OpenAI has acquired io, a secretive artificial-intelligence hardware startup founded by Jony Ive (former Apple Design Chief), in a historic all-stock deal valued at approximately $6.5 billion.
OpenAI has made its most important acquisition yet, and this move signals an aggressive push to develop physical consumer products powered by AI.
OpenAI now has access to io, a team of 55 designers and engineers, as well as the visionary design of Ive, who is the British designer of Apple’s iconic products, including the iPhone iPod and MacBook Air.
This acquisition formalizes a partnership that Ive has had with OpenAI CEO Sam Altman for almost two years. They have been quietly exploring new device concepts together.
Ive, in an interview conducted with Altman, said: “I’m growing to believe that all I have learned during the past 30 years led me here and at this time.”
The relationship between us and the way we work together will, I believe, produce products.
Sam & Jony Introduce io
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OpenAI and OpenAI-io to launch first hardware product by 2026
OpenAI acquired io, which included a $1.5 billion stake that was previously invested through the startup fund of OpenAI. It also acquired a new $5 billion equity agreement to acquire the company.
Altman and Ive have described the team as “a family” of devices for an age of general artificial intelligence.
They did not reveal any details about the hardware in development, but they said that it would be a completely new form of computing to compliment AI’s increasing capabilities.
Ive hinted that users are tired of their current gadgets.
Altman said, “AI has made such an enormous leap in what it can be used for that a different form factor of computer is needed to maximize its potential.”
In 2026, the first product from this collaboration will be released.
What is Jony Ive all about?
Jony Ive, once described as Steve Jobs’ “spiritual companion”, is making a comeback in the consumer electronics industry. This marks an important return for one of today’s most influential designers.
British born designer, Steve Jobs, spent many years at Apple where they worked together to create products which would be remembered for generations, such as the iPhone, iPod and Apple Watch.
Ive, who left Apple after an illustrious tenure in 2019, played a key role in the development of the tactile and visual language used in today’s personal and mobile devices.
I am thrilled to partner with Jony, who is my opinion the best designer in the entire world. I’m excited to work on a new AI-powered computer generation.
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Apple CEO Tim Cook said that Ive would collaborate with the company after his departure. However, no joint product was ever developed.
I founded LoveFrom after leaving Apple. It is a collective of creatives who were former Apple employees and collaborators.
He co-founded io in 2023 with Apple veterans Scott Cannon and Evans Hankey — all of whom have deep knowledge about Apple’s hardware ecosystem.
OpenAI acquires ex-Apple Hardware veterans
OpenAI has also acquired a group of former Apple hardware experts who followed Ive when he left the company in 2019.
Scott Cannon is one of them. He’s the co-creator and creator of Mailbox. Evans Hankey will be Ive’s successor in Apple. Tang Tan was responsible for iPhone and Apple Watch design up until 2024.
The team at io had developed devices for an artificial intelligence future, where machines would have cognitive capabilities similar to humans.
OpenAI has now made this mission a part of its strategy, as they seek to integrate intelligence into the software and physical world.
Other investors, including Laurene Jobs Emerson Collective’s Emerson Collective and Maverick Capital as well as SV Angel, have also supported the hardware ambitions.
Altman has confirmed to OpenAI that he does not own any personal equity shares in the io.
Apple’s shares drop amid AI concerns
Apple’s shares fell as much as 2,3% Wednesday after the news of the purchase. The market was absorbing the fact that its ex-star designer is now heading up one of Apple’s AI competitors.
Apple is seen to be lagging in the field of artificial intelligence. Its recently launched AI platform, ChatGPT by OpenAI, relies on it.
Analysts believe that the move may accelerate Apple’s decline in AI and product innovation.
Altman, who praised Ive’s legacy of creativity and called their collaboration “a rare opportunity,” said that “Jobs” would be “damn proud.”
Altman and Ive made it clear that, despite the fact their project could be a competitor to Apple’s smartphone, they do not intend to make the device obsolete.
Altman stated that “I don’t believe our first step will make the smartphone disappear” in the same manner as the smartphone did not make laptops go away.
The physical future of AI
OpenAI is pushing consumer hardware as AI competition intensifies.
The company is currently worth $300 billion and racing to stay ahead of rivals such as Google, Anthropic or Elon Musk’s xAI.
They are all investing heavily and releasing new AI features and models quickly.
OpenAI’s hardware and robotics experts have been bolstered to support the expansion of OpenAI.
It hired Caitlin CK Kalinowski in November to head its robotics and consumer hardware efforts. She was previously the director of Meta’s Orion augmented-reality glasses project.
Kalinowski stated that the aim was to “unlock AI benefits for mankind” by using physical products.
OpenAI invested separately in the robotics start-up Physical Intelligence based in San Francisco, which had raised $400M at an estimated valuation of $2.4Billion.
The company’s goal is to implement general-purpose AI in the physical world by using robots that are powered by algorithms of large scale.
Jeff Bezos, founder of Amazon and investor in this startup, is also a shareholder.
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