hHello, and welcome to TechScape. This week’s edition is a team effort: My colleague Heather Stewart reports on AI’s plans for world domination in Davos; I examine how much investment in nominal AI companies has gone beyond drama and dreams; And Nick Robbins-Early highlights how loose regulation of autonomous driving in Texas has allowed Tesla to thrive.
AI in Davos
When they weren’t discussing Donald Trump, delegates at the World Economic Forum last week were dazzled by the possibilities of artificial intelligence.
Up and down the Swiss Alps town’s main street, almost every storefront was temporarily decorated with the neon slogan of a tech firm — or a consultancy promising to tell executives how to incorporate AI into their business. Cloudflare’s wood-paneled headquarters urged delegates to “Join, Protect, and Build Together”, and Wipro shouted: “Dream Solve, Repeat Prove.”
At the conference, tech CEOs expressed their hopes for how physical manifestations of AI will impact the world in the years to come. Microsoft Chief Executive Satya Nadella told a spellbound audience that to spread the benefits of AI globally, “token factories,” as he calls datacenters, need to be distributed around the world.
“For me, a long-term, scalable solution is to have all these token factories that are part of the real economy, connected to the grid, connected to the telco network – and that’s what will drive that scale, whether it’s in the global South, or in the developed world,” Nadella said.
Meanwhile Google was showing off the latest version of its Google Glasses to excited delegates; And there were endless sessions at the Davos Congress Center about the potential benefits of the technology — including a breathless conversation with Elon Musk, who joined the event late, though with the SpaceX IPO clearly looming, he was eager to talk about going to Mars.
However, away from the glitzy shops, there was considerable concern that this all proved to be an epic bubble.
In an interview with the Financial Times, DeepMind chief Demis Hassabis warned that some aspects of AI investment look “like a bubble”, but insisted that, “if the bubble bursts, we (ie Google, not society at large) will be fine”.
Nadella offered a test for how we know if it’s a bubble – which I didn’t find convincing. “A clear indication of this as a bubble is that we’re only talking about tech companies,” he said.
Just drama and dreams: AI companies without products still score billions
Much of Silicon Valley has been captivated by a “very human drama” this past week wall street journal Keep it. According to the Journal, Thinking Machines Lab, a startup founded by former OpenAI chief technology officer Mira Muratti, fired its own chief technology officer, Barrett Zoff, due to an affair with a co-worker and recent lack of productivity. Within hours, his former employees – along with one of his co-founders and a third employee – had reportedly signed offers with OpenAI, which he had left to join their startup just last year. According to the Journal, all three told him they disagreed with the direction of the company at the meeting, which ended with Zoff’s dismissal. For his part, Zoff told the Journal that Murati had fired him only to tell him he was considering another job.
As cheesy as the drama may be, the stakes of Murati’s mess are different than a juicy celebrity entanglement that might be chronicled in TMZ or Page Six, two of my favorite publications. The stakes in San Francisco are billions of actual dollars and potentially more than $10 billion. Muratti’s company has raised $2 billion in venture capital since its founding in February 2025. Its value is 12 billion dollars. The talent involved in these California productions – not movies, but AI tools used by millions of people – achieve superstar importance.
Thinking Machines released a product, Tkinter, in October 2025 that aims to streamline the optimization of large language models, a specific concern compared to ChatGPT’s ambitions to replace Google Search or the cloud’s coding ability.
The massive investment and resulting valuations are hitting little target in terms of the company’s actual offerings. A new company was outlined the new York Times Last week, Human’s End, I have nothing but a dream, and ugly website – And several hundred million dollars. Researchers from Google, Anthropic and Elon Musk’s xAI, including those who helped develop the infamous Grok AI tool, founded the company just three months ago. They aim to facilitate collaboration rather than isolation between humans and machines – “innovations in long-horizon and multi-agent reinforcement learning, memory, and user understanding,” according to the site. If this sounds strange, it’s because the company hasn’t launched any products.
According to the New York Times, Humans End has raised $480 million from Nvidia, Jeff Bezos and Google. Its price is 4.48 billion dollars. It has – say it with me one more time – not launched any products.
Whatever fears may prevail about an AI bubble, money is still flowing, pursuing the future with a huge but uncertain bet on the present.
Teslas in Texas: The Practical Law of Hands-Free Driving
Musk announced last week that Tesla has removed human safety monitors from its robotaxis in Austin, Texas, as the company moves to expand its autonomous vehicle business. Like most things Musk does, the reality was a little more complicated — Tesla’s vice president of software later clarified on X that the company had “deployed some unsecured vehicles mixed with an extensive robotaxi fleet with safety monitors.”
However, what Tesla’s testing of fully driverless vehicles highlighted was the difference in how much leeway it allows autonomous vehicles compared to Texas, the birthplace of autonomous driving in the US and home to the highest number of self-driving cars in the country. The Texas Department of Motor Vehicles does not have regulatory authority over autonomous vehicles in the state, instead autonomous vehicles are governed by the state’s transportation code. Although a new government authorization system for autonomous vehicles is set to be implemented in the coming months, there is currently no application process required for autonomous vehicle operators in the state.
“Autonomous vehicles on Texas roads are subject to all traffic laws and can be cited for safety violations, but do not yet require specific authorization to operate,” the Texas DMV said.
If an autonomous vehicle is operated for personal, non-commercial use, the lack of state regulations on its operation is also surprising. As long as it complies with certain conditions, such as traffic laws and safety standards, an autonomous vehicle can drive around Texas without anyone in the car.
The Texas Transportation Code states, “Any motor vehicle equipped with an automated driving system may operate in this state.” “An automated motor vehicle may operate in this state with an automated driving system, whether or not a human driver is physically present in the automated motor vehicle.”
Meanwhile in California, the state Department of Motor Vehicles requires three phases of testing and permitting for commercial autonomous vehicles. Regulators are also in the process Consideration of new rules This could lead to even greater requirements on vehicle operators. Tesla caused confusion last October when Musk announced ride-hailing service in the Bay Area, only to have regulators say the company did not have authorization to operate paid or unpaid autonomous rides for the public. On the robotaxi section of Tesla’s website, it only mentions Texas.
