The Download: Musk and Altman’s legal showdown, and AI’s profit problem

This is today’s edition of The Download , our weekday newsletter that provides a daily dose of what’s going on in the world of technology. Elon Musk and OpenAI CEO Sam Altman head to trial this week in a case with sweeping consequences. Ahead of OpenAI’s IPO, the court could rule on whether the company can exist as a for-profit enterprise.

It could even oust its leadership. Musk, an OpenAI co-founder, claims he was deceived into bankrolling the firm under false pretenses. He’s seeking $134 billion in damages, the removal of Altman and president Greg Brockman, and the company’s restoration to a non-profit.

In a celebrated South Park episode, a community of gnomes sneak out at night to steal underpants. Why? The gnomes present their pitch deck.

“Phase 1: Collect underpants. Phase 2: ? Phase 3: Profit.” It’s a business plan that captures the current state of AI.

Companies have built the tech (Step 1) and promised transformation (Step 3). But how they get there is still a big question mark. For years, experts have warned that deepfakes could be deployed in malicious ways.

These dangers are now here. Cheap, accessible models now produce weaponized deepfakes—from sexually explicit images to political propaganda—that look startlingly real. They’re already inciting violence, changing minds, and sowing mistrust, with women and marginalized groups disproportionately affected.

Here are some of the top tech stories making headlines: 1 OpenAI has ended its exclusive partnership with Microsoft The new deal allows OpenAI to court rivals such as Amazon. ( Reuters $) + Microsoft will still license OpenAI’s tech, but no longer exclusively. ( NYT $) + OpenAI is missing key growth targets ahead of its IPO.

( WSJ $) 2 Google has signed a classified AI deal with the Pentagon It permits AI use for “any lawful government purpose.” ( The Information $) + Over 600 Google workers had called for a block on the deal. ( QZ ) + AI firms are set to train military versions of their models on classified data. ( MIT Technology Review ) 3 The EU has told Google to open Android to AI rivals It wants to end Gemini’s built-in advantage.

( Ars Technica ) + Google calls the move an “unwarranted intervention.” ( WSJ $) + A final decision is expected by the end of July. ( Reuters $) 4 OpenAI is reportedly developing an AI-first smartphone It would replace apps with agents. ( TechCrunch ) + Qualcomm and MediaTek may be developing its processors.

( Gizmodo ) 5 A brain implant for depression is moving into human testing The FDA has approved a human study of the device. ( Wired $) + BCIs have thus far struggled to reach the market. ( MIT Technology Review ) 6 A populist backlash against AI is gaining momentum in rural America From Indiana to Idaho, voters are pushing back against the technology.