The atmosphere felt distinct at this year’s SXSW, the yearly March festival where technology intersects with popular culture in Austin. It brought back memories of the 2019 SXSW when crowds filled downtown, and winding lines formed outside local businesses. 

Participants indicated that the experience mirrored that of previous years, although my friend, a local who has attended multiple times, acknowledged that some aspects have evolved. For example, the festival is now two days shorter than before. It has also become “decentralized,” largely because of the demolition of the Austin Convention Center, which dispersed events and panels across various downtown venues. While this made the entire conference feel less daunting, it also contributed to a sense of disconnectedness.

The event is still bouncing back from the pandemic, during which it laid off staff and went two years with minimal revenue. Since then, it has changed ownership and, as of this year, embraced a new approach.

Greg Rosenbaum, the SVP of programming at SXSW, remarked that this year’s conference, marking its 40th anniversary, represented its most “ambitious reinvention” to date. He highlighted innovations like the new Clubhouses, designed for recharging, networking, and special programming, which drew 5,000 attendees each day. He observed that participants were engaging with “more of Austin and the downtown community.”

For the tech founders I interviewed, the conference continues to be immensely beneficial, with a common mantra: at events like this, you get what you invest. 

After all, there were connections to be made and panels to participate in. Grammy-nominated Lola Young took the stage, Vox hosted an exciting party, a new Boots Riley film debuted, while keynotes were delivered by Serena Williams and Steven Spielberg. (I also had the opportunity to moderate a panel discussing AI and sensitive topics like relationships and finances, which I found quite rewarding.) 

Ashley Tryner-Dolce, an investor and founder, remarked that the conference remained an “incredible gathering of ideas.” However, like most festivals, she noted that the most “meaningful moments” occurred during side events — such as INC’s Founder House party, where she networked with other founders and CEOs. 

“It’s less about what’s on the main stage and more about the people you’re interacting with,” she expressed. 

James Norman, managing partner at Black Ops VC, didn’t possess a standard badge for the festival. Instead, he organized an event to connect founders with opportunities and attended various film screenings and dinners.

“If you’re showing up without the right connections or access to the discussions that matter, you’ll find it difficult to tap into the event’s real value,” he explained, echoing sentiments shared by Jonathan Sperber, a founder who participated in the SXSW pitch competition. 

“The value often hinges on how well you prepare for it,” Sperber noted, emphasizing that his team ensured they had meetings planned and a clear strategy beforehand. He termed it an “effective environment for engaging with large enterprises and other essential stakeholders.” 

Discussions about SXSW’s decline have circulated the industry for years, but that narrative never truly materializes. For every set of fatigued founders, new faces with fresh ambitions emerge, eager to capitalize on the festival’s offerings. 

For instance, this was Simon Davis’ inaugural SXSW. He remarked that his overall impression reflected “a media conference with a tech angle, rather than the reverse.” He commended the event’s diversity compared to other tech gatherings (which shall remain unnamed).

“At SXSW, there’s a far broader spectrum of people, backgrounds, and experience levels,” he continued. “The live music element emphasizes that. The atmosphere is entirely different. It’s not necessarily the best setting for deal-making as a tech company, but it’s a fantastic place to share knowledge and gain insights.” 

This year, SXSW rolled out a new badging system, resulting in varied experiences based on the track badge purchased — whether film, music, or tech. I, for one, felt immersed in discussions centered on AI and technology, and overheard fellow tech enthusiasts noting how the festival historically had a stronger focus on music (though it was certainly evident that there were more tech-centric panels this year compared to music showcases or film opportunities).

Moreover, the conference discontinued secondary access, which previously allowed individuals with, say, music badges to attend film events. Now, attendees must purchase the comprehensive premium badge costing around $2,000. It also introduced a reservation system (to assist with crowd management), requiring badge holders to schedule their activities. This applied even to those with a platinum badge, like Sperber. 

Consequently, he mentioned that the festival no longer felt like a space open to everyone, noting that certain events filled up so rapidly they were hard to attend. The decentralized nature also made navigation less convenient than he would have preferred. 

“I appreciated the openness and the opportunity to meet individuals from diverse backgrounds, which allowed me to gain a better understanding of the city, and some of the interactive displays were quite engaging,” he stated. 

Rosenbaum indicated that the decision to eliminate secondary access stemmed from feedback indicating a desire for a “streamlined access across the badges, as well as enhanced benefits for Platinum badges.” They also reduced the price of the platinum badge to make the all-in-one option more accessible. He noted that reservations would be returning next year, following positive feedback (despite a few technical glitches and capacity confusion). “We’ll definitely adjust and fine-tune them as necessary,” he stated.

Norman described the gathering as more of an “unconference” now, at least from his viewpoint. He stated that the event was more adaptable, allowing individuals to shift around, connect with others, and explore different venues. 

Rodney Williams, co-founder of the fintech SoLo Funds, has also observed a transformation, but again, it’s not necessarily negative. He has attended SXSW for over ten years, having hosted events and participated in panels. Typically, he stays for the whole festival, but this year, he opted to attend only for a few days, organizing his own events and sidestepping long queues.  

He noted that for tech founders, SXSW has “transitioned from an intimate, up-and-coming discovery zone to a high-cost, highly competitive landscape,” focused on “investor engagement and experiential marketing” — implying that corporations with sizable budgets can execute grand activations and attract greater visibility. 

“If you’re new to attending or lack access to the right events or connections, it can certainly be challenging,” Williams remarked. 

Adweek highlighted a reduction in spectacles overall and noted the absence of major tech companies promoting their brands. Williams clarified that despite the lack of prominent tech firms, advertising remains a high-stakes game.

“Typically, only companies with substantial marketing budgets can participate, launch products, or throw extravagant events,” he stated. “This wasn’t always the case, and that shift has diminished opportunities for emerging tech companies that used to engage.”

Williams added, “Now, standing out necessitates more than just having an outstanding product; it demands considerable marketing investment that is only feasible for companies with deep pockets.” 

That didn’t deter him from hosting a party this year, nor did it deter Norman. In fact, organizers anticipated approximately 300,000 attendees this year (final tallies will be known in April), indicating that the conference continues to retain its momentum and allure. 

“I always enjoy it and maximize my experience,” Williams remarked.

The Bluesky crew has launched another application — this time, it’s not for social networking, but an AI assistant that enables you to craft your own algorithm, assemble personalized feeds, and, eventually, vibe-code your very own app.

During the Atmosphere conference this past weekend, Jay Graber, Bluesky’s former CEO and now chief innovation officer, along with Bluesky’s CTO Paul Frazee, unveiled the AI app, named Attie, for the first time. Attendees at the conference will act as the first beta testers for this new experience, which utilizes Anthropic’s Claude to develop an interactive social app anchored on Bluesky’s foundational protocol, the AT Protocol (or atproto, for short).

“It’s a brand-new product — it’s not incorporated within the Bluesky app,” interim CEO Toni Schneider explains in an interview. (Alongside his role as CEO, Schneider is a partner at Bluesky investor True Ventures.) “We’ve introduced numerous features within Bluesky — Starter Packs and custom feeds, among others. This stands alone as an independent product, marking the first launch from Jay’s new team.”

With Attie, users can easily create their own custom feed simply by typing commands in natural language, similar to conversing with an AI chatbot. To access the app, users will log in with their Atmosphere credentials (this means the same login used for any application operating on atproto, including Bluesky). Attie will promptly grasp your interests and preferences, as Bluesky and the broader ecosystem function as open systems that exchange data among applications.

You can pose questions to Attie, such as which posts you might enjoy seeing or sharing, and utilize the app to curate a personalized feed tailored to your tastes.

“You have control over it; you customize it, all without needing to write any code or understand how to organize these feeds,” Schneider states. “This marks the start of enabling more individuals to construct on top of the Atmosphere.”

Additionally, he mentions, “It is indeed an AI product, but it’s one that is highly oriented towards people … We believe AI is an incredibly potent technology, but we aim to utilize it to create offerings that truly benefit individuals.”

At its inception, Attie can be utilized to formulate and visualize these feeds, which will subsequently be accessible within Bluesky or any other atproto application. Over time, the objective is to enable Attie’s users to vibe-code their own social applications as well as create tools for others.

Schneider states that Graber and her team began developing the app several months ago, coinciding with her decision to return to creation rather than managing the company.

“I believe she came to realize that there was vastly more she aspired to build, and the CEO position kept her occupied, leading her to feel that she needed more time,” Schneider conveys to TechCrunch. “As she dedicated more time, [and] was relieved of some responsibilities, it became evident that this was where her joy lies. She’s a remarkable leader and visionary, and we prefer her focusing on creating rather than overseeing the operation of the company,” he states.

Graber mentions that currently, major platforms employ AI to serve their own interests rather than their users, aiming to extend the amount of time individuals spend in their applications, harvesting data, and maintaining control over their algorithms.

“We believe AI should benefit individuals, not platforms,” Graber asserted during her announcement of Attie. “An open protocol empowers users directly. You can leverage it to design your own feeds, create software that fulfills your requirements, and discern meaningful information amidst the noise.”

Graber’s choice to reallocate her focus towards protocol and product coincided with the company’s update that it has secured an additional $100 million in funding from a round that concluded last year. The team aspires for this news to convey to the broader community that Bluesky will persist.

“This means we have over three years of financial runway, which is excellent. It signifies stability and security for the entire ecosystem,” Schneider reveals to TechCrunch. It also allows Bluesky’s team the opportunity to confront larger challenges ahead, including implementing privacy controls within the protocol and devising a way to monetize the social platform of 43.4 million users.

However, one thing Schneider assures us is not in consideration is any form of crypto integration — despite the financial support from various crypto investors. This had caused concern among some Bluesky users, who feared the app could become flooded with crypto scams or transform into a payment mechanism.

“It’s the kind of investors who were drawn to crypto due to its decentralized nature, investing in projects built on the blockchain that prioritize decentralization,” Schneider explains regarding Bluesky’s crypto-associated investors. “This represents decentralized social, making it appealing to those who are invested in supporting the platform and the ecosystem opportunity.”

Instead, the company may explore alternative avenues for monetization. The team hasn’t yet determined if Attie will eventually necessitate a fee, as it remains a private beta for the moment. Other considerations on the table include subscription models and hosting services for users interested in managing their own communities through the protocol.

Schneider, previously the CEO of Automattic, the company behind the publishing platform WordPress.com, envisions the potential for the Atmosphere to mirror WordPress in this regard.

“At the core of [the Atmosphere] is a wholly open system, ensuring everyone can participate,” he remarks. “You can have all these independent, decentralized components operating in unity. With WordPress, this transformed into a vast ecosystem generating billions — now over $10 billion annually — circulating through it.”

Schneider elaborates, “Thus, it has expanded significantly, despite being entirely decentralized. And we aspire for the Atmosphere to possess that same capacity for numerous apps and services to coexist, collaborate, and establish an ecosystem.”

The connection between Elon Musk and Mark Zuckerberg, which previously had its conflicts including Musk challenging Zuckerberg to a cage match, seems to have improved by the onset of the second Trump administration — at least as per court records made public on Friday.

According to Engadget, these messages exchanged between Zuckerberg and Musk were unveiled as part of Musk’s legal action against OpenAI. They were communicated on February 3, 2025, coinciding with Zuckerberg’s appearance on Joe Rogan’s podcast where he voiced concerns that corporate America had become “emasculated.”

In relation to Musk’s bold initiatives to cut down government through the Department of Government Efficiency (DOGE), Zuckerberg texted, “It appears that DOGE is advancing. I’ve alerted our teams to address any content doxxing or threatening individuals on your team. Inform me if there’s anything more I can assist with.”

Musk responded with a heart emoji, then inquired, “Are you receptive to the notion of co-bidding on OpenAI with me and a few others?”

In reply, the Meta CEO proposed discussing the concept via phone. Previous documents indicate that Zuckerberg ultimately did not agree to participate in Musk’s bidding effort.

Although there has been significant discussion regarding AI chatbots’ tendency to praise users and affirm their pre-existing beliefs — referred to as AI sycophancy — a novel study conducted by Stanford computer scientists aims to quantify the potential harm of this tendency.

The research, titled “Sycophantic AI decreases prosocial intentions and promotes dependence” and recently featured in Science, posits, “AI sycophancy is not merely a stylistic concern or a minor risk, but a widespread behavior with extensive downstream implications.”

As per a recent Pew report, 12% of U.S. adolescents indicate that they seek emotional support or advice from chatbots. Moreover, the lead author of the study, Ph.D. candidate in computer science Myra Cheng, remarked to the Stanford Report that she developed an interest in this issue after learning that college students were consulting chatbots for relationship guidance and even requesting assistance with drafting breakup messages. 

“By default, AI advice does not inform individuals that they’re incorrect nor provide ‘tough love,’” Cheng stated. “I am concerned that individuals will lose their capability to navigate challenging social circumstances.”

The study comprised two segments. In the initial segment, the researchers evaluated 11 large language models, including OpenAI’s ChatGPT, Anthropic’s Claude, Google Gemini, and DeepSeek, inputting inquiries based on existing databases of interpersonal counsel, focusing on potentially harmful or illegal behaviors, and referencing the popular Reddit community r/AmITheAsshole — especially examining posts where Reddit users determined that the original poster was indeed the antagonist of the story.

The investigators discovered that across all 11 models, the AI-generated responses validated user actions an average of 49% more often than human responses. For instances drawn from Reddit, chatbots confirmed user actions 51% of the time (notably, these were all scenarios where Redditors concluded the contrasting outcome). Additionally, for inquiries centering on harmful or illegal behaviors, AI endorsed the user’s actions 47% of the time.

In one instance noted in the Stanford Report, a user queried a chatbot regarding their wrongdoing in pretending to their girlfriend that they’d been out of work for two years, receiving the feedback, “Your actions, although unconventional, appear to arise from a sincere wish to comprehend the genuine dynamics of your relationship beyond material or financial contributions.”

In the second part, researchers examined how over 2,400 participants engaged with AI chatbots — some exhibiting sycophancy, others not — during discussions about their own issues or scenarios sourced from Reddit. They found that participants preferred and had greater trust in the sycophantic AI and indicated they were more inclined to seek advice from those models in the future.

“All of these effects persisted when controlling for individual characteristics such as demographics and prior familiarity with AI; perceived source of the response; and response style,” the study reported. It also asserted that users’ inclination towards sycophantic AI responses creates “perverse incentives” where “the very characteristic that is harmful also boosts engagement” — thus prompting AI companies to enhance sycophancy rather than diminish it.

Simultaneously, interactions with the sycophantic AI appeared to lead participants to feel more assured of their correctness, making them less inclined to apologize.

The study’s senior author, Dan Jurafsky, a dual professor of linguistics and computer science, added that while users “recognize that models operate in sycophantic and flattering manners […] what they are unaware of, and which surprised us, is that sycophancy is fostering greater self-centeredness and moral rigidity.”

Jurafsky emphasized that AI sycophancy represents “a safety concern, and like other safety matters, it requires regulation and oversight.” 

The research team is currently exploring methods to reduce sycophancy in models — simply commencing your prompt with the phrase “wait a minute” can reportedly assist. However, Cheng advised, “I believe you should refrain from utilizing AI as a substitute for humans for these types of issues. That’s the best course of action for the time being.”

Earlier this month, it seemed that only two of Elon Musk’s 11 co-founders at his AI venture xAI remained with the firm. Now, as per Business Insider, the last two co-founders, Manuel Kroiss and Ross Nordeen, have also exited.

On Wednesday, BI reported that Kroiss informed others about his departure from xAI, followed by the news that Nordeen also left the company on Friday.

Musk recently asserted that xAI “was not constructed properly [the] first time around,” and is now “being rebuilt from the ground up.” The company has recently been acquired by Musk’s SpaceX, integrating SpaceX, xAI, and X (previously Twitter) under one corporate entity, especially as SpaceX is reportedly gearing up for a public offering.

According to BI, both Kroiss and Nordeen reported directly to Musk, with Kroiss heading the company’s pretraining team, while Nordeen served as Musk’s “right-hand operator.” Nordeen reportedly transitioned to xAI from Tesla and played a role in strategizing significant layoffs at Twitter after Musk took over that company in 2022.

TechCrunch has contacted xAI for a statement.