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OpenAI’s Hardware Plans Have a Bigger Problem Than Apple’s Lawsuit

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OpenAI’s plans to build and sell an AI device undeniably hit a bump in the road this month when Apple filed a lawsuit against the ChatGPT maker, alleging that former Apple employees stole trade secrets when they left Apple to join OpenAI. But if OpenAI isn’t careful, it’s going to have much bigger problems to deal with.

OpenAI’s hardware ambitions

OpenAI got serious about the idea of an AI device in 2025, accelerating its plans and public image with the acquisition of io Products, led by famed former Apple designer Jony Ive. With credentials like designing the iPhone, MacBook and Apple Watch, Ive’s partnership with OpenAI CEO Sam Altman set the tone for what to expect.

There’s a good reason OpenAI seems to be recruiting former Apple employees to bolster its hardware research and development. From the Cupertino company’s inception, founder Steve Jobs insistently and creatively blended form and function, creating an iconic style that prioritized user experience and simplicity. Apple’s design style has helped the company revolutionize entire categories of technology, from the iPhone paving the way for smartphones to the first iPad as the first mainstream tablet.

Reports from the beginning of Ive and OpenAI’s partnership describe their ideal device as a kind of “third” gadget that can sit alongside your phone and computer. The most recent report of how that could shape up is a kind of portable, screen-free smart speaker with a “humanlike” personality. The screenless part seems important to Altman and Ive, coming up in multiple reports, with Ive reportedly wary of wearables like pins, watches and smart rings.

There could be some other devices in the family, including a device rumored in January that’s worn behind your ear so you can talk with ChatGPT. There may be at least one screen in the new family of products, with a May report describing an “AI agent phone,” run by the autonomous bots that are increasingly relied upon for advanced AI tasks. 

AI Atlas

Our rocky relationship with AI devices

The most well-known type of AI hardware right now is Meta’s smart glasses. Meta is not the only one, but it’s by far the industry leader in creating glasses that use VR/AR and AI tech. But they have already highlighted a lot of privacy and autonomy issues.

Meta drew the ire of many folks this summer when it was reported that it was experimenting with adding facial recognition tech into its glasses. Then came a lawsuit alleging that Meta’s Kenyan contractors can see everything you see through the glasses, including sensitive info and settings. 

Meta’s response to these incidents did little to reassure people that they could easily understand when they were being recorded. The many eye-roll responses to Kylie Jenner’s campaign for her special edition Meta glasses show that. And it’s not like the Facebook parent company has a strong track record of protecting its users’ privacy.

Another AI device that’s sparked backlash is the Friend AI pendant. This always-listening companion raised similar privacy concerns as Meta’s smart glasses. Friend spent $1 million to blanket New York City in ads, which people quickly graffitied. They wrote sentiments like “Surveillance capitalism” and “Get real friends.”

There are other startups experimenting with AI hardware, like the Plaud AI pin and the Vocci AI smart ring. But they’re a niche category of tech, not the kind of essential that smartphones and laptops have become over the past two decades. Maybe that will be the case in the future, but these early waves of backlash show that many of us in the general public aren’t ready to fully integrate it into our lives. 

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Katelyn is a reporter with CNET covering artificial intelligence, including chatbots, image and video generators. Her work explores how new AI technology is infiltrating our lives, shaping the content we consume on social media and affecting the people behind the screens. She graduated from the University of North Carolina at Chapel Hill with a degree in media and journalism. You can reach her at kchedraoui@cnet.com. See full bio

OpenAI’s plans to build and sell an AI device undeniably hit a bump in the road this month when Apple filed a lawsuit against the ChatGPT maker, alleging that former Apple employees stole trade secrets when they left Apple to join OpenAI. But if OpenAI isn’t careful, it’s going to have much bigger problems to deal with.

OpenAI’s hardware ambitions

OpenAI got serious about the idea of an AI device in 2025, accelerating its plans and public image with the acquisition of io Products, led by famed former Apple designer Jony Ive. With credentials like designing the iPhone, MacBook and Apple Watch, Ive’s partnership with OpenAI CEO Sam Altman set the tone for what to expect.

There’s a good reason OpenAI seems to be recruiting former Apple employees to bolster its hardware research and development. From the Cupertino company’s inception, founder Steve Jobs insistently and creatively blended form and function, creating an iconic style that prioritized user experience and simplicity. Apple’s design style has helped the company revolutionize entire categories of technology, from the iPhone paving the way for smartphones to the first iPad as the first mainstream tablet.

Reports from the beginning of Ive and OpenAI’s partnership describe their ideal device as a kind of “third” gadget that can sit alongside your phone and computer. The most recent report of how that could shape up is a kind of portable, screen-free smart speaker with a “humanlike” personality. The screenless part seems important to Altman and Ive, coming up in multiple reports, with Ive reportedly wary of wearables like pins, watches and smart rings.

There could be some other devices in the family, including a device rumored in January that’s worn behind your ear so you can talk with ChatGPT. There may be at least one screen in the new family of products, with a May report describing an “AI agent phone,” run by the autonomous bots that are increasingly relied upon for advanced AI tasks. 

AI Atlas

Our rocky relationship with AI devices

The most well-known type of AI hardware right now is Meta’s smart glasses. Meta is not the only one, but it’s by far the industry leader in creating glasses that use VR/AR and AI tech. But they have already highlighted a lot of privacy and autonomy issues.

Meta drew the ire of many folks this summer when it was reported that it was experimenting with adding facial recognition tech into its glasses. Then came a lawsuit alleging that Meta’s Kenyan contractors can see everything you see through the glasses, including sensitive info and settings. 

Meta’s response to these incidents did little to reassure people that they could easily understand when they were being recorded. The many eye-roll responses to Kylie Jenner’s campaign for her special edition Meta glasses show that. And it’s not like the Facebook parent company has a strong track record of protecting its users’ privacy.

Another AI device that’s sparked backlash is the Friend AI pendant. This always-listening companion raised similar privacy concerns as Meta’s smart glasses. Friend spent $1 million to blanket New York City in ads, which people quickly graffitied. They wrote sentiments like “Surveillance capitalism” and “Get real friends.”

There are other startups experimenting with AI hardware, like the Plaud AI pin and the Vocci AI smart ring. But they’re a niche category of tech, not the kind of essential that smartphones and laptops have become over the past two decades. Maybe that will be the case in the future, but these early waves of backlash show that many of us in the general public aren’t ready to fully integrate it into our lives. 

Imitation is the sincerest form of flattery that mediocrity can pay to greatness, as the expression goes. But when does copying, a time-honored tradition among tech companies, cross the line? According to Apple’s new lawsuit, that’s happening now. Specifically naming Apple’s former 24-year hardware chief Tang Tan and software engineer Chang Liu in the lawsuit, Apple claims OpenAI “wrongfully took Apple’s secret and confidential information.” 

The lawsuit alleges impropriety by these job-hoppers. But beyond those claimed contract violations, the underlying concern is that OpenAI will use Apple’s secret sauce — manufacturer contacts, specs, strategies — when creating its own piece of AI hardware. One that, in a worst-case scenario for Apple, could eventually become a competitor to the iPhone.

Apple’s lawsuit is yet another problem on top of a mountain of them. In addition to proving it didn’t steal from Apple, OpenAI already had a tough task: Prove whatever gadget it’s made is safe, useful and worthy of our hard-earned cash. As we’ve seen so far with other AI devices, public reaction ranges from indifference to outrage. And OpenAI has staked a lot on the possibility of creating a tangible product.

Black and white photo of Sam Altman and Jony Ive

OpenAI CEO Sam Altman (right) and Jony Ive (left).

OpenAI

Products like these are one form of physical AI, the devices that help us tangibly interact with AI. Many tech experts see the progress in the software part of AI as substantial enough to power new hardware forms, like robots, wearables and other designs. 

But at this point, it’s hard to know if any OpenAI device will be meaningfully different from, say, an Amazon Echo or Google Home. OpenAI certainly doesn’t have the shopping network and interconnected home ecosystem that Amazon and Google both have. So if OpenAI is building devices only for work tasks — like the $230 limited edition Codex keypad — are there enough hard-core AI users willing to shell out for these devices?

For companies like OpenAI, which are building both the software and the hardware, the possibility of selling devices — popular and well-priced, ideally — could bring in some much-needed revenue as they continue to burn through billions of dollars on development. Way more than a $20 per month subscription for ChatGPT and finicky government contracts. And as the company continues to tease a future initial public offering, having more to offer than ChatGPT and Codex is a plus.

The success of any AI device by OpenAI will fall almost entirely on the company’s positioning of it, particularly around its usefulness, safety and, frankly, that elusive cool factor. You only have to look at the controversies and failures of other AI devices to see just how badly it can go — and question whether we need another AI device at all.

Meta smart glasses ad featuring Kylie Jenner

Kylie Jenner is Meta’s newest model for its smart glasses. The glasses she’s wearing in this ad on Meta’s website is her special edition smart glasses.

Meta/Screenshot by CNET

At the very least, they’re PR disasters that are cooling any demand for consumer AI devices, if that demand ever existed at all. But if any company has the clout to bring this fledgling product category into the mainstream consciousness, it’s going to be the same company that already did it with ChatGPT. 

Any AI device OpenAI comes out with will be judged against these previous ones. And with AI’s already precarious reputation around privacy — you really shouldn’t be trusting AI with your private and sensitive info — the policy and implementation of safeguards will be crucial.

[analyse_source url=”http://cnet.com/tech/services-and-software/openai-apple-lawsuit-hardware-plans-commentary/”]

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