AWS outage explained, OpenAI’s new acquisition, Anthropic’s billion-dollar TPU deal, and Reddit sues Perplexity

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Meet Mico, Microsoft’s AI version of Clippy
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• Microsoft has launched a new virtual character named Mico (rhymes with “pico”) for its Copilot voice mode, giving the assistant a visual identity and expressive facial reactions as users speak.

• Mico includes a “Learn Live” mode that uses interactive whiteboards and visual cues to guide users through concepts rather than simply giving answers — aimed at students and language learners.

• At launch, Mico will only be available in the U.S., and it relies on a memory feature that surfaces facts it has learned about the user and their tasks.

How the AWS outage happened: Amazon blames rare software bug and ‘faulty automation’ for massive glitch
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• AWS says a rare software bug caused two independent automation systems to race each other and erase key network entries in its DynamoDB service, triggering a cascading failure across multiple services.

• The company clarified the outage was not due to hardware failure or external attack, but the issue shows how deeply online services rely on a few big cloud providers.

• In response, AWS has globally disabled the flawed automation, plans to fix the bug, and will add new safety checks and improve recovery processes.

OpenAI acquires Software Applications Incorporated, maker of Sky
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• OpenAI acquired Software Applications Incorporated, the maker of Sky, a Mac-integrated natural-language interface that understands what’s on your screen.

• Sky’s technology will be integrated into ChatGPT and related offerings to help “AI work alongside you” rather than only respond to prompts.

• The transaction was led by Nick Turley and Fidji Simo and approved by OpenAI’s board; a fund related to Sam Altman held a passive investment in Software Applications Incorporated.

Google and Anthropic announce cloud deal worth tens of billions of dollars
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• Anthropic will access up to one million of Google’s Tensor Processing Units (TPUs), representing well over a gigawatt of compute capacity coming online in 2026 — with the deal worth tens of billions of dollars.

• The AI startup chose Google’s TPUs due to their cost-performance efficiency and prior experience with them, as it scales its Claude models for enterprise use.

• Even though Amazon remains a major partner, this multicloud strategy (TPUs, AWS Trainium, Nvidia GPUs) signals fierce competition in securing AI infrastructure.

Reddit sues Perplexity for scraping data to train AI system
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• Reddit filed a lawsuit in federal court alleging Perplexity and three data-scraping firms illegally scraped Reddit’s content (without licensing) to train Perplexity’s AI system.

• Reddit claims the scraped data was essential for Perplexity’s “answer engine”, that one of the firms increased citations to Reddit forty-fold after a cease-and-desist, and seeks monetary damages plus an order blocking further use of Reddit’s data.

• Reddit says this litigation is part of a broader wave of content-owner legal action against AI training practices, highlighting a “data-laundering” economy driven by the AI arms race.