April 13 2023 - Inflation, AI and Pepsiman

👋It's Thursday, and I just learned about Pepsiman yesterday. Let's get into it.  

US inflation eased to 5% in March, the lowest level in nearly two years, due to lower prices for groceries, gasoline, medical care and utilities, according to the Labor Department. However, underlying price pressures remain high, with core prices rising 5.6% in March from a year earlier, only slightly less than the previous month. The Fed has raised interest rates nine times in the past year to combat inflation, and officials may consider another increase at their May meeting, but will be closely monitoring economic activity and lending conditions following recent midsize bank failures.

Juul has reached a $462 million settlement with several states, including New York and California, to resolve thousands of lawsuits claiming the company aggressively marketed its e-cigarettes to young people and fueled a vaping crisis. The settlement brings to an end many of the company's legal woes, with settlements already reached with 47 states and territories, and 5,000 individuals and local governments. Despite not admitting wrongdoing in the agreement, Juul Labs' efforts to broker deals over the lawsuits have cost the company nearly $3 billion so far.

Universal Music Group has sent a letter to streaming platforms like Spotify and Apple Music, urging them not to allow artificial intelligence (AI) to use copyrighted songs for training. The record label fears that AI labs will use millions of tracks as training data for their models and create copycat versions of pop songs. The move follows a similar one from the Recording Industry Association of America last October, which warned that AI-based technology could be similar to or almost as good as reference tracks by well-known sound recording artists.

Warner Bros. Discovery has announced that it will rebrand its streaming services HBO Max and Discovery+ under a new single brand called Max. The new service is set to launch on May 23, with a new tagline, color, and mission. Max will replace the HBO moniker and is intended to encapsulate the full breadth of content that the combined service will offer, including the Looney Tunes brand and a new Harry Potter series featuring a new cast. The company reported 96.1 million total direct-to-consumer subscribers at the end of 2022 but also experienced a more than $200 million fourth-quarter loss in the streaming segment alone.

TikTok's ad revenue is expected to increase by 51.7% YoY in 2023, reaching around $15.2 billion, according to a report by WARC Media. The report also predicts that technology and accessories will be the leading ad-spending sectors, followed by cosmetics and retail. Clothing and accessories was the leading ad-spending sector in 2021, while technology and electronics took the lead in 2022. In 2022, the short video app generated almost $10 billion in ad revenue, three times more than in 2021, despite being banned in some countries.

Nordstrom Rack has updated its logo for the first time in more than a decade as part of a new brand identity. The off-price retailer hired branding agency Jones Knowles Ritchie in late 2021 to develop a new branding system. The resulting identity, which includes a fresh logo and brand colours, features a plumper retro font that is intended to be more compatible with digital and mobile formats. The new logo will be used on store signage, online and in advertising. Nordstrom Rack's traditional blue colouring has been evolved to include multiple shades of the hue.

• Apple has been granted a patent outlining the use of a ring to control objects while using its upcoming mixed-reality headset, the Reality Pro. The idea is to perform skin-to-skin contact gestures on the ring, which will allow the headset to detect a range of movements and enable users to perform various tasks. The use of a ring for gesture control is an interesting approach, as previous patents have focused on using Apple Pencils or thimble-like devices to enable hand-tracking.

• Peruvian beer brand Pilsen Callao partnered with DDB Latina's Fahrenheit DDB and FTW DDB Peru to create AI bots called  that can translate in-game conversations into gamer sign language in real-time, helping deaf gamers to participate in online gaming. The project took nearly a year to develop an algorithm capable of identifying the voice of every player and integrating it into a visual response. The next step was to help deaf gamers respond using their voice through facial recognition, within Discord, without relying on written responses.
• Paramount+ has partnered with Formula 1 for the 2023/24 season, with the deal including Paramount+ branding trackside, as well as in Fan Zone areas and through digital sponsorships and promotions. The streaming platform has increasingly focused on sports content, with the NFL, UEFA Champions League and PGA Tour golf all available. Marco Nobili, EVP and International General Manager of Paramount+, said the deal would bring "the worlds of motorsport and entertainment" together.

• A new study by the Allen Institute for AI has found that ChatGPT, a large language model, can become toxic by changing its assigned persona in the system settings, which can be accessed by anyone using OpenAI’s API. Nearly 100 personas from diverse backgrounds were examined across over half a million ChatGPT output generations, and the model carried inherent toxicity that was heightened up to six times when assigned a diverse range of personas, such as historical figures, profession, etc. The research is significant because assigning personas is often a key part of building a chatbot, and while many have assumed ChatGPT’s bias is in the training data, the model can develop an “opinion” about the personas themselves.
• Ed Meyer, the former CEO of Grey Advertising, has passed away at the age of 96. Meyer joined the company in 1956, and during his 36-year tenure as CEO, he built Grey into one of the world’s biggest agencies, with diversified businesses across multiple disciplines. He sold the agency to WPP for $1.52 billion in 2005, making it the only major independent agency among the Madison Avenue giants at the time. Meyer is credited with transforming Grey into a global powerhouse and nurturing strong, account-driven relationships with clients, including P&G, one of the agency's biggest clients.
• Snap has hired Darshan Kantak, the former Vice President of Google Search Ads, as Senior Vice President of Revenue Product. Kantak's role is to help Snap enhance the performance of its digital ads. Before joining Google, Kantak held positions at Facebook as Ads Delivery Product Lead and Microsoft as Partner, Group Program Manager for Bing Ads. The hiring comes as Snap looks to rebuild its ad-sales team after two key leaders left for Netflix last year.
• The Incredible History of Pepsiman
• Apple's high-yield Savings account could launch soon as it is now active on the backend. The service was announced in October 2022 and was included in the terms and conditions for Apple Card in March 2023, bringing it closer to release. Users will be able to direct their Daily Cash rewards earned from Apple Card into the high-yield account, which will be provided by Goldman Sachs.

• The out-of-home OOH advertising industry has rebounded from the pandemic thanks to digital out-of-home. DOOH has been growing faster than the overall US ad market, with its second consecutive year of double-digit growth at 24.2% in 2022, according to the Out of Home Advertising Association of America. Yet, there's still room for more growth, as OOH only accounts for slightly more than 2% of total US ad spend. DOOH must adapt to the automated tools marketers use for measuring and buying against performance before we see substantial growth in ad spend.
• HBO has announced the series order for "A Knight of the Seven Kingdoms: The Hedge Night," a Game of Thrones prequel series based on George R.R. Martin's Dunk & Egg fantasy novellas. The show is set a century before the events of Game of Thrones and follows Ser Duncan the Tall and his squire, Egg. The series was written and executive produced by Martin and Ira Parker, with Ryan Condal and Vince Gerardis as executive producers. HBO is currently producing the second season of House of the Dragon, another Game of Thrones prequel, and has a Jon Snow spinoff in the works.
• NPR has announced that it will no longer post content to its 52 official Twitter feeds after being labeled as "government-funded media" on the social media platform. The label is described by NPR as "inaccurate and misleading," and the organization noted that it is a "private, nonprofit company with editorial independence." NPR CEO John Lansing has stated that he has "lost faith" in Twitter's decision-making and will need time to understand whether Twitter can be trusted again.
• Apple may be planning to launch its augmented reality "Apple Glasses" by 2026 or 2027 at the earliest, provided it can finalize new metalens technology. Metalenses are a flat lens technology that use metasurfaces to focus light, and they will replace plastic lens covers in a range of devices, starting with iPads and iPhones. Metalens covers will enter mass production in 2024 for use in Apple's Face ID system for iPad Pro, then iPhone in 2025 or 2026. If development goes as planned, they would eventually be used in Apple's AR glasses. Earlier this year, Bloomberg reported that some Apple employees do not believe that Apple will ever ship AR glasses, since most of Apple's AR/VR group is working on mixed reality headsets.
• Omnicom Group is undertaking a significant real estate consolidation across the US to reduce costs, including downsizing office space in Chicago, San Francisco, and Dallas. Omnicom agencies are expected to share space with other shops within the holding company to utilize office space that has remained empty following COVID-driven closures. Omnicom is aiming to accommodate 60-70% of its staff five days a week, requiring three days of in-person attendance from Wednesday to Friday. The move is cost-cutting as clients are not spending, and business is not changing quickly enough. However, the way the consolidation is happening in Chicago is upsetting some employees. Omnicom has not communicated plans or details adequately, and many agency workers do not know where they are going. There is also concern about consolidating agency brands within a single space and not muddying up the agencies to fix a real estate problem.
• Fuzzy Door Productions, Seth MacFarlane’s production company, has launched Fuzzy Door Tech, a technology division to market its in-house tool, Viewscreen, which allows filmmakers to visualize and animate virtual assets in real-time. Fuzzy Door vfx supervisor Brandon Fayette and software developer Gene Reddick created the software. Fuzzy Door Tech has appointed former Siri chief marketing officer Faith Sedlin as president of the new division. Sedlin will oversee all technology development and operations, including Viewscreen.
• ByteDance's new app, Lemon8, is gaining popularity in the United States despite growing national security concerns surrounding the Chinese-owned company. Lemon8 caters to a Gen Z audience with its mix of TikTok-like videos and Instagram-like photos. The app's aesthetic is more colorful and artsy than TikTok's, resembling Pinterest in some ways. Lemon8 has been downloaded 17 million times globally since its launch and has been installed 650,000 times in the US in the past week and a half. Japan is Lemon8's biggest market, representing 36.5% of its lifetime downloads.

Incredible headline from The Verge

How to Cartoon Book: "Points on Cartooning" by George Carlson (1937)

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