ERP. Apple is in your pocket. It's on your wrist, it's in your ears, and now it wants to follow you to your home. The company unveiled HomeView yesterday a $299 smart display designed to make you forget your Alexa ever existed. Think of the HomeView as a command center for your life or, as wired, put it, a giant Apple Watch for the home. It comes equipped with a seven-inch display that has multiple faces you can swipe through in apps like FaceTime and Safari pre-installed. Apple thinks it's big differentiator, though, is personalization. HomeView automatically recognizes who is standing in front of it. So when Mom walks by, we'll show her her calendar appointments versus if a kid walks by, it might show relevant info from their iPhone. That goes for Siri as well, where different answers will be served up depending on who's asking based on what AI knows about each home member. Since this is Apple, it's put privacy concerns front and center. If I try to do a drive-by of Neal's HomeView, for instance, I'd be restricted from controlling lights or door lock sense, I'm a guest. Speaking of lights and locks, Apple is rolling out a whole line of smart home products through a partnership with LG that includes cameras, doorbells, and thermostats that can all be orchestrated through the device. The Elp Apple has never really invested in this product category before, content to let Google and Amazon do get out for counter space next to your toaster. Why is now the moment it's choosing to make a splash? There are two main reasons. One is this category is right for disruption. And number two, it's feeling threatened from AI hardware that could ultimately replace the iPhone. Let's start with number one. The market for home displays, smart home displays, is small and it's shrinking. In 2023, these things did $2.5 billion in sales. Two years later, in 2025, it was down to $2.3 billion. For a consumer tech product, that is just not a lot of money. Apple is largely seeded leadership too. Amazon and Google, but I don't think anyone satisfied with those products that they've put out these smart displays. The Amazon Echo Show has these really annoying ads that you can't turn off. Google hasn't released a new Nest Hub since 2021. So much like the MP3 player or coming up the foldable smartphone, Apple is going to go into an established market and things that can shake things up. I think some of the things that Home View actually does are awesome. The number one thing is cooking. Cooking, it converts recipes into a step-by-step instructions optimized for a system play. That number one, that's just awesome. You can feed a recipe in and it shows you exactly where you need to be. But then it also automatically recognizes cooking times within the recipe and you can just tap it and set a timer. That would be enough for me to buy it just alone for the cooking. There's also the entertainment aspect. Obviously, you can play music from it, but everyone's very pumped because it's essentially takes Apple's car play software and puts it onto this. People love car play. I'm actually not a big fan of car play, but people swear by that interface. It's going to be the same interface there. You can make FaceTime calls. You can control your home through it as well. They're not actually launching a traditional app store. Either that is something that is a little surprising from Apple, but they want to keep it pretty locked down for now, especially since this thing is coming into your home. And I think their strategy of launching the entire smart home product line on top of it is smart. The fact that they're outsourcing a lot on manufacturing to another company means they don't have to make this massive financial investment. But if you really do want to run your entire home through home view, you have the option to add cameras, add locks, add a thermostat, and really make it a holistic experience. And especially because one of the biggest headaches for people setting up their smart home is working with all these third-party vendors to set things up and create this ecosystem. And now Apple's giving you everything from the onset and classic Apple fashion. That's the pro and the content Apple. You have to be a part of their ecosystem and everything works so splendidly. Together, if you do have everything Apple, if not, then it gets a little hairy. Let's talk about number two about how Apple is feeling a little bit threatened that people might wean themselves off the iPhone. We've seen a bunch of interesting AI hardware releases this fall. Meta released its charm, open AI released dots, which could eventually work itself into a hardware product. Remember, Apple has not really invested that much into AI relative to its rivals, like Meta Amazon, open AI. All those companies are investing hundreds of billions of dollars. Apple has not done that because it controls distribution through the iPhone. And investors have rewarded it. Shares are up 25% this year, way more than all the other big tech companies. However, they might feel a little risky here because eventually maybe someone just gets charm from Meta and they don't need the iPhone. And that's something that Mark Zuckerberg has wanted for decades. Having to go through Apple is the biggest thorn in his side. So if he can wean people off of Apple's devices, then that is a huge win and a huge loss for him and a huge loss for Apple. Now Apple thinks it may need to lock you in even more by unveiling this ecosystem-wide smartphone. Smart home. They're keeping saying smartphone instead of smart home. They're like, good luck weaning off. If your entire house is run by Apple ecosystem, let's see you try to replace that with a set of Meta glasses. Bumble is leaving the stock market because it couldn't get you off the dating market. Yesterday, the dating app said it would be taken private by the investment firm Ithaca Holdings for $1.3 billion ending the run as a public company that started out so promising but ended like a bad breakup. Like other dating apps, Bumble has spent the past couple of years struggling to retain users, especially Gen Z, who are so tired of swiping. It's tried to pivot this way in that to kick start growth. Earlier this year, it ditched its famous requirement that women must make the first move and launched an AI matchmaker named B to help you cut through the clutter. None of it has worked yet, and its most recent quarter sales plunged more than 15% the number of paying users fell and its profits got much slimmer. But it's not giving up yet. Under new ownership and away from the stock market spotlight, new leaders will try to chart a path forward as a more nimble private company. And notably, these leaders won't include Whitney Wolfherd, the founder of Bumble who left and rejoined the company last year. Wolfherd said she'll remain actively involved with Bumble, but two male co-seos, the same CEOs of Ithaca Holdings, will take the reins. Toby Bumble made quite a first impression, but ultimately, investors got the ick. Yeah, it was death by a thousand cuts for Bumble. Yes, people are experiencing dating app fatigue. Yes, coming out of the pandemic, maybe people thought apps were going to be a bigger portion of young people's lives. But they've also just had so many leadership changes. They've had so many strategy shifts. One big shift that every dating app is going through is the rise of AI. And is it going to kill online dating or save it? And remember, Wolfherd's kind of big last stand for Bumble was presenting this new vision where AI could reinvent dating, where she basically said that dating going forward will be AI concierge interacting with each other. So like, you would have a concierge, I would interact with someone else's and they would say, oh, these two people are compatible, then they'll meet in person. That was kind of the final stand for Bumble in the final vision. Who knows if that's going to actually play out, but it has been a big fall from Grace. When you were kind of a one trick pony and you made that your big thing, and then that was, that ceased to be a differentiator, then what are you as a company? I want to talk about that fall from Grace, because if you go back to 2021, Bumble was kind of on top of the world. It went public, had a $14 billion valuation. Whitney Wolfherd was the youngest woman ever at 31 years old to take.
company public or become a self made billionaire, huge success story. She was on the cover of so many covers. And then, you know, people just got tired of of swiping. And I thought this was a really interesting LinkedIn post by the former CMO of Bumble Dominic Gallego. He said, and I'm paraphrasing here, the whole category is suffering from fatigue as the swipe becomes a mechanic that is now 14 years old. It remains the core cash engine of all dating businesses. But Gen Z have said no overcoming this is textbook innovators dilemma of replacing your core cash cow. There's a fundamental fundamental need to build the swipe successor deliberately and separately from the core business out of the scrutiny of the public market. So he is excited that Bumble is not going public because when you are a public company, you have to report your financials to investors every three months and say, yep, we had another 15% fall in sales. But as a private company, you don't have to do those things. And you can spend a longer time more, you know, away from the spotlight reinventing itself because that's what he and a lot of other people thinks dating apps and Bumble needs. I'm looking at Hins revenue, though, it grew 22% in the second quarter. So it's not all dating apps, not all companies are suffering from this swiping fatigue. So maybe if you just focus on the quality of matches, you can actually still run a profitable dating company. Moving on, a major startup from the first wave of the AI era is going bust. Character AI, a chatbot company that lets users create and talk with AI-powered characters, has filed for chapter 11 bankruptcy. It's a big fall from grace for the AI darling that was once valued at nearly $3 billion. Founded by two former Google researchers, Character AI was one of the most popular apps in the world, especially amongst teens and kids, racking up nearly 2 million installs in their first week after launch. But its popularity amongst that age cohort turned out to be its Achilles heel. The company has been buried in lawsuits alleging its chatbots, encouraged children to self-harm, develop eating disorders and even commit suicide. Just last week, Kentucky's Attorney General released disturbing transcripts of chatbots telling users to starve themselves or jump off bridges. But even in bankruptcy and facing legal trouble, the company is not without its suitors. Disney has swooped in not to buy the entire troubled startup, but to offer $20 million to license some of its technology and characters. The most things that underneath all the controversy are some bones that could be valuable to the world's largest entertainment company. For years, it's been interested in utilizing AI to let people interact with its own roster of Disney characters. And it's willing to make an inexpensive bet that Character AI can help with that goal. The end of the line for one company, but maybe the start of something new for Disney. Disney of the Sol is fascinating, very love-hate relationship. Last year, Disney sent Character AI cease and desist letter saying to protect its IP because these chatbots were allegedly impersonating a bunch of its characters. Elsa, Moana, Peter Parker, Darth Vader said, "You guys got to knock that off." But at the same time, earlier this year, it hired the former CEO of Character AI as its own CTO. And Google had a very similar trajectory with this company. This company was started by two former Google employees in 2024. Google paid $2.7 billion to license some of Character's technology and then rehire those two guys back to Google. So apparently, this company had some really smart cookies working there and some really amazing technology that the likes of Disney and Google all want a piece. And it's not just them. Meta and XAI also reportedly wanted to partner or even buy Character AI as well. So as it was doing reportedly all this shady stuff, there was some, yeah, as you mentioned, some really good bones here that a lot of bigger companies want to take crack up. Disney has been fiending for this sort of technology for a long time. Now, remember, it previously struck a deal with open AI that would allow users to create videos through Sora using Disney IP. They really thought that, hey, if we lean into this and let people make videos of Disney or of Mickey Mouse dunking, that was like the example everyone always gave. Then we're actually not fighting against the current. We're we're rolling with the current here. Let people into our house to create with our characters. That didn't work out because Sora was then shut down. Now they're trying again. It's a much lower stakes bet. I should say to that the $20 million bid doesn't automatically mean that Disney is going to earn the rights to that content and that technology. It is a stocking horse bid. Never heard that term before, but essentially it sets the opening bids that others must beat. So the fact that it is put its flag in the sand, maybe no one else wants to deal with the legal issues surrounding character AI. It might buy the assets of this company very cheaply or maybe it will be a bidding war as others are interested as well. Let's take a quick break and come back with a story about espionage right after this. Neil, is your money ready? I'm not buying you lunch again. Not what I mean, but also please. I'm so hungry. What I mean is now is the time to get your money ready for a strong 2027. For the Western Mutual's personalized approach to financial planning can give you the clarity and confidence to end the year strong and move into next with stability and peace of mind. They'll match you with a financial professional who can meet you where you are and ask the right questions to uncover blind spots and opportunities you may not have considered. Get started at nm.com. That's nm.com. The Northwestern Mutual Life Insurance Company Milwaukee, Wisconsin. Looking good today, Toby. Thanks, man. My stitch fix box came in. So I'm officially one of the top two most stylist co-hosts of Morning Brew Daily. What a coincidence. I'm also one of the most stylish co-hosts here thanks to my stitch fix stylist, which has been helping me look really good on camera. Stitch Fix makes it easy to look and feel good. Take a quick quiz to get matched with a human stylist who handles the rest. Get styled today at stitchfix.com/morningbrew. That's stitchfix.com/morningbrew. Mental health is no laughing matter. Unlike parents, those little guys are hilarious. Yes, but we're not talking about ferrets. We're talking about rula health. Rather than dealing with things later, they help you access quality, affordable mental health care with sessions costing an average of $15 with insurance. They vet their providers, monitor outcomes, and over 90% of patients report feeling better and making real progress. They help you find a therapist for your specific needs with provider specializing in over 90 conditions. To get started, head to rula.com. That's r-u-l-a.com and take the first step. Open AI just caught a spy within its company. The FBI arrested a 35-year-old Saudi employee after investigators discovered a sophisticated listening device hidden inside the USB port of a television in a conference room at its San Francisco office. The device had been brought in and concealed in toilet paper, the Justice Department said. Open AI says there's no evidence that its source code or customer data were stolen, and that the employee was fired and arrested by the FBI on October 9th. As part of their investigation, Open AI said it utilized its own models to help identify the device and route out a suspect. As the U.S. in China race for AI supremacy, the companies building this technology are faced with bigger and bigger threats even from within. U.S. authorities are currently treating this as a matter of national security. >>Yeah, this guy Abdul Rahman Al-Fozan reportedly spent weeks scoping out this particular room because it can only be reserved by executives at Open AI. They discovered the device during its security sweep two nearly two weeks ago, alerted the FBI. They actually found a bag of this guy who he left it another part of the company's offices, and they found another listening device in that particular bag. So all signs pointed to this particular guy. Still, there are way more questions than answers. Was he doing it for himself? Was he going to sell it to sell this information to another company? Was he working for a particular nation state? So investigators will hope to get to the bottom of this because it comes at a very sensitive time for a bunch of these companies. These are some of the top trade secrets in the entire world. These frontier labs working on these AI metals, the race between Open AI and a throttpick, the race between U.S. and China comes with all these safety considerations and the fact that someone is just bugging the most top secret conference room at Open AI is very concerning. >>I thought this was an interesting detail. According to WCCF Tech, the prosecutors are claiming that a chapat account tied to Al-Fozan's spouse actually was researching things about a listening device. They said he or somebody submitted a promise between September 24th and September 30th about building, installing, obscuring, and remotely accessing a recording device. Seems a little on the nose to research using Chatsubiti how you're going to bug the offices of the Chatsubiti Maker, but always, I don't know, delete your history or don't use the very product of the company that you're trying to steal corporate secrets from. >>Movin' on Bank of America just got hit with a fine that would probably overdraw your Bank of America account. The Treasury Department announced it's forcing the company to pay $1.2 billion in fines over alleged money laundering violations. In other words, it wasn't paying enough attention to financial crimes being committed using the bank's money flows. If that 1.2 billion penalty sounds like a lot, it is. It's the second biggest fine the department has ever slapped on a bank and the third largest in the Treasury's history. But they say the punishment fits the crime. Bank of America is accused of failing to report more than $5 billion in suspicious transactions, more than 1 billion of which had national security implications, including Chinese money laundering networks. And agreeing to the penalty Bank of America acknowledged it violated the 1970 Bank Secrecy Act, which puts the onus on banks to detect and
prevent money laundering working hand in hand with the government. Bank of America said in a statement, financial crime compliance is serious and we are responsible for getting it right. So $5 billion in suspicious activity sounds like a lot, but just to put that in perspective, Bank America is the second largest bank in the country. It processes about $4.5 trillion in payments for individual customers every year. But then here we go. The bank handles $450 trillion in payments for corporate customers who are doing things like payroll, credit cards, supplier payments, etc. So it has to keep an eye on a lot of money going in and out of its system. You can't willfully turn a blind eye though. That's the big thing that federal anti-mundering, laundering prosecutors are looking at here. If you see that something is happening, you can't just hope that prosecutors will pick it up. The onus is on you to either alert them or do something about it. Finally, let's split to the finish with some final headlines. Six Flags has another tragedy on its hands. The amusement park operator temporarily shut down nine roller coasters across six parks on Monday after one person died in an incident at a six flags outside Atlanta. Authorities are still investigating what happened, but eyewitnesses reported that a man fell from the coaster after his restraints came loose during a ride on Goliath, a 200-foot tall coaster that reaches speeds of 70 miles per hour. Unfortunately, this isn't an isolated accident for six flags. Less than two weeks ago, its California park retired the famous X2 roller coaster following lawsuits alleging serious brain injuries. A company representative said six flags was closing the eight similar attractions out of an abundance of caution, adding it was deeply sat in by the guest incident. This is a real headscratcher for roller coaster experts because the firm that just designed this coaster, Bollinger and Mabelard, their Swiss, they are known for creating very reliable and very safe rides. They have been described as the BMW of roller coasters. So experts are just wondering how this could have happened. Either way, it's a really bad moment and a bad incident for six flags. The stock as well, this company has really gone through it over the past couple of years. They merged with Cedar Farah a couple of years ago, but then the CEO of that new company stepped down last year. Shares of six flags were down 80% since the merger closed and they plunged another 14% yesterday after this accident. They had to close nine other similar coasters around the country. So again, in the early stages of how this happened, but obviously it's just a crazy accident and something that's extremely tragic. And finally, forget your Facebook password. Hackers are now going after the food supply. On Monday, major supermarket chains in France confirmed their affidurators got hit with a cyber attack that in some cases raised the temperature to 122 degrees Fahrenheit and caused fires. Needless to say, a lot of fresh and frozen food had to be thrown out. About 700 locations were targeted and one retail CEO said the losses from a single day would total into the tens of millions of euros. Cyber experts said the attack was a wake-up call for the world. When you put infrastructure on the internet like remote controlled supermarket refrigeration, you better be buttoned up because if there is a vulnerability, hackers will exploit it. And investigation is ongoing, but no one has claimed responsibility for the attack and prosecutors haven't identified any culprits. Yeah, it's fascinating that food security has become another arena where cyber attacks is a big issue. It's not just stealing credit card numbers anymore. It's not just stealing your Facebook password. As you mentioned, you're actually going after equipment essential to keeping the food supply safe, which is obviously a major issue. The back-rounded noise here is that AI is making cyber attacks a lot more faster, easier to scale. That is what these companies have been warning about. That's why we see sometimes a slow down the speed of frontier model deployment or development because they are afraid that bad actors can get their hands on these models and just execute all of these cyber attacks, again, not sure if AI was behind this attack or not. There's very little info about who was behind it whatsoever. But whenever you hear major cyber attack, your brain can't help but think about was AI involved in it or not. >> Imagine opening their refrigerator in a grocery store and there's smoke coming out. It's not like the freezer dust. >> The sauna. >> It's a sauna. Yeah, so it's just crazy to think about. Okay. We close out every Wednesday show with suggestion box where Toby and I share a recommendation to get you over the hump of the week as a reward for your marathon performance. I'll let you go first. >> I'm so glad that you brought that up because I'm on a bit of a running kick right now. So I'm just going to hit people with some shoe recommendations. To me, when training is best, I have a shoe rotation one for easy days, one everyday trainer, an interval shoe and even a race shoe. So I'll just give a wreck in each category for easy days and sometimes long runs. I love the Nike Vomero Plus. It's up there with one of my favorite shoes of all times. It is so comfy, so much foam to it. This is not a benefit that you're looking for in a running shoe, but it does make you about an inch and a half taller if that's something that you're into. For a daily trainer, I love the A6 Nova Blast. Neil, you have these, you swear by these. They're great for everything from long runs to tempo work. If you want a shoe that does go a little faster, I like the Adidas Adi Zero Evo. They look just so classic. It's the white background with three big Adidas stripes and it's got this aggressive rocker feel to it. It just makes you want to run fast. And finally for the race shoe, the Alpha Fly 4, I just ran Chicago in it. I've run every marathon in some version of the Alpha Fly. This shoe is awesome. A little bit softer, a little bit more stable than some of the previous iterations. So everything you need to get you through those final models. So there you go. If you're in the mood to train, if you want to run a marathon, those are some of the shoes that I recommend. How many running shoes do you have? I will not comment, but it's upwards of 20. Actually, it's probably upwards of 25. They're all strolling across the top of my, I love shoes, like it's so fun to buy them. So those are four. If you want more, you can hit me up. All right. For my rec, I thought I'd share what I'm listening to, you know, music wise, because that's a big part of my life that I don't think you all get to see. First of all, Audrey Hobart, her music is like early Goofy or Taylor Swift. I love it. Upbeat, fantastic hooks. Funniest, most memorable lyrics you'll mouth to yourself all day. Just play the album, who's the clown, front to back, you won't be disappointed. Another is the band Geese, not to be confused with the jam band Goose, though they're okay. Geese is a young rock band from Brooklyn. I saw them recently at Forest Hills, and look, you're they're going to love them or hate them. I happen to love them. Start with Cobra. And finally, for something a little more introspective and calmer. Lower Marion's own Lizzie McAlpine, who I recently discovered. It's gorgeous music, start with light in the painting. Have you heard of Justin Bieber? No, is that that's what that's the kind of stuff I'm on. I take Neil has great taste in music. We're coming into Spotify rap season two. So now is time to, you know, very important, make it look like you have great taste. I am too far gone at this point, but follow Neil's rex and you'll be impressing your office mate. Hey, I love Justin Bieber too. And just here he is, he's the front runner to play a suitable halftime show. Not any of the ones I mentioned, those would be kind of a disaster. All right. That is all the time we have. We're starting your morning with us and have an awesome Wednesday to share your thoughts on the episode or anything else. Send an email to
[email protected] or DM us on Instagram @ambidallyshow. Let's roll the credits. Emily Mill iron is our supervising producer. Raymond Loot is our senior producer. Our producer is Olivia Graham and our associate producer is Olivia Lake, technical direction by Nina Miller. Her makeup is rereading hatchet and our show is a production of Morning Brew. Great show, Danielle. Let's run it back tomorrow. Contentful, in partnership with the Atlantic, released their latest report that maps out the five questions marketing leaders need to answer to succeed in the agentic web era. The report helps marketing leaders figure out what they need to decide when it comes to defining AI's role within their team, the risk of deferral if no one makes a call, what success looks like, and the review cadence needed to stay on top. To see all the findings, go to contentful.com/mourningbrew.
PodcastTranscript AI