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2258. Big AI's worst nightmare is a Chinese hedge fund, the RePebble and 'Robodebt for landlords'

Plus: Why is a UK council selling a fire station to pay for Saas?

Author

Cam Wilson
January 28, 2025

Issue 2258 - Tuesday 28 January, 2025

Hello! I’m so sorry for the late edition today. An awful combination of a family illness and DNS problems have made today’s edition a struggle to get together, but we made it! Enjoy and see you tomorrow (a lot closer to midday).

In Today’s Issue

  • Meet the big AI players’ worst nightmare: a Chinese hedgefund

  • The Repebble

  • ‘Robodebt for landlords’ — kinda

  • Why is a UK council selling their fire station to pay for Saas?

  • A long-weekend splurge of tech deals including bargains on SanDisk and Samsung flash drives; prepaid mobile packs from Belong, Vodafone, Boost and Kogan; JBL bluetooth speaker and headphones, Lenovo laptops and tablets, TP-Link Archer wi-fi router and Apple Macbook 14’’ M4 builds.

The News

Meet the big AI players’ worst nightmare: a Chinese hedge fund

It seems crazy but an open source Chinese hedge fund’s AI reasoning model is one of the biggest stories in the world right now. It caused a trillion dollars to be wiped off the US stock market (The Guardian), AI leaders like Sam Altman to make defensive statements (Reuters) and now people are already speculating about a US ban (Mashable) after millions of people downloaded the DeepSeek’s app, visited their website and pulled their model to run locally. 

Sizzle readers are already across DeepSeek’s AI work because I’ve mentioned it twice recently, but its R1 model performs as well as OpenAI’s o1 model but at 3-5% of the cost (VentureBeat). Regardless of whether you believe that it was trained on below cutting edge chips for less than $10 million — Elon Musk doesn’t (Fortune) but he’s full of shit — you don’t need to take their word for the efficiency stuff: you can download R1 yourself (here’s a Reddit guide). Apparently it performs well on ordinary, consumer computers.

There are so many big questions out of this:

  • What does it mean for the big AI players like OpenAI and Google that a tiny firm was able to put out a model perform as well as theirs on much fewer resources? What’s the point of pouring untold billions into development if others catch-up immediately?

  • The US has been trying to stop China’s AI development by blocking the sale of top end chips. Did this backfire by getting their AI firms to focus on efficiency rather than chasing more compute and data to shove into their models?

  • DeepSeek R1’s output shows signs of Chinese censorship and bias like refusing to criticise Xi Jinping or answer questions about Tiananmen Square (BBC). Regardless, people in the West are clearly already using it. What happens when one of the most popular AI models in the world talks like Chinese state media? For most people, does it even matter? Is big tech reaping what it sowed after 15 years of convincing users not to care what happens to their data as long as you do something cool.

There’ll be heaps more on this but let me leave you with two directionally opposite takes: ‘The great undermining of the American AI industry’ (Substack) versus ‘China’s AI upstart may not be the danger to Nvidia and U.S. export controls many assume’ (Fortune). Both agree on one thing: this is big.

The RePebble

Remember Pebble? Out of all of the Kickstarter vapourware back in the day, founder Eric Migicovsky actually produced what he promised: a smartwatch that was pretty cool, even if it was ultimately blown out of the water by competitors like the Apple Watch.

Migicovsky is back, promising a new Pebble (RePebble.com). Even cooler, though, is that the Pebble founder convinced Google, which bought Fitbit which had previously bought Pebble’s IP, to open source much of its code so that others can contribute to it (Google Blog). One of my pet peeves is the way that companies let products wilt but hoard them, stopping anyone else who might want to try give them another life. Glad to see this is happening.

Landlord robodebt? Kinda

First spotted by friend of the newsletter Rohan Pearce earlier this month (Bluesky), the tax office has launched a “data matching program” to catch $1.2 billion of estimated unpaid tax from landlords (Domain). Needless to say, Australia’s attempts automated debt recovery has a checkered past (will linking to Royal Commission suffice?). Even though some have dubbed this “robodebt for landlords” (X), as rightly pointed out by others, the problem with robodebt was the cruel way in which it was implemented. The ATO says it has already clawed back $23 million with a “less intensive data collection” and is now stepping it up by analysing “address of the rental property, name of landlords, name of tenants, how much rent is paid, bank account details, email addresses, phone numbers, lease details and details of the managing agent”.

Oh, Also

Why is a UK council selling a fire station to pay for Saas?

It’s a tale as old as time: West Sussex County Council wanted to deal with its tech debt. It signed a deal with Oracle to replace its 20 year old SAP system with a slick new, cloud-based HR and finance system in 2019, supposedly costing “£1m to £1.5m” to implement. Six years later, the Council is facing having to pay up to £40million in costs for the system which is expected to go live at the end of this year. And, to pay for this, West Sussex County Council is reportedly spending £25million from selling capital assets, including the old fire station (The Register). One to remember for the next time someone says upgrading will be easy.

Bargains

The End

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Always Was, Always Will Be Aboriginal Land

The Sizzle is created on Gadigal land and acknowledges the traditional owners of country throughout Australia, recognising their continuing connection to land, water and community. I pay my respect to them and their cultures and to elders both past and present.

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