Embedding AI into Daily Lives: How Muse Charm, VR Glasses Expand META's Footprint

Alex Coffey (0:00)

Welcome back to Next Generation Investing. I'm Alex Coffey. It's time to welcome in our next guest. That's Steven Dickens, the CEO and principal analyst at Hyperframe. And I was just taking a look at Meta and thinking about September.

Risk happens fast and the story can change really quickly. This was a stock that after its last earnings, seemed like it was going back to the drawing board and apparently quickly did because it's at its highs. It's really turned the story around. I'm curious your thoughts on September so far, and we can kind of drill down on some of these big takeaways.

Steven Dickens (0:36)

So for me, I think this is a company that's got a huge footprint, large part of everybody's day with some of their social platforms, and they've done a proven job of monetizing that over the last few decades. So I think what we're seeing from the company now, and from what they've announced at Meta Connect, is a real leaning into their Muse personal agent, third-party connectors, they've also got into the device space with a keychain style device called Charm.

So I think there's lots to like here about where the company's going. If you've been on any of the Meta social platforms over the last week, it's just wall-to-wall ads for Muse. So where the people are starting to get engaged and drive interaction, that's what we'll be looking for. But I think large-scale bullish on what they're doing.

Alex Coffey (1:30)

Yeah, I guess my question, Steven, is clearly they're doing things that are a little bit different. So I don't want to discount the innovation. But what is making this stand out the way that it seemingly is versus a Claude or the ChatGPT?

Is it simply the connection that they're having in the plugins with the other companies or is it the idea? I don't mean this in the negative connotation, it's the easiest way I can describe it. The fact that they're huge user base for their other platforms almost serves as a Trojan horse into this Muse platform.

Steven Dickens (2:06)

So Alex, I think the way I look at it is, the platforms you mentioned, the OpenAI, the Claude, they've largely penetrated the market through a business context. Maybe they've penetrated into students who were thinking about doing them from their homework, but I don't know whether they're in the fabric of their day-to-day lives yet. Having a third party connected sort of AI agent to Walmart or Gap or Sephora or Best Buy, that's how people live their daily lives. That's where they spend their money. If there's ways that we can connect that huge surface area that Meta's got with apps like Facebook, Threads, Instagram, connect that into how people live their daily lives, and the bet around VR glasses starts to become something that people are comfortable wearing and using.

If the more speculative bet around something like Charm, with this keychain type of wearable device, if those start to pan out, this is embedding AI directly into where people live their lives, where they spend a significant amount of their time. That for me is what's different to the anthropics and the open AIs of this world.

Alex Coffey (3:28)

Yeah. I think you're raising a lot of things that are making me think here in real time.

I think back to some of the decisions that Meta has made, Steven, even with its Instagram platform, which started as just a posting of photographs in a chronological way, your timeline would show it that way, and then they subtly made changes, whether it was curating the feed and then slowly adding in things like stories. But all of a sudden, it became almost like an advertisement at the same time, with shopping embedded and all these other things. I think too, something as simple as the trust factor that consumers already have with the Meta to use those credentials to establish new credentials at other places similar to how they do maybe with Alphabet or Apple, is that also a huge difference? Because you mentioned the business context of the GPTs and the clods, but the lack of maybe the consumer connection, is it come down to trust and has Meta established that trust through its other platforms over the last 10, 15 years?

Steven Dickens (4:36)

100 percent, Alex. For me, it's around frictionless. How many of us have clicked on an advert that we've seen or something, an affiliate link on an Instagram post and actually made a purchase? If you'd have said that maybe 5, 10 years ago, people would have laughed at you. Where we are now, though, that's part of people's day-to-day retail journey. So infusing AI and some of these third-party collaborations that they've made, you know, the huge community of people who are on Instagram looking at beauty products. I've got four daughters. They're always looking at this type of stuff. So being able to connect Muse to Sephora and make that seamless. Hey, these are sort of cosmetics trends.