TheCUBE Pod analysis: An update on Silicon Valley Bank and GPT-4 integration in Microsoft products

TheCUBE Pod analysis: An update on Silicon Valley Bank and GPT-4 integration in Microsoft products

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The fallout from the collapse of Silicon Valley Bank continues to reverberate and is leading to some big questions for the government, regulators and investors. More detail continues to emerge, including, as The New York Times and others reported this week, that, for over a year, the bank’s risky practices were on the Federal Reserve’s radar.

In a recent theCUBE Pod analysis, some of the questions posed about the impact on Silicon Valley have become more focused. Others remain unclear.

“Silicon Valley Bank caused a string of events. And you know, we called it on the last Pod. That’s going to have an impact,” said theCUBE industry analyst John Furrier on the latest theCUBE Pod episode“The system, the banking system is this operating system, and they all kind of work together. And I don’t think they want the government involved.”

There has been speculation that First Republic Bank could be the next to be hit. On Monday, shares of the bank tumbled, closing 47% lower.

“I talked to somebody last night, one of our customers, who told me they had all their money in SVB,” said theCUBE industry analyst Dave Vellante. “They were able to get out enough to meet payroll. They’re really sweating it. I know you’ve heard this story over and over.”

There’s been speculation over whether the collapse of SVB could be characterized as a “Black Swan” event or if it represents something more significant.

“Black Swan is like the weather. It’s all around us,” Vellante said. “I think there are some unpredictable ripple effects of this.”

Is there a depression or recession in the cards?

“I think stock prices are going to be sideways for a long, long time. Maybe two or three years. I could see that happening,” Vellante said. “But I’m a long-term optimist for tech. I think innovation and productivity is still going to pound through it. But it could take a long time.”

AI is still booming

All of this comes amid continued excitement around the potential of AI to transform the technology space. This past week, OpenAI launched GPT-4 while rival Anthropic rolled out its new Claude chatbot.

“We’re in a moment of great exploration with AI, and with ChatGPT launching 4 this week, it’s going beyond the large language model to multimodal,” Furrier said. “You’re going to have a lot of content mills popping up with ChatGPT. You’re going to have a lot of fake images. It’s going to be amazing to see how this exploration creatively either trainwrecks somewhere or advances.”

Citing Microsoft’s relationship with OpenAI, Furrier said the company has a leg-up regarding its competition with Amazon relative to the “hype factor.”

“Actually, Microsoft is behind, in my opinion, compared to Google and Amazon AI. If you look at the code that they’ve been writing, the OpenAI was a relationship that Microsoft put together,” Furrier said, going on to note the compelling nature of Microsoft’s use of ChatGPT on their Bing search tool and other products. “They’re integrating it into all their apps, PowerPoint, Excel, Word and Teams.”

“They might have been behind in tech, I would kind of agree,” Vellante said. “But it’s like they leapt ahead in the business model. Now, it’s so well-positioned with Azure, like you said, [with] their Office suite.”

As a part of recent layoffs, Microsoft let go of its entire ethics and society team tasked with making responsible AI tools. The ethics conversation will continue to get more complicated, and the advent of the industry is going to lead to other jobs going away, according to Furrier.

“That’s a fact. I mean, look at ChatGPT for tax code. You can write software, apps. It’s going to accelerate all the software mechanisms,” he said. “People are going to be unleashed from the hassle of the blocking and tackling drudgery of their day jobs. If AI can do things like the heavy lifting on this stuff, it’s going to open up creativity.”

For more compelling analysts insights, check out the latest theCUBE Pod episode below. If you’re a listener, let Furrier and Vellante know on Twitter which subjects you’d like to hear discussed in the next episode.

Image: SiliconANGLE

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