#252 - GPT 5.6, Grok 4.5, Nemotron-Labs-Diffusion, AI 2040

Our 252th episode with a summary and discussion of last week's big AI news! Recorded on 07/11/2026 Hosted by Andrey Kurenkov and Jeremie Harris Feel free to email us your questions and feedback at andreyvkurenkov@gmail.com and/or hello@gladstone.ai Read out our text newsletter and comment on the podcast at https://lastweekin.ai/ In this episode: OpenAI publicly rolled out GPT-5.6 (including Sol and Luna) and rebranded its desktop agentic coding product as ChatGPT Work, amid disputed claims about whether the US government effectively green-lit and delayed the release and concerns about inconsistent, ad hoc frontier-model oversight and jailbreakability. New model releases intensified pricing and capability competition: SpaceX AI’s Grok 4.5 launched as a very low-cost, Opus-class coding model with minimal safety documentation, while Meta released Muse Spark 1.1 with aggressive pricing, large coding/cyber benchmark gains, and a lengthy safety evaluation. Meta also previewed Muse Video and rolled out Muse Image before quickly backtracking after backlash over easy generation of images of public Instagram accounts; separately, Chinese open-source models grew to over 30% of weekly OpenRouter tokens as cost pressure increased, alongside discussion of risks like potential insider threats. Infrastructure, policy, and safety developments included Meta exploring selling AI compute as a cloud business, US energy regulators pressing grid operators on large-load data-center connections, Anthropic publishing a “global workspace” interpretability method for verbalizable internal representations, reports that China may restrict overseas access to top models, and AI 2040 proposing US–China coordination to slow progress until alignment improves. A thank you to our current sponsors: Box - visit box.com/LWIAI to learn more Notion - visit notion.com/lwai to try Notion’s Developer Platform today. ODSC AI - visit odsc.ai/east and use promo code LWAI for an additional 15% off your pass to ODSC AI East 2026. Factor - visit factormeals.com/lwai50off and use code lwai50off to get 50 percent off and free breakfast for a year Timestamps (note - these don't take into account dynamically inserted ads and therefore may be off by a couple of minutes): (00:00:10) Intro / Banter (00:01:33) News Preview Tools & Apps (00:02:03) OpenAI rolls out GPT-5.6 after government greenlight — and announces ‘ChatGPT Work’ | The Verge + The new ChatGPT superapp takes aim at Claude Desktop + OpenAI is shutting down its Atlas web browser + OpenAI’s latest AI model likely has similar cyber vulnerabilities to one that led to U.S. export controls on Anthropic’s Fable, British agency says (00:15:41) SpaceXAI, Cursor Launch Grok 4.5 AI Model for Finance, Legal Applications - Bloomberg + SpaceXAI’s Grok 4.5 Undercuts Anthropic and OpenAI on Coding Agent Pricing (00:20:29) Meta says its new AI model is ready to compete on coding | The Verge (00:27:21) Introducing Muse Image and Muse Video + https://www.nytimes.com/2026/07/10/technology/meta-muse-images-instagram-removal.html (00:29:01) Chinese AI models gain ground with U.S. companies as costs surge + Anthropic and OpenAI Face a New Threat from China Applications & Business (00:35:21) Meta Is Planning a Cloud Business to Sell AI Computing Power - Bloomberg (00:46:32) US energy regulator sets ultimatum for data centres + Grid operator PJM orders emergency steps to avoid large-scale US power outages Projects & Open Source (00:51:40) Nemotron-Labs-Diffusion: A Tri-Mode Language Model Unifying Autoregressive, Diffusion, and Self-Speculation Decoding (00:57:44) Tencent Releases Hy3: An Open 295B Mixture-of-Experts (MoE) Model with 21B Active Parameters and 256K Context - MarkTechPost Policy & Safety (00:58:30) Verbalizable Representations Form a Global Workspace in Language Models (01:09:29) Beijing is looking at curbing overseas access to China's top AI models, sources say (01:12:53) The ex-OpenAI employee behind ‘AI 2027’ recommends a