AI News Weekly - The AI civil war? Anthropic blasted and Open AI sees users flee

Things are pretty serious. AI is totally a geopolitical issue now - and more AI companies have 1 billion seed rounds now Anthropic got blacklisted. OpenAI is the bad guy as users revolted. LeCun walked away from Meta with a billion dollars and a thesis that everyone else is wrong. Oracle said it out loud: we're firing people to build data centres. None of this is theoretical anymore. Sponsor If you’re only using AI to rewrite emails, you’re doing it wrong. Become AI-proficient in 8 weeks. The AI for Business & Finance Certificate Program teaches practical, everyday AI for nontechnical professionals—and earns you a certificate from Columbia Business School Exec Ed. Starts March 16. In the News Online Age-Verification Tools for Child Safety Are Surveilling Adults CNBC · Mar 8 Half of U.S. states now force every user through AI-powered identity gates to protect children — creating a mass surveillance infrastructure that caused site traffic to collapse in states where it was enforced. #QuitGPT: 2.5M Users Flee ChatGPT; Claude Hits #1 on App Store TechCrunch · Mar 1 OpenAI's Pentagon deal triggered the largest consumer AI backlash ever — ChatGPT uninstalls surged 295%, Claude's daily signups quadrupled, and Anthropic's app overtook ChatGPT for the first time in the U.S. App Store. Anthropic Claims Pentagon Feud Could Cost It Billions TechCrunch · Mar 9 Anthropic filed two federal lawsuits challenging its "supply chain risk" designation — a label never before used against a domestic company — arguing the Pentagon is retaliating for its refusal to allow unrestricted military AI use. UK Eyes Sweeping Powers to Regulate Tech Computing.co.uk · Mar 9 The UK government is seeking broad executive authority to regulate online harms through the Children's Wellbeing Bill — and legal experts warn those same powers could be weaponized by future populist governments. Yann LeCun's AMI Labs Raises $1.03B to Build 'World Models' TechCrunch · Mar 10 Turing Award winner LeCun left Meta, called LLMs "complete nonsense" as a path to real intelligence, and raised $1B at a $3.5B valuation for a Paris-based startup building AI that understands physical reality — backed by Bezos, Nvidia, Schmidt, and Cuban. Fake AI Content About the Iran War Is All Over X CNN · Mar 10 AI-generated fake war footage is racking up tens of millions of views on X while monetized accounts profit from it — and X's own chatbot Grok made it worse by confirming fabricated content as real. Oracle Plans 20,000–30,000 Layoffs to Fund AI Data Centres Yahoo Finance / Bloomberg · Mar 5 Oracle is cutting up to 18% of its workforce to free $8–10B for AI infrastructure — the starkest example yet of a company explicitly firing humans to pay for AI, while U.S. banks pull back from financing the expansion. Kids Would Be Banned from Using Chatbots in Minnesota AI Bills CBS News · Mar 10 Minnesota's bipartisan AI bills — banning minors from chatbots, blocking surveillance pricing, and restricting AI in health insurance — signal that states are becoming AI's de facto regulators in the absence of federal action. OpenAI and Google Workers File Amicus Brief for Anthropic TechCrunch · Mar 9 Over 30 employees from rival firms — including Google's chief scientist Jeff Dean — told a federal court that if the Pentagon can blacklist a company for setting safety boundaries, no AI developer is safe. Microsoft: Hackers Abusing AI at Every Stage of Cyberattacks Microsoft Security Blog · Mar 7 Threat actors are now using generative AI across the entire attack lifecycle — one Russian-speaking hacker breached 600+ firewalls in five weeks using AI, a scale previously requiring a full team. DOJ Lawyer Resigns Before Judicial Scolding for AI-Filled Brief Bloomberg Law · Mar 10 A 30-year federal prosecutor resigned after filing a brief with AI-fabricated citations — calling it the worst decision of his career and underscoring that even experienced professionals are falling for AI hallucinations. Anthropic Seeks to Undo 'Supply Chain Risk' Designation NPR · Mar 9 The first-ever use of a supply chain risk designation against a domestic U.S. company sets a precedent that could reshape how every AI firm negotiates with the military — all because Anthropic drew two red lines on surveillance and autonomous weapons.