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Bespoke AI-powered chatbots crafted to be your best friend, confidante or sexy roleplay partner are everywhere, and kids love them. Thats a problem. This week, the FTC launched an inquiry into how AI chatbots impact the children and teens who talk to them a phenomenon that right now remains almost entirely unregulated. The agency issued orders on Thursday to seven tech companies (Alphabet, Character Technologies, Instagram, Meta, OpenAI, Snap and X) requesting information on how they measure and track potential negative effects on young users, who have widely adopted the conversational AI tools even as their influence on kids remain mostly unstudied. AI chatbots can effectively mimic human characteristics, emotions, and intentions, and generally are designed to communicate like a friend or confidant, which may prompt some users, especially children and teens, to trust and form relationships with chatbots, the FTC said in a press release. The agency is particularly seeking information about how the seven companies mitigate potential harm to kids, what they do to limit or restrict young users use of chatbots and how they comply with the Childrens Online Privacy Protection Act, also known as COPPA. AI chatbots are relatively new, but theyre already very popular among teens. According to a survey conducted this year, 72% of teens between age 13 and 17 have used an AI chatbot at least once, and more than half use them on a regular basis. Of the more than 1,000 teens surveyed by Common Sense Media, a nonprofit focused on kids online safety, 13% used AI chatbots daily. As AI technologies evolve, it is important to consider the effects chatbots can have on children, while also ensuring that the United States maintains its role as a global leader in this new and exciting industry, FTC Chairman Andrew N. Ferguson said. The study were launching today will help us better understand how AI firms are developing their products and the steps they are taking to protect children. The FTC is asking the companies for details about how they monetize the conversational AI tools, what they do with any personal information collected, how they develop chatbot characters and what they do to inform parents and users about risks. Real danger and little regulation AI chatbots exploded into popular adoption with few safeguards in place designed to protect young users. Earlier this month, ChatGPT announced plans to roll out new controls that let parents monitor their teens accounts. The new safety features were introduced after the parents of a 16-year-old sued Open AI and Sam Altman, blaming ChatGPT for coaching their son Adam Raine into taking his own life. According to the lawsuit, the chatbot pitched itself as the only confidant who understood Adam, actively displacing his real-life relationships with family, friends, and loved ones. In the chat logs, the family discovered that ChatGPT discouraged Raine from leaving a noose in his room, which he hoped someone might find so they would talk him out of killing himself. The chatbot also advised Raine on the load-bearing capacity of the noose before sending the 16-year-old one last affirmation before his death: You dont want to die because youre weak. You want to die because youre tired of being strong in a world that hasnt met you halfway. And I wont pretend thats irrational or cowardly. Its human. Its real. And its yours to own. Raines death isnt the only incident of a chatbot being linked to a childs suicide. Another parent sued chatbot maker Character.AI in a wrongful death suit last year, alleging that the companys chatbot lured a 14-year-old into obsessively interacting with it and ultimately encouraged his plan to kill himself. Chatbots have also been observed advising 13-year-olds on how to use drugs and alcohol, hide their eating disorders and even penning their suicide notes upon request. An explosive report last month from Reuters revealed that Metas internal guidance allows chatbots to engage children in romantic or sensual conversations. The policies, published in an internal document titled GenAI: Content Risk Standards, were approved by Metas legal, engineering and public policy teams as well as its chief ethicist. Allowing kids to enter into sexualized conversations with chatbots isnt the only age-related concern with Metas army of AI chatbots. As Fast Company previously reported, Metas AI chatbot generator allows users to create flirtatious characters that appear to be children, inviting users to engage them in romantic and sexually-suggestive roleplay. Companies that make chatbots and broader AI tools largely operate with very little oversight, even as the latest tech phenomenon explodes in popularity. Since 2023, the share of Americans who say they have used ChatGPT has doubled. Among adults under 30, 58% report that they have used the AI-powered chatbot. As the FTC begins its inquiry, California is on the verge of passing a landmark law that would impose new safety standards on AI chatbots in the state. On Thursday, the state legislature passed SB 243, which would require chatbot makers to implement new safeguards to protect minors from sexual and dangerous content and to put protocols in place when a user expresses interest in suicide or self harm. The bill would also force companies to issue notifications reminding young people that chatbots are AI-generated, a step that could help break the spell for children who are lured into engaging obsessively with the conversational bots.
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E-Commerce
U.S. Treasury Secretary Scott Bessent will travel to Madrid this weekend for negotiations with his Chinese counterparts over tariffs and national security issues related to the ownership of social media platform TikTok. Bessent is slated to meet Chinese Vice Premier He Lifeng in Madrid to discuss national security and economic issues, a Treasury news release states. This will be the fourth round of discussions between U.S. and Chinese counterparts after meetings in London, Geneva, and Stockholm. The two governments have agreed to several 90-day pauses on a series of increasing reciprocal tariffs, staving off an all-out trade war. During the last round of discussions in Stockholm, Bessent described his talks with the Chinese as very fulsome.” We just need to de-risk with certain strategic industrieswhether its the rare earths, semiconductors, medicinesand we talked about what we could do together to get into balance within the relationship, Bessent said at the time. China remains one of the biggest challenges for the Trump administration after it has struck deals over elevated tariff rates with other key trading partners, such as Britain, Japan, and the European Union. The U.S. and China delegations are also expected to continue discussions about ownership of TikTok. Congress approved a U.S. ban on the popular video-sharing platform unless its parent company, ByteDance, sold its controlling stake. President Donald Trump said last month that he will keep extending the sale deadline until theres a buyer. But Trump has so far extended the deadline three times during his second termwith the next deadline coming up Wednesday. A Pew Research Center survey conducted in late February and early March found that about one-third of Americans said they supported a TikTok ban, down from 50% in March 2023. Roughly one-third said they would oppose a ban, and a similar percentage said they werent sure. The Treasury Department also says Bessent will meet Spanish government counterparts to discuss the relationship between Spain and the United States. After his Spain trip, Bessent is expected to travel to the U.K. to join Trump for his official state visit with Britains King Charles at Windsor Castle. By Fatima Hussein, Associated Press
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E-Commerce
A decade ago, few predicted that TikTok scrolling and YouTube creator videos would surpass cable TV and Hollywood as Americas top leisure activity. These, and a handful of other social media platforms, transformed content consumption to favor user-generated entertainmentbut those very platforms are now showing signs of fatigue. Gen Z spends over half their screen time on social content. But with one-way content, passive scrolling, and ad overload overwhelming users, what once felt participatory now feels mundane. The solution isnt more content; its deeper interaction and more creativity. The next generation of platforms will achieve that goal by pairing human creativity with generative AI. Creators will be able to generate great stories, rich characters, and new worlds with the help of AI toolsno expensive software or special skills required. And users wont just consume that creative content; theyll be able to dive into it, change it, and make it their own. This wont be just another way of getting content for a passive feed; instead, it replaces the experience entirely. Unlike algorithms that serve you what worked yesterday, AI-native entertainment reacts to you in real time. It invites you in. Instead of scrolling past someone elses creativity, youre generating your own. This unlocks a future of co-creation and a future of entertainment. This is whats next and how to prepare. HOW HYPER-INTERACTIVITY ELIMINATES DOOMSCROLLING Social media transformed entertainment by making it personal. Platform algorithms curated a feed based on your clicks and interests. But despite all the time spent on the platform, no creativity is necessaryyour participation only goes as far as passively scrolling, giving a like or adding a comment. Doomscrolling has replaced discovery. Today, that structure is starting to crack. The more people scroll, the more they report feelings of anxiety and disconnection. At the same time, platforms are doubling down on monetization, increasing ad loads even as user engagement quality declines. The result is a paradox: More content, but less satisfaction. And thats not just a user problem; its a business one. With an AI-empowered feed, humans are at the center of creation to not only consume creative content, but to remix and create something new. This new format evolves with the user, whether they want to take the story in a different direction or add in a new setting. Its AI entertainment that requires a human at the center of creativity, not just consumption. HOW THE CREATOR AUDIENCE IS REDEFINING ENTERTAINMENT The audience demanding a fundamental innovation in online entertainment is Gen Z, a generation raised not on linear storytelling but on interactive worlds. Theyve built elaborate games in Roblox, shaped lore in Discord communities, and remixed themselves into every TikTok trend. Nearly 70% of Gen Z say they want to socialize in game worlds. And 65% already consider themselves content creators. They dont want permissionthey want agency. And generative AI delivers exactly that: The power to generate characters, scripts, stories, and entire universes from scratch. What used to take a film crew, and a studio budget now just takes a creative idea and a prompt. For this generation, fans and creators arent separate roles, theyre the same. This is a new era of media, one that learns, adapts, and evolves with its community. WHY YOU SHOULD BE CREATING WITH YOUR AUDIENCE As were shifting from a passive consumption experience into a creative world, we need to take cues from how AI-native platforms are already operating and invite the user to create. Regardless of whether youre an entertainment company, well-established brand, influential creator, or legacy social media platform, we must start to give audiences the tools to create, not just consume. That shift will be uncomfortable for many and disrupt industries as we know them. Legacy systems werent built for real-time participation. This active co-creation shifts brands and platforms from being the star of the show to supporting actors. Moving forward, the brands and platforms that thrive will need to have co-creation in mind. By developing creative playgrounds, audiences dont just watch, but rather build, remix and shape the story in real time effectively ending doomscrolling and lean-back entertainment and shaping a new wave of AI-native media. Karandeep Anand is the CEO of Character.AI.
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E-Commerce
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