OpenAI is officially jumping into the hardware game and bringing a design legend along for the ride. The company just acquired io Products, a secretive AI hardware startup co-founded by ex-Apple design chief Jony Ive, in a massive $6.5 billion deal. This is a clear step towards AI-powered products that go beyond just the digital world.

Jony Ive is best known for designing the iPhone, iMac, and MacBook. This new role in OpenAI means that he is stepping up and taking the expertise of OpenAI and building a product that might create revolution. While the company hasn’t revealed what product it’s building, it described the goal as creating “a new family of products” that will not rival smartphones but might become a new interactive way we use AI in our day to day lives. 

Details of the deal

The deal is mostly equity-based, with OpenAI forking over $5 billion and rolling in the 23% stake it already held in io Products since 2023. The company was quietly founded in Delaware in September last year and registered in California just this April.

Jony Ive is also the founder in a design firm LoveFrom that will still remain independent, but he and his team are stepping into a deep creative role within OpenAI. “It became clear that our ambitions to develop, engineer, and manufacture a new family of products demanded an entirely new company,” wrote Ive and Altman in a joint blog post.

This just looks like a small beginning for OpenAI. According to the Wall Street Journal, Altman told employees that this could become “the biggest thing we’ve ever done” at OpenAI. This has also possibly boosted the company’s valuation by as much as $1 trillion. The new io division will be led by OpenAI executive Peter Welinder, known for heading the company’s robotics. The team, described by Altman and Ive as comprising “the best hardware and software engineers, technologists, scientists and manufacturing experts” will collaborate closely with OpenAI’s research teams in San Francisco.

This partnership has been brewing for nearly two years. Back in February, Altman teased an AI-first device that was in the works with Ive. Ive also looked emotional in the announcement video as he said that 30 years had led him to this place. Altman added to this by admiring Jony, noting that he and his team designed the iPhone, MacBook Pro, and defined the ways people use technology. He further added that AI technology deserves something much better, and that’s where this new partnership will play a huge role

The Next Big AI product? 

While OpenAI hasn’t exactly revealed what type of device they are working on, considering the variety of AI devices we’ve seen over the past couple of years, we could be getting something similar but done the right way. This could be real and ambitious hardware that might take the shape of wearables, like Humane AI Pin or Rabbit R1, but bigger and better. Right now, it’s too early to even guess as it won’t just be a gadget but likely something that acts as an interface between humans and AI.