Ep 812: Fable 5 is (kinda) Back, OpenAI Might Give Gov Equity, Microsoft’s new AI Company and more AI News
July 6, 2026
AI Summary
5 min readAn Upside-Down Week in AI: Microsoft Starts a Consulting Company, Anthropic Reinstates Fable 5, and OpenAI Floats Government Equity
This week in AI felt like the world turned upside down. Microsoft launched a $2.5 billion AI consulting division with 6,000 employees. Anthropic announced it will start developing drugs. The company's most powerful model, Fable 5, returned after a 19-day suspension but will disappear again for most users within hours. And in the strangest development of all, OpenAI is reportedly considering giving the U.S. government a 5% equity stake in the company.
Microsoft Frontier Company: A $2.5 Billion Bet on AI Consulting
Microsoft has created a new subsidiary called Microsoft Frontier Company, backed by a $2.5 billion investment and 6,000 employees who will embed directly with clients to support AI adoption. The model is known as forward deployed engineering (FDE), a role popularized by Palantir and now adopted by OpenAI, Anthropic, and Google. Microsoft claims its platform supports more AI models and integrations than competitors like Palantir, giving it a unique pitch: since Microsoft is a major investor in both OpenAI and Anthropic, it can help clients navigate the choice between models without favoring one.
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What you'll learn
- 1 (00:46) **Upside-Down Week in AI** - Host Jordan Wilson introduces a week of surprising AI headlines, including Microsoft starting a new company, Anthropic moving into drug discovery, and OpenAI considering giving equity to the US government.
- 2 (02:12) **Microsoft Launches "Microsoft Frontier" with $2.5B and 6,000 Employees** - Microsoft invests $2.5 billion in a new AI client services company, embedding 6,000 employees directly with clients to support AI adoption.
- 3 (07:06) **Anthropic Launches Claude Science for Drug Discovery** - Anthropic announces Claude Science, an AI workbench for scientific research, and reveals plans to develop drugs faster, focusing on neglected diseases.
- 4 (09:24) **Meta Launches "MetaCompute" to Sell AI Cloud Capacity** - Meta launches a new subsidiary, MetaCompute, to sell its AI computing capacity to outside customers, directly competing with AWS, Azure, and Google Cloud.
- 5 (14:00) **Cloudflare to Block AI Crawlers on Ad-Supported Pages** - Cloudflare announces it will default to blocking AI training and agent crawlers on ad-supported pages starting in September, while still allowing search crawlers.
- 6 (19:09) **US Government Nears Voluntary AI Model Standards** - The US government is in advanced talks with leading AI companies to create voluntary standards for releasing new AI models, with an announcement expected as soon as this week.
- 7 (24:52) **Fable 5 is Back (But Not for Long)** - Anthropic reinstates its advanced Fable 5 model after a 19-day suspension, adding aggressive new cybersecurity classifiers that frequently misidentify harmless prompts as security risks.
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Show Notes
This was upside down week in AI news. 😵
Microsoft is starting a new AI company.
Anthropic is getting into pharma and drugs.
And OpenAI might be giving 5% equity to the U.S. government?
We'll help you sort it all out on our AI News That Matters show.
Fable 5 is (kinda) Back, OpenAI Might Give Gov Equity, Microsoft’s new AI Company and more AI News -- An Everyday AI Chat with Jordan Wilson
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Topics Covered in This Episode:
- Microsoft Frontier Company $2.5B AI Investment
- Anthropic Claude Science Drug Discovery Launch
- MetaCompute Cloud AI Infrastructure Business
- Cloudflare Blocks AI Crawlers on Ad-Supported Pages
- US Government Voluntary AI Model Standards
- Anthropic Fable 5 Model Reinstatement Updates
- Fable 5 Enterprise Data Retention Policy Changes
- OpenAI Considers US Government 5% Equity Stake
- Anthropic SONNET 5 Model Release
- Meta Watermelon Model Rumors
- Alibaba Bans Claude Code over Security Concerns
- Anthropic and Samsung Custom AI Chip News
- OpenAI GPT 5.6 Soul Ultra in Codex
- US House Kids Act AI Safety Legislation
- Google Gemini Omni Flash and Nano Banana 2 Lite
- Cursor and OpenClaw Mobile App Launches
Timestamps:
00:00 Microsoft's big AI investment
05:05 AI experts deploying to companies
07:22 Anthropic's move into drug development
09:47 Meta's new cloud venture
13:29 Cloudflare blocks AI crawlers
16:32 Impact of AI on web traffic
19:37 Government oversight on AI releases
24:27 Fable Five model reinstated
29:19 AI firms discussing public financial stakes
30:46 AI companies preparing to go
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