Daily AI Newsletter: Sam Altman challenges Elon Musk with plans for Neuralink rival

In today’s email:

🤑 OpenAI priced GPT-5 so low, it may spark a price war
🤔 Perplexity offers to buy Chrome for billions more than it’s raised
☠️ I’m a psychiatrist. In 2025, I’ve seen 12 people hospitalized after losing touch with reality because of AI.
🧰 10 new AI-powered tools and resources. Make sure to check the online version for the full list of tools.

Sam Altman challenges Elon Musk with plans for Neuralink rival

Key Takeaway: OpenAI and Sam Altman are moving to back (and co-found) Merge Labs, a brain-computer interface start-up valued at $850mn, directly challenging Elon Musk’s Neuralink.

More Insights:

Merge Labs is targeting a $250mn raise, with major funding expected from OpenAI’s ventures arm.
Altman will help launch the company alongside Alex Blania (of the eyeball-scanning ID project “World”) but won’t run it day-to-day.
Neuralink, founded in 2016, raised $650mn this year at a $9bn valuation; rivals include Precision Neuroscience and Synchron.
Advances in AI and signal-processing hardware are making brain implants more practically useful; Altman has long argued “the merge” of humans and machines is near.

Why it matters: This isn’t just tech one-upmanship, if OpenAI backs a BCI platform, it could fuse frontier AI with direct neural interfaces, concentrating power over how (and by whom) cognition-level computing gets built, governed, and monetized.

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ChatGPT’s model picker is back, and it’s complicated

Key Takeaway: GPT-5 was pitched as a unified, auto-routing model, but launch-day routing issues and user backlash have pushed OpenAI to reintroduce a more complex model picker with new modes and revived legacy models.

More Insights:

Altman added “Auto,” “Fast,” and “Thinking” modes for GPT-5, letting users bypass the router when they want.
Paid users can again access GPT-4o (default), plus GPT-4.1 and o3 via settings, after last week’s deprecations sparked outrage.
OpenAI leaders acknowledged rough rollout; Altman and Turley promised quick iteration and warmer, but not overbearing, personality updates.
The core challenge: routing must infer user preferences and task needs instantly; many users value style and persona as much as speed.

Why it matters: This episode shows that “one-size-fits-all” AI isn’t here yet, people want control and consistency, and platforms that honor model choice, personality, and stability will earn deeper trust (and usage) than those that chase simplicity at the cost of user agency.

AI is creating new billionaires at a record pace

Key Takeaway: AI’s fundraising frenzy is creating unprecedented paper fortunes at lightning speed, with hundreds of unicorns and soaring private valuations concentrating wealth and power in a few companies and a single region.

More Insights:

498 AI unicorns now worth $2.7T; 100 founded since 2023, plus 1,300+ startups valued over $100M.
Mega-rounds are minting moguls: Anthropic reportedly targeting $170B; OpenAI exploring a $500B secondary; Mira Murati’s new lab raised a record $2B seed at a $12B valuation; Anysphere raced from $9.9B to an $18–20B offer.
Most wealth is illiquid, but tender offers, secondary markets, acquisitions, and loans against equity are providing growing, if limited, liquidity.
The boom is Bay Area-centric: San Francisco now counts 82 billionaires vs. New York’s 66, with surging luxury real estate and rents tied to AI demand.

Why it matters: This is not just tech hype, it’s a rapid reordering of who owns tomorrow’s profits and where they live; if history rhymes, today’s concentrated, illiquid fortunes will chase more AI bets before rotating into traditional wealth management, reshaping financial services, urban economies, and inequality in the process.

Other stuff

Surveillance Company Flock Now Using AI to Report Us to Police if it Thinks Our Movement Patterns Are “Suspicious”
Apple taught an LLM to predict tokens up to 5x faster in math and coding tasks
OpenAI priced GPT-5 so low, it may spark a price war
Sex is getting scrubbed from the internet, but a billionaire can sell you AI nudes
OpenAI rolls out Gmail, Calendar, and Contacts integration in ChatGPT
Character AI Gave Up on AGI. Now It’s Selling Stories
Perplexity offers to buy Chrome for billions more than it’s raised
I’m a psychiatrist. In 2025, I’ve seen 12 people hospitalized after losing touch with reality because of AI.
‘I Feel Like I’m Going Crazy’: ChatGPT Fuels Delusional Spirals
OpenAI beats Elon Musk's Grok in AI chess tournament

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