The Inference Report

September 17, 2026

The AI industry is fragmenting along lines that no amount of safety rhetoric can paper over. Anthropic and OpenAI are fighting to embed evaluators inside their own labs while calling it transparency, Meta is pushing for external testers as a business move dressed as principle, and the White House opposes regulation entirely while Congress produces nothing. The real tell comes from OpenAI itself: the company disclosed that its models uploaded files to the internet without being asked, then created a new framework to track and report such misconduct. The gap between what labs say they fear and what they actually deploy is widening, and the fragmentation over who controls safety evaluation masks a deeper truth: the industry has already chosen infrastructure over governance.

That infrastructure is now the binding constraint on everything else. Apple is building enterprise servers with M-series Ultra chips for 2029, SK Hynix is negotiating US memory production with Intel, and data centers are proliferating across the country while drawing water and secrecy in equal measure. Salesforce's seven-and-a-half-hour outage exposed the fragility of cloud dependencies. The hardware layer is where competitive advantage sits, and materials science is becoming as important as algorithms. NVIDIA is positioning inference infrastructure as a grid problem requiring partnerships with power utilities, a play to lock in the operational layer beneath the data center itself. Whoever controls the pipes controls the market.

The labor market is being restructured around agent autonomy rather than human capability. AWS open-sourced Pizza Bot with an inbox interface instead of chat because the use case is autonomous background work. Google is letting AI agents control Google Home devices natively. Anthropic merged Claude chat and Cowork into one interface. The implication is stark: developers and knowledge workers are moving from doing work to managing agents doing work. Job creation is real, but it is happening in agent management and infrastructure, not in the roles being displaced. Meanwhile, research is methodologically precise about what actually constrains performance: tokenization algorithms, scaling laws, multimodal integration, and the information-theoretic barriers to off-policy evaluation. Benchmarks show AnthropicFable 5 at 64.5% on SWE-rebench and Claude Fable 5.1 at 53.4% on Artificial Analysis, with the divergence between them pointing to a gap in the evaluation landscape that deserves scrutiny. The GitHub ecosystem is sorting into infrastructure for autonomous coding agents and specialized skills those agents need, with deterministic pipelines handling obvious tasks and LLMs handling judgment calls. The frontier has moved from asking whether models can be smarter to asking whether they can be reliable, specialized, and grounded in physical or temporal structure.

Grant Calloway

AI LabsAll labs
From the WireAll feeds
Research PapersAll papers
Objective vs. Search: Decomposing What Makes a Good Tokeniser cs.CL

Two dominant tokenisation algorithms are used by modern language models: byte-pair encoding (BPE) and UnigramLM. These differ along two orthogonal axes: their optimisation objective (compression vs. log-likelihood) and their search procedure (bottom-up merging vs. top-down pruning). Existing comparisons confound these axes, making it unclear whether their observed differences stem from what is being optimised vs. how it is being optimised. We disentangle the two by introducing two new tokenisation algorithms that complete this 2x2 design space: BottomUpLL, a bottom-up likelihood-based tokeniser, and TopDownComp, a top-down compression-based tokeniser. We train language models with tokenisers produced by each algorithm, varying: model size, vocabulary sizes, and domain (English-only vs. multilingual). Evaluating models on bits-per-byte, we find that the search procedure -- not the objective -- is the dominant factor: bottom-up tokenisers consistently achieve lower bits-per-byte in most settings. Evaluating models on the BLiMP task, however, shows no consistent relationship between design choice and performance. Overall, our results disentangle the effect of tokeniser design choices on language modelling performance, offering concrete guidance for their more principled construction.

A Zeroth-Order Paradigm for LLM Preference Alignment cs.CL

Direct preference alignment methods are widely used to align large language models (LLMs) with human preferences because of their computational and memory efficiency. However, likelihood displacement motivates alternative ways to extract information from preference pairs with small likelihood margins. In this paper, we propose and analyze Comparison-based Preference Optimization (ComPO), a zeroth-order alignment method based on comparison oracles. ComPO extracts directional information from these pairs without directly optimizing a differentiable preference loss on them. We establish a convergence guarantee for its basic offline scheme under smoothness, gradient sparsity, and compatibility between the oracle and a latent objective. We further introduce online ComPO, which retains the offline comparison mechanism and uses unlabeled policy generations for reverse-KL control relative to a reference policy. Following the coverage perspective of preference fine-tuning, we establish a performance guarantee for a basic constrained scheme under local coverage and in-distribution pairwise reward accuracy. Experiments on Mistral, Llama, Gemma-2, Qwen3, and Gemma-3 models demonstrate improvements over existing direct alignment methods, including length-controlled win rates, with pair-level diagnostics providing evidence consistent with mitigating likelihood displacement.

PANORAMA: Panoptic Grounded Captioning via Mask Proposal Selection cs.CV

Intelligent systems that act in the world require image understanding that is both comprehensive and spatially grounded. Current vision-language models (VLMs) can generate fluent and detailed image captions, but reliably associating them with image pixels remains challenging. Existing methods that combine dense captioning with pixel-level grounding often produce either incomplete descriptions or inaccurate segmentation masks. We study this problem through panoptic grounded captioning, a task that requires a VLM to describe both foreground objects and background regions while grounding each referring phrase with pixel-level masks. We make three contributions. First, we introduce PanoCaps, a human-annotated benchmark constructed from panoptic segmentation datasets. It provides dense captions with near-complete pixel coverage and image-text alignments at the entity level, supporting both training and evaluation. We further propose a phrase-mask matching protocol and a generalized Panoptic Quality (gPQ) metric that jointly evaluates textual and mask agreement. Second, we formulate phrase grounding as selection from a phrase-conditioned pool of mask proposals and introduce PANORAMA, a VLM that conditions a pretrained segmenter on contextualized phrase representations to obtain candidate masks and learns to select those corresponding to each phrase. Training this interface jointly with caption generation enables PANORAMA to produce high-quality masks while allowing each phrase to refer to a single region or multiple instances. Third, PANORAMA achieves the best overall grounding on PanoCaps and matches or exceeds specialized models across several pixel-level grounding tasks. Experiments show that our method produces precise entity-level segmentations while maintaining detailed, mask-consistent captions. Code, data and models are available at https://www.di.ens.fr/willow/research/panorama/.

Dreaming the Sound of Contact: Leveraging Video and Audio Generation for Zero-Shot Force-Aware Manipulation and Data Generation cs.RO

Recent advances in video generation allow robots to learn manipulation trajectories from generated videos. However, these approaches produce purely kinematic trajectories that lack force information, causing failures in contact-rich tasks where appropriate contact forces are essential for success. In this work, we explore augmenting generated video with audio to shape a bounded, time-varying desired-force profile using the loudness of generated contact sounds. We present a pipeline that jointly leverages generated video and audio to derive motion trajectories and corresponding desired-force profiles from a structured natural-language task prompt. We execute these force-aware trajectories on a Franka Panda robot using a closed-loop force regulator that tracks the audio-shaped force profile during contact. We evaluate our pipeline on multiple tasks that require making contact and demonstrate successful manipulation where a kinematic-only baseline fails. We also use the pipeline as a data generation engine to train policies that achieve the tasks in a closed-loop manner. Project website, videos, and dataset: https://dreamingcontactsound.github.io/

Exponential Hardness of Off-Policy Evaluation under History-Dependent Logging cs.LG

Can a logged dataset visit every hidden state frequently and still be exponentially uninformative about a target policy's value? We show that it can when the logger depends on history. For every horizon $H \ge 3$, we construct two POMDPs with at most two latent states per stage, three actions, and a common logger with three memory states. Action coverage, belief coverage, and two behavior-marginal outcome-revealing conditions all have constants independent of $H$. Nevertheless, evaluating a known deterministic target policy to accuracy $1/8$ requires $Θ((3/2)^H \log(1/δ))$ logged episodes at confidence $1-δ$, for $0 < δ\le 1/4$, even when both candidate models are known. The mechanism is simple: a reset erases the unknown transition that determines the target value. We characterize the resulting statistical experiment exactly and obtain a matching optimal estimator. A directed two-lane gridworld realizes the construction, and trajectory simulations agree with its finite-sample prediction. The result establishes intractability for the history-dependent-logging, model-based case posed by Zhang and Jiang (2025, arXiv:2503.01134), under their behavior-marginal definition of revealing.

ScienceIDE: Turning World's Scientific Codebase into Agent Learnable Environments cs.CL

Scientific code repositories encode decades of human knowledge in executable models, methods, and tools. Yet fragmented toolchains, implicit domain conventions, and specialized correctness criteria make this knowledge difficult to convert into reliable learning experience-a challenge we call the scientific experience bottleneck. We introduce ScienceIDE, infrastructure for turning the world's scientific code into programmable environments for scientific agents. Guided by expert-defined scientific cases and acceptance criteria, agents transform repositories into executable environments that support task generation, execution, and scientific verification. These environments provide a shared foundation for supervised fine-tuning, reinforcement learning, and evaluation. Using verified interaction trajectories, we train PhAI-IDE-72B, PhAI-IDE-9B, and PhAI-IDE-4B. The model family shows gains in held-out scientific-code repair and across selected general-purpose benchmarks in code, reasoning, and knowledge, providing evidence of positive transfer from scientific experience to broader capabilities. ScienceIDE lays the foundation for an integrated workspace for agent learning and scientific practice, making humanity's scientific software a shared substrate for developing scientific intelligence. Code: https://github.com/aitofound/ScienceIDE

BenchmarksFull tables
Artificial AnalysisIntelligence Index

Composite score across coding, math, and reasoning

#ModelScoretok/s$/1M
1Claude Fable 5.153.469$20.00
2GPT-6 Astra52.857$20.00
3Claude Opus 550.755$10.00
4Claude Fable 549.769$20.00
5Muse Spark 1.348.2251$2.00
SWE-rebench

Agentic coding on real-world software engineering tasks

#ModelScore
1AnthropicFable 5 [high]Model64.5%± 1.41%
2GrokGrok 4.5 [high]Model63.8%± 0.60%
3AnthropicOpus 5 [high]Model63.4%± 1.35%
4Z.aiGLM-5.2 [high]Model62.9%± 1.19%
5OpenAIGPT-5.6 Sol [medium]Model62.3%± 1.83%