Google is requiring school districts to accept AI features or risk losing access to its search engine, sparking backlash from educators and city leaders. New York City Mayor Zohran Mamdani called the move an attempt to use monopoly power to push AI into public schools, while parent advocates described it as blackmail. The city operates roughly 1.3 million Chromebooks, with about 500,000 assigned to students. City education officials have already disabled Gemini and AI Mode on student devices while they review the changes.
Google plans to automatically turn off Gemini, Gemini Notebook, and Search for school districts early next year, requiring administrators to opt back in. The company says Search and AI are deeply integrated, making it impossible to offer one without the other. Around 60,000 K-12 districts use Google Workplace, and roughly 93 percent of U.S. public schools use or plan to use Chromebooks. Seattle Public Schools is taking a different path, blocking Gemini and other generative AI tools entirely while limiting screen time for younger students.
Students and education advocates argue that AI companies are exploiting under-resourced schools by offering chatbots as solutions to deep problems like underfunding. They point out there is no conclusive evidence that AI improves learning outcomes. Meanwhile, NYU Professor Emeritus Gary Marcus warned that OpenAI could become the WeWork of AI due to its repeatedly delayed IPO and high valuation. He also suggested Nvidia could feel the impact if OpenAI is forced to sell at a discount to Microsoft.
Marcus cited a Bank of England study of about 10,000 decision-makers that found limited productivity gains from AI so far. He warned that investor faith in generative AI could shift, potentially hurting chipmakers like Nvidia. The midterm elections added to the uncertainty, as AI-related stocks dropped after the Democratic victory. Nvidia and Lam Research fell on fears that a Democratic Congress would slow data center construction, while defense and oil companies also declined.
Market anxiety reflects growing concerns about the affordability of AI infrastructure spending. A new survey estimates total AI spending will reach about $280 billion in the US and $25 billion in the UK in 2026, yet fewer than 2 percent of firms account for half of all expected spending. Veteran strategist Ed Yardeni said the recent selloff was partly panic-driven and that data center challenges are speed bumps, not roadblocks. He pointed to Texas as a state still welcoming projects, though developers will need to prove local benefits.
In the gaming world, artist Kenney and Epic CEO Tim Sweeney clashed over AI use in games. Kenney called AI immoral in its current state, citing environmental and training data concerns, while Sweeney defended it as part of Epic's responsibility to explore the technology. The debate highlights a wider split in the industry over disclosure and appropriate use of generative AI tools.
Key Takeaways
- Google is requiring school districts to accept AI features or lose access to its search engine, affecting roughly 93 percent of U.S. public schools that use Chromebooks.
- New York City Mayor Zohran Mamdani called Google's approach blackmail, and city officials have already disabled Gemini and AI Mode on student devices.
- Seattle Public Schools is blocking Gemini and generative AI tools entirely while capping screen time at 30 minutes daily for K-2 students.
- Gary Marcus warned OpenAI could become the WeWork of AI due to its delayed IPO, and said Nvidia could suffer if OpenAI sells at a discount to Microsoft.
- A Bank of England study of about 10,000 decision-makers found limited productivity gains from AI so far.
- Dem midterm election victories caused AI stocks like Nvidia to drop over fears of new limits on data center construction.
- Total AI spending is expected to reach about $280 billion in the US and $25 billion in the UK in 2026, but fewer than 2% of firms account for half of all spending.
- SoundHound AI expects sustainable profitability in the second half of 2027 and plans to cut at least $120 million in costs by replacing external AI models with proprietary tech.
- Artist Kenney called generative AI immoral in games, while Epic CEO Tim Sweeney defended its use, reflecting a wider industry split over AI disclosure.
- Ed Yardeni said the recent AI stock selloff was partly panic-driven and that data center challenges are speed bumps rather than roadblocks.
Google faces backlash over AI ultimatum to NYC schools
Google told New York City schools that blocking AI features could mean losing access to Google Search. Mayor Zohran Mamdani called it an attempt to use monopoly power to force AI into public schools. Parent advocates described the company's stance as blackmail. The city has about 1.3 million Chromebooks, with 500,000 assigned to students. City education officials said they are reviewing the changes and have already disabled Gemini and AI Mode on student devices.
Seattle schools to block AI tools and limit screen time
Seattle Public Schools will block Gemini AI, Minecraft and other generative AI tools for students in kindergarten through 12th grade. YouTube will be blocked for students in kindergarten through fifth grade. Students in kindergarten through second grade will have no individual assigned devices and up to 30 minutes of screen time per day. Students in third through fifth grade will also have no individual devices and will be limited to 60 minutes of daily screen time. Superintendent Ben Shuldiner said the district is taking a more critical look at technology use.
Schools scramble after Google gives AI ultimatum
Google announced that early next year its Gemini, Gemini Notebook and Search will automatically be turned off for school districts. Administrators will have to opt into these features. The company said Search and AI are deeply integrated, so schools cannot turn on Google Search without accepting AI. New York Mayor Zohran Mamdani criticized Google for trying to force AI into public schools. An estimated 60,000 K-12 schools use Google Workplace and around 93 percent of U.S. public schools use or plan to use Google Chromebooks.
AI companies prey on under-resourced schools, students say
Students and education advocates say AI companies are taking advantage of under-resourced schools by pushing chatbots and other tools as fixes for deep problems like underfunding. Tara Donnelly of the Chicago Teachers Union said Google and other companies are motivated by profit. Yeisbel Peña, a Boston high school student, said AI limits learning because it lacks the complexity of a classroom with a teacher. Sacdiya Rashid, a student in Raleigh, North Carolina, said AI companies are trying to benefit from struggling students. Experts say there is no conclusive evidence that AI improves learning outcomes.
Schools struggle with Google AI requirement
School officials are in a difficult position after Google required districts to accept AI or lose access to its search engine. Google said it will automatically turn off Gemini, Gemini Notebook and Search for school districts early next year. New York Mayor Zohran Mamdani said no corporation should dictate how children are taught. Clay Lavercombe, a principal in Ohio, said changing technology use mid-school year is a challenge. Eric Gibbs of Copyleaks said Google is forcing schools to choose between information access and controlling student AI use.
NYU Professor Gary Marcus Says OpenAI Could Become the WeWork of AI
NYU Professor Emeritus Gary Marcus warned that OpenAI could become the WeWork of AI. He pointed to OpenAI's repeatedly delayed IPO plans as a warning sign. Marcus also said Nvidia could feel the impact if OpenAI is forced to sell at a discount to Microsoft. He added that neocloud companies are the most vulnerable in the AI financing crunch.
Gary Marcus Warns OpenAI Could Be the WeWork of AI and Nvidia May Suffer
Gary Marcus warned that OpenAI's delayed IPO and high valuation could make it a cautionary tale like WeWork. He said Nvidia's chip demand may not grow forever if companies cannot profit from AI investments. Marcus cited a Bank of England study of about 10,000 decision-makers that found limited productivity gains from AI so far. He also warned that investor faith in generative AI could shift and hurt companies like Nvidia.
Midterm Elections Shake Up Wall Street and AI Stocks
The Democratic victory in the midterm elections shook up Wall Street. Shares tied to the AI boom, including Nvidia and Lam Research, fell on fears that a Democratic Congress would slow data center construction. Defense and oil companies also dropped on hopes for an end to the U.S.-Iran war. Hospital shares rose on expectations of restored funding for programs like Medicaid.
Midterm Results Shift Markets From AI Stocks to Tariff-Hit Industries
The Democratic midterm sweep caused big moves across Wall Street. AI stocks like Nvidia dropped over worries about new limits on data center development. Defense companies such as Northrop Grumman and Lockheed Martin fell between 4% and 12%. Trump Media & Technology lost 33% of its market value after the election. Meanwhile, alcohol companies and renewable energy firms gained on hopes for tariff relief and friendlier policies.
Artist Kenney and Epic CEO Tim Sweeney Clash Over AI in Games
Artist Kenney criticized generative AI in games during an exchange on X with Epic CEO Tim Sweeney. Kenney said AI raises environmental and training data concerns and called it immoral to use in its current state. Sweeney defended AI, saying Epic sees it as part of its job to make the case for the technology. The debate reflects a wider split in the gaming world over AI disclosure and use.
AI spending is highly concentrated among a few firms
A new survey estimates total AI spending will reach about $280 billion in the US and $25 billion in the UK in 2026. Spending per employee is expected to rise by more than 40% compared with 2025. However, fewer than 2% of firms account for half of all expected AI spending in both countries. This concentration has major implications for the economy and the future of work.
SoundHound AI outlines long-term growth plan
SoundHound AI announced on its third-quarter 2026 earnings call that it expects sustainable profitability in the second half of 2027. The company is shifting from upfront licensing to steady hosted subscriptions through its OASYS platform. Management plans to trim at least $120 million in costs by integrating acquisitions and cutting unprofitable contracts. SoundHound is also replacing external AI models with its own proprietary tech to reduce costs.
Fixing security breaches takes weeks while exploits happen in hours
A report highlights that fixing security vulnerabilities takes a median of 43 days, while exploits can be created in hours. Only 26% of known-exploited vulnerabilities were fully remediated. Between 2.6 and 4.4 million PHP installations remain unprotected outside edge defenses. Impart Security launched a Runtime Defense Harness where AI agents test virtual patches before engineers approve blocking decisions.
Analyst says AI stock selloff creates buying opportunity
Veteran market strategist Ed Yardeni said the recent AI stock selloff was driven partly by panic and unwinding leverage. He believes the beware period is over and there are now buying opportunities. Yardeni called data center challenges speed bumps rather than roadblocks, pointing to Texas as a state still welcoming projects. He said data center developers will need to prove their projects benefit local communities.
US Magnificent Seven face growing AI cost pressure
After the US midterm elections, Wall Street optimism about AI quickly soured. The US stock market reacted negatively as the Magnificent Seven companies face mounting AI costs. Questions about the affordability of AI infrastructure spending have intensified. The article examines which companies and investors can still sustain heavy AI investments amid rising financial pressure.
Kevin O'Leary discusses if A.I will make America richer
Kevin O'Leary shared his thoughts on whether artificial intelligence will make America richer. The discussion aired on CNN. Artificial intelligence is rapidly changing the world. O'Leary weighed in on the economic impact of this growing technology.
Sources
- Google told NYC schools to accept AI or lose access to Google Search, report says
- Seattle schools to block AI tools, limit screen time
- Schools scramble after Google gives AI ultimatum
- AI Companies Are Preying on Under-Resourced Schools, Students Say
- Schools scramble after Google gives AI ultimatum
- OpenAI could become the 'WeWork of AI,' says NYU Professor Gary Marcus
- Gary Marcus Warns OpenAI Could Become ‘WeWork Of AI’ — And Nvidia May Pay The Price
- From high-flying AI stocks to tariff-hit alcohol companies, the midterms shook up Wall Street
- From High-Flying AI Stocks to Tariff-Hit Alcohol Companies, the Midterms Shook up Wall Street
- The AI posting war is heating up: 'Please, leave me behind,' says artist who got into it with Epic CEO Tim Sweeney on X
- The concentration of AI spending
- SoundHound AI: 3 Key Takeaways for Long-Term Investors
- Patching Takes Weeks, Exploits Take Hours
- AI Selloff Has Investors Panicking, But Ed Yardeni Says It’s Time To Start Buying
- As the U.S. “Magnificent Seven” face their AI costs, who can still afford it?
- Will A.I make America richer? Kevin O’Leary weighs in
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