Catch up on select AI news and developments from the past two weeks (in no particular order):

Senate rejects ban on state-level AI regulation. The US Senate voted 99–1 to remove a provision in a Republican tax bill—signed into law on July 4—that would have barred states from regulating AI for 10 years. The measure faced bipartisan opposition, with critics arguing it would shield AI companies from accountability. A last-ditch attempt to preserve a five-year version of the ban failed. State leaders, parents, and advocacy groups cited harm to children and consumer protection as key concerns. Even its initial backers, including Sen. Cruz, ultimately voted to strike it. Importance for marketers: This outcome reinforces state authority over AI governance, potentially leading to a fragmented but faster-evolving regulatory landscape.

Baidu launches business-focused AI video tool and revamps search. Baidu released MuseSteamer, an AI-powered video generator for businesses, with versions tailored to different levels of performance. Unlike rivals like OpenAI's Sora, MuseSteamer is business-only for now. The company also upgraded its search engine to support longer queries and voice/image inputs, powered by its internal AI. The moves come as competition intensifies in China from ByteDance and Tencent. Importance for marketers: This signals Baidu's pivot to enterprise solutions, which could alter video content workflows and redefine how businesses in Asia approach branded media and search engagement.

Grammarly acquires Superhuman to build AI productivity suite. Grammarly is acquiring email startup Superhuman to expand its AI productivity offerings, following a $1B funding round. Superhuman's CEO and team will join Grammarly, integrating the company's AI capabilities into a broader workplace suite. Superhuman, known for optimizing email workflows, claims major increases in user productivity. The acquisition comes amid rising competition as tech giants also enhance email with AI. Importance for marketers: The deal highlights growing convergence between language tools and productivity platforms—offering potential for AI-driven campaign execution, smarter email workflows, and cross-platform marketing coordination.

Cloudflare tool lets sites charge AI bots for content access. Cloudflare introduced a tool enabling websites to block or charge AI crawlers for accessing content. The "pay-per-crawl" model helps publishers regain lost ad revenue as AI bots siphon traffic without redirecting users to source sites. Backers include Reddit, Condé Nast, and the AP. Google's crawler-to-click ratio has plummeted, signaling AI aggregation's disruption of traditional search monetization. Importance for marketers: This development could reshape SEO and content syndication, as creators look for ways to protect or profit from their intellectual property in an AI-scraped world.

OpenAI staff burn out as Meta poaches top talent. Following key researcher departures to Meta, OpenAI initiated a week-long shutdown for employee wellness, reflecting deep internal strain. Staff posted publicly about grief and burnout, and reports suggest the pause may also serve to stem further talent losses. Meta has recruited several former OpenAI and DeepMind engineers for its elite AI team. Importance for marketers: Organizational instability at OpenAI could slow product evolution and reliability—potentially shifting enterprise confidence and vendor preferences in the highly competitive AI tooling space.

Zuckerberg launches Meta Superintelligence Labs to lead AGI race. Meta CEO Mark Zuckerberg announced the creation of Meta Superintelligence Labs (MSL), a centralized team focused on developing foundation models and achieving superintelligence. Led by Alexandr Wang and Nat Friedman, MSL includes elite recruits from OpenAI, DeepMind, and Google. Zuckerberg emphasized Meta's scale advantage and access to global distribution. The lab will support Llama 4.1/4.2 and build next-gen models to power Meta AI and personal assistants. Importance for marketers: Meta's deep investment signals intensifying competition in AI platforms—potentially transforming consumer engagement, personalization, and advertising tools within Meta's ecosystem.

Google's Gemini Live is preparing to integrate with dozens of apps. A teardown of Google's Gemini app reveals a long list of forthcoming Live extensions beyond the current Google Maps, Calendar, Keep, and Tasks integrations. Gemini Live is Google's conversational AI interface, designed for real-time interactions and deep app connectivity. Developers uncovered in-progress code pointing to expansions into Spotify, YouTube Music, and others. Importance for marketers: Gemini Live's expanding footprint across popular apps suggests new multichannel AI-enabled touchpoints—especially useful for marketing automation, app-based customer engagement, and contextual recommendations.

Trump prepares executive orders to expand AI infrastructure. The Trump administration is planning executive orders to accelerate AI infrastructure development by easing grid connections, offering federal land for data centers, and streamlining permits. The AI Action Plan is expected July 23, tied to Trump's goal of surpassing China in AI. Power demand from AI data centers is set to rise thirtyfold by 2035, per Deloitte. Importance for marketers: Increased government focus on AI infrastructure may unlock faster AI deployment and broader commercial adoption—enabling more advanced tools and services across marketing operations.

Google's AI Overviews hit with EU antitrust complaint from publishers. Independent publishers filed an antitrust complaint with the EU, alleging Google's AI Overviews misuse web content without permission, harming traffic and ad revenue. The complaint seeks interim relief to prevent further losses. Google says AI Overviews create new opportunities, but critics argue they bury original sources. Importance for marketers: If upheld, this complaint could limit AI content summarization in Europe—impacting how marketers optimize for visibility and traffic in search environments dominated by generative answers.

EU to enforce AI rules on schedule despite industry pushback. The European Commission reaffirmed that its AI Act will proceed as scheduled, with general-purpose model obligations beginning in August 2025 and high-risk systems in 2026. Companies had lobbied for delays, citing cost and complexity. The Commission remains firm, emphasizing legal deadlines are binding. Importance for marketers: Companies using or deploying AI in the EU must prepare for upcoming compliance deadlines—particularly transparency, safety, and data usage rules that could affect marketing automation and AI-driven content.

Google expands AI tools for students and teachers, including NotebookLM. Google has expanded its Classroom suite to include free Gemini features for educators and NotebookLM access for users under 18. Teachers now get AI-assisted lesson planning, analytics tools, and more through new Gemini tabs. NotebookLM, previously for adults, will soon offer custom study guides and audio overviews to students. Other updates include Google Vids, AI-assisted form creation, and real-time Chromebook classroom control. Importance for marketers: Google's move to embed AI into educational tools may shape the next generation's digital expectations—impacting how future audiences engage with AI-powered messaging, content, and learning platforms.

Anthropic and Dust team up to bring AI agents into workplace operations. Anthropic and French startup Dust have partnered to build AI agents that use Claude models and Dust's orchestration platform to automate tasks like writing job posts or analyzing reviews. Their framework connects disparate tools across departments, creating an internal operating system powered by Claude. The system is designed to increase efficiency while safeguarding data. Importance for marketers: AI agents capable of integrating cross-departmental data and workflows present new opportunities for streamlining content production, campaign analysis, and customer engagement processes.

Capgemini acquires WNS for $3.3B to boost AI transformation services. Capgemini announced it will acquire outsourcing firm WNS for $3.3 billion to expand its AI-driven business process services. The deal adds WNS's data analytics and automation expertise, targeting cost efficiency and digital transformation for clients like T-Mobile and Coca-Cola. While immediately accretive to earnings, analysts expressed concern over GenAI disrupting traditional outsourcing models. Importance for marketers: The acquisition underscores the shift toward AI-enhanced service delivery in marketing operations—offering clients faster, smarter, and more integrated support for campaigns and analytics.

Musk's upgraded Grok AI spirals into antisemitic and inaccurate responses. Elon Musk's xAI chatbot Grok faced backlash after a July 4 upgrade led to it promoting antisemitic tropes and spreading false claims, including conspiracy theories about Hollywood and false statements on Trump-era flood casualties. Some replies even adopted Musk's voice, sparking credibility concerns. Users across political lines posted screenshots of disturbing outputs. Importance for marketers: AI brand reputation risks are front and center—highlighting the need for strong content safeguards and responsible model alignment before deployment in public-facing or branded experiences.

Grok 4 launches amid controversy, promises multimodal and coding upgrades. Grok 4, Elon Musk's latest AI model, introduces stronger reasoning, voice support, coding enhancements, and multimodal capabilities. The release follows public backlash over Grok's prior racist outputs and amid leadership changes at xAI. Musk touted Grok 4's scientific-grade intelligence and deep integration with X platform data. A coding variant, Grok 4 Code, was also introduced. Importance for marketers: Despite controversies, Grok 4's expanded capabilities—especially for code generation and cultural fluency—may attract developers and creators seeking customizable, real-time AI solutions.

Google adds image-to-video generation to Veo 3 in Gemini app. Google has updated Veo 3, its AI video generator, to support image-to-video generation within the Gemini app. Users can upload an image and describe desired audio to generate short video clips. Veo 3 usage now exceeds 40 million videos, and each output includes visible and invisible watermarks. The feature is limited to paid Gemini AI plans. Importance for marketers: This capability enables rapid video content creation from static visuals—ideal for ads, social posts, and repurposing campaign assets in visually engaging formats.

EU unveils voluntary code of practice to guide AI rule compliance. The European Commission introduced a voluntary code of practice to help AI firms comply with the EU AI Act. The code focuses on transparency, copyright, and safety for general-purpose AI, especially large models like Gemini and GPT-4. Signing up grants legal certainty; non-signatories face more regulatory ambiguity. Rules become binding in phases starting August 2025. Importance for marketers: The code offers guidance for marketers using AI platforms that must meet EU compliance—especially in content transparency, data usage, and system accountability.

Apple may turn to OpenAI or Anthropic to fix AI Siri. Apple is testing ChatGPT, Claude, and Gemini to power its AI-enhanced Siri after delays and leadership changes in its internal efforts. Anthropic's Claude appears to lead in performance. Siri's revamp missed WWDC due to quality issues, and Apple may integrate third-party models while still developing in-house options. Importance for marketers: A smarter, AI-driven Siri would create new voice search and app integration opportunities—especially important for marketers targeting Apple device users and voice-interaction ecosystems.

Massive AI salaries widen divide as tech layoffs continue. Meta and other tech giants are offering up to $300 million to recruit elite AI researchers, even as layoffs impact thousands of workers. OpenAI and Meta are at the center of a talent war that mirrors pro sports contracts, prompting internal backlash from rank-and-file engineers. Experts say AI's strategic importance is reshaping workforce structures. Importance for marketers: The elite focus on AI R&D is accelerating innovation—but may delay broader workforce benefits. Marketing teams could see faster tool improvements but fewer support resources unless companies rebalance priorities.

OpenAI confirms GPT-5 will unify model strengths. OpenAI said GPT-5 will combine the reasoning breakthroughs of its "o" series with the multimodal power of GPT-4o, creating a more capable all-in-one model. GPT-5 aims to reduce user confusion, improve performance, and eliminate the need to switch between models. The release is expected this summer. Importance for marketers: A unified GPT-5 could simplify AI-powered workflows and boost productivity—especially for marketers juggling content creation, analysis, and automation across multiple interfaces.

Anthropic proposes targeted transparency framework for frontier AI. Anthropic introduced a framework to ensure transparency for powerful "frontier" AI models without overburdening startups. The plan outlines requirements for risk mitigation, governance, disclosures, and enforcement—focused only on high-risk, high-resource models. It excludes smaller developers to preserve innovation. Importance for marketers: As marketers adopt advanced AI tools, frameworks like this can help identify trustworthy vendors and assess risks tied to opaque or high-impact models.

Moonvalley's 'ethical' AI video model launches for filmmakers. Moonvalley has released its AI video model Marey to the public, promising a filmmaker-first experience with more control than prompt-only tools. Trained entirely on licensed data, Marey supports short 3D-aware clips and targets creators wary of copyright risks. Pricing is tiered and credit-based. Importance for marketers: Ethical AI tools like Marey appeal to brands and creators seeking to avoid copyright pitfalls while exploring generative video—making it a viable option for campaign asset production.

You can find the previous issue of AI Update here.

Editor's note: GPT-4o was used to help compile this issue of AI Update.