October 21, 2023
Issue No. 75
Welcome to this week's AtherXplorer, covering the latest in gaming, blockchain, and everything in between.
This week’s top picks include:
- AI: OpenAI Launches ChatGPT Web-Browsing and Enables DALL-E 3 Access from within GPT-4
- Gaming: New ‘Super Mario Bros. Wonder’ Embraces Change
- Web3, Metaverse, and NFTs: SEC Dismisses Lawsuit Against Ripple Execs
- Legal Landscape: Former FTX Director Tries Avoiding 75-Year Sentence by Testifying Against SBF
OpenAI Launches ChatGPT Web-Browsing and Enables DALL-E 3 Access from within GPT-4
OpenAI is expanding access to its latest image generator DALL-E 3. Paying ChatGPT subscribers will now be able to access and use DALL-E 3 directly within the ChatGPT app. OpenAI claims it has implemented extensive safety measures to mitigate risks, like limiting depictions of public figures or realistic images. Other text-to-image models have faced issues like generating copyrighted materials or inappropriate images.
ChatGPT is also officially gaining the ability to search the open web. After testing the feature in beta, ChatGPT subscribers can now use "Browse with Bing" to search Microsoft's Bing engine from within the app. Previously, ChatGPT was limited to its initial training dataset from 2021. Integrating web search raises abuse and algorithmic chaos risks, so OpenAI has focused on avoiding paywalled content and respecting site policies.
With DALL-E 3 now in beta, users can get images directly through ChatGPT without switching apps. ChatGPT can also help provide better text prompts for DALL-E 3 to generate more accurate images. These changes are part of OpenAI's broader effort to transition ChatGPT beyond text and into an integrated, real-time search platform for text, images, audio, and more.
ByteDance Unveils AI-Integrated CapCut for Business
CapCut, ByteDance's popular video editor app, is expanding into business tools with the launch of CapCut for Business. Known for its AI effects and templates that helped make it one of the top revenue-earning apps, CapCut is now bringing these capabilities to advertisers and creators. The new tools allow marketers to generate branded content and scripts using AI, convert URLs to videos, and access AI-generated presenters for product demos. Collaboration tools let agencies and teams work together on ads.
AI plays a major role, including virtual try-on features to showcase products. Unlike the consumer app, CapCut for Business facilitates teamwork. The tools can help businesses advertise on short-form platforms like TikTok but also create organic content for brands. Originally from China, CapCut has expanded globally with key markets in the US, UK, Germany, and Latin America. It surpassed Splice to become the most profitable editor, seeing downloads grow following AI introductions.
ByteDance also offers CapCut integration with ChatGPT. The company aims to position the app as an easy way for both consumers and marketers to create compelling videos for social media. Early cases found some businesses nearly tripled video metrics and sales using CapCut. While full results are pending wider adoption, the new software is available at no cost starting today.
Stack Overflow Lays off 28% of Workforce as AI Coding Boom Continues
Stack Overflow has laid off over 100 employees, accounting for 28% of its total staff. In an announcement, CEO Prashanth Chandrasekar said the company is significantly reducing the size of its go-to-market and support teams among others. This comes over a year after Stack Overflow doubled its headcount to over 500 people through a major hiring push.
Chandrasekar noted around 45% of those new hires joined the now-downsized go-to-market sales division. The layoffs signal challenges for Stack Overflow as the generative AI boom has integrated coding assistance into many developer tools through chatbots and APIs. This presents difficulties for a personal coding help forum as developers grow comfortable with AI alternatives.
AI-generated answers have also caused issues for Stack Overflow. Last year it temporarily banned users from providing responses with AI chatbot help due to quality concerns. An alleged lack of enforcement led to a months-long strike by moderators that has since been resolved, though the ban remains. Seeking new revenue, Stack Overflow additionally announced plans to start charging AI companies for access to its dataset to train models.
The hiring spree and now layoffs at Stack Overflow point to struggles transitioning its business model amid growing AI competition for coder assistance that has penetrated directly into their tools.
WhatsApp-based AI Chatbot ‘Luzia’ Raises $10M
The Spanish startup Luzia is introducing AI chatbots to non-tech users through a bot accessible on WhatsApp and Telegram. Founded in 2023, Luzia aims to serve Spanish and Portuguese speakers with an easy-to-use conversational agent. Users can add Luzia as a contact and start chatting without extra apps.
Powered by GPT-3 and other models, Luzia can converse in multiple languages including Spanish, Portuguese, English, and others. It has seen over 17 million total interactions so far, with 8 million monthly active users sending 13 million daily requests. People often share Luzia with friends and family via their phone numbers.
The bot tailors its language to the user's country but can also understand other languages from its GPT foundation. Based in Spain, the US is a new target market. Luzia seeks to introduce non-tech audiences unaware of AI models to chatbot technology through a familiar messaging interface.
Moving forward, Luzia will offer image generation based on text prompts. It recently raised $10 million from investors including Khosla Ventures to focus on growth. For now, Luzia remains free while avoiding revenue approaches used by others in the space. Investors expect potential given its traction so far addressing Latin American and Iberian markets with a consumer-centric product.
“Image2Audio” and “Lyrics2Audio” AI App Riffusion Turns Viral Success into $4M in Funding
Nearly a year ago, developers Seth Forsgren and Hayk Martiros released the AI music generation tool Riffusion, using images of audio rather than raw files. It gained millions of users and attention, including citations in research from large companies.
This year, Forsgren and Martiros commercialized Riffusion with $4 million in seed funding led by Greycroft. They also launched a new free Riffusion app allowing users to describe lyrics and a style to generate "riffs" that can be shared. The upgraded model was trained from scratch to empower musical self-expression through short generated clips.
Forsgren and Martiros met at Princeton in a band and have decades of music experience. They saw the potential for generative AI to connect people creatively. The app records voice prompts like "punk rock anthem" and returns an energetic sample. However, it isn't designed for replication and can't generate content violating copyright.
Riffusion avoids familiar names and songs to prevent lawsuits seen elsewhere regarding "deepfake" music. For now, monetization isn't the focus as the team expands and explores new generative products. They also aim to work with artists like advisors The Chainsmokers.
OpenAI Challenger Zhipu AI Raises $340M
Chinese startup Zhipu AI, spun off from the prestigious Tsinghua University, announced raising $340 million in total financing this year from local investors.
The funding news comes amid increasing geopolitical tensions that threaten to further divide the two nations' AI industries. This week, the U.S. imposed new restrictions on exporting Nvidia chips to China. In response, top Chinese AI firms have stockpiled semiconductors, crucial for large model training.
The $340 million raise for Zhipu consisted entirely of yuan funds, marking a shift from reliance on USD as political tensions curb American investment in sensitive Chinese sectors like AI via executive order. Some U.S.-based China funds have separated local units to continue operating.
Zhipu's investors include prominent domestic VCs as well as typical rivals Alibaba and Tencent. The funding will aid China's costly participation in the global AI race at a time when it faces supply chain restrictions.
Recently, Zhipu open-sourced large conversational and foundation models including a 6 billion parameter bilingual chatbot trained domestically. As geopolitics drives the tech worlds further apart, such independent Chinese foundations could play a meaningful role.
In Other AI News…
- EY teams up with IBM and launches ‘EY.ai Workforce’ to automate HR processes
- Meta recreates mental imagery from brain scans using AI
- Google takes aim at Duolingo with new English tutoring tool
- Square’s new AI features include a website and restaurant menu generator
- AI trains for 50k hours while playing Pokémon Red
New ‘Super Mario Bros. Wonder’ Embraces Change
In Nintendo's latest adventure, "Super Mario Bros. Wonder" for the Nintendo Switch, Mario undergoes a transformative twist. Instead of donning familiar costumes like the iconic catsuit or penguin wings, Mario is metamorphosed into a gigantic elephant. This change allows him to employ his newfound trunk to swat enemies and nurture friendly flowers, presenting a novel gameplay experience.
The decision to turn Mario into an elephant underscores the franchise's reliance on an array of power-ups to maintain player excitement. Mario's innate ability has always been his high jumping, and his enduring mission primarily revolves around rescuing Princess Peach from the clutches of the villainous King Bowser. However, the stakes in Mario's adventures remain relatively low, with heroes and villains often uniting for party games and go-kart racing.
Takashi Tezuka, a longtime executive producer at Nintendo who played a pivotal role in designing the original "Super Mario Bros." in 1985, notes that Mario wasn't initially created to be a conventional hero. Nevertheless, he has evolved into an endearing and relatable character. Yet, in comparison to other Nintendo protagonists, Mario might be seen as somewhat unexciting. These other characters wield magical swords, shoot lasers from spacesuits, inhale objects the size of semi-trucks, or lead armies of sentient plants, making Mario seem less spectacular by contrast.
Despite his unassuming stature, Mario has grown into Nintendo's equivalent of Mickey Mouse. His popularity has led to amusement parks dedicated to him and a highly successful animated movie that grossed over $1.3 billion. "Super Mario Bros. Wonder," the franchise's first classic side-scrolling game in over a decade, coincides with Nintendo's recent push to expand beyond gaming into the broader entertainment industry.
Spider-Man 2 Released on PS5, Generates ‘Length vs Price’ Debate
Marvel's Spider-Man 2 was released with an estimated main story length of 15 hours, which some feel is too short for the £70 price tag, especially compared to longer RPGs. However, Insomniac's creative director Bryan Intihar defended the value, stating quality, not length, was their focus.
Intihar acknowledged the price/length debate but explained they aim to deliver an experience worth the cost. Their job is to make any length game feel worthwhile. Early reviews support this, with one player recording 17 hours so far focused solely on the main story.
The game allows extending playtime beyond the main plot through side missions and collectibles, adding potentially 25 extra hours. Insomniac also teased bosses Kraven and Sandman prior to the launch.
For those finishing quicker than anticipated, Insomniac reassured more content is coming. This includes a New Game Plus mode planned for release before the end of the year. Insomniac aims to continue offering value after the initial purchase.
While some questioned the sequence's value against its price tag due to length, Intihar emphasized Insomniac's goal is to provide a quality experience worth the cost regardless of duration. Early feedback indicates the developer achieved this ambition.
Blizzard Offers Diablo IV Skins in Overwatch 2, Faces Criticism Over $40 Bundle
Blizzard, the developer of Overwatch 2, is facing criticism for offering exclusive Diablo 4-themed skins, Lilith for Moira and Inarius for Pharah, through a $39.99 Ultimate Battle Pass Bundle for Season 7. These skins, inspired by characters from Blizzard's action RPG, Diablo 4, have garnered significant attention since their launch.
The decision to restrict these sought-after Diablo 4 skins to the $39.99 Ultimate Battle Pass Bundle for Season 7 has sparked outrage among Overwatch 2 players. These skins played a prominent role in the promotion of Season 7, known as Rise of Darkness, intensifying the disappointment among players. As a result, there is no alternative method to obtain these skins other than purchasing the bundle with real-world money.
The gaming community has voiced its displeasure regarding the bundled approach. The Overwatch subreddit saw criticism of this practice and accused Blizzard of greed. Players had eagerly anticipated acquiring these exceptional skins, and many had even saved up the premium in-game currency, only to be dismayed by the realization that they could only obtain the skins by spending $40 on the bundle.
The controversy highlights ongoing concerns surrounding microtransactions and the perception of game developers prioritizing profit over player experience. Many players were dismayed to find content that had initially been presented as part of the new season behind a paywall, leading to a surge of frustration and disappointment within the Overwatch 2 community.
Device that Plays Nintendo 64 at 4K to be Released in 2024
Analogue announced its next retro device after the popular Analogue Pocket - the Analogue 3D, which will play Nintendo 64 games. Like the Pocket, the 3D aims to play an original system's games on a modern handheld with high-quality enhancements.
Limited details were shared, but an image shows what appears to be a sleek black recreation of the N64 controller. The 3D will output games through 4K HDMI, include the Analogue OS and support wireless Bluetooth and WiFi connectivity. It will also have four ports to use the original N64 controllers.
Analogue claims the 4K output allows for "incomprehensibly profound Original Display Modes" that enhance old games. In partnership with 8BitDo, it will release a wireless controller for the device.
Further specifics were not provided, but the 3D is planned for a 2024 release date. Pre-orders are not open yet but will likely happen well before launch based on past precedent. Considering the high demand for the Pocket, fans are advised to pre-order swiftly upon availability since the new device may also sell out rapidly. The 3D promises to beautifully display the N64 library for new audiences.
Netflix’s Cloud Gaming Service Begins Tests in the US
Netflix has begun testing its cloud gaming service in the US after initial trials in Canada and the UK. This expands on mobile gaming efforts that began in 2021 and represents an attempt to make gaming a major part of its business. The service allows members to stream and play Netflix games on smart TVs and connected devices like Fire TV, Chromecast, and Roku, using their phone as the controller.
In 2021, Netflix VP Mike Verdu signaled plans to enter cloud gaming, arguing it would add value without replacing consoles. Games would be playable anywhere through a subscription. This positions Netflix against services like Xbox Cloud Gaming, GeForce Now, and PlayStation Plus.
Netflix games are free with subscriptions. Reports indicate titles based on shows like "Squid Game," "Wednesday," and "Black Mirror," as well as a possible "Grand Theft Auto" game through Take-Two. The existing catalog includes games tied to popular shows and genres.
The company has made acquisitions like Boss Fight, Night School Studio, and Next Games, as well as internal studios in Helsinki and California. Testing initially focused on mobile but cloud and original IP are now priorities.
Critics question if gaming fits Netflix given the competition for time from apps like TikTok and YouTube. The new TV streaming tests titles from Night School and Molehill, supporting controllers on devices like Fire TV, Chromecast, Roku, and Samsung TVs. Phones act as controllers. Verification aims to improve the experience. Netflix seeks to expand gaming across platforms.
‘Skull Island: Rise of Kong’ — From Deadline to Downfall
"Skull Island: Rise of Kong" has faced severe criticism for its outdated graphics and gameplay, being labeled as “the worst game of 2023”. Despite the negative reception, insights from its developers shed light on the challenging circumstances imposed by its publisher, GameMill Entertainment.
IguanaBee, an indie studio based in Santiago, Chile, worked on the game. While the developers at IguanaBee are recognized as highly talented, GameMill's stringent one-year development timeline severely limited their creative expression. Skull Island's development began in June of the previous year and was slated to finish by June 2nd the following year, allowing minimal time for its creation.
GameMill Entertainment is known for contracting smaller developers for licensed games with short turnaround times, often resulting in variable quality. Developers revealed that they frequently lacked essential project information, leading to frustration and improvisation.
Additionally, GameMill's financial support wasn't sufficient to maintain an experienced team. Layoffs occurred due to funding constraints, further hindering the game's development.
Developing a game within a year is feasible under certain conditions, such as project scope, team size, and access to existing assets. However, Skull Island was reportedly built from the ground up, involving a small team of two to twenty people, making a one-year development timeline exceedingly challenging.
In Other Gaming News…
Web3, Metaverse, and NFTs
SEC Dismisses Lawsuit Against Ripple Execs
The SEC dismissed charges against Ripple CEO Brad Garlinghouse and Executive Chairman Chris Larsen, who had been charged alongside the company in 2020 for allegedly violating securities laws through XRP sales. Ripple called it a "stunning capitulation" while Larsen questioned the lawsuit's origins. XRP's price rose around 5% on the news.
The dismissal comes after the judge ruled in July that XRP is not necessarily a security. Earlier this month the SEC failed to overturn this ruling before a final judgment next spring. It is unclear what specifically prompted the SEC to drop the individual charges.
Regardless, the case against Ripple itself is continuing, in a legal battle framed as defining crypto regulation in the US. Numerous major crypto players including Coinbase have supported Ripple legally.
While Ripple and the industry have taken encouragement from recent favorable rulings, the company and ecosystem are not yet out of regulatory uncertainty. The July ruling spurred a $73.5 billion crypto market value increase, but the final judgment is still pending next year. Victory for Ripple could shape the future of crypto, though the dismissal of top executives alone does not equate to broader legal acceptance of XRP.
Reddit Pulls the Plug on “Community Points” AKA Subreddit Crypto Tokens
Reddit announced it will shut down its Community Points rewards program on November 8th, citing scalability issues. The program launched in 2020 to incentivize quality engagement by awarding points redeemable for special items. Points were stored as ERC-20 tokens in Reddit's Vault wallet.
Each participating subreddit had its own token, like MOON for CryptoCurrency and BRICK for FortniteBR. Users could spend points on badges and avatars.
In response, a r/CryptoCurrency moderator said users' MOON tokens would not be burned and transfer functionality would remain. However, the news plunged the value of MOON and BRICK significantly.
Crypto community members heavily criticized Reddit's decision, with one trader labeling it a "rug" for removing a built community feature. Comments expressed disappointment that the platform had effectively disrupted invested users.
Cool Cats Launches Avatar System Beta
Cool Cats launched the Avatar System Beta on October 19th, allowing users to customize their digital identity. The feature announcement explained that avatars will exist as separate soulbound NFTs from current collections, empowering users to define their online identity freely across platforms by mixing assets.
At launch, Cool Cat holders can claim complimentary assets to complete outfits for free in a single transaction as ERC-1155 NFTs on Polygon. There is a caveat, however, as original Cool Cat traits obtained via the 10k Cool Cat NFTs cannot be combined, to preserve exclusivity.
Future ways to obtain wearables include purchasing avatar packs themed like Halloween, earning through games/achievements, redeeming codes from merchandise, and converting physical items.
Avatars will have distinct frontal views and backgrounds for clarity. Explorers are default avatars for newcomers to experience the ecosystem easily.
To mint an initial free avatar, users connect their wallet on the website and follow instructions. Inventory allows direct wearable purchases with ETH or fiat. For now, avatar creation requires owning a Cool Cat, but support for ‘Explorers’ will be available in the future.
In Other Web3 & Metaverse News…
Legal Landscape, Policies, and Regulation
Former FTX Director Tries Avoiding 75-Year Sentence by Testifying Against SBF
Nishad Singh, the former engineering director at collapsed crypto exchange FTX, reportedly testified against Sam Bankman-Fried as part of a plea deal with prosecutors to avoid potential jail time. Singh faces up to 75 years for fraud charges related to deceiving FTX users.
In his testimony, Singh revealed that FTX had spent $1.3 billion on celebrity endorsements prior to the 2022 crypto crash. He said former CTO Gary Wang disclosed that Alameda Research borrowed $13 billion from FTX, which didn't seem to surprise Bankman-Fried. Singh felt betrayed by this upon learning the extent of funds moved between related companies.
Singh also stated that Bankman-Fried had suggested using $120 million in FTX user funds to purchase Telegram and for political donations via Alameda. During FTX's November 2022 liquidity issues, Singh reported being suicidal while handling inconsistencies between public statements and internal activities.
Additionally, Singh testified that Bankman-Fried sometimes spent Alameda funds excessively on investments in AI startup Anthropic and firm K5 Global without consulting others.
This testimony on the ninth day of Bankman-Fried's criminal trial in New York aimed to establish his role in using customer assets from FTX for Alameda. Bankman-Fried faces 12 total fraud charges to which he has pleaded not guilty. The trial details the meltdown of his crypto empire that led to billions in losses.
Biden “Chokes off” China’s AI Chip Supply with Nvidia Bans
Nvidia chip export bans to China have impacted the country's AI startups. Last year, reduced-performance alternatives provided temporary relief, but new rules target Nvidia's A800 and H800 chips designed for China.
While aiming to curb military use, the bans most visibly affect language model startups. Many rushed to stockpile coveted A100 and H100 chips at inflated prices before the rules. Alibaba, Baidu, ByteDance, and Tencent collectively ordered $5 billion of the new A800 chips for this year and next.
Nascent startups must now raise funds quickly to develop costly AI despite limited chip access. An Nvidia spokesperson said they expect no major financial impact and will comply with regulations while supporting various industries.
Still, Chinese companies pursue AI ambitions. On the day of the new bans, Baidu unveiled Ernie 4.0, claiming it matches GPT-4. Ernie now has 45 million users.
Rules requiring licenses for public LLMs pose challenges, in testing government relationships and navigating regulations. Chip shortages and complex censorship make business intelligence services focusing on internal data and scenario-based prompts more viable, as seen in Baidu's Qianfan platform with 17,000 customers.
Universal Music Sues AI Company Anthropic for Distributing Song Lyrics
Universal Music Group and other music publishers have sued Anthropic for copyright infringement through its AI model Claude 2. The complaint alleges Claude 2 can recreate lyrics for songs like "Roar" and "I Will Survive" nearly verbatim when prompted. It also notes Claude 2 responded with the full lyrics to "American Pie" when asked to compose a song about Buddy Holly's death.
While websites commonly share lyrics, the publishers argue that licensed aggregators pay for this use. They claim Anthropic fails to properly license the works or provide critical copyright information. The plaintiffs allege Anthropic not only distributes material without permission but uses copyrighted lyrics in training.
UMG states it uses AI tools internally but Anthropic's unauthorized distribution amounts to "theft." The complaint argues Anthropic can control infringing outputs, as Claude 2 sometimes refuses song requests, demonstrating awareness of potential copyright issues. However, infringement remains in most cases.
Copyright infringement from generative AI is an ongoing issue, with other lawsuits against ChatGPT, Stable Diffusion, and Midjourney. UMG has partnered with Google and YouTube to shape responsible AI use. Anthropic says it prioritizes safety and based its research on "constitutional AI" principles of rule-based training. However, publishers argue Anthropic fails to properly license lyrics or avoid copyright infringement.
In Other Legal & Regulatory News…
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