OpenAI announced on May 21 that it had made a significant move by acquiring io, the AI hardware startup co-founded by renowned designer Jony Ive.
The deal is valued at approximately $6.5 billion and brings Ive and a team of former Apple AAPL engineers into OpenAI's fold to spearhead a new division focused on building screenless, AI-powered hardware devices, Bloomberg reports.
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Strategic Move To Reinvent Human-AI Interaction
According to OpenAI CEO Sam Altman, the partnership aims to develop “a totally new kind of thing,” referring to a novel category of computing devices that minimize screen dependency and prioritize seamless interaction with artificial intelligence, Bloomberg says.
Ive, who co-founded io in 2024 after launching his independent design firm LoveFrom, will oversee design across all OpenAI initiatives, including both software and hardware interfaces, according to Bloomberg.
According to Bloomberg, the io acquisition includes roughly 55 engineers and designers from Apple and LoveFrom. These include Tang Tan, Evans Hankey, and Scott Cannon, all of whom were instrumental in the development of the iPhone, Apple Watch, and other flagship products, Bloomberg reports.
Legacy Talent And Vision Behind The Next Generation Of Devices
Ive's career spans nearly three decades at Apple, where he was responsible for designing the iPhone, iMac, iPod, iPad, and Apple Watch. According to CNBC, Ive was described by the late Steve Jobs as his “spiritual partner at Apple,” and his “closest and most loyal friend.”
Altman also referred to Ive as "the greatest designer in the world" in a post on X, expressing his excitement about their partnership. Altman said he was "thrilled to be partnering with Jony" and "excited to try to create a new generation of AI-powered computers," signaling a bold step toward reimagining how people interact with artificial intelligence.
The team's mission at OpenAI will be to build a family of AI-native devices that offer new modes of interaction, breaking away from legacy interfaces like smartphone screens and physical keyboards, Bloomberg reports. According to TF International Securities analyst Ming-Chi Kuo in an X post, one prototype involves a display-less wearable device that connects to smartphones and is worn around the neck, similar in philosophy to Apple's AirPods.
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OpenAI Expands Consumer Reach As Apple Faces AI Pressure
According to Bloomberg, the $6.5 billion transaction consists of $5 billion in equity and the balance from OpenAI's previously held 23% stake in io, established in a deal during the fourth quarter of 2024. Investors in io include Laurene Powell Jobs through Emerson Collective, Thrive Capital, Maverick Ventures, Sutter Hill Ventures, and SV Angel.
This acquisition marks OpenAI's largest to date and underscores its transition from pure software research to full-stack consumer hardware development. The company's valuation has soared to $300 billion, driven by the success of ChatGPT and related AI systems, Bloomberg says.
Meanwhile, Apple continues to face mounting pressure in the AI race. According to Bloomberg, the company's current platform relies in part on OpenAI's models, and its in-house capabilities have been perceived as lagging behind competitors like OpenAI, Google, and Anthropic.
With a team of seasoned designers and engineers, OpenAI now holds a unique position to create transformative devices that align with its broader mission of democratizing access to artificial intelligence in everyday life.
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