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The AI boyfriend business is booming

Also: Zuckerberg - Open Source AI Is the Path Forward

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AI KATANA
July 24, 2024

Morning,

Welcome to our new subscribers!

In today's newsletter, we explore the burgeoning market for AI companions, particularly the rise of AI boyfriends via apps like Replika and Nomi, offering emotional support and customizable interactions. A study reveals that over 70% of Thai people utilize AI daily for its convenience and efficiency. Alphabet, Google's parent company, sees a dip in ad sales growth amidst heavy AI investments. Mark Zuckerberg emphasizes the importance of open-source AI at Meta. We also examine Vice President Kamala Harris's approach to AI regulation and OpenAI's latest leadership restructuring. Additionally, Adobe and Samsung release innovative AI tools, and the legal AI firm Harvey secures $100 million in funding.

Sliced:

  • 🙋🏻‍♂️ The AI boyfriend business is booming

  • 🇹🇭 Majority of Thai people use AI in their daily lives for its convenience: study

  • 📈 Google Parent’s Ad Sale Growth Slows as AI Investments Soar

  • 🤓 Zuckerberg - Open Source AI Is the Path Forward

  • 🇺🇸 A Kamala Harris Presidency Could Mean More of the Same on A.I. Regulation

  • ⚠️ OpenAI assigns new project to AI safety leader Madry in revamp

The popularity of AI boyfriends from Replika and Nomi is on the rise, particularly among women seeking emotional connection and support. These AI companions offer a sense of empathy and reliability that some users find lacking in human relationships. Apps like Replika and Nomi allow users to customize their AI avatars and engage in conversations, which can include text, voice, and video interactions. Users report high engagement, with these apps seeing significantly more user sessions than other types of AI applications. However, there are concerns about the impact on human relationships and potential privacy risks, as users' personal data may be used to train these chatbots. Despite these concerns, the trend highlights a shift in how people are seeking and forming intimate connections in the digital age.

A recent study by BBDO Bangkok reveals that over 70% of Thai people integrate AI into their daily lives for its convenience, primarily to save time and enhance efficiency. The research indicates a significant trust in AI, with 48.23% of respondents appreciating its potential to assist with work, while 40.60% value its time-saving capabilities. Despite this, concerns about personal data security and cost remain, particularly among women and men, respectively. The study also highlights generational differences in AI use, with younger generations utilizing it for work and older generations for safety and medical benefits. Top recognized AI brands include Google, ChatGPT, and Samsung, with strong expectations for AI adoption in mobile, medical, home appliance, automotive, and finance industries.

Alphabet, Google's parent company, experienced a slowdown in advertising sales growth in the second quarter of 2024, reporting an 11.1% increase to $64.6 billion, down from the previous quarter's 13% growth. Despite this, Alphabet's total revenue rose 13.5% to $84.7 billion, and net income increased by 28.6% to $23.6 billion, exceeding Wall Street expectations. Significant investments in AI and technical infrastructure contributed to increased capital expenditures of $13.2 billion, a 91.4% rise from the previous year. Google's cloud business saw a slight acceleration in growth, while YouTube's ad revenue growth also slowed. Alphabet's shares dipped 1.4% in after-hours trading due to concerns over future operating margins. Additionally, Google reversed its plan to eliminate cookies from Chrome, opting to provide users with a choice to disable them, while continuing to invest in privacy-focused advertising tools.

Meta CEO Mark Zuckerberg advocates for open source AI, drawing parallels to the success of Linux in transforming high-performance computing. He announces the release of Llama 3.1 models, including a frontier-level 405B model, emphasizing their superior cost-performance and adaptability for fine-tuning. Meta collaborates with companies like Amazon and NVIDIA to enhance the ecosystem, offering extensive support for developers. Zuckerberg argues that open source AI ensures security, affordability, and innovation, preventing dependency on closed systems. He highlights the potential for open source AI to democratize access, enhance safety through transparency, and drive global economic growth and technological advancement.

As the presumptive Democratic presidential nominee, Vice President Kamala Harris has played a significant role in shaping AI policy, advocating for voluntary safety standards among major tech companies and pushing for federal regulation. Her tenure as AI czar included convening tech leaders and crafting an executive order on AI governance. Despite her efforts, Congress has yet to pass substantial AI legislation. Harris's balanced approach combines industry engagement with calls for accountability, reflecting her background in tech regulation as California's Attorney General. Her presidency would likely continue this trajectory, maintaining a collaborative yet scrutinizing stance towards AI innovation and regulation.

OpenAI is undergoing a reorganization, with CEO Sam Altman announcing that AI safety leader Aleksander Madry is now focused on a new significant research project. Meanwhile, executives Joaquin Quinonero Candela and Lilian Weng will manage the preparedness team, which assesses the readiness of AI models for artificial general intelligence. This change follows OpenAI's formation of a Safety and Security Committee to oversee the development of new AI models, addressing the growing concerns about the safety and ethical implications of increasingly powerful AI technologies.

🧑🏽‍💻 AI Jobs

🛠️ AI tools updates

Adobe has launched new Firefly AI tools for Illustrator and Photoshop, enhancing the capabilities of graphic designers. These tools enable users to generate AI-based textures and images through brief text prompts, significantly reducing the time required for such tasks. In Illustrator, the "Generative Shape Fill" tool allows the addition of details and textures to shapes, powered by an updated beta version of the Firefly Vector model. Photoshop now includes a broadly available text-to-image generator, previously in beta, that allows users to create AI images by simply describing them. Adobe emphasizes a creator-friendly approach, providing Creative Cloud customers with a limited number of generative credits at no extra cost. The integration of AI tools is driving higher conversions to pricier plans, contributing to Adobe's financial performance, as Firefly has generated over 9 billion images since its launch in March 2023.

Samsung's new AI image-generating tool, featured in the Galaxy Z Fold 6, transforms rough sketches into detailed images with remarkable accuracy. The tool, called "sketch to image," allows users to draw on photos or blank notes and then uses generative AI to create realistic images. This technology convincingly integrates AI-generated elements into photos, making it difficult to distinguish them from real ones. While the feature offers fun and creative possibilities, such as adding whimsical elements to images, it also raises concerns about the potential for generating convincing but fake images. This capability, combined with Samsung's plans to expand AI features to millions of devices, highlights both the innovative potential and the ethical implications of advanced AI tools in consumer technology.

💵 Venture Capital updates

The midyear forecast for 2024 highlights several key trends in the tech and startup sectors. AI remains the dominant focus in venture capital, with funding for AI-related companies surging to $24 billion in the last quarter, nearly doubling year-over-year. This growth is driven by substantial investments in generative AI chips, which are in high demand for their cost-efficiency and performance. The semiconductor industry also saw a 25% increase in funding, with significant rounds for companies like PsiQuantum and Celestial AI. Despite expectations, mergers and acquisitions (M&A) activity remains low, influenced by high valuations, regulatory uncertainties, and the upcoming November elections. However, optimism for an M&A revival persists due to a backlog of strong, still-private companies. Additionally, debt financing is becoming more attractive, particularly for high infrastructure investments in cleantech and AI sectors, as interest rate cuts are anticipated. Notably, large debt rounds have been secured by companies like CoreWeave and Northvolt, indicating a trend towards less dilutive funding options for scaling.

Legal AI startup Harvey has raised $100 million in a Series C funding round led by GV, Alphabet Inc.’s venture capital arm, with participation from OpenAI, Kleiner Perkins, Sequoia Capital, Elad Gil, and SV Angel. This round values the company at $1.5 billion. Founded in 2022, Harvey offers AI tools to assist lawyers in drafting and analyzing legal documents and conducting research in legal, regulatory, and tax domains. The funding will support the company's growth and development of its AI capabilities, amidst a backdrop of increasing investment and interest in AI technologies within the legal sector.

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