ABBA’s successful avatar show in London offers a glimpse at a daring new direction for live music
LONDON — Before the launch of “ABBA Voyage,” the London concert performed by 3D digital avatars of the iconic Swedish band, member Björn Ulvaeus said they hoped audiences would “feel that they’ve gone through something that they’ve never seen before.”
Following its May 27 debut, much of the reaction from domestic and international critics, fans and industry professionals has been rapturous.
“Other than the team involved, no one really knew how they would integrate an avatar-based performance,” Sarah Cox, director of live event technical consultancy Neutral Human, told CNBC. “That blew me away as someone working on real-time graphics. My jaw hit the floor. You look around and people are really buying into the idea that ABBA are there.”
Demand has been strong — the show’s run has been extended to November 2023 and could well go beyond that.
And the team has confirmed it aims to take the show around the world.
“Our ambition is to do another ABBA Voyage, let’s say in North America, Australasia, we could do another one in Europe. We can duplicate the arena and the show,” producer Svana Gisla told a U.K. government committee session in November.
It also expects other shows to begin following the same model.
“The tech itself isn’t new but the way in which we’ve used it and scale and barriers we’ve broken down are new. I’m sure others will follow and are planning to follow,” Gisla said.
That could “absolutely” be the case somewhere like Las Vegas, where some shows run round the clock with rotating crews, she added.
“We have live musicians, so we keep our band and do seven shows over five days a week. But you could roll round the clock. Vegas will quickly adopt this style of entertainment and do Elvis or the Beatles.”
Money, money, money
Voyage’s venue, dubbed the ABBA Arena, was built specifically for the show on a site in Stratford in east London, with its 3,000 capacity comprising a standing pit, tiered seats along three sides with no restricted view, and higher-priced private “dance booths,“ as well as space for the extensive kit positioned in the roof and what creators White Void say is the largest permanent kinetic lighting installation in the world.
View of the ABBA Arena on May 26, 2022 in London, England.
Dave J Hogan | Getty Images Entertainment | Getty Images
It was also designed for flexibility. It was constructed on a one meter raised platform without breaking ground, and could be disassembled and reconstructed elsewhere — or stay in place and host another show in future.
But emulating Voyage’s model — which sees digital replicas of the four band members perform classic hits and newer numbers for 90 minutes, while also interacting with each other and speaking to the audience between songs — will be no easy task.
The show was in the works for five years and had a £141 million ($174.9 million) budget funded by global investors. It needs to get around 3 million people through its doors to break even, according to Gisla, and the average ticket price is £75.
After choosing their set list and making other creative decisions, the ABBA members did five weeks of performance in motion capture suits. Hundreds of visual effects artists then worked on the show for two years, led by the London branch of Industrial Light & Magic, a visual effects company founded by George Lucas.
Promotional image for ABBA Voyage, the digital avatar-based live show currently running in London.
Johan Persson | ABBA Voyage
A decade ago, a Coachella performance featuring an apparent hologram of Tupac Shakur impressed audiences and hinted at alternative reality’s potential in live shows, with the artist’s likeness digitally recreated without using archive footage.
While not meeting the technical definition of a hologram, which uses laser beams to construct an object with depth, the visual effects team projected a 2D image onto an angled piece of glass, which was itself projected onto a Mylar screen, creating a 3D effect. Shakur then “performed” two songs with Dr. Dre and Snoop Dogg, 16 years after his death.
The Voyage team is tight-lipped about exactly how their show works, but previously confirmed it is not a laser-based hologram either. It involves 65-million pixel screens which give the impression of the band performing life-size on stage in 3D in real time, with traditional-style concert screens showing close-ups and different views on either side.
Its servers are being pushed to the “absolute extreme” to render the images without lag, Gisla said, such that they are shaking through some transitions. She also acknowledged that the 10-meter high side screens are “very unforgiving” on detail and there are improvements that could be made.
Rapper Snoop Dogg (L) and a “hologram” of deceased rapper Tupac Shakur perform on stage on the third day of the 2012 Coachella Valley Music & Arts Festival.
Christopher Polk | Getty Images Entertainment | Getty Images
But, she added, with real-time render speeds becoming quicker, “Benny and Bjorn could be sitting in a chair at home connected to their avatar, updating them to talk about last night’s football result to the audience. That will come.”
Next steps
Consultant Sarah Cox said the kind of processing and motion capture technology used by Voyage is still prohibitively expensive for most productions, but believes it is a “brand-new format that will be replicated time and time again,” particularly somewhere like Las Vegas.
“An immersive venue could host multiple shows. And then the cost comes down, because you have the technology stack, the venue, and all the money goes into creating the avatar and virtual experience and tweaking the programing.”
Many will remain skeptical of digital avatar-based gigs, particularly if they are wary of the general trend toward metaverse-based virtual experiences.
Bjorn Ulvaeus himself previously told CNBC he has concerns about the misuse of the technology to create nefarious “deep fakes” which will be “indistinguishable from the real thing going forward.”
There is also the question of finding suitable artists for shows. ABBA is a rare proposition as a band with a large catalogue of hits, a multi-generational worldwide fanbase, and a full set of members who are on-board with the show — but who have not toured together for 40 years.
ABBA avatars perform their 1981 song The Visitors in London, 2022.
Johan Persson | ABBA Voyage
“Posthumously you can put artists back on stage, ethically you may or may not have a view on that,” said Gisla. “Having ABBA partake in this is I can say this is an ABBA concert. ABBA made the decisions, chose what to wear, chose their set list, ABBA made this show.”
For an artist like Elvis with an extensive visual and audio archive you could create an accurate replica, but without the input that makes this show feel so tangible, she said.
For Cox, live shows that provide a “shared experience” like ABBA Voyage hold a greater appeal than headset-based virtual experiences, though there will certainly be more of those available in future.
And both AR and VR are spreading in the worlds of gaming, events, sports, theater and beyond.
Digital avatar experiments have included musician Travis Scott premiering a song within the wildly popular game Fortnite in 2020, with his avatar looming over players who were still moving around within the world of the game. It got a reported 45.8 million viewers across five shows. Lil Nas X performed the same year in the game Roblox.
A 15 year-old plays Fortnite and Travis Scott Present: Astronomical on April 23, 2020, in Los Angeles, United States.
Frazer Harrison | Getty Images Entertainment | Getty Images
Jo Twist, chief executive of trade body UK Interactive Entertainment, said she was noticing growing opportunities in the intersections between games, music and entertainment experiences.
“While these kind of experiences have mostly been the preserve of the biggest artists so far, we believe that growth in both the number of people who play, and online game worlds that enable user generated content, could open games up to all kinds of performers, allowing them to successfully tap into its enormous player base to raise their profile.” she said.
Giulia De Paoli, founder and general manager of show design and AR studio Ombra, has worked on projects bringing “extended reality” — spanning AR and VR — to live sports.
“AR has permitted us to create a full show for broadcast events that would be impossible with traditional projection and LED setups, like creating huge 10-meter flying numbers and flames around the arena,” she said.
“We see this developing into a full experience for people to watch live and, as the word says, augmenting the reality around us, gamifying, interacting and seeing impossible things happen.”
Microsoft CEO Satya Nadella speaks during the Microsoft Build conference at Microsoft headquarters in Redmond, Washington, on May 21, 2024.
Jason Redmond | AFP | Getty Images
A half-century ago, childhood friends Bill Gates and Paul Allen started Microsoft from a strip mall in Albuquerque, New Mexico. Five decades and almost $3 trillion later, the company celebrates its 50th birthday on Friday from its sprawling campus in Redmond, Washington.
Now the second most valuable publicly traded company in the world, Microsoft has only had three CEOs in its history, and all of them are in attendance for the monumental event. One is current CEO Satya Nadella. The other two are Gates and Steve Ballmer, both among the 11 richest people in the world due to their Microsoft fortunes.
While Microsoft has mostly been on the ascent of late, with Nadella turning the company into a major power player in cloud computing and artificial intelligence, the birthday party lands at an awkward moment.
The company’s stock price has dropped for four consecutive months for the first time since 2009 and just suffered its steepest quarterly drop in three years. That was all before President Donald Trump’s announcement this week of sweeping tariffs, which sent the Nasdaq tumbling on Thursday and Microsoft down another 2.4%.
Cloud computing has been Microsoft’s main source of new revenue since Nadella took over from Ballmer as CEO in 2014. But the Azure cloud reported disappointing revenue in the latest quarter, a miss that finance chief Amy Hood attributed in January to power and space shortages and a sales posture that focused too much on AI. Hood said revenue growth in the current quarter will fall to 10% from 17% a year earlier
Nadella said management is refining sales incentives to maximize revenue from traditional workloads, while positioning the company to benefit from the ongoing AI boom.
“You would rather win the new than just protect the past,” Nadella told analysts on a conference call.
The past remains healthy. Microsoft still generates around one-fifth of its roughly $262 billion in annual revenue from productivity software, mostly from commercial clients. Windows makes up around 10% of sales.
Meanwhile, the company has used its massive cash pile to orchestrate its three largest acquisitions on record in a little over eight years, snapping up LinkedIn in late 2016, Nuance Communications in 2022 and Activision Blizzard in 2023, for a combined $121 billion.
“Microsoft has figured out how to stay ahead of the curve, and 50 years later, this is a company that can still be on the forefront of technology innovation,” said Soma Somasegar, a former Microsoft executive who now invests in startups at venture firm Madrona. “That’s a commendable place for the company to be in.”
When Somasegar gave up his corporate vice president position at Microsoft in 2015, the company was fresh off a $7.6 billion write-down from Ballmer’s ill-timed purchase of Nokia’s devices and services business.
Microsoft is now in a historic phase of investment. The company has built a $13.8 billion stake in OpenAI and last year spent almost $76 billion on capital expenditures and finance leases, up 83% from a year prior, partly to enable the use of AI models in the Azure cloud. In January, Nadella said Microsoft has $13 billion in annualized AI revenue, more even than OpenAI, which just closed a financing round valuing the company at $300 billion.
Microsoft’s spending spree has constrained free cash flow growth. Guggenheim analysts wrote in a note after the company’s earnings report in January, “You just have to believe in the future.”
Of the 35 Microsoft analysts tracked by FactSet, 32 recommend buying the stock, which has appreciated tenfold since Nadella became CEO. Azure has become a fearsome threat to Amazon Web Services, which pioneered the cloud market in the 2000s, and startups as well as enterprises are flocking to its cloud technology.
Winston Weinberg, CEO of legal AI startup Harvey, uses OpenAI models through Azure. Weinberg lauded Nadella’s focus on customers of all sizes.
“Satya has literally responded to emails within 15 minutes of us having a technical problem, and he’ll route it to the right person,” Weinberg said.
Still, technology is moving at an increasingly rapid pace and Microsoft’s ability to stay on top is far from guaranteed. Industry experts highlighted four key issues the company has to address as it pushes into its next half-century.
Microsoft didn’t respond to a request for comment.
Regulation
There’s some optimism that the Trump administration and a new head of the Federal Trade Commission will open up the door to the kinds of deal-making that proved very challenging during Joe Biden’s presidency, when Lina Khan headed the FTC.
But regulatory uncertainty remains.
It’s not a new risk for Microsoft. In 1995, the company paid a $46 million breakup fee to tax software maker Intuit after the Justice Department filed suit to block the proposed deal. Years later, the DOJ got Microsoft to revamp some of its practices after a landmark antitrust case.
Microsoft pushed through its largest acquisition ever, the $75 billion purchase of video game publisher Activision, during Biden’s term. But only after a protracted legal battle with the FTC.
At the very end of Biden’s time in office, the FTC opened an antitrust investigation on Microsoft. That probe is ongoing, Bloomberg reported in March.
Nadella has cultivated a relationship with Trump. In January, the two reportedly met for lunch at Trump’s Mar-a-Lago resort in Florida, alongside Tesla CEO Elon Musk.
President Donald Trump shakes hands with Microsoft CEO Satya Nadella during an American Technology Council roundtable at the White House in Washington on June 19, 2017.
Nicholas Kamm | AFP | Getty Images
The U.S. isn’t the only concern. The U.K.’s Competition and Markets Authority said in January that an independent inquiry found that “Microsoft is using its strong position in software to make it harder for AWS and Google to compete effectively for cloud customers that wish to use Microsoft software on the cloud.”
Microsoft last year committed to unbundling Teams from Microsoft 365 productivity software subscriptions globally to address concerns from the European Union’s executive arm, the European Commission.
Noncore markets
Fairly early in Microsoft’s history the company became the world’s largest software maker. And in cloud, Microsoft is the biggest challenger to AWS. Most of the company’s revenue comes from corporations, schools and governments.
But Microsoft is in other markets where its position is weaker. Those include video games, laptops and search advertising.
Mary Jo Foley, editor in chief at advisory group Directions on Microsoft, said the company may be better off focusing on what it does best, rather than continuing to offer Xbox consoles and Surface tablets.
“Microsoft is not good at anything in the consumer space (with the possible exception of gaming),” wrote Foley, who has covered the company on and off since 1984. “You’re wasting time and money on trying to figure it out. Microsoft is an enterprise company — and that is more than OK.”
It’s unlikely Microsoft will back away from games, particularly after the Activision deal. Nearly $12 billion of Microsoft’s $69.6 billion in fourth-quarter revenue came from gaming, search and news advertising, and consumer subscriptions to the Microsoft 365 productivity bundle. That doesn’t include sales of devices, Windows licenses or advertising on LinkedIn.
“As a company, Microsoft’s all-in on gaming,” Nadella said in 2021 in an appearance alongside gaming unit head Phil Spencer. “We believe we can play a leading role in democratizing gaming and defining that future of interactive entertainment, quite frankly, at scale.”
AI pressure
Microsoft has an unquestionably strong position in AI today, thanks in no small part to its early alliance with OpenAI. Microsoft has added the startup’s AI models to Windows, Excel, Bing and other products.
The breakout has been GitHub Copilot, which generates source code and answers developers’ questions. GitHub reached $2 billion in annualized revenue last year, with Copilot accounting for more than 40% of sales growth for the business. Microsoft bought GitHub in 2018 for $7.5 billion.
Microsoft CEO Satya Nadella, right, speaks as OpenAI CEO Sam Altman looks on during the OpenAI DevDay event in San Francisco on Nov. 6, 2023.
Justin Sullivan | Getty Images
But speedy deployment in AI can be worrisome.
The company is “not providing the underpinnings needed to deploy AI properly, in terms of security and governance — all because they care more about being ‘first,'” Foley wrote. Microsoft also hasn’t been great at helping customers understand the return on investment, she wrote.
AI-ready Copilot+ PCs, which Microsoft introduced last year, aren’t gaining much traction. The company had to delay the release of the Recall search feature to prevent data breaches. And the Copilot assistant subscription, at $30 a month for customers of the Microsoft 365 productivity suite, hasn’t become pervasive in the business world.
“Copilot was really their chance to take the lead,” said Jason Wong, an analyst at technology industry researcher Gartner. “But increasingly, what it’s seeming like is Copilot is just an add-on and not like a net-new thing to drive AI.”
Innovation
At 50, the biggest question facing Microsoft is whether it can still build impressive technology on its own. Products like the Surface and HoloLens augmented reality headset generated buzz, but they hit the market years ago.
Teams was a novel addition to its software bundle, though the app’s success came during the Covid pandemic after the explosive growth in products like Zoom and Slack, which Salesforce acquired. And Microsoft is still researching quantum computing.
In AI, Microsoft’s best bet so far was its investment in OpenAI. Somasegar said Microsoft is in prime position to be a big player in the market.
“To me, it’s been 2½ years since ChatGPT showed up, and we are not even at the Uber and Airbnb moment,” Somasegar said. “There is a tremendous amount of value creation that needs to happen in AI. Microsoft as much as everybody else is thinking, ‘What does that mean? How do we get there?'”
Technology
Nvidia positioned to weather Trump tariffs, chip demand ‘off the charts,’ says Altimeter’s Gerstner
Altimeter Capital CEO Brad Gerstner said Thursday that he’s moving out of the “bomb shelter” with Nvidia and into a position of safety, expecting that the chipmaker is positioned to withstand President Donald Trump’s widespread tariffs.
“The growth and the demand for GPUs is off the charts,” he told CNBC’s “Fast Money Halftime Report,” referring to Nvidia’s graphics processing units that are powering the artificial intelligence boom. He said investors just need to listen to commentary from OpenAI, Google and Elon Musk.
President Trump announced an expansive and aggressive “reciprocal tariff” policy in a ceremony at the White House on Wednesday. The plan established a 10% baseline tariff, though many countries like China, Vietnam and Taiwan are subject to steeper rates. The announcement sent stocks tumbling on Thursday, with the tech-heavy Nasdaq down more than 5%, headed for its worst day since 2022.
The big reason Nvidia may be better positioned to withstand Trump’s tariff hikes is because semiconductors are on the list of exceptions, which Gerstner called a “wise exception” due to the importance of AI.
Nvidia’s business has exploded since the release of OpenAI’s ChatGPT in 2022, and annual revenue has more than doubled in each of the past two fiscal years. After a massive rally, Nvidia’s stock price has dropped by more than 20% this year and was down almost 7% on Thursday.
Gerstner is concerned about the potential of a recession due to the tariffs, but is relatively bullish on Nvidia, and said the “negative impact from tariffs will be much less than in other areas.”
He said it’s key for the U.S. to stay competitive in AI. And while the company’s chips are designed domestically, they’re manufactured in Taiwan “because they can’t be fabricated in the U.S.” Higher tariffs would punish companies like Meta and Microsoft, he said.
“We’re in a global race in AI,” Gerstner said. “We can’t hamper our ability to win that race.”
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