Hey there, it’s tech reporter Alexandra Sternlicht. Last night I braved swarms of banking analysts in Manhattan to reach a mixer for creator-economy types.
There, I mingled with influencers who’ve garnered millions of likes, and with the folks who pull the strings: marketers, managers, financiers (and one ex-U.S. Open ball boy) in the $250 billion creator economy. And the vibe was what can only be described as trauma bonding.
“There’s so many people who just don’t know what they’re doing in this space,” says Jacob Wallach, founder of social media consultancy Social4TheWin, which sponsored the night’s festivities.
He’s throwing these events on a monthly basis to “break barriers” in the creator economy by getting creators, brand marketers, and tech workers in a room—or bar. Wallach steered me to two well-known creators who both complained that their high-paying promotional deals with big brands have all but evaporated. Instead, they’re being inundated by random low-rent merchants who pay a lot less and only want them to create advertorial videos for TikTok’s e-commerce initiative, Shop, which launched publicly about six months ago.
“I get 10 emails a day [from brands] asking me to do stuff for TikTok Shop, and they’re all really, really sketchy and it’s not lucrative,” says Sarah Luciano, whose comedic @lucianobunny TikTok account has attracted over 450,000 followers and 25.5 million likes. “If anything, TikTok Shop threw a wrench into my brand deals.”
Melissa Becraft, a dancer for the NBA’s Brooklyn Nets who has over 1.2 million TikTok followers and 50 million likes on her @melissabecraft account, then chimes in: “Yeah! It’s all products that have nothing to do with what I do. It’s like, ‘You’re a dancer, what about this vacuum cleaner?’”
Though TikTok Shop videos resonate far less with users than the organic content like flashy dancing and sketch comedy on the service, it’s probably not going anywhere. Quality brands may be less inclined to forge old-fashioned creator partnerships on TikTok while the platform elevates Shop content—usually cheap dollar store merchandise like a $1.59 light-up toy, $5.88 butt-enhancing leggings, and $1.51 Mexican chips.
Becraft and Luciano know that brand deals will return if they achieve their goals: Make compelling content that sparks viral trends within their respective genres. For now, they’re sifting through spam emails for partnership offers from actual humans.
Visitour Media founder Benjamin Putzer, who I bump into while ordering a sparkling water, is well-aware of this struggle. His agency and production company is trying to train college kids to be influencers. He was partially inspired to found the business—currently a side hustle to his day job, also in the creator economy—because he sees an opportunity for student athletes to profit from their name image and likeness (NIL) rights after the 2021 Supreme Court ruling that opened the door to it.
“I grew up my whole life trying to play college football, but I couldn’t,” says the 2022 grad, shouting over clubby EDM beats. “99% of college fans will never get that opportunity. If you’re a college athlete who understands that, and creates content around it, you’re going to have a chance to make a name for yourself beyond your sport.”
With incredible NIL successes like college gymnast Olivia Dunne, who made $2.3 million last year mostly from brand deals (per Forbes), maybe Putzer will be able to make Visitour a force on college campuses nationwide. For now, he’s a student of the influencer craft—and hoping the industry will soon rebound from its current pall.
Alexandra Sternlicht
The rest of this edition of Data Sheet was written by David Meyer.
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NEWSWORTHY
Musk sues OpenAI. Elon Musk has sued OpenAI and its CEO Sam Altman for breaching the AI company’s founding agreement. Musk claims OpenAI has become a “closed-source de facto subsidiary of the largest technology company in the world: Microsoft,” thus abandoning its original “non-profit mission of developing AGI for the benefit of humanity broadly.” Microsoft, whose investment in OpenAI is currently under regulatory scrutiny in Europe, denies controlling the smaller company.
Facebook drops News tab. Facebook’s five-year-old News tab will be axed next month in the U.S. and Australia, continuing Meta’s abandonment of a news industry that came to rely on it for a great deal of traffic. The tab is already gone in the U.K., France, and Germany. Meta’s turn away from news and politics is partly to do with the scourge of online disinformation, but also because countries like Australia have started forcing it to pay news publishers for linking to their stories. Now it will no longer make those payments in Australia, and Reuters reports that the government there is furious.
WhatsApp scores spyware win. Meta’s WhatsApp has scored a major legal victory against the Israeli spyware vendor NSO Group. The Guardian reports that a U.S. judge yesterday ordered NSO to give the messaging platform the code for spyware products including Pegasus, as part of the discovery process in a long-running suit by WhatsApp over the alleged use of those products against 1,400 WhatsApp users. However, the judge did not force NSO to identify its clients, nor to give up server-infrastructure information.
Google vs. Indian developers. Irked at the developers of Indian apps who are not complying with its billing policies, Google has removed some apps from its Play Store in the country. As TechCrunch reports, some are widely used matrimony apps. At least one affected developer, Bharat Matrimony, which has alongside others been trying to challenge Google’s fee for in-app payments, believes Google’s actions today violate an order by the Indian antitrust regulator.
ON OUR FEED
“China imposes restrictions on American autos and other foreign autos operating in China. Why should connected vehicles from China be allowed to operate in our country without safeguards?”
—U.S. President Joe Biden orders an investigation into “connected vehicles with technology from countries of concern.” As The Register points out, no Chinese automaker currently sells its wares in the U.S.
IN CASE YOU MISSED IT
Electronic Arts is the latest gaming giant to announce big layoffs, cutting 5% of staff, by Chris Morris
Salesforce founder Marc Benioff really doesn’t want people to know he bought hundreds of acres of land in Hawaii worth $100 million, by Christiaan Hetzner
Microsoft, ex-Google CEO back startup that aims to make AI systems work as humans intended, by Bloomberg
The guy who bought the first Apple Vision Pro in New York says it’s a ‘bit heavy’ and he doesn’t use it as much as he expected—but he isn’t returning it, by Jessica Mathews
BEFORE YOU GO
Generative AI worms. Researchers have created a worm called Morris II that can attack email systems that feature generative-AI assistants, Wired reports. The proof of concept reportedly shows it’s possible to bypass security protections in OpenAI and Google’s large language models to steal data from emails, propagate itself, and pump out spam. OpenAI said it’s trying to make its systems “more resilient,” but Google declined to comment on the research, Wired said.
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