OpenAI-Microsoft relationship shows cracks

PLUS: Adobe's new AI search optimization tool & MIT study reveals ChatGPT's cognitive impact

In today’s agenda:

1️⃣ OpenAI and Microsoft relationship tensions reach inflection point

2️⃣ Adobe launches LLM Optimizer to help brands dominate AI-powered search

3️⃣ MIT study reveals ChatGPT users accumulate "cognitive debt"

  • Alta raises $11M to bring 'Clueless' fashion tech to life with all-star investors

  • Meta hints at new Oakley-branded smart glasses targeting athletes

MAIN AI UPDATES / 17th June2025

🔥 OpenAI-Microsoft partnership under strain 🔥
The cracks in their relationship are reportedly widening

OpenAI and Microsoft may be reaching an inflection point in their relationship, according to a report from The Wall Street Journal. OpenAI executives have considered publicly accusing Microsoft of anticompetitive behavior throughout their partnership and mulled seeking a federal regulatory review of their contract. The startup is trying to loosen Microsoft's grip on its intellectual property and computing resources, but also needs the tech giant's approval to complete its for-profit conversion. The two companies are in a standoff over OpenAI's $3 billion acquisition of AI coding startup Windsurf, with OpenAI not wanting Microsoft to access Windsurf's IP that could enhance GitHub Copilot.

🎯 Adobe LLM Optimizer launches 🎯
Own your brand's presence in AI-powered search

Adobe introduced Adobe LLM Optimizer at Cannes Lions, a new enterprise-grade tool designed to help businesses improve their visibility in generative AI-powered environments. With data showing a 3,500% increase in AI-sourced traffic to U.S. retail sites between July 2024 and May 2025, Adobe's move addresses the shift from SEO to "Generation Engine Optimization" (GEO). The tool offers a three-pronged approach: Auto Identify (detects how content appears in AI models), Auto Suggest (recommends improvements), and Auto Optimize (implements changes directly). FAQ pages tend to perform exceptionally well in LLM indexing, providing direct, authoritative answers that AI models prefer when generating responses.

🧠 ChatGPT users show "cognitive debt" 🧠
MIT study reveals concerning brain connectivity changes

An MIT study revealed concerning findings about ChatGPT's impact on our brains. Researchers monitored 54 people writing essays over four months using EEG headsets. ChatGPT users showed dramatically weaker brain connectivity, and when they later tried writing without AI, their brains looked more like novices than practiced writers. Most alarming: 83% of ChatGPT users couldn't quote a single sentence from essays they'd written minutes earlier, compared to only 11% in the brain-only group. The researchers coined the term "cognitive debt" - borrowing against future cognitive capacity for short-term convenience. However, people who wrote without assistance first, then used ChatGPT to edit, actually showed increased brain connectivity.

INTERESTING TO KNOW

👗 Alta's AI fashion revolution 👗

Jenny Wang's dream of creating a personal styling agent has finally come to life with Alta, which raised $11 million in seed funding led by Menlo Ventures. The AI stylist and personal shopper makes outfit recommendations and lets users try on looks with personalized virtual avatars. Backed by heavy names including Michelle Obama's stylist Meredith Koop, who helped train Alta's AI, the platform allows users to upload their closet and get styling suggestions based on budget, lifestyle, weather, and calendar. Other investors include Anthropic's VC arm Anthology fund, supermodels Jasmine Tookes and Karlie Kloss, and DoorDash CEO Tony Xu.

🥽 Meta teases Oakley collaboration 🥽

Meta has hinted at the next stage for its smart glasses with a new "Oakley/Meta" collaboration set to launch on June 20th. The new athletic sunglasses will reportedly be based on Oakley's "Sphaera" style and come with a single camera in the center of the frame to reduce weight, aimed specifically at athletes with new data tracking elements for performance feedback. Meta's initial Ray Ban glasses have proven popular with over 2 million units sold, and this expansion into fitness tracking could further boost market demand. Oakley is owned by EssilorLuxottica, the same company behind Ray Ban, solidifying Meta's partnership as it builds toward its planned AR glasses launch in 2027.

📩 Have questions or feedback? Just reply to this email , we’d love to hear from you!

🔗 Stay connected: