OpenAI Bets Big on Hardware: The $6.5 Billion Merger with Jony Ive and Sam Altman’s io

In a move that promises to recalibrate the trajectory of the entire AI and hardware sector, OpenAI has acquired the AI hardware startup io—founded by former Apple design chief Jony Ive and OpenAI CEO Sam Altman—for a monumental $6.5 billion. The deal marks OpenAI’s largest acquisition to date and unites two of Silicon Valley’s preeminent visionaries, aiming to create what they describe as a “family of AI products for everyone,” according to 512 Pixels.

Watch their unusual (but very cool) video announcement…

The announcement, aired on OpenAI’s official YouTube channel, was presented as both a culmination of years of ideation and the start of a new chapter. As Sam Altman put it: “We want to bring people something beyond the legacy products we’ve been using for so long.” Ive, whose design legacy includes the iPhone and MacBook Pro, framed the ambitions as “galactic,” emphasizing a mission to create “amazing products that elevate humanity.”

Shared Vision, Unmatched Talent

The seeds of io were planted two years ago when Altman and Ive began discussing the limitations inherent in today’s consumer devices. Describing the collaboration as rooted in “friendship, curiosity and shared values,” Altman noted that these initial conversations quickly matured into tangible designs and led to the founding of io Products alongside Scott Cannon, Evans Hankey, and Tang Tan—a team comprising some of the top engineering and design talent from Apple and beyond.

In an interview with The New York Times, the pair was tight-lipped about the concrete nature of the devices but unequivocal about their aspirations: to “completely reimagine what it means to use a computer.” According to the Observer, LoveFrom—the design collective launched by Ive after his departure from Apple—played a central role, providing the creative backbone for io’s product innovations.

Hardware as the New AI Frontier

While OpenAI has dominated headlines for breakthroughs in software, the acquisition signals a recognition that transformative AI experiences require bespoke hardware. Existing tools—laptops, smartphones—remain wedded to decades-old paradigms. “It’s common sense to at least think, surely there’s something beyond these legacy products,” Altman said.

Sources across the tech industry have speculated about the device’s form factor but one point is clear: this is not merely an upgrade on the smartphone. “I don’t think you should try to do a better phone,” Altman remarked to Axios last year, indicating that the vision is to create something unprecedented—potentially a new category of consumer AI device entirely.

The Information and Patently Apple have documented the steady migration of talent from Apple to io, including Tang Tan, who led iPhone product design, and Evans Hankey, who succeeded Ive in Apple’s design division. The expertise being assembled is formidable, and with OpenAI’s technology as the core, the industry is bracing for disruption.

A New Ethos for AI Product Design

Both Altman and Ive repeatedly stress that the project is as much about principles as products. In their conversation, mutual respect and a focus on user empowerment were evident. “Our motivations and values are completely the same,” Ive said. “We want this to be democratized. I want everybody to have it. I don’t want it to be the tiny percentage of the population that figures out how to use bad tools, and is really smart. I want anybody to say, hey, I have this idea. Make it happen.”

Their approach places unprecedented emphasis on the intersection of design, ethics, and accessibility—values both believe are too often overlooked in the pursuit of technological advancement.

Looking Ahead

Details on io’s first device remain under wraps, but the ambition is unmistakable. Altman claims that after living with one of the prototypes, it is “the coolest piece of technology that the world will have ever seen.” The acquisition positions OpenAI not merely as a software power, but as a full-stack innovator poised to define the next era of personal computing.

As the industry awaits further specifics slated for next year, one thing is clear: with this acquisition, OpenAI is betting that the future of AI will be as much about how we use it as what it can do. The era of hardware designed around AI, rather than merely embedding it, has officially begun. (512 Pixels, Observer, Patently Apple)