Technology

➚ MOVE FAST: Turning down the pressure. While other companies are aggressively pitching their AI capabilities, Cisco CEO Chuck Robbins knows when to ease off. At a Semafor event, he said he told his staff to publicly discuss the hot technology only if they have specifics on what they will do with it, noting the market will determine who is just riding the AI wave.

➘ BREAK THINGS: Pressure cooking. The Instant Pot has solidified its place as the gadget version of a one-hit wonder. Its parent company filed for bankruptcy after seven quarters of declining sales. The device was a once-in-a-decade purchase, and efforts by the firm’s new private equity owners to entice consumers with other products, like an air purifier, ultimately failed.

The internet is increasingly being flooded with AI-generated content as more people begin using ChatGPT to create marketing campaigns, blog posts, and other material. A team of researchers from Cambridge University and the University of Toronto tried to figure out how all that synthetic text might influence the performance of large language models trained in the future. They found that programs relying on AI-generated content quickly lost their capabilities and became vulnerable to a phenomenon they dubbed “model collapse.”

“Just as we’ve strewn the oceans with plastic trash and filled the atmosphere with carbon dioxide, so we’re about to fill the Internet with blah,” writes Cambridge University professor Ross Anderson. “This will make it harder to train newer models by scraping the web, giving an advantage to firms which already did that, or which control access to human interfaces at scale.” In other words, your old LiveJournal and Tumblr blogs are about to become a precious asset.

Klarna CEO Sebastian Siemiatkowski talks about how AI will shake up shopping.

Q: Klarna has taken the AI revolution seriously with a revamp to TikTok-style content that’s hyper-targeted based on user interests. But another vision of the AI-enabled future seems almost the opposite, where people ask large language models what they should buy. Instead of getting an influencer trying to sell them products, the AI lays out the pros and cons of each option and just does the research. How does Klarna fit in?

A: Both versions you describe are complementary to each other. Our recent Future of Retail report found that 26% of U.S. Gen Zers and Millennials expect the shopping experience to be so customized that AI will eventually do the shopping for them. On the other hand, 85% of consumers still like speaking with product experts when shopping online.

The future of shopping will include a combination of hyper-personalization based on users’ unique preferences, AI-shopping assistants, and content creators that connect people and products through entertaining experiences.

E-commerce has historically been very transactional and static, and the reality is people miss the emotional element of shopping at the mall with their friends. Enhancing both the online shopping journey through curated, AI-driven content, while maintaining a meaningful, human touch will be very important. Perplexity is a fantastic company and we’re excited to collaborate with them and others on how we can make these experiences come to life.

Q: How do you see advertising and marketing changing in an AI-driven world? What happens if we’re just chatting with AI bots instead of browsing websites and TikTok?

A: Today in the Western world, 80% of e-commerce is search-driven, whereas in China we are seeing the opposite — 80% of e-commerce is driven by AI-powered recommendation engines, while 20% is through search. Marketers and advertisers benefit immensely when they can more accurately reach their target audiences and tailor their content to meet consumer expectations.

Q: Klarna is diversifying beyond payments and moving into advertising/marketing. But do you see any possibility that AI enables a commerce landscape that actually does revolve around fees and commissions, rather than marketing and ads?

A: The creator economy is thriving and I don’t believe the model of affiliate marketing will go away any time soon; if anything it will evolve based on consumer behavior with the help of AI.

For the full conversation, read here.

Number of Reddit forums that went dark in protest of the company’s decision to start charging developers for access to its API. Reddit said the move would prevent AI giants from using its data to train on their models for free, but the change is also pricing out indie developers who run third-party apps for the site.

That includes the makers of beloved clients like Apollo and Reddit is Fun, which, in addition to providing sleek user experiences, also strip out the advertisements that make Reddit money. Reddit CEO Steve Huffman downplayed the demonstration in an email leaked to The Verge, telling employees that “we absolutely must ship what we said we would.”

Semafor’s Ben Smith and Max Tani will be in France next week for the Cannes Lions festival — a hub for advertising, marketing and tech news, and where Apple and Netflix will be marking their arrival into the ad business.

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The Beijing Academy of Artificial Intelligence’s annual conference featured a star-studded lineup of speakers, including OpenAI CEO Sam Altman, Anthropic co-founder Christopher Olah, and Meta chief AI scientist Yann LeCun, who dialed in at 4 a.m. from France. The event demonstrated China’s “convening power” in AI, writes Kevin Xu in his newsletter Interconnected.

China currently lags behind the U.S. in terms of AI development, as I previously reported. But the BAAI conference shows that it’s nonetheless a major player in the sector globally, and will have a say in how it is regulated. During his speech, Altman said he hoped that Chinese AI researchers “will make great contributions” to mitigate the harms of the technology.

—Louise

U.S presidential candidate Robert F. Kennedy Jr. is attracting buzz in Silicon Valley. Twitter co-founder Jack Dorsey said on a podcast Monday that he appreciated Kennedy for approaching issues from “more of a humanitarian angle” and being willing to explore controversial topics. Meanwhile, investors David Sacks and Chamath Palihapitiya are hosting a fundraiser for him this week, Axios reported.

Kennedy is still a longshot against Joe Biden for the Democratic nomination, but the financial support could help him become a thorn in the president’s side. Best known for his storied family and anti-vaccine activism, our Semafor Business colleagues also reported recently on Kennedy’s connection to an investment firm that advised a business with ties to a Venezuelan corruption scandal.

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