Good morning, it’s Friday. Today, we’ve got Eric Schmidt warning that an AGI arms race could go full Cold War, SaaS companies scrambling to keep up with AI’s takeover, and Alibaba flexing its AI muscles hard enough to boost its stock by 8%.

And in our interview with Bhaskar Roy, Chief of AI Products & Solutions at Workato, we ask the big question: Is SaaS dead, or just having an identity crisis?

Read on!

🤔 FRIDAY FACTS

Can you hear space? Outer space is often described as a “silent vacuum,” but is it really completely silent?

Stick around to find out more! 👇

🗞️ YOUR DAILY ROLLUP

Top Stories of the Day

📈 Alibaba’s New AI Model Boosts Stock 8%
Alibaba unveiled QwQ-32B, an AI reasoning model it claims outperforms OpenAI and DeepSeek’s latest models. The announcement sent Alibaba’s Hong Kong-listed shares up 8%, contributing to a 30% surge in the Hang Seng China Enterprises Index since January. The model boasts efficiency with fewer parameters than DeepSeek’s R1 while achieving similar performance. Alibaba also pledged a $52.4 billion AI investment, signaling China’s deepening AI push amid US-China tech competition.

🛡️ Pentagon Taps AI for Faster Military Decisions
The Pentagon signed a contract with Scale AI to integrate artificial intelligence into military planning through its Thunderforge program. The AI system, supported by Microsoft’s language models, will speed up decision-making for U.S. military leaders, replacing outdated processes. Initially deployed in Indo-Pacific and European Commands, it will expand across combatant commands. The deal reflects the Pentagon’s push to modernize defense with AI-driven analysis and automation.

🔬 AI Enhances Microplastic Identification for Research
Researchers have developed a machine learning tool to improve microplastic identification using spectroscopy, helping assess pollution with greater accuracy. Traditional methods struggle to distinguish similar plastic types, but the new AI-driven approach, conformal prediction, provides uncertainty measures for more reliable results. Tested in Michigan, the system successfully identified microplastics with expert-verified accuracy.

💰 Crogl Raises $30M for AI-Powered Cybersecurity Assistant
Crogl, a cybersecurity startup, has launched an AI-driven assistant designed to help analysts process thousands of security alerts daily—calling it an "Iron Man suit" for researchers. The company secured $30M in funding, led by Menlo Ventures, to expand its product and customer base. Using a "Large Security Model," Crogl not only flags threats but also learns and enables natural language queries for deeper insights. Future plans may include automated remediation capabilities.

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🗺️ GEOPOLITICS

Eric Schmidt Warns Against a ‘Manhattan Project for AGI’

The Recap: Former Google CEO Eric Schmidt, along with Scale AI’s Alexandr Wang and AI safety expert Dan Hendrycks, argues against a U.S.-led “Manhattan Project” for artificial general intelligence (AGI). Their new policy paper warns that aggressively pursuing AGI dominance could provoke hostile responses from China, including potential cyberattacks, destabilizing global security.

Highlights:

• Schmidt, Wang, and Hendrycks compare AGI development to nuclear arms, arguing that a U.S. bid for control could trigger an AI arms race or preemptive cyber strikes.

• The paper, Superintelligence Strategy, critiques recent U.S. proposals for a government-backed AGI project modeled after the WWII atomic bomb program.

• The authors introduce the concept of Mutual Assured AI Malfunction (MAIM)—a strategy where nations disable threatening AI systems rather than allowing adversaries to deploy them.

• They advocate for cyberwarfare tactics to sabotage hostile AGI projects and restrict access to advanced AI chips and open-source models.

• The AI policy debate is framed between "doomers" (who fear inevitable catastrophe) and "ostriches" (who ignore risks), with the authors proposing a third path: a defensive AI strategy.

• Schmidt’s shift in stance is notable—he previously urged the U.S. to compete aggressively in AI but now calls for caution.

• With the Trump administration pushing full steam ahead on AI, the authors stress that America’s choices will shape global security dynamics.

Forward Future Takeaways:
This paper signals a shift in high-level AI policy discussions from pure competition to strategic deterrence. If adopted, Schmidt’s proposed approach could redefine U.S. AI policy by prioritizing defensive measures over an arms race. However, given the political momentum behind AI acceleration, it remains to be seen whether Washington will embrace caution—or charge ahead into an unpredictable AGI future. → Read the full article here.

👾 FORWARD FUTURE ORIGINAL

The SaaS Shake-Up: Winners, Losers, and What’s Ahead

Few statements grab attention in the enterprise tech world like “SaaS is dead.” But as Bhaskar Roy, Chief of AI Products & Solutions at Workato, argues, the reality is more nuanced. SaaS isn’t disappearing—it’s being transformed at its core. In a recent conversation with Nick Wentz of Forward Future, Roy laid out a compelling case for how AI-driven agents are fundamentally altering how businesses interact with software.

For the past two decades, SaaS has been a combination of a graphical user interface, a database, and business logic. This framework has driven digital transformation, but AI is rewriting the rules. Instead of static interfaces, intelligent AI agents are handling everything from business logic to workflow orchestration. So, is SaaS really dying? Not exactly—but its role is shifting toward becoming a system of record rather than a primary interface. → Continue reading here.

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📑 TECHNOLOGY & POLICY

Anthropic CEO Dario Amodei Talks Claude, China, and the Future of AI

The Recap: Anthropic CEO Dario Amodei joined the Hard Fork podcast to discuss AI’s rapid evolution, the latest improvements to Claude 3.7 Sonnet, and the escalating AI race between the U.S. and China. With AI approaching human-level reasoning, Amodei warned of both its transformative potential and the urgent need for safeguards.

Highlights:

• Claude 3.7 Sonnet prioritizes real-world problem-solving over traditional coding benchmarks, with features like an “extended thinking mode” to simulate deeper reasoning.

• Internet access is coming soon, but Claude 3.7 still lacks direct web search integration—something competitors already offer.

• AI and geopolitics are deeply intertwined, with Amodei raising concerns about China’s growing AI capabilities and the risk of AI reinforcing authoritarian power.

• The AI arms race is a paradox—some argue competition with China fuels reckless acceleration, while Amodei insists that U.S. leadership is necessary to allow time for responsible regulation.

• AI safety is hitting a critical juncture, with Claude 3.7 nearing the capability threshold where it could assist in harmful activities like biosecurity threats.

• Anthropic is prepared to slow releases if safety risks become too great, contrasting with the industry’s prevailing rush to scale.

• AI could reach “human-level intelligence” within two years, fundamentally reshaping economies, workplaces, and global power dynamics.

Forward Future Takeaways:
Amodei paints a future where AI is both an unparalleled tool for progress and a potential risk for misuse—especially in the hands of authoritarian regimes. The coming years will test whether the U.S. can balance innovation with safety or if competitive pressures will force reckless acceleration. One thing is certain: AI’s breakneck pace isn’t slowing down anytime soon. → Read the full article here.

🛰️ NEWS

What Else is Happening

💸 Shield AI Raises $240M at $5.3B: The defense startup is expanding Hivemind, its AI software that powers autonomous drones, aircraft, and more.

🗪 Mistral AI Expands with Le Chat: The French AI startup, valued at $6B, launched its chat assistant on mobile, aiming to challenge OpenAI.

📟 ChatGPT for macOS Can Edit Code: OpenAI's chatbot now directly modifies code in Xcode, VS Code, and JetBrains, competing with AI coding tools like GitHub.

🌉 Databricks Pledges $1B to San Francisco: The AI giant is expanding its HQ, doubling its workforce, and keeping its major conference in the city.

🦆 DuckDuckGo Expands AI Search Features: Its AI answers now pull from the web, integrate with Duck.ai chat, and remain privacy focused.

🏫 FFU MINI

Reverse-Engineering High-Quality Outputs

Ever received an AI-generated response so good you wished you could replicate it consistently? The secret: working backward to decode what made that output shine. Reverse-engineering great AI responses helps you craft structured, optimized prompts for future use. → Continue reading.

📽️ VIDEO

LLM Generates the Entire Output at Once (World’s First Diffusion LLM)

Inception Labs has unveiled the world's first Diffusion Large Language Model (DLMM), which generates entire outputs at once instead of token by token. This novel approach, inspired by text-to-image diffusion models, makes AI responses 10x faster and cheaper. Get the full scoop in Matt’s latest video! 👇

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🤔 FRIDAY FACTS

Can You Hear Space? Yes and No.

In the vacuum of space, there’s no air to carry sound waves, so traditional sound as we know it can’t travel. However, space isn’t entirely silent. Some celestial objects, like black holes and planets, emit electromagnetic waves that can be converted into sound. For example, NASA’s Perseverance rover recorded actual audio from Mars—where the thin atmosphere does allow for sound travel (just slightly muffled).

Even eerier? NASA has "sonified" radio waves from black holes, turning them into ghostly, otherworldly noises. So, while no one can hear you scream in space, with the right instruments, we can still listen to the universe. 🎧✨

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