Artificial intelligence

Microsoft signs multi-billion-dollar AI pact with Nebius

Shares in Amsterdam-based Nebius surged more than 50% in US premarket trading after the company announced a $19.4 billion deal with Microsoft. The agreement will provide cloud computing power for AI workloads and is set to run until 2031.

Under the pact’s terms, Nebius will generate $17.4 billion in revenue over the next six years, with Microsoft also retaining the option to purchase additional computing capacity.

Investors responded strongly, with Nebius shares climbing 60% in extended trading on Monday and continuing their rise on Tuesday. Rival AI infrastructure company CoreWeave also benefited, gaining more than 6% premarket.

Nebius, spun out from Russian internet firm Yandex in 2023, specialises in supplying GPUs for training AI models. The deal underscores the high demand for computing power as companies race to develop increasingly advanced AI systems.

Industry leader Nvidia recently reported soaring earnings and forecast that AI infrastructure spending could reach $4 trillion by 2030.

The boom in AI infrastructure comes amid mounting questions over whether valuations are sustainable. OpenAI has reportedly reached a $500 billion valuation, while rival Anthropic recently raised $13 billion at a $183 billion valuation.

Some analysts, including OpenAI chief executive Sam Altman, have warned that the AI sector may already show signs of a bubble.

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Social media authenticity questioned as Altman points to bot-like behaviour

Sam Altman, X enthusiast and Reddit shareholder, has expressed doubts over whether social media content can still be distinguished from bot activity. His remarks followed an influx of praise for OpenAI Codex on Reddit, where users questioned whether such posts were genuine.

Altman noted that humans are increasingly adopting quirks of AI-generated language, blurring the line between authentic and synthetic speech. He also pointed to factors such as social media optimisation for engagement and astroturfing campaigns, which amplify suspicions of fakery.

The comments follow OpenAI’s backlash over the rollout of GPT-5, which saw Reddit communities shift from celebratory to critical. Altman acknowledged flaws in a Reddit AMA, but the fallout left lasting scepticism and lower enthusiasm among AI users.

Underlying this debate is the wider reality that bots dominate much of the online environment. Imperva estimates that more than half of 2024’s internet traffic was non-human, while X’s own Grok chatbot admitted to hundreds of millions of bots on the platform.

Some observers suggest Altman’s comments may foreshadow an OpenAI-backed social media venture. Whether such a project could avoid the same bot-related challenges remains uncertain, with research suggesting that even bot-only networks eventually create echo chambers of their own.

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AI adoption drops at large US companies for the first time since 2023

Despite the hype surrounding AI, new data suggests corporate adoption of AI is slowing.

A biweekly survey by the US Census Bureau found AI use among firms with over 250 employees dropped from nearly 14 percent in mid-June to under 12 percent in August, marking the largest decline since the survey began in November 2023.

Smaller companies with fewer than four workers saw a slight increase, but mid-sized businesses largely reported flat or falling AI adoption. The findings are worrying for tech investors and CEOs, who have invested heavily in enterprise AI in the hope of boosting productivity and revenue across industries.

So far, up to 95 per cent of companies using AI have not generated new income from the technology.

The decline comes amid underwhelming performance from high-profile AI releases. OpenAI’s GPT-5, expected to revolutionise enterprise AI, underperformed in benchmark tests, while some companies are rehiring human staff after previously reducing headcount based on AI promises.

Analysts warn that AI innovations may have plateaued, leaving enterprise adoption struggling to justify prior investments.

Unless enterprise AI starts delivering measurable results, corporate usage could continue to decline, signalling a potential slowdown in the broader AI-driven growth many had anticipated.

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Anthropic AI faces legal setback in authors’ piracy lawsuit

A federal judge has rejected the $1.5 billion settlement Anthropic agreed to in a piracy lawsuit filed by authors.

Judge William Alsup expressed concerns that the deal was ‘nowhere close to complete’ and could be forced on writers without proper input.

The lawsuit involves around 500,000 authors whose works were allegedly used without permission to train Anthropic’s large language models. The proposed settlement would have granted $3,000 per work, a sum far exceeding previous copyright recoveries.

However, the judge criticised the lack of clarity regarding the list of works, authors, notification process, and claim forms.

Alsup instructed the lawyers to provide clear notice to class members and allow them to opt in or out. He also emphasised that Anthropic must be shielded from future claims on the same issue. The court set deadlines for a final list of works by September 15 and approval of all related documents by October 10.

The ruling highlights ongoing legal challenges for AI companies using copyrighted material for training large language models instead of relying solely on licensed or public-domain data.

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Orson Welles lost film reconstructed with AI

More than 80 years after Orson Welles’ The Magnificent Ambersons was cut and lost, AI is being used to restore 43 missing minutes of the film.

Amazon-backed Showrunner, led by Edward Saatchi, is experimenting with AI technology to rebuild the destroyed sequences as part of a broader push to reimagine how Hollywood might use AI in storytelling.

The project is not intended for commercial release, since Showrunner has not secured rights from Warner Bros. or Concord, but instead aims to explore what could have been the director’s original vision.

The initiative marks a shift in the role of AI in filmmaking. Rather than serving only as a tool for effects, dubbing or storyboarding, it is being positioned as a foundation for long-form narrative creation.

Showrunner is developing AI models capable of sustaining complex plots, with the goal of eventually generating entire films. Saatchi envisions the platform as a type of ‘Netflix of AI,’ where audiences might one day interact with intellectual property and generate their own stories.

To reconstruct The Magnificent Ambersons, the company is combining traditional techniques with AI tools. New sequences will be shot with actors, while AI will be used for face and pose transfer to replicate the original cast.

Thousands of archival set photographs are being used to digitally recreate the film’s environments.

Filmmaker Brian Rose, who has rebuilt 30,000 missing frames over five years, has reconstructed set movements and timing to match the lost scenes, while VFX expert Tom Clive will assist in refining the likenesses of the original actors.

A project that underlines both the creative possibilities and ethical tensions surrounding AI in cinema. While the reconstructed footage will not be commercially exploited, it raises questions about the use of copyrighted material in training AI and the risk of replacing human creators.

For many, however, the experiment offers a glimpse of what Welles’ ambitious work might have looked like had it survived intact.

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AI-tissue collaboration could transform drug trials and precision medicine

Researchers combine human tissue models with explainable AI to analyse patient data and identify treatments that work best for specific patients. First applied to inflammatory bowel disease, the approach could improve clinical trial success rates and accelerate drug discovery.

REPROCELL, IBM, and the STFC Hartree Centre have developed Pharmacology-AI, a platform uniting tissue models with machine learning. Delivered through the Hartree National Centre for Digital Innovation, it reduces costs, enhances trial design, and enables more targeted therapies.

Unlike tools that seek to replace human expertise, the platform acts as a decision-support system. It helps scientists detect patterns in complex datasets while keeping outputs interpretable for clinical trial use. Developers emphasised usability, ensuring non-technical staff can work with the system.

Human fresh tissue models play a central role, preserving biological complexity and simulating drug effects before trials. However, this generates reliable data that can be paired with AI to identify optimal patient profiles and reduce the risk of costly trial failures.

The project’s success suggests broad applications beyond IBD. With explainable AI and high-quality patient data, Pharmacology-AI could improve outcomes across multiple disease areas, making drug development faster, more efficient, and more precise.

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OpenAI study links AI hallucinations to flawed testing incentives

OpenAI researchers say large language models continue to hallucinate because current evaluation methods encourage them to guess rather than admit uncertainty.

Hallucinations, defined as confident but false statements, persist despite advances in models such as GPT-5. Low-frequency facts, like specific dates or names, are particularly vulnerable.

The study argues that while pretraining predicts the next word without true or false labels, the real problem lies in accuracy-based testing. Evaluations that reward lucky guesses discourage models from saying ‘I don’t know’.

Researchers suggest penalising confident errors more heavily than uncertainty, and awarding partial credit when AI models acknowledge limits in knowledge. They argue that only by reforming evaluation methods can hallucinations be meaningfully reduced.

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AI threatens the future of entry level jobs

The rise of AI puts traditional entry-level roles under pressure, raising concerns that career ladders may no longer function as they once did. Industry leaders, including Anthropic CEO Dario Amodei, warn that AI could replace half of all entry-level jobs as machines operate nonstop.

A venture capital firm, SignalFire, found that hiring for graduates with under one year of experience at major tech firms fell by 50% between 2019 and 2024. The decline has been consistent across business functions, from sales and marketing to engineering and operations.

Analysts argue that while career pathways are being reshaped, the ladder’s bottom rung is disappearing, forcing graduates to acquire skills independently before entering the workforce.

Experts stress that the shift does not mean careers are over for new graduates, but it does signal a more challenging transition. Universities are already adapting by striking partnerships with AI companies, while some economists point out that past technological revolutions took decades to reshape employment.

Yet others warn that unchecked AI could eventually threaten entry-level roles and all levels of work, raising questions about the future stability of corporate structures.

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Mistral AI pushes growth with new funding and global deals

Founded in 2023 by ex-Google DeepMind and Meta researchers, Mistral has quickly gained global attention with its open-source models and consumer app, which hit one million downloads within two weeks of launch.

Mistral AI is now seeking fresh funding at a reported $14 billion valuation, more than double its worth just a year ago. Its investors include Microsoft, Nvidia, Cisco, and Bpifrance, and it has signed partnerships with AFP, Stellantis, Orange, and France’s army.

Its growing suite of models spans large language, audio, coding, and reasoning systems, while its enterprise tools integrate with services such as Asana and Google Drive. French president Emmanuel Macron has openly endorsed the firm, framing it as a strategic alternative to US dominance in AI.

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OpenAI backs AI-generated film Critterz for 2026 release

OpenAI is supporting the production of Critterz, an AI-assisted animated film set for a global theatrical release in 2026. The project aims to show that AI can streamline filmmaking, cutting costs and production time.

Partnering with Vertigo Films and Native Foreign, the film is being produced in nine months, far faster than the usual three years for animated features.

The film, budgeted under $30 million, combines OpenAI’s GPT-5 and DALL·E with traditional voice acting and hand-drawn elements. Building on the acclaimed 2023 short, Critterz will debut at the Cannes Film Festival and expand on a story where humans and AI creatures share the same world.

Writers James Lamont and Jon Foster, known for Paddington in Peru, have been brought in to shape the screenplay.

While producers highlight AI’s creative potential, concerns remain about authenticity and job security in the industry. Some fear AI films could feel impersonal, while major studios continue to defend intellectual property.

Warner Bros., Disney, and Universal are in court with Midjourney over alleged copyright violations.

Despite the debate, OpenAI remains committed to its role in pushing generative storytelling. The company is also expanding its infrastructure, forecasting spending of $115 billion by 2029, with $8 billion planned for this year alone.

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