Recent days have been dominated by talk about Meta's impressive $14.3 billion investment in Scale AI, in exchange for a 49% nonvoting stake. A question that quickly arose after the details behind the negotiations started emerging was whether the investment benefited Scale. Not long after the news broke, OpenAI and Google confirmed they were cutting ties with Scale and looking to take their business to the company's competitors.

News that Scale would lose high-profile customers surprised nobody, as secrecy about models' training data has long been a cornerstone of generative AI product development. It turned out to be quite understandable that even though Meta allegedly has no substantial control over how Scale's data business operates, customers would still be concerned about Meta having a degree of privileged access to its inner workings. Since the investment was first reported on, Scale has emphasized its commitment to upholding its customers' privacy rights more than once.

For Meta, the deal with Scale seems to be part of a new master plan to catch up in the cutthroat competition now dominating the development of generative artificial intelligence, especially after the Llama 4 models failed to meet expectations. In addition to now owning almost half of Scale AI, Meta hired CEO Alexandr Wang away from the company, as Wang will now lead Meta's efforts to develop artificial "superintelligence" and will report to Meta CEO Mark Zuckerberg himself.

It soon became apparent that Meta was on a hiring spree that was just getting started. It is now known that Meta approached both Perplexity and Safe Superintelligence as potential acquisition targets. Following these failed negotiations, Meta is allegedly in talks to hire Safe Superintelligence co-founder and CEO Daniel Gross and partially acquire NFDG, an investment fund Gross created with former GitHub CEO Nat Friedman, who the company is also trying to hire. Sam Altman recently publicly declared that Meta had been trying to poach top talent at his firm, going as far as offering potential hires $100 million signing bonuses.

Whether Meta can buy its return ticket to the competition remains to be seen. But regardless of how it turns out for the company, this shakeup will surely have consequences for the whole industry.

Other noteworthy recent headlines

Microsoft launches the Sora-powered Bing Video Creator: Microsoft has launched Bing Video Creator, a free AI-powered tool that uses OpenAI's Sora technology to generate 5-second videos from text prompts, now available on mobile, and with desktop support coming soon.

Wordsmith AI secured $25M to transform legal operations with AI agents: Edinburgh-based Wordsmith AI raised $25 million Series A led by Index Ventures to scale its AI agent platform that transforms legal departments from bottlenecks into "revenue accelerators" by embedding legal intelligence across business workflows.

Moments Lab raised a $24M Series B to accelerate scalable video indexing and discovery: Paris-based Moments Lab raised a $24 million Series B to expand its AI-powered video production tools that help Hollywood studios and media companies create content up to seven times faster by automatically indexing footage and generating rough cuts from text prompts.

Rapidly growing startup Anysphere raised its third funding round in less than a year: Anysphere, the maker of the popular AI code editor Cursor, has announced a $900 million Series C at a $9.9 billion valuation. Thrive, Accel, Andressen Horowitz, and DST participated in the startup's funding round.

Multiverse Computing raises €189M Series B for revolutionary LLM compression technology: Spain-based Multiverse Computing raised €189 million Series B led by Bullhound Capital to scale its CompactifAI technology that compresses large language models by up to 95% while maintaining performance, enabling AI to run efficiently on edge devices and reducing inference costs by 50-80%.

A deep learning-assisted method enables painting restoration in hours rather than months: Researchers have developed a new digital restoration method that leverages deep learning techniques to reconstruct damaged areas and uses printable polymer films to physically apply the digital restorations onto the damaged paintings without altering the original canvas and pigments.

Google's newest experiment brings short audio overviews to some Search queries: Google has launched an experimental feature that enables users to leverage the latest Gemini models to generate audio overviews for appropriate search queries. The overviews can be played within the search results page on a player that displays selected relevant web pages.

OpenAI and Google will reportedly drop data provider Scale AI after Meta's investment in the company: Meta's investment in Scale has effectively upended the data annotation industry. Since news of the deal, which gives Meta a 49% nonvoting stake in Scale, OpenAI and Google have publicly cut ties with the company.