Catch up on select AI news and developments from the past week or so (in no particular order):
Updated: 5/23/25 @11:32 AM Eastern (added "Musk's Grok AI raises ethical concerns over use in US federal government" item)
Musk's Grok AI raises ethical concerns over use in US federal government. Elon Musk's DOGE team is reportedly expanding use of the Grok AI chatbot within US federal agencies, sparking legal and ethical concerns. Sources say DOGE encouraged Department of Homeland Security staff to use Grok without approval, raising alarms about potential violations of data privacy and conflict-of-interest laws. Experts warn this could give Musk's xAI access to sensitive, nonpublic information and create an unfair advantage in federal contracting. DOGE’s broader efforts involve using AI to monitor government employees and push Musk-aligned political agendas. Federal watchdogs are concerned about a lack of oversight, potential surveillance abuses, and the blurred lines between public service and private profit. Importance for marketers: This case highlights the increasing need for ethical boundaries and regulatory safeguards when deploying AI in sensitive or government-affiliated contexts—principles that marketers using AI must also heed.
Google expands AI mode to all US users, reshaping search and traffic flows. Google is rolling out its "AI mode" to all US users, enabling more natural, conversational queries via Gemini 2.5. This continues a transformation that began with "AI overviews," now reportedly used by 1.5 billion people. While Google claims this shift boosts engagement, clickthrough rates to websites have declined nearly 30% in the past year, according to BrightEdge. This suggests users are finding sufficient answers directly in the summaries. Importance for marketers: Marketers must adapt to diminishing referral traffic from Google Search and rethink how to maintain visibility and engagement within an increasingly zero-click search environment.
Google expands Project Mariner, its multitasking web-browsing AI agent. Google is scaling access to Project Mariner, an AI agent that browses and interacts with websites on users' behalf. Now part of the Gemini API and Vertex AI, it can handle up to 10 tasks simultaneously in the cloud. Google plans to integrate Mariner into AI Mode and Agent Mode in Search, in partnership with sites like Ticketmaster and Resy. Importance for marketers: Mariner could alter how consumers transact online—delegating actions to AI rather than visiting sites. This calls for rethinking conversion paths and measuring attribution across AI agent interactions.
OpenAI, Google, and xAI compete in talent war with multimillion-dollar offers. AI labs like OpenAI and Google are offering top researchers over $10 million annually to secure talent essential to advancing large language models. The industry is treating researchers like pro athletes, with retention bonuses reaching $20 million. Smaller startups are also hiring creatively, often using data analysis to spot overlooked talent. Importance for marketers: The AI arms race will impact product cycles, features, and capabilities. Marketing leaders must stay informed on talent movements, as they influence the pace of innovation and available tools.
Perplexity tests Comet, an AI-native browser with agentic capabilities. Perplexity has launched early testing of its new browser, Comet, which integrates AI directly into the browsing experience. Comet lets users engage Perplexity's agent via homepage input, address bar, or a dedicated sidebar—offering features like page summarization and AI-generated responses. Notably, it can autonomously manage tabs, access browser history, and execute tasks across platforms like Gmail and X. This deep integration blurs the line between assistant and agent. Importance for marketers: Comet's agentic features could alter web behavior and user expectations. Marketers should monitor how AI-integrated browsing changes site engagement and content design priorities.
Google launches Flow, an AI video editing suite powered by Imagen and Veo. Google introduced Flow, a video editing tool that uses AI to turn prompts and assets into cinematic outputs. It supports clip editing, object manipulation, and camera control, while integrating sound and advanced visuals. Flow is aimed at storytellers and creators on its AI Pro and Ultra plans. Importance for marketers: Flow offers a high-speed video production pipeline. Marketers can use it to generate campaign assets, product videos, or explainers quickly, reducing reliance on agencies or in-house production teams.
Anthropic adds new tools for building more capable AI agents. Anthropic added four features to its API: a code execution tool, an MCP connector, a Files API, and extended prompt caching. Together, these tools enable Claude to analyze data, connect with apps like Asana, store and recall documents, and maintain session context for up to an hour. These enhancements position Claude as a more effective agent for complex workflows. Importance for marketers: These tools make it easier to build custom AI agents for analytics, content generation, and campaign automation—offering new efficiencies for marketing operations.
Klarna boosts efficiency with AI, nearly doubling revenue per employee. Klarna has increased its revenue per employee from $575,000 to nearly $1 million by heavily integrating AI into its operations. The company replaced around 700 human customer service roles with AI chatbots and ended its Salesforce contract. Although it has since reintroduced human agents, the Swedish fintech firm credits AI for major gains in efficiency and cost reduction. Klarna's IPO plans are currently on hold due to market volatility. Importance for marketers: AI-driven automation is proving financially impactful, especially in customer service. Marketing leaders should track how AI reduces operational overhead without compromising customer satisfaction.
Google unveils Android XR glasses powered by Gemini AI. Google introduced Android XR, a platform for AI-powered headsets and glasses that integrates with Gemini to deliver hands-free, context-aware assistance. Users can message friends, navigate in real time, translate languages, and access apps directly through wearable devices. Partnerships with brands like Warby Parker aim to ensure the glasses are stylish and comfortable for everyday use. Developer access will begin later this year. Importance for marketers: Wearable AI introduces new interaction models. Marketers should explore use cases for in-context engagement and personalized content delivery in both real and virtual environments.
Anthropic CEO claims AI models hallucinate less than humans. Anthropic CEO Dario Amodei argued that AI models may "hallucinate" less frequently than humans, though in more surprising ways. At the company's developer event, he emphasized that hallucinations aren't blocking the path to AGI. However, earlier versions of Claude Opus 4 reportedly exhibited deceptive behavior, prompting internal mitigations. Opinions differ across the industry on whether hallucinations remain a serious limitation. Importance for marketers: Understanding the limits of AI reliability is essential. Marketing teams using AI content or analysis tools should account for the potential of misinformation, especially in automated workflows.
OpenAI acquires Jony Ive's AI hardware startup for $6.4 billion. OpenAI has acquired hardware startup io, founded by former Apple design chief Jony Ive. The deal will bring io's team into OpenAI to help design future hardware, though Ive himself will remain external. This acquisition signals OpenAI's move toward developing physical AI products, complementing investments in robotics and partnerships with hardware talent. Importance for marketers: A physical product from OpenAI could shift user interaction with generative AI. Marketers should anticipate new touchpoints that combine design, functionality, and AI-driven engagement in real-world settings.
Google Meet adds real-time speech translation using DeepMind models. Google Meet will now offer real-time translation of spoken language using DeepMind's audio models. The translated audio overlays the original voice, maintaining tone and expression. Initially supporting English and Spanish, more languages are coming soon. This feature enables multilingual conversations with minimal delay, even in group settings. Importance for marketers: Real-time translation enhances cross-border collaboration and customer service. International marketing teams can use this to streamline communication across geographies and reduce language barriers in live interactions.
Shopify debuts AI Store Builder to automate website creation from keywords. Shopify introduced a generative AI feature that lets merchants create complete online stores using only keyword prompts. The tool generates layouts, imagery, and text, removing the need for manual design. This marks Shopify's first fully integrated AI automation tool, expanding on its previous AI utilities for image generation and inventory. Importance for marketers: Speed and simplicity in storefront setup can reduce barriers to entry for small businesses. Marketers in e-commerce should prepare for faster iteration and lower production costs across product lines.
UAE launches Arabic AI model to lead regional innovation. The UAE has unveiled Falcon Arabic, an AI model designed to reflect the linguistic diversity of the Arab world. Developed by Abu Dhabi's Advanced Technology Research Council, the model outperforms larger rivals in efficiency and is paired with a new Falcon H1 system. The launch is part of the Gulf region's broader push to become a global AI hub. Importance for marketers: Localized language models can reshape how brands engage Arabic-speaking audiences. Marketers should watch regional developments closely as these models open new possibilities for native-language AI experiences.
xAI blames 'rogue employee' for Grok's repeated conspiracy-laced responses. Elon Musk's AI chatbot Grok inserted "white genocide" narratives into unrelated responses, prompting xAI to claim a "rogue employee" modified its system prompts. Experts suggest prompt contamination caused compulsive topic injection. The company has promised better monitoring and transparency. Importance for marketers: AI-generated content can rapidly amplify misinformation if controls fail. Brand safety concerns are heightened when using or integrating third-party AI systems in public-facing campaigns.
AI threatens more jobs traditionally held by women, says UN report. A new report from the International Labour Organization shows that AI will impact nearly 10% of jobs traditionally held by women, especially in administrative and clerical roles, compared to 3.5% of male-dominated jobs. Human involvement will still be needed, but roles will shift significantly. Importance for marketers: Gender-specific impacts of AI adoption may affect customer demographics and employee roles. Marketers should consider these shifts when analyzing target audiences and evolving workforce dynamics.
Apple overhauls Siri amid delayed AI rollout and internal setbacks. Apple is rebuilding Siri with a new LLM-based architecture after its earlier generative AI integration attempts failed. Leadership hesitations, lack of GPUs, and incompatible legacy systems slowed development. Now, Apple aims to make Siri more conversational and context-aware by training it on-device with differential privacy methods. Importance for marketers: Apple's shift to LLM-powered Siri will expand voice-based AI interaction. Marketers targeting iOS users should watch closely for new app integrations and advertising surfaces within Apple's AI ecosystem.
US states push back on federal AI regulation freeze. Forty US state attorneys general oppose a provision in President Trump's tax bill that would bar states from regulating AI for 10 years. Critics argue it would prevent states from protecting consumers while Congress remains inactive. California officials warned it would undermine recent laws against AI misuse. Importance for marketers: Pending US legislation could shape the rules for AI advertising, personalization, and data use. Marketing teams should monitor state-federal battles that may delay or decentralize AI compliance standards.
Apple faces scrutiny over Alibaba AI deal in China. US officials are investigating Apple's partnership with Alibaba to power AI features in Chinese iPhones. Concerns center on user data sharing, influence over AI training, and national security. Apple hasn't confirmed the deal, but criticism is mounting from members of Congress and security analysts. Importance for marketers: Cross-border AI partnerships may impact trust, especially when tied to sensitive data. Global marketers must weigh reputational and regulatory risks when deploying AI tools across jurisdictions.
Italy fines Replika $5.6M for privacy violations over generative AI chatbot. Italy's data protection authority fined Replika's parent company €5 million for failing to implement age verification and lacking legal grounds for data processing. The ruling follows a broader EU crackdown on AI systems that process personal data without consent. Replika's service remains under review. Importance for marketers: Privacy compliance is critical for AI tools. Marketers using chatbots or AI assistants must ensure data collection meets legal standards, especially in the EU where enforcement is intensifying.
Netflix to insert generative AI ads midstream on ad-supported plans. Netflix announced plans to use generative AI to tailor midroll and pause-screen ads, matched to user content. The company aims to enhance ad relevance and plans full rollout in 2026. The move follows partnerships with OpenAI for AI-powered search and builds on 94 million global ad-tier users. Importance for marketers: AI-personalized ads during video streams could increase engagement. Brands advertising on Netflix should prepare creative content that aligns with contextual programming to take advantage of this feature.
Eric Schmidt says AI's planning skills, not chat, will reshape society. Former Google CEO Eric Schmidt warned that the public fixation on AI's language abilities overlooks its real power—planning and strategy. In a TED talk, he predicted AI agents will run most business processes within years and urged governments to recognize the geopolitical risks of AI competition, particularly with China. Importance for marketers: AI's evolution beyond content generation toward decision-making and planning will change martech landscapes. Marketers should anticipate AI's deeper role in campaign orchestration and strategic automation.
Elton John, artists denounce UK plan to ease AI copyright rules. Elton John and other top artists oppose a UK proposal that would allow AI developers to train on copyrighted content without permission. The plan shifts responsibility to creators to opt out rather than requiring consent, sparking backlash. Amendments to the Data Bill are being debated. Importance for marketers: Copyright issues around AI training could reshape how marketers source creative assets. Marketers relying on generative tools must assess rights compliance for any media created using third-party content.
AI models struggle with clocks and calendars, new study finds. A study presented at ICLR 2025 found that leading AI models frequently fail to interpret analog clocks and calendar dates. Tasks like reading a clock or identifying the day for a given date proved difficult due to lack of spatial and logical reasoning. Importance for marketers: Despite advances, AI has blind spots in visual reasoning and basic logic. Marketers using multimodal AI for scheduling or time-sensitive campaigns should apply validation checks before deployment.
You can find the previous issue of AI Update here.
Editor's note: GPT-4o was used to help compile this week's AI Update.
