Hello everybody. Welcome to Daily Zaps.

Here’s what we got for ya today:

• ✌️FTC bans non competes agreements

• 📦 Nvidia CEO hand delivers first DGX H200 to OpenAI

• 🍶 TikTok algorithm is its secret sauce

• 🏎️ Tesla not a car company?

Let’s get right into it!  

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GOVERNMENT

FTC bans non compete agreements

The U.S. Federal Trade Commission (FTC) has issued a significant ruling that bans the enforcement of noncompete clauses in employment contracts. This decision, aimed at fostering innovation and enhancing worker freedom, will impact almost all existing noncompete agreements, except for a few exceptions concerning senior executives.

It is now considered an unfair practice under Section 5 of the FTC Act to impose noncompete clauses, which could notably change the AI sector. This change allows developers greater mobility between companies, potentially accelerating innovation and distributing expertise more broadly throughout the industry. The new landscape could lead to a more competitive and dynamic market, encouraging companies to retain talent through enhanced conditions and opportunities rather than through restrictive legal measures.

BIG TECH

Nvidia CEO hand delivers first DGX H200 to OpenAI

Nvidia CEO Jensen Huang personally delivered the first Nvidia DGX H200, the company's latest and most advanced AI processor, to OpenAI's San Francisco office, symbolizing the strong partnership between the two AI industry leaders.

H200 is a high-performance GPU that boasts significant enhancements over its predecessor (H100), including a 1.4x increase in memory bandwidth and a 1.8x increase in memory capacity, utilizing HBM3e memory technology for improved speed and efficiency in data handling.

This delivery marks a critical step for OpenAI, enhancing its capacity to develop more complex AI models, such as the anticipated GPT-5, and pushing the boundaries of AI research and applications across various sectors. The introduction of the DGX H200 is expected to drive advancements across the AI industry, although concerns about supply and market dynamics persist given the high demand for such advanced AI hardware.

GLOBAL TECH

TikTok algorithm is its secret sauce

ByteDance, the owner of TikTok, views the app's algorithms as integral to its overall operations, making it unlikely to sell TikTok with these core algorithms if faced with a U.S. ban. Despite TikTok constituting a small portion of ByteDance's revenue and daily active users, the company would rather shut down the app in the U.S. than sell it, prioritizing the retention of its algorithm.

This algorithm, shared with ByteDance's other apps like Douyin (Chinese version of TikTok), is considered superior to those of competitors and is intricately linked to the company's intellectual property registered in China, complicating any potential divestment. Amidst legislative pressures and potential bans in the U.S., ByteDance remains firm on not selling TikTok's "secret sauce" — its advanced and valuable algorithm.

BIG TECH

Tesla not a car company?

Despite disappointing quarterly results, with sales and profits both down, Tesla CEO Elon Musk shifted the focus to the future during an earnings call. He highlighted plans for autonomous ridesharing and more affordable car models, framing Tesla not just as a car maker but as a tech company focusing on digital platforms and AI.

This new direction excited investors, causing Tesla's stock to surge by as much as 14%. Despite the positive market reaction, there is still skepticism about Tesla's ambitious plans for autonomous driving technologies and their practical timeline. Musk emphasized that those who doubt Tesla’s direction in autonomy might not be suitable as investors.

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