Legal filings submitted earlier this month from lawyers representing OpenAI and Jony Ive’s io reveal new details about the companies’ efforts to build a mass-market AI hardware device.
The filings are part of a trademark dispute lawsuit filed this month by iyO, a Google-backed hardware startup developing custom-molded earpieces that connect to other devices. Over the weekend, OpenAI pulled promotional materials related to its $6.5 billion acquisition of Jony Ive’s io startup in order to comply with a court order involved in the suit. OpenAI says it’s fighting iyO’s allegations of trademark infringement.
For the last year, OpenAI executives and former Apple leaders now working at io have vigorously researched in-ear hardware devices, according to filings submitted in iyO’s lawsuit. In a June 12 filing, lawyers representing OpenAI and io said the companies purchased at least 30 headphone sets from various companies to explore what’s on the market today. In recent months, OpenAI and io executives also met with iyO’s leadership, and demoed their in-ear technology, according to emails revealed in the case.
That said, OpenAI’s first device in collaboration with io may not be a pair of headphones at all.
Tang Tan, a longtime Apple executive that co-founded io and serves as the startup’s chief hardware officer, claims in a declaration to the court that the prototype OpenAI CEO Sam Altman mentioned in io’s launch video “is not an in-ear device, nor a wearable device.” Tan notes that the design of said prototype in not yet finalized, and that the product is at least a year away from being advertised or offered for sale.
The form factor of OpenAI and io’s first hardware device has largely remained a mystery. Altman merely stated in io’s launch video that the startup was working to create a “family” of AI devices with various capabilities, and Ive said io’s first prototype “completely captured” his imagination.
Altman had previously told OpenAI’s employees at a meeting that the company’s prototype, when finished, would able to fit in a pocket or sit on a desk, according to the Wall Street Journal. The OpenAI CEO reportedly said the device would be fully aware of a user’s surroundings, and that it would be a “third device” for consumers to use alongside their smartphone and laptop.
“Our intent with this collaboration was, and is, to create products that go beyond traditional products and interfaces,” said Altman in a declaration to the court submitted on June 12.
Lawyers representing OpenAI also said in a filing that the company has explored a wide range of devices, including ones that were “desktop-based and mobile, wireless and wired, wearable and portable.”
While smart glasses have emerged as the front-runner for AI-enabled devices, with companies like Meta and Google racing to develop the first broadly adopted pair, several companies are also exploring AI-enabled headphones. Apple is reportedly working on a pair of AirPods with cameras, which would help power AI features by gathering information about the surrounding environment.
In recent months, OpenAI and io executives have done considerable research into in-ear products.
On May 1, OpenAI’s VP of Product, Peter Welinder, and Tan met with iyO’s CEO, Jason Rugolo, to learn more about iyO’s in-ear product, according to an emailed invitation revealed in the case. The meeting took place at io’s office in Jackson Square, the San Francisco neighborhood where Ive has bought several buildings to work on LoveFrom and io.
At the meeting, Welinder and Tan tested out iyO’s custom-fit earpiece, but were disappointed when the product failed repeatedly during demonstrations, according to follow-up emails revealed in the case.
Tan claims in his declaration that he met with Rugolo as a courtesy to his mentor, longtime Apple executive Steve Zadesky, who recommended he take the meeting. Tan also claims he took several precautions to avoid learning too much about iyO’s IP, such as suggesting that his lawyers review materials before he does.
However, it seemed that OpenAI and io employees thought they could learn something from one of iyO’s partners. To customize its in-ear headsets, iyO sent a specialist from an ear-scanning company, The Ear Project, to someone’s home or office to get a detailed map of someone’s ear.
In one email revealed in the case, Marwan Rammah, a former Apple engineer that’s now working at io, told Tan that purchasing a large database of three-dimensional scans from The Ear Project could give the company a “helpful starting point on ergonomics.” It’s unclear if any such deal took place.
Rugolo tried repeatedly to forge a deeper relationship between iyO, io, and OpenAI — but largely failed, according to the emails. He pitched OpenAI on launching iyO’s device as an early “developer kit” for its final AI device. He pitched OpenAI on investing in iyO and, at one point, even offered to sell his entire company for $200 million, the filings say. However, Tan said in his declaration that he declined these offers.
Evans Hankey, former Apple executive turned io co-founder and chief product officer, said in a declaration to the court that io is not working on a “custom-molded earpiece product.”
The ChatGPT-maker seems to be more than a year out from selling its first hardware device, which may not be an in-ear product whatsoever. Given what the company said in this lawsuit, it appears it is also exploring other form factors.
