OpenAI and Microsoft strengthen their long-term AI collaboration

Microsoft and OpenAI have reaffirmed their long-standing collaboration after new funding and partnerships raised speculation about their relationship.

Both firms stressed that recent announcements leave their original agreements intact, preserving a framework built on technical integration, trust and shared ambitions for AI development.

Microsoft’s exclusive licence to OpenAI’s intellectual property remains untouched, as does its position as the sole cloud provider for stateless APIs powering OpenAI models.

These APIs can be accessed through either company. Yet all such calls, including those arising from third-party partnerships such as OpenAI’s work with Amazon, continue to run on Azure rather than on alternative clouds. OpenAI’s own products, including Frontier, also stay hosted on Azure.

Revenue-sharing arrangements are unchanged, alongside the contractual definition and evaluation process for artificial general intelligence.

Both companies emphasised that the partnership was designed to allow independent initiatives while preserving deep cooperation across research, engineering and product innovation.

OpenAI retains the freedom to secure additional compute capacity elsewhere, supported by large-scale initiatives such as the Stargate project.

Even with broader collaborations emerging across the industry, both firms present their alliance as central to advancing responsible AI and expanding access to powerful tools worldwide.

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Topshop unveils AI shoppable catwalk in Manchester

Topshop has staged what it describes as a world-first AI-driven shoppable catwalk in Manchester, as part of its UK brand revival. The Manchester event combined physical runway looks with real-time digital purchasing through a bespoke Front Row AI app.

Guests in Manchester were able to buy outfits instantly as models walked, while also trying on virtual versions after the show. The experience was adjudicated by the World Record Certification Agency and positioned as a new model for immersive retail in the UK.

The Manchester showcase formed part of Topshop’s regional strategy beyond London, highlighting the North West’s role in the UK fashion sector. Students from the University of Salford and Manchester Metropolitan University designed and presented the finale in Manchester.

Topshop’s broader comeback in the UK includes pop ups in John Lewis stores, a standalone website relaunch and a partnership with Liberty in London. Executives said Manchester marked a new phase where AI and commerce converge to reshape retail experiences.

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Action-capable AI highlights new security challenges

AI agents are evolving from demos into autonomous tools, with OpenClaw emerging as a leading example. Unlike chatbots, these agents execute tasks directly, interacting with software and systems without constant human input.

The rise of action-capable AI introduces new security challenges. Agents can be manipulated through untrusted input or prompt injection. Persistent memory can also prolong mistakes or unintended behaviour.

The combination of access to sensitive data, external actions, and unverified content, sometimes called the ‘lethal trifecta’, amplifies risks, making careful configuration and oversight essential.

Self-hosted agents offer more control, while cloud-based versions simplify setup but shift security responsibility. Experts recommend running agents in isolated environments, limiting permissions, and requiring approval for sensitive actions.

These precautions reduce the chance of accidental or malicious harm while allowing users to experiment safely.

OpenClaw illustrates the potential of AI agents to automate workflows, handle repetitive tasks, and act proactively rather than passively advising. These tools show the future of consumer AI, but broader adoption requires stronger safety measures and awareness of risks.

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OpenAI expands London research hub

OpenAI is turning its London office into its largest research hub outside the US, marking a strategic shift towards deeper engagement with the UK’s rapidly developing AI landscape. The move places the company in direct competition with Google DeepMind for scientific talent.

An expansion that strengthens OpenAI’s long-term presence in Europe by building a substantial research base rather than relying on satellite operations. The firm aims to attract researchers seeking strong academic links, regulatory clarity and access to the UK’s growing AI ecosystem.

The enlarged London team is expected to support frontier model development and experimental work that aligns with OpenAI’s international ambitions. Senior leadership framed the decision as a vote of confidence in the UK’s capacity to become one of the most influential centres for advanced AI research.

The announcement intensifies debate over global competition for expertise, as major labs seek locations that balance research freedom with responsible oversight.

OpenAI’s investment signals a belief that the UK can offer such conditions while positioning itself as a key player in shaping the next generation of AI capabilities.

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Data sovereignty becomes an infrastructure strategy in the AI era

For most of the past decade, data governance was treated as a legal issue. IT built networks and bought tools, while regulators were someone else’s problem. That division no longer holds. Cloud adoption and AI have turned data sovereignty into a core infrastructure and strategy question.

Regulatory frameworks such as GDPR, NIS2, and DORA are expanding and being enforced more strictly. Governments are also scrutinising foreign cloud providers and cross-border access. Local data storage no longer ensures absolute data sovereignty if critical control layers remain outside national jurisdiction.

Traditional SASE and SSE models were not built for this environment. Many still separate outbound cloud traffic from inbound controls. That split creates blind spots in distributed architectures and complicates consistent policy enforcement.

AI workloads intensify the pressure. Retailers, banks, and manufacturers are deploying models locally, not just in hyperscale clouds. Securing east-west traffic across systems and APIs without undermining data sovereignty is becoming a central architectural challenge.

Managed sovereign infrastructure is one response. It reduces reliance on external cloud paths while preserving operational scale. Ultimately, organisations must align security, AI deployment, and governance with long-term resilience goals.

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Nano Banana 2 brings Flash speed to Gemini image generation

Google has introduced Nano Banana 2, branded Gemini 3.1 Flash Image, combining Flash speed with advanced reasoning. The update narrows the gap between rapid generation and visual quality, enabling faster edits. Improved instruction-following enhances the handling of complex prompts.

Nano Banana 2 integrates real-time web grounding to improve subject accuracy and contextual awareness. The model supports more precise text rendering and in-image translation for marketing and localisation tasks. It can also assist with diagrams, infographics, and data visualisations.

Upgrades include stronger subject consistency across multiple characters and objects within a single workflow. Users can create assets in aspect ratios and resolutions from 512px to 4K. Google highlighted improvements in lighting, textures, and photorealism while maintaining Flash-level speed.

The model is rolling out across the Gemini app, Search, Lens, AI Studio, Vertex AI, Flow, and Google Ads. In Gemini, Nano Banana 2 replaces Nano Banana Pro by default, though Pro remains available for specialised tasks. Availability is expanding to additional countries and languages.

Google also reinforced its provenance strategy by combining SynthID watermarking with C2PA Content Credentials. The company said verification tools in Gemini have been used millions of times to identify AI-generated media. C2PA verification will be added to the app in a future update.

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European businesses gain AI-powered contract tools with local data hosting

Workday has rolled out its Contract Lifecycle Management (CLM) platform with EU-hosted data in Frankfurt, allowing European organisations to use AI contract tools while keeping all data within the EU.

German, French, and Spanish language support is live, with more languages planned. The update is part of Workday’s EU Sovereign Cloud strategy, targeting the CLM market, which is set to grow to $1.9 billion by 2033.

The platform uses AI agents to automate contracts. The Contract Intelligence Agent extracts terms, obligations, and renewal dates to create a searchable repository, while the Contract Negotiation Agent flags deviations, drafts redlines, and speeds approvals.

Multilingual support ensures smooth workflows across Europe’s largest commercial languages, improving compliance and efficiency.

GDPR compliance remains critical, with fines up to €20 million or 4% of global turnover. EU-hosted CLM removes offshore data risks, which are crucial for the finance, healthcare, and defence sectors. Workday combines AI efficiency with full legal compliance.

Decision-makers should focus on three priorities: EU data residency, leveraging AI agents to accelerate contracts, and integrating CLM with HR and finance systems to maximise value. Workday aims to capture market share in Europe against competitors such as Icertis and DocuSign.

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Australia begins a landmark study on social media minimum age

eSafety Commissioner has launched a major evaluation of Australia’s Social Media Minimum Age to understand how platforms are applying the requirement and what effects it is having on children, young people and families.

The study aims to deliver robust evidence about both intended and unintended impacts as the national debate on youth, wellbeing and digital environments intensifies.

Over more than two years, the research will follow more than four thousand children and families in Australia, combining surveys, interviews, group discussions and privacy-protected smartphone tracking.

Administrative data from national literacy assessments and health systems will be linked to deepen understanding of online behaviour, wellbeing and exposure to risk. All research materials are publicly available through the Open Science Framework to maintain transparency.

The project is led by eSafety’s Research and Evaluation team in partnership with the Stanford University Social Media Lab and an Academic Advisory Group of specialists in mental health, youth development and digital technologies.

Young people themselves are shaping the study through the eSafety Youth Council, ensuring that the interpretation reflects lived experience rather than external assumptions. Full ethics approval underpins the methodology, which meets strict standards of integrity and privacy.

Findings will be released from late 2026 onward, with early reports analysing the experiences of children under sixteen.

The results will inform a legislative review conducted by Australia’s Department of Infrastructure, Transport, Regional Development, Communications, Sport and the Arts.

eSafety expects the evaluation to become a major evidence source for policymakers, researchers and communities as the global conversation on minors and social media regulation continues.

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Pakistan’s digital transformation highlighted as UNESCO advances AI ethics

UNESCO used the Pakistan Governance Forum 2026 to highlight the need for a structured Ethical AI and Data Governance Framework as the country accelerates its digital transformation.

Federal leaders, provincial authorities and civil society convened to examine governance reforms, with UNESCO urging Pakistan to align its expanding digital public infrastructure with coherent standards that protect rights while enabling innovation.

Speaking at the Forum, Fuad Pashayev underlined that Pakistan’s reform priority should centre on the Recommendation on the Ethics of Artificial Intelligence, adopted unanimously by all 193 Member States.

Anchoring national systems in transparency, accountability and meaningful human oversight was framed as essential for maintaining public trust as digital services reshape access to benefits and interactions between citizens and the state.

To support the shift, UNESCO promoted its AI Readiness Assessment Methodology (RAM), which is already deployed in more than 50 countries. The tool helps governments identify regulatory gaps, strengthen institutional coordination and design safeguards against discrimination and algorithmic bias.

UNESCO has already contributed to Pakistan’s draft National AI Policy, ensuring alignment with international ethical frameworks while accommodating national development needs.

Capacity building formed a major pillar of UNESCO’s engagement. In partnership with the University of Oxford, the organisation launched a global course on AI and Digital Transformation in Government in 2025, attracting over nineteen thousand enrolments worldwide.

Pakistan leads participation globally, reflecting both the country’s momentum and growing demand for structured training.

UNESCO’s ongoing work aims to reinforce data governance, improve AI readiness and embed ethical safeguards across Pakistan’s digital transformation strategy.

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Google API keys exposed after Gemini privilege expansion

Security researchers warn that exposed Google API keys in public client-side code could be used to authenticate with the Gemini AI assistant and access private data. The issue arose after developers enabled the Generative Language API in existing projects without updating key permissions.

Truffle Security scanned the November 2025 Common Crawl dataset and identified more than 2,800 live Google API keys publicly exposed in website source code. Some belonged to financial institutions, security firms, recruitment companies, and Google infrastructure.

Before Gemini’s launch, Google Cloud API keys were widely treated as non-sensitive identifiers for services such as Maps, YouTube embeds, analytics, and Firebase. After Gemini was introduced, those duplicate Google API keys also acted as authentication credentials for the AI assistant, expanding their privileges.

Researchers demonstrated the risk by using one exposed key to query the Gemini API models endpoint and list available models. They warned that attackers could exploit such access to extract private data or generate substantial API charges on victim accounts.

Google was notified in November 2025 and later classified the issue as a single-service privilege escalation. The company said it has introduced controls to block leaked keys, limit new AI Studio keys to Gemini-only scope, and notify developers of detected exposure.

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