Welcome to the Techmeme Ride Home for the final day of July 2024. I'm Brian McCulloch today. Another big pullback of a major AI tool, Microsoft Earnings, how CapCut is taking over the Creator Tools space, Amazon's speedy delivery is rolling out to the nooks and crannies of North America, and the start-up taking a new run at AI wearables. Here's what you
miss today in the world of tech. As part of that move to AI Studio, we told you about Meta has officially scrapped its celebrity AI chatbot feature less than a year after launching it, quoting the information. The reversal less than a year after Meta launched the celebrity chatbots shows how even the biggest tech companies haven't figured out how to
transform breakthroughs in generative AI into winning consumer products. None of the AI chatbots amassed particularly big filings, especially compared with the personal accounts of the celebrities. In some cases, Meta paid millions of dollars to license these celebrities' likenesses, links to the accounts of the celebrity chatbots on Facebook and Instagram return to message Tuesday, saying the pages are not available. Meta is now taking a different approach to AI chatbots.
On Monday, the company rolled out a new feature called AI Studio in the US, allowing any creator to customize AI avatars of themselves to answer common questions from fans, such as where they bought a dress or offering a link for a workout video. This feature is similar to one offered by startup Character AI, which had an early lead in consumer chatbots, but has since considered research partnerships
with companies including Meta. A Meta spokesperson confirmed the chatbots take down saying, in a statement quote, we took a lot of learnings from building them and Meta AI to understand how people can use AI to connect and create unique ways. The company expects people including celebrities to use AI Studio to customize their own AI avatars instead. Microsoft reported earnings yesterday. There's not really much that I can see in this to highlight.
Revenue was up 15%. Net income up 10%. Office commercial revenue linked in revenue all up. Yada Yada. The all important intelligent cloud revenue was up 19%. Azure and other cloud services up 29%. The stock is trading down about 1% in pre-market. The only real news I can drag out for you, maybe signs of a gaming rebound. Gaming revenue was up 44% year on year, and Xbox content and services was up 61% year on year. Bloomberg takes a look at CapCut, a video editing platform
that is huge. Like the reason TikTok and Instagram look the way they do is because basically everybody is using CapCut to make their short form videos. CapCut is owned by Bite Dance, which owns TikTok. But I also didn't realize how huge CapCut is. CapCut has more than 318 million monthly active users. And that's just outside of China. Compare that to Canvas, 97.4 million mows. And CapCut is making money too to get those pro-level video effects that everybody uses.
quoting Bloomberg. The app is a streamlined tool for making videos, especially with effects popular on TikTok. The social platform also owned by Bite Dance. Since launching outside China in 2020, CapCut has picked up more than 300 million monthly mobile active users. And commands 81% of the total active users for mobile video editing according to market intelligence firm sensor tower. That sudden dominance is tough news for Adobe. The longtime leader in desktop
creative software. Its investors have worried that users would leave behind complicated professional oriented applications like Photoshop for simplified tools made by startups like Canva or more recently OpenAI. Jalen, a lifestyle content creator with nearly 20,000 TikTok followers who asked to be identified by his first name, said he was drawn to CapCut because of its simple interface and popularity with other TikTokers. CapCut templates let users quickly match video formats and export
finished content directly to TikTok. Posted videos are watermarked with a CapCut link inviting viewers to try the template themselves. The whole app is quote, very user friendly and ergonomic. Jalen said, Mass adoption of CapCut threatens the pipeline of new users to Adobe's premiere pro or after effects where video makers traditionally land when they need more advanced tools, said Tyler Ratke and analyst at City Group. The emergence of generative AI based tools such as OpenAI
Sora threatens to further complicate the picture he added. For now, more seasoned video makers such as freelance advertising editor Brianna Thompson still rely on Adobe for complex projects, but she and other professionals have started using CapCut for simpler videos. In comparison to Adobe, it's not all the way there yet, but it's really accessible, she said.
And with a new desktop app, suite of tools for small businesses and a pro version priced at $9.99 per month in the US, CapCut is branching further into professional users. Since her tower estimates CapCut has made $125 million so far this year on mobile,
a spokesperson for Bydance Declined a Comment. Adobe has been developing a slimmed down version of premiere aimed at casual users that would run in a web browser, according to a person familiar with the issue who asked not to be identified because they weren't authorized to discuss the topic. And Adobe spokesperson Declined a Comment. Thus far, though, Adobe's attempts to gain share in the mobile editing market have not panned out.
It's two apps that can edit video have less than 2% of the active users of CapCut, according to the sensor tower data. Canva, an Australian software firm that is among the world's most valuable startups, has been viewed as a disruptor in creative software. But the company's efforts to build the definitive all-in-one visual media editor may be stymied by the rise of CapCut. Canva has been, quote, continuously investing in video, head of product Rob Kowalski said in a
statement. Social media video creation on Canva is up 44% compared with last year, a spokesperson said. Bydance's better known app, Tiktok has been the subject of long-running concern from lawmakers about potential security threats to users from the Chinese government. In April, President Joe Biden signed a law to give Tiktok 270 days to find a buyer or be banned
in the US with some possibility of an extension. That divest or ban law was written to include CapCut, according to an aide to a House Democrat who worked on the bill and wasn't authorized to speak publicly. As part of Tiktok's appeal to the US Justice Department against the potential ban, multiple creators touted the ease of use of CapCut. While the CapCut development team is separate from Tiktok, US employees share office space in Los Angeles, according to a person familiar with
the company who asked not to be identified. The division is led by Bydance executive Kelly Zhang, who in her previous role headed Tiktok's domestic sibling, Duoyen. Content creator and video editing instructor Camilo Castaneda said, a CapCut ban would provide an obstacle for those starting out with video making or balancing it with a different job. He has already seen the effects on his students in India where Tiktok and CapCut have been banned since 2020 over data privacy concerns.
Those tools have allowed people to without friction create content. For those apps to go, you're literally losing a whole revenue stream, he said. If you're listening to me right now from a rural location, guess what? You might be getting your Amazon orders a lot faster. That's because Amazon is expanding its one to two day delivery capabilities to US rural areas using hyper-efficient warehouses, contracted drivers, and mom and
pop shops. Quoting the Wall Street Journal. Amazon's goal is to increase its shipping volume and have more control over its deliveries. The company is seeing demand in more remote pockets of the country and betting that offering faster delivery to rural customers increases the rate at which they purchase items. By increasing its volume, it can offset the higher delivery costs with the fees it charges its sellers. Amazon isn't trying to deliver itself to 100% of its customers in the US,
but as of now, is targeting around 90% people familiar with its plans said. Amazon said it now delivers more than two thirds of its own packages in America. Maya Valtier, an Amazon spokeswoman said, expanding the rural delivery network, quote, will help cut delivery times for customers in smaller towns and more isolated parts of the country. The rural push comes as Amazon has pinned down what customers want and where demand is. Many people moved to live and work remotely during the COVID-19
pandemic, and the company is pushing to expand categories such as medicine delivery. As Amazon has gotten better at delivery, it has become economically practical to do it in more places. Said Josh Loetz, co-founder of Consumer Intelligence Research Partners, which studies Amazon Prime members, have learned that they can do it. Amazon is opening optimized delivery centers that are smaller than its traditional warehouses and closer to rural areas and increasing the level of
automation across its delivery network. It is using contracted drivers and enlisting small businesses to at times handle deliveries and store packages for customers to pick up. Amazon's remote expansion includes small cities and towns in Arizona, Minnesota, Louisiana, and Texas. Amazon's outreach is also a way to lessen the company's exposure to the U.S. Postal Service. The U.S. PS has been raising rates and reducing pickups in some areas to compel shippers to use more of the
Postal Services Network. The U.S. PS has said it wants to modify contracts to end discounts to shippers dropping parcels off at delivery units just for the difficult final mile of deliveries. Amazon's deeper dive into remote pockets is a strategy to maintain a competitive edge against its fiercest rivals. Walmart, which has thousands of stores and rural areas, has been expanding a service called Go Local that delivers packages for other retailers, quote, anywhere in the U.S.
Through third-party contractors, E-commerce company Temu, which has risen in popularity in the U.S. because of its bargain prices, relies on carriers that include the U.S. PS. Duluth, Minnesota, is an area where Amazon is expanding. The company plans to open its first delivery site in the city in an industrial park area that was once the home of a steel plant.
The greatest beneficiaries of the new Amazon site will be the areas near Duluth said Daniel Fanning, Vice President of Strategy and Policy of the Duluth Area Chamber of Commerce. He pointed to places in Minnesota like Ellie, which has a population of about 3,200 and Grand Maurei, with a population of roughly 1,300 according to the latest census figures. Customers and those in similar remote areas sometimes wait 3-5 days for some Amazon packages,
Fanning said. That time could be soon cut in half, he said. Some people that order medicine or other important things could benefit, he said. A search of Amazon's products makes the company's ambitions clear. A pack of water wipes, baby wipes, one of Amazon's most in-demand products can take a day or less to get to San Francisco area zip codes. The same item showed several days to get to Ellie. A pack of charmin toilet paper showed similar results. Amazon wants to bridge that gap. End quote.
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With almost any project, it can be hard to visualize it. To even keep your vision in your head or share that vision with others. Many tools like Gira can be restrictive in the way they organize information, your ability to see all tasks is restricted by the size of your screen, which can make it harder to understand the relationships between tasks, especially between different teams or
epics. Miro is a visual collaboration platform that gives your team more clarity through comprehensive functionalities that work together with your existing toolsets to make any sprint ritual, whether it be a stand-up estimation, sprint planning, or retrospective, more efficient, clear, and ultimately more productive. When I did the AI project, I used Miro to work with my
remote team because I wanted to do it quick and dirty. It was a sprint. And we got it done. With Miro planning team tasks is smoother and gives everyone a clear sense of mission for every sprint. You can even plan sprints with ease using Miro's planner widget. Connect your team's Gira or Azure Instance to your Miro board to visualize and filter tasks by sprint week, status, epic, and team. Whether you work in product design, engineering, UX, agile, or marketing, bring your
team together on Miro. Your first three Miro boards are free when you sign up today at Miro.com. That's three free boards at MIRRO.com. Finally, today, there's a new start-up looking to take on the AI wearable space, despite the recent high-profile failures in that space. A company called Friend has prefued a $99 AI pendant with an always-on microphone that's designed to provide the wearer with companionship. This is set to ship in January. Goatting wired.
Abby Schiffman shows up at the wired offices with a friend hanging around his neck. It dangles there like a pendant on a necklace. It's about the size and shape of an air tag, a soft round little puck that rests right next to Schiffman's heart, just atop the dark side of the moon logo on the t-shirt behind it. The Friend, to be clear, is an AI wearable. It's a pal, a buddy, but mostly
an AI chatbot that lives inside the pendant. It always has an opinion to share about what's going on around it, which it communicates using text messages and push notifications on the phone. It's paired to Schiffman and his friend, this one's named Emily, have come to wired San Francisco office to meet with me and my colleague, Reese Rogers, to talk publicly about this new AI wearable for the first time. Always listening is one of the main taglines of Schiffman's as yet
unreleased AI device. The friend has an onboard microphone that listens to everything happening around the wearer by default. You can tap and hold it to ask a question, but sometimes it will send messages commentary about the conversation you just had, for example, unprompted. It is powered by Anthropics AI Cloud 3.5 large language model, which can engage in
helpful conversation, offer encouragement, or review for being bad at video games. The friend gets around 15 hours of battery life and comes in an array of colors that look almost exactly like the color palette of the first Apple iMac computers. Schiffman says that wasn't intentional. The design comes from a partnership with Bold, the company that designed nest thermostats. The friend is available for preorder now from friend.com. A domain Schiffman says he paid 1.8
million dollars for, and the devices are slated to start shipping in January 2025. They cost 99 dollars a piece, and there is no paid subscription attached yet anyway. If the notion of a wearable AI device makes you feel like your eyebrows have risen high enough to be seen from space, you'd be forgiven for your skepticism. In recent months, the nascent
product category has had a couple very prominent and spectacular flame outs. Humane, which promised a wearable pin that could accomplish tasks that would free you from your phone, turned out to be barely competent and also unable to function properly in sunlight. The Rabadar 1 is a gorgeous colorful little device designed by the God tier gadget design company Teenage Engineering that wound up being a frustrating dud that probably should have just been an app all along.
It feels to me like the crown of AI hardware and AI companionship is lying in the gutter, Schiffman says. Like all these companies just shut themselves. Schiffman wants the friend to be something very different. While the Humane AI pin and Rabadar 1 both aimed to automate and accomplish tasks and increase productivity, the friend doesn't try to automate or optimize anything. As my colleague Reese put it, it's much more vibes based than productivity focused.
The friend purely offers companionship. It's meant to develop a personality that compliments the user and is always there to guess you up. Chat about a movie after watching it or help analyze how bad a date went. Not only does Schiffman want the friend to be your friend, he wants it to be your best friend. He wanted that is with you wherever you go listening to
everything you do and being there for you to offer encouragement and support. He gives an example where he says he recently was hanging out playing some board games with friends he hadn't seen in a while and was glad when his AI friend chimed in with a quip. So there's lots of snark around this story along the lines of what Keaton English tweeted. Raised 1.9 million, spent 1.8 million of it on a domain. Built a Bluetooth microphone that listens to everything
that you say and sends it to an AI wrapper. Yeah, but I don't know. I might have taken a swing on this one as an investor. But I'm also including the link to the launch video as the last link in the show notes today because I would also give you even odds that this is just some sort of elaborate art projects or prank. Nothing more for you today. Talk to you tomorrow.