OpenAI unveils its first custom chip, “Jalapeño,” with Broadcom

On June 24, OpenAI and Broadcom revealed Jalapeño, OpenAI’s first custom-designed AI chip, with engineering samples physically delivered to Sam Altman and Greg Brockman by Broadcom CEO Hock Tan. The chip targets roughly 50% cheaper LLM serving, with prototype data center deployment expected by end of 2026 and production ramping in 2027-2028.

Anthropic accuses Alibaba of a massive distillation attack

A letter Anthropic sent to US Senators Tim Scott and Elizabeth Warren became public this week. Anthropic accused Alibaba and its Qwen AI lab of running “the largest known distillation attack on Anthropic to date,” alleging attackers used 25,000 fraudulent accounts over six weeks to run 28.8 million exchanges between April 22 and June 5, 2026, seeking to extract agentic reasoning, software engineering proficiency, and long-horizon task completion capabilities.

Google loses more top AI researchers to Anthropic and OpenAI

Two leading Gemini researchers, Jonas Adler and Alexander Pritzel, are planning to leave Google for Anthropic, adding to a wave of exits. The company had already lost Nobel laureate John Jumper to Anthropic and star researcher Noam Shazeer to OpenAI, with the departures rattling investors and pulling Alphabet’s stock down.

Google delays Gemini 3.5 Pro

Google quietly pushed the general availability of Gemini 3.5 Pro from June to July 2026, with testers flagging issues around token efficiency and long-horizon task performance.

The industry shifts from “tokenmaxxing” to efficiency

The era of spending freely on AI is cooling off. As OpenAI and Anthropic head toward historic IPOs both filed confidentially in early June at valuations nearing $1 trillion enterprise customers are growing reluctant to pour money into frontier models without clear returns. The trend has a name shift behind it: from “tokenmaxxing” (chasing maximum capability at any cost) to prioritizing efficiency. The clearest example came from Lindy CEO Flo Crivello, who moved 100% of his company’s traffic off Anthropic’s Claude to the cheaper Chinese open-weight model DeepSeek, watching his costs “crash to the ground” and calling it a matter of business survival. With Anthropic and OpenAI slower to cut token prices lately, and Microsoft, Amazon, and Google all pushing low-cost alternatives, the pressure on premium AI pricing is only mounting.

Mythos 5 Partially Restored – The Anthropic Saga Continues

Two weeks after the Commerce Department abruptly banned Anthropic’s Mythos 5 and Fable 5 models, the Trump admin partially lifted restrictions on Mythos 5, allowing it to be redeployed to critical infrastructure operators and cyber defenders. Fable 5 remains banned. Commerce Secretary Howard Lutnick told Anthropic its efforts “yielded significant progress,” and Anthropic agreed to future model review protocols. The Pentagon had previously designated Anthropic a national security risk over ethical concerns about AI in warfare.

OpenAI’s GPT-5.6 Release

The big release was the GPT-5.6 family, announced June 26. It’s a set of three models on a new naming structure where the number (5.6) is the generation, and Sol/Terra/Luna are durable tiers that can be upgraded independently over time — essentially a “good/better/best” lineup.

• Sol (Flagship): Designed for deep reasoning, coding, and biology. It features a massive ~1.5M token context window and two new modes:
  • Max Mode: Allows the model to “think” longer before answering.
  • Ultra Mode: Spins up multiple AI agents to solve complex, multi-step problems.
• Terra: The balanced option, offering performance close to GPT-5.5 but at roughly half the cost.
• Luna: The smallest and fastest model, optimized for quick responses and high-volume, low-complexity tasks.

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