Welcome to Stuff I Thought About Last Week, a personal collection of topics on tech, innovation, science, the digital economic transition, the finance industry, and whatever else made me think last week.

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In today’s post: preparing for your home holodeck room; a week of unexpected AI leaps from Sora to Gemini 1.5; sizing the data center market; adding LTM to LLMs; another new Disney droid lands in parks; Billy Joel turns the lights back on and travels through time with AI; and much more below. 

Stuff about Innovation and Technology
Holodeck Rec Room
There is a long history of cultivating dedicated spaces at home for entertainment and media consumption. Even back in Shakespeare’s day, the king had a theater in the palace for live shows (just don’t invite your nephew if you axed his father and married his widow!). The first home cinemas date back to the early 1920s and were a luxury for only the wealthiest of movie buffs. The first modern home theater system was introduced around 40 years ago, resulting in a multi-decade trend of transforming spare rooms or basements into cinematic experiences. All the while, movie theater technology has continuously improved to provide a better experience than home equivalents; and, of course, it also fulfills the social aspect of shared media consumption. Over the last decade, deflation in consumer electronics has made ultra-large screens and good audio attainable for most households; but, after the pandemic bump, the home theater has plateaued in favor of everyone scattered around the house staring at their own phone or tablet. Meanwhile, the availability of content has evolved from expensive VCR tapes to DVDs to streaming to ubiquitous/infinite content from YouTube, social networks, podcasts, video games, etc. And, despite a post-COVID recovery, the movie theater box office has stalled out below its prior peaks. 
 
I think the next decade will be defined by the creation of a new personal media space: the home holodeck. Increasingly, we will want dedicated rooms (perhaps with padded walls!) free of obstacles to experience immersive storytelling, games, fitness, and media. These rooms could also function as social spaces for virtually interacting in a realistic way with people around the world, including attending live events or game play. Multidirectional flooring innovations, like Disney’s HoloTile floor I previously mentioned (#423), and other new innovations may populate our home holodecks. These rooms will benefit from a lack of windows, taller ceilings, and neutral backgrounds. Specially designed, multi-purpose objects will be invented to stand in for virtual objects to increase realism. These morphable shapes and weights could be things you carry, move around, or spar with. The objects might even be interactive, android-like robots that could hand you objects or keep you safe. Imagine self-assembling robotic blocks that create climbable surfaces and changing terrain. Today’s dedicated, decked-out home theaters cost anywhere from $10K to hundreds of thousands of dollars. If you look at the entire spectrum of technology, including the more simple systems of a large screen and media bar, one estimate puts the number of households in the US with some sort of dedicated media room at around 40%. I don't know precisely when or how many households will have a holodeck, but I suspect they will eventually be as prevalent as dedicated media rooms and perhaps even cost a similar amount with some extreme setups that cost many hundreds of thousands of dollars. No doubt there will be an HGTV show about mega home holodeck makeovers in the near future.

The immersive content to populate our home holodecks is already here with devices like the Meta Quest 3, and soon the sky will be the limit. For example, OpenAI’s new Sora video generation engine demonstrates the stunning pace of advancement in AI media creation. You can take a video created by Sora and feed it into a 3D gaming engine, or an app like LumaLabs, and instantly create an immersive virtual world – all emerging from a simple text prompt. It’s a seemingly short step to imbuing this world with rich, complex, AI-driven content and interactions. In another milestone that demonstrates how quickly AI’s understanding of the visual world is progressing, Google unexpectedly released Gemini 1.5 last week, which can process enormous amounts of text, audio, and video.
 
As I wrote a couple of weeks ago in “Your Wish is Granted” and in last week’s Bringing the Virtual to Reality, this is likely a key shift in storytelling that will transform the multi-hundred-billion-dollar entertainment and gaming industry into something very different and much larger than it is today. We no longer appear to be limited by the creative/AI side of the equation; rather, we are limited by the installed base of hardware (e.g., data centers, VR headsets, and the like; also, check out these new AR glasses to get a glimpse into the near future). It took over a decade for smartphones and high-speed wireless to reach 50% penetration. Adoption of the next platform will depend on the pace of innovation, the production of hardware form factors, and the developers who will create all the apps we can’t yet even imagine. At the moment, it all looks to be arriving sooner than anticipated, but timing can be deceiving this early in the innovation curve. 
 
Datalicious
Nvidia CEO Jensen Huang gave an interesting stat on the size of the data center market, and his comments align with my views on the absurdity of trying to scale the chip industry by multiple orders of magnitude: “There’s about a trillion dollars’ worth of installed base of data centers. Over the course of the next four or five years, we’ll have $2 trillion worth of data centers that will be powering software around the world.” By installed base, Huang is referring to all of the infrastructure, networking, buildings, power, etc. that go into a data center, which costs many multiples of the chips that run inside of them. Of course, every dollar spent in the future will buy far more computing power than it would today, given ongoing gains in chip/systems efficiency. Last week, Nvidia surpassed both Amazon and Google to become the third most valuable company by market cap behind Microsoft and Apple. Speaking of historic milestones, a year before I was born, the Warner-Lambert company introduced Bubblicious gum, giving children the ability to blow bigger, more burstable bubbles than ever before. The great thing about Bubblicious is you could blow bigger, more burstable bubbles than ever before – you just never knew when they'd pop!
 
LLMs with LTM
Long-term memory is coming to chatbots, with OpenAI announcing that the feature is currently under trials. As I wrote last July: 
One of the more remarkable leaps with LLMs will come when they have access to long-term memory. [LLMs] have amnesia. As soon as you ask it something, it has no memory of the previous answer or any context through time from other conversations. The entire concept of your sense of self comes from a constantly updated narrative of your moment-to-moment life that you can recall increasingly vaguely over time (combined with being in a body that is taking in sensory data from the world around you). Without this grounding and context, you would have no idea who you are. So, giving LLMs long-term memory could create the ability for them to possess a sense of self and have significantly increased value to users.

Robotic Teams
Disney’s deployment of their new “Indestructible” class of character bots, first introduced in 2023 (see Emotive Bots), is expanding with a Duke Weaselton bot for Shanghai Disneyland’s Zootopia attraction. IEEE reports in detail on the Duke. Due to the instability of bots with more free-form movement, it turns out they work best in collaboration with other robots that can provide support and locomotion. Following the new droids at Galaxy’s Edge, Duke marks the second time in recent history that an emotive robot form factor was rapidly developed and deployed in parks. This raises my hopes that Disney’s HoloTile floors will be available soon!

Miscellaneous Stuff
Artificial Patient Screening
In last week’s Clinical Twins, I mentioned the clinical trial bottleneck that may result as the number of AI-created drug candidates explodes in the near future. Virtual patients can alleviate some of that strain, and a recent study also indicates that AI can greatly automate the manual process of screening to determine the best candidates for a human drug trial. 
 
Piano Man
This video for Billy Joel’s new single “Turn the Lights Back On” features some very well done AI effects that transport Joel on a round-trip journey back through time. The generative AI of Joel aging through his career strikes a poignant tone, especially given the song’s theme. The AI in the music video was generated by Deep Voodoo, a company started four years ago by Matt Stone and Trey Parker of South Park fame. Although Joel has been performing live continuously, his last record was River of Dreams released in 1993.

Stuff About Demographics, the Economy, and Investing
US Labor Force Multipler
The US Congressional Budget Office has increased projected labor force participation from ~5M new workers to ~10M over the next decade. The 5.2M increase – from the forecast from just twelve months ago – is largely due to immigration (PDF). The CBO estimates this big increase in the labor force will add $7T to the US economy through 2034. One estimate puts the 2023 US population growth at the largest on record. This is a welcome offset to the accelerating retirees in the Boomer demographic I wrote about last week, but a rapid growth in the labor force coinciding with rising capabilities of AI and robotics could be setting us up for structurally higher unemployment over the next decade.

✌️-Brad

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