OpenAI CEO Sam Altman has revealed details of a new AI hardware project being developed with former Apple designer Jony Ive. The plan includes eventually producing 100 million units of a compact device designed for everyday use.
OpenAI to buy ‘io’ startup in $6.5 billion deal
During an internal meeting, Altman told employees the initiative could be “the biggest thing we’ve ever done.” He also confirmed that OpenAI will acquire Ive’s startup, io, for $6.5 billion.
A recording reviewed by The Wall Street Journal revealed Altman’s belief that the acquisition could boost OpenAI’s value by as much as $1 trillion. Reflecting on the collaboration, Ive described working with Altman as “profound,” similar to his experience with Apple co-founder Steve Jobs.
Device Features
The upcoming device is described as an AI assistant that can sense and understand its environment. It is small enough to be carried in a pocket or placed on a desk.
Altman and Ive said the device will not function as a phone or wearable like smart glasses. Instead, it will serve as a third core device, used alongside a laptop and smartphone.
Ive mentioned the beginning of a “new design movement.” Altman added that the project will involve a series of devices, combining hardware and software in a unified system—an approach similar to Apple’s.
The device will have cameras and microphones to detect surroundings but will not include a display. It is intended to connect to phones and computers for processing and screen use.
Production and Launch Timeline
The first version is expected to be released by the end of 2026. Altman said the goal is to reach 100 million units shipped, not all at once, but at a faster rate than any previous tech device.
Ive’s team is already working with suppliers to enable large-scale production. The device’s final assembly is planned to take place outside China, with Vietnam being the likely location, the report added.
Industry Context
This strategy allows OpenAI to deliver AI products directly to users rather than relying on platforms like Apple or Google. The company has reportedly told investors it does not anticipate turning a profit before 2029, with projected cumulative losses reaching $44 billion by that time.
Altman pointed out that current devices restrict AI use, since people still have to open browsers and type commands manually, which he said falls short of AI’s full potential.
Analyst Views
Analyst Ming-Chi Kuo shared his insights on X (formerly Twitter), outlining several predictions about the device:
- Mass production is expected to begin in 2027.
- Manufacturing will likely take place outside China, with Vietnam as the leading candidate.
- The prototype is slightly bigger than the AI Pin, and similar in shape to an iPod Shuffle.
- One possible use is wearing it around the neck.
- It will feature microphones and cameras, but no screen.
- The device will rely on phones and PCs for computing and display.
Kuo suggested the timing of OpenAI’s announcement may aim to draw attention away from Google’s recent I/O event. He also sees the move as part of a growing trend toward “physical AI”—bringing AI into everyday physical environments.
He concluded with a reference to Alan Kay’s well-known quote: “People who are serious about software should make their own hardware.”
Background and Development
The collaboration began roughly 18 months ago when OpenAI VP Peter Welinder started working with Ive’s team. At first, io planned to develop its own device powered by OpenAI’s technology.
Altman later decided on a full merger, saying the device was too central to OpenAI’s mission to remain separate. “If you subscribed to ChatGPT, we should just send you new computers,” Altman told staff, explaining that the project aims to rethink how users interact with AI.
Outlook
Many details about the device remain secret as development continues. OpenAI’s acquisition of io and partnership with Jony Ive mark a significant move into AI hardware. The first product is expected by 2026, with more updates to come as the project advances.