May 30 2023 - Headset Wars + AI

👋Happy Tuesday friends and welcome back. It was light on news over the long weekend, so let's ease back into into things.

Quick Take

• As we lead up to WWDC and Apple's MR headset debut, Meta takes Mark Gurman on a PR tour of the upcoming Quest 3
• Agencies sprint to formalize their AI offerings + partnerships

The Meta Quest 3 (codenamed Eureka) will be "far lighter and thinner" than its predecessor, the Quest 2. The report suggests that the Quest 3 will feature fancy hand-tracking and pass-through video, similar to what is expected from Apple's rumored VR/AR headset. The Quest 3 is said to have a second-generation Qualcomm Snapdragon XR2 chip for improved performance. Eye-tracking won't be included, which means foveated rendering won't be supported. The Quest 3 will feature redesigned controllers, more sensors, and an improved system for adjusting inter-pupillary distance. The pass-through video is described as "almost lifelike," with improvements in handling light and color.

Google Messages has introduced its AI-powered Magic Compose feature, which uses artificial intelligence to write out messages on your behalf. The feature is now available for testing in the beta version of the Messages app for Android. Users can choose from different writing styles, such as Remix, Excited, Chill, Shakespeare, Lyrical, Formal, and Short. The feature analyzes previous messages to learn about the user's writing style and conversation context, with Google assuring that the messages are discarded once AI responses are generated. However, concerns have been raised about the privacy implications and the authenticity of AI-generated text in personal conversations.

Microsoft's proposed $75 billion acquisition of Activision Blizzard is facing scrutiny from regulators who are concerned about the dominance of the Call of Duty video game franchise. Regulators, including the U.K.'s Competition and Markets Authority and the U.S. Federal Trade Commission, have cited Call of Duty as a central focus of their concerns about the deal. They worry that Microsoft could use Call of Duty to gain an unfair advantage in cloud gaming and potentially withhold access to the franchise from competitors. Microsoft's acquisition of Activision would add Call of Duty to its Xbox Game Pass subscription service.

• WPP has signed a deal with Nvidia to develop a generative AI-enabled content engine for digital ads. The partnership aims to harness Nvidia Omniverse and AI technology to enable creative teams to produce high-quality commercial content faster and more efficiently while maintaining brand alignment. The technology, called Omniverse Cloud, will allow WPP to use the same images, video, and AI-generated copy for personalized ad experiences for individual consumers.
• Outfront Media, the company responsible for selling ads on the the New York City Subway System, has launched programmatic advertising for the MTA's digital screens. This new approach allows advertisers to purchase ad space through a demand-side platform, targeting variables like time, day, and location.
• Nvdia showcased a demo at Computex 2023 that envisions a future where gamers can have natural voice conversations with AI game characters. The demo presented a cyberpunk ramen shop scene where players could speak to the proprietor and receive responses. Nvidia's technology, called Nvidia ACE (Avatar Cloud Engine) for Games, was used to create the demo, utilizing middleware tools like NeMo for language models and Riva for speech-to-text and text-to-speech. While the visual quality of the demo was impressive, the dialogue generated by the AI was lacking. Nvidia suggests that the technology has the potential to scale to multiple characters and allow NPCs to interact with each other, although not been fully tested yet.

• Kick, a new livestreaming service, is attracting streamers with a more generous revenue-split, allowing creators to keep 95% of their subscription revenue compared to Twitch's 50% split. A recent report shows the success of this approach, with Kick's hours watched increasing from 12.8 million in January to 51.8 million in April. The release of Kick's mobile app in March contributed significantly to this growth. Despite its progress, Kick still lags behind Twitch, which recorded 1.67 billion hours watched in April. Kick is following a strategy similar to other streaming services, such as Spotify, by quickly expanding its audience and bringing on popular streamers. Twitch's chief monetization officer downplayed the Kick threat, emphasizing their focus on creators' needs
• YouTube has announced an upgrade to its NFL Sunday Ticket offering, allowing users to watch unlimited simultaneous streams of NFL content on both YouTube and YouTube TV if they are at home. Previously, the limit was set at two screens. This change could lead to increased football viewing in households, especially with the introduction of YouTube TV's multiview feature.
• Jellycats, a line of plush toys, are becoming popular among young adults. These toys, featuring fruits, vegetables, and other objects with human-like faces and dangly limbs, are gaining traction on social media platforms. The scarcity of certain Jellycat designs has also created a resale market, with some toys fetching high prices on platforms like eBay.

• Warner Bros Discovery's streaming service, Max, is facing delays in fixing its credits issue, where writers and directors are grouped together under a single "Creators" category. The studio insiders state that it could take weeks to transfer, check, and finalize the data for the credits. The misattribution was unintentional and a result of rushed IT decisions to merge content from Warner Bros, HBO, Discovery, and other properties. The issue has drawn criticism from writers and filmmakers.
• Pixar's latest film, "Elemental," received a lukewarm reception at its premiere at the Cannes Film Festival. Critics praised the film's lush visuals but had mixed opinions about its script. Some reviewers found the film predictable and accused it of feeling like a product of an algorithm creating a formulaic Pixar movie. There were also comments about the forced world-building and a missed opportunity to explore themes more deeply. The visuals of the film were widely praised as visually dense and gorgeous. "Elemental" is set to release in theaters on June 16.

• D&AD Announces 2023 Winners
• MIK Studio expands into commercial content production
• The CEO of YouTube Has a Favorite Video and a Plan to Win Over Anyone Watching TV
• What’s the Best Background for Video Calls? Most People Get It Wrong
• U.S. Consumer Spending Jumped in April and Inflation Accelerated
• McDonald's and Chick-fil-A are tracking your location to make sure your fries are perfectly crispy when you come collect your mobile order
• The Witcher is getting a fifth season on Netflix
• John Wick 5 is already in ‘early development,’ according to Lionsgate
• At Cannes Film Festival, TikTok is inescapable
• PepsiCo elevates Tarun Bhagat as CMO, Indian beverages
• Gaming industry execs chime in on changing consumer habits and the the rise of AI in Q1 2023

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