Hi, and welcome to today's Bay Area Times daily newsletter. Top stories today: 1) OpenAI launches 10x cheaper ChatGPT API, 2) Tesla announces Mexico factory, 3) Silvergate Bank might be bankrupt, and 4) Salesforce outperforms and grows 14%.

0. Data and calendar

1. OpenAI launches ChatGPT and Whisper APIs, reduces pricing by 90%

• ChatGPT API: $0.002 per 1,000 tokens, or about 750 words. That's the price for ChatGPT's latest model, named "gpt-3.5-turbo", which is much superior to the "text-davinci-003" (GPT-3) model that was being offered at $0.02 per 1,000 tokens. - OpenAI, Techcrunch

• Threatens expensive products built on OpenAI, like Jasper. Now their API cost is going from around $1.30 to $0.13 for 50,000 words, and yet their monthly charge is $49/mo. We expect competitors to push down on these prices significantly. - Jasper

• Is OpenAI selling API calls at a loss? That's what some experts and users are speculating. Given their lead investor Microsoft owns Azure, OpenAI might be getting compute with subsidies, which they're passing on to consumers. - Hacker News

• Whisper, voice-to-text API, $0.006 per minute. It is an optimized version of the Whisper open-source voice-to-text software they released in September. This just accelerates the broader trend of a transcriber's job becoming editing the text prepared by an AI. - Techcrunch

• In related news, OpenAI CTO Mira Murati was profiled, saying about GPT-4 that she "think[s] less hype would be good." She also commented on multimodal models, seeing them as the pathway to longer-term breakthroughs and potentially AGI. - Fast Company

2. Tesla confirms Mexico factory, Investor Day disappoints for lack of news

• $1B cost to start, $10B at full maturity: Elon confirmed the rumors that Tesla's next Gigafactory will be in Monterrey, Mexico, a 1-hour flight from Austin, Tesla's HQ. The Mexican President spoiled the news on Tuesday, which added to Investor Day's lack of excitement. - The Verge

• Walking humanoid robot Optimus: Elon showed a video of their humanoid robots walking and working on building other robots, in line with Elon's vision that these robots will one day outnumber humans and do most of the world's work for us. Elon believes these robots will significantly increase GDP per capita and be worth more than the car division of Tesla, over the long term. - Video

• Other than that, mostly climate change talk -- no ElonGPT, no super app. Elon believes that transitioning away from fossil fuels is necessary and feasible. While we are skeptical of climate change catastrophizing, Elon at least presents a positive, technological solution to the problem. - The Verge

Stock is down 5% in the pre-market

3. Crypto-linked Silvergate Bank delays annual report, could be bankrupt

• Annual report delayed indefinitely, typical of bankrupt companies. While Q4 results were released in January, the company had to release its audited and comprehensive annual report 60 days from the end of the fiscal year, which was Wednesday. Instead, it filed with the SEC stating it was "less than well-capitalized" and "reevaluation its businesses and strategies." - SEC filing, Bloomberg

Stock is down 30% in the pre-market

• Still trading at 73% of reported book value, which is extremely high for a potentially bankrupt company. According to the December 2022 balance sheet released in January, its book value was $12.93 per common share. Of course, the current real value is likely much lower than that.

• In related news: Signature Bank will stop serving Kraken withdrawals for non-corporate clients. - Bloomberg

4. Salesforce's revenue grows 14% to $8.4B, vs expected 9%

• Salesforce founder and CEO Marc Benioff successfully maneuvered 5 activist investors: rather than being combative, Benioff embraced activist investors and preemptively focused on financial performance, with a 10% headcount reduction and doubling the stock buyback plan to $20B.

• The result: operating cash flow up 41% to $2.8B, which investors loved.- Reuters, Bloomberg

Stock is up 15% in the pre-market

5. Other headlines

Tech

• Snowflake's revenue grows 54% to $555M: top growing SaaS giant.

• New Youtube head promises generative AI, Duet-style features.

• Windows 11's AI integration is mostly a search box that leads you to Bing.

• 8VC raises $880M for 5th VC fund, $6B+ AUM.

• Google's Waymo layoffs reach 209 employees, 8% of staff.

• Stripe cut its fundraising valuation down another 10%, to $50B, from $95B in 2021.

• TikTok to put 60-minute time warning for teens under 18.

• TikTok ban bill approved by House Committee.

• USPS buys 9.25K electrical vehicles from Ford.

Business

• U.S. labor market shows sign of cooling, according to data from private companies.

• Eli Lilly caps insulin cost at $35/mo for all patients, including non-Medicare.

• ESG rule is approved by House (216-204) and Senate (50-46); Biden veto is expected.

• British Arm now targeting U.S. IPO only, seeking $60B valuation.

Crypto

• Binance's $1.8B USD transfer still unexplained.

• Robinhood's self-custody iOS app launches.

• Gensler needs to recuse from crypto enforcement cases for comments: lawyers.

• Watchmaker Panerai to include NFT with every watch.

• Coinbase CEO claims "good relationship" with SEC, minimizes Gensler's comments.

• Australia to launch eAUD CBDC pilot.

China

• China is leading the U.S. in most areas of scientific research, claims Australian report.

• Authoritarian China warns "hedonistic" bankers to stop emulating West.

• Taiwan and U.S. strike $0.6B weapons sale, including F-16 missiles.

• U.S. seeking allies' support for potential China sanctions if they sell weapons to Russia.

• 2023 growth target likely between 5-6%, final number to be announced on March 5.

Washington and more

• Fox News soft banning Trump, who hasn't been on since November.

• Pence declines to support Trump if he's the nominee, wants "different leadership."

• House Weaponization Committee to focus March 9 on Twitter Files.

• Carbon emissions rise 1% in 2022 even as anti-fossil fuel measures grow.

• Finland likely to enter NATO first, as Sweden is held up by Turkey.

• Japan has record population decrease, fertility rate at 1.3.

• Havana Syndrome is not a disease caused by adversaries: intelligence report.

• Alex Murdaugh trial likely to result in guilty verdict.

6. Interesting tweets, memes, and images

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