Good morning, it’s Monday. Western firms are cozying up to China’s DeepSeek AI despite major security concerns, AGI might be arriving faster than we thought (gulp), and an AI-powered aviation deal is ready for takeoff.

Plus, in our latest I Will Teach You to AI post, we’re diving into some powerhouse ChatGPT features that could change the way you work.

Read on!

🗞️ ICYMI RECAP

Top Stories You Might Have Missed

✈️ Archer and Palantir Partner on AI Aviation: Archer will use Palantir’s Foundry and AIP to scale aircraft production and enhance air traffic and route planning. The goal is to improve efficiency, safety, and affordability.

👍 Google Backs U.S. AI Action Plan: Google urges the U.S. to invest in AI infrastructure, modernize government AI adoption, and push for global pro-innovation standards. It calls for balanced export controls and unified AI regulations to maintain America’s competitive edge.

🚀 Baidu Unveils Ernie 4.5 and New AI Model Ernie X1 Baidu introduced Ernie 4.5 and the reasoning-focused Ernie X1, aiming for smarter AI capabilities. It also made Ernie Bot free earlier than planned, intensifying competition in China's AI market.

🚧 China Tightens Grip on AI Startup DeepSeek: After DeepSeek’s R1 model gained attention, the government imposed travel limits on staff and began screening potential foreign investors. Parent company High-Flyer is reportedly holding employee passports.

🏡 AI Boom Spurs Texas Housing Rush: Texas’ growing data center sector, led by a $500B Stargate project, is driving housing demand in key areas like Dallas-Fort Worth, Abilene, and other rapidly expanding tech hubs. Rising land prices and strain on the state’s power grid could follow.

🦾 China’s Tiangong Crew Tests AI Robot: Shenzhou 19 astronauts are using the AI robot "Xiao Hang" to study human-machine interaction aboard the Tiangong space station, aiming to improve operational efficiency and crew support. Two more crewed missions and a cargo flight are planned for 2025.

🛡️ L3Harris Taps AI for Missile Defense: L3Harris is partnering with Palantir and Shield AI to enhance the Pentagon’s Golden Dome program with AI-driven threat detection and interception. The AI layer will help coordinate sensors and interceptors in real time.

🫂 Study Finds AI More Compassionate Than Humans: AI responses were rated 16% more compassionate than human crisis responders, preferred 68% of the time for their consistency and attentiveness.

🏷️ China to Require AI Content Labels: China will mandate labeling of AI-generated content, including metadata, starting Sept. 1 to curb online disinformation and improve digital transparency. The move aligns with similar steps in the EU and US.

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Visit www.langtrace.ai to learn more about how Langtrace can help you build and transform your AI agents from prototypes to enterprise grade products.

🧑‍🚀 FORWARD FUTURE PRO

Master ChatGPT: Your Introduction to the World of AI Assistance

Discover how ChatGPT can become your personal digital assistant. This beginner’s guide introduces ChatGPT’s key features and practical uses — from web searches and deep research to team collaboration and document analysis. Along the way, you’ll learn effective strategies and handy tricks to quickly advance from novice to power user.

📊 MARKET PULSE

The Public SaaS Slowdown

Public SaaS companies have seen their growth rates halved since 2023, dropping from 36% to 17%, according to David Spitz. 

The culprit? A lack of fresh, fast-growing SaaS firms entering public markets. With IPO activity stagnant since 2022, the pool of younger, high-growth companies isn’t replenishing the sector, leaving aging firms with naturally slower expansion rates. However, software spending remains strong, and thriving SaaS businesses still exist in private markets—just not in the public eye. With abundant late-stage funding and easy secondary liquidity, this trend may persist, making public SaaS metrics less reflective of the software industry's true state. → Read the full article here.

🤖 DEEPSEEK

Western Firms Adopt DeepSeek While Grappling with Security Concerns

The Recap: DeepSeek’s R1, the Chinese AI model that shook up the tech world in January, remains the most powerful open-source AI model available. While Western companies are starting to integrate R1, questions over security, censorship, and reliance on Chinese technology remain unresolved.

Highlights:

• DeepSeek’s R1 is the top open-source AI model, launched in January and still unmatched by any Western or Chinese competitor.

• The open-source advantage allows companies to use R1 without permission or fees and run it locally for better privacy and performance.

• Western adoption is growing as Amazon and Microsoft support R1 on their cloud platforms, while Meta is studying it to improve its Llama models.

• European banks are leading adopters, with Natwest, HSBC, and BBVA experimenting with R1 to avoid cloud-based AI due to strict data privacy rules.

• Security fears in the U.S. have led some American firms to use R1 only on isolated systems, while the White House considers banning it from government devices.

• Code is now fully open-source after DeepSeek released the exact code used to train R1 in February, leading to thousands of downloads in a week.

• Censorship remains an issue as R1 avoids sensitive topics like Tiananmen Square; some firms, like Perplexity, are retraining it to remove bias.

Forward Future Takeaways:
DeepSeek’s rise reflects China’s growing dominance in AI, but Western hesitation over security and censorship could limit adoption. If U.S. regulators move to restrict DeepSeek, European companies might find themselves forced to rely more heavily on Chinese or American technology — with strategic consequences for global tech competition.→ Read the full article here.

🧠 AGI

Powerful A.I. Is Coming. We’re Not Ready.

The Recap: Kevin Roose argues that artificial general intelligence (AGI) could arrive as soon as 2026 — and that society is woefully unprepared for its transformative economic, political, and technological impact. He contends that insiders in the AI industry are sounding the alarm, and the rapid improvement of AI models suggests that world-shaking change is imminent.

Highlights:

• AGI could be declared within the next two years, shifting the global balance of power and generating trillions of dollars in value

• Top AI leaders, including Sam Altman and Demis Hassabis, warn that AGI could be three to five years away

• OpenAI’s reasoning model "o1" jumped from 9% to 74% on the AIME math test within months, highlighting the rapid improvement in AI capabilities

• AI is already reshaping industries such as coding, medical diagnosis, and scientific research

• Governments and institutions have no realistic plan to regulate, mitigate risks, or capitalize on AI’s benefits

• AI now handles up to 95% of coding tasks for startups, shifting the role of programmers to oversight rather than creation

• Most people remain unaware of AGI’s approach and potential consequences, echoing the delayed response to social media’s rise

Forward Future Takeaways:
The pace of AI progress means that waiting to act could be catastrophic. Roose argues that preparation — from strengthening cybersecurity to teaching AI literacy — is essential even if AGI arrives later than expected. Ignoring the signs now could leave society vulnerable to the next technological earthquake.→ Read the full article here.

📽️ VIDEO

Beginner’s Guide to Reinforcement Learning

Matt’s latest video breaks down how reinforcement learning helps AI "think" by maximizing rewards from its environment. He explains reward hacking, verifiable rewards, and why aligning rewards with goals boosts AI reliability and performance. Get the full scoop! 👇

🧰 TOOLBOX

Image Editing, Creative Generation, and Streamlined Automation

🖼️ KV-Edit: Training-free image editing tool using DiT models to preserve backgrounds and improve image quality without retraining.

🎨 PicLumen: Free AI image generator for creating art, logos, and product images with tools for upscaling, background removal, and colorizing.

⚙️ Continual: AI agent platform that automates workflows, optimizes business operations, and enables real-time decision-making.

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🤠 THE DAILY BYTE

Gemini Robotics Folds an Origami Fox — Proof AI Is More Than Just Paper Smart

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The Forward Future Team

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