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An animated avatar generated by the AI video platform Synthesia.

Synthesia

Synthesia, a digital media platform that lets users create artificial intelligence-generated videos, has raked in $90 million from investors — including U.S. chip giant Nvidia, the company told CNBC exclusively.

The London-based company raised the cash in a funding round led by Accel, an early investor in Facebook, Slack and Spotify. Nvidia came in as a strategic investor, putting in an undisclosed amount of money. Other investors include Kleiner Perkins, GV, FirstMark Capital and MMC. 

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Founded in 2017 by researchers and entrepreneurs Victor Riparbelli, Matthias Niessner, Steffen Tjerrild and Lourdes Agapito, Synthesia develops software that allows people to make their own digital avatars to deliver corporate presentations, training videos — or even compliments to colleagues in over 120 different languages.

Its ultimate aim is to eliminate cameras, microphones, actors, lengthy edits, and other costs from the professional video production process. To do that, Synthesia has created animated avatars which look and sound like humans, but are generated by AI. The avatars are based on real-life actors who speak in front of a green screen.

“Productivity can be improved because you are reducing the cost of producing the video to that of making a PowerPoint,” Philippe Botteri, at Accel, the lead investor in Synthesia’s Series C, told CNBC, adding that adoption of video has been proliferated by consumer platforms such as YouTube, Netflix and TikTok.

“Video is a much better way to communicate knowledge. When we think about the potential of the company and the valuation, we think about what it can return, [and] in the case of Synthesia, we’re just scratching the surface.”

Synthesia is a form of generative AI, similar to OpenAI’s ChatGPT. But the company says it has been working on its own proprietary generative AI for years, and that although ChatGPT may have only recently emerged into public consciousness, generative AI itself isn’t a new technology.

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Synthesia sells to enterprise clients, including Tiffany’s, IHG, and Moody’s Analytics. The company doesn’t disclose its sales or revenue metrics, though it says it “consistently driven triple digit growth,” with over 12 million videos produced on the platform to date. The number of users on Synthesia spiked 456% year over year, the company said.

Synthesia plans to ramp up investment into its technology, with a particular focus on advancing its AI research and making Synthesia avatars capable of performing more tasks. 

“We work with 35% of the Fortune 100 [with a focus on] product marketing, customer support, customer success — areas of the company you have a lot of text that you want to turn into video,” Riparbelli told CNBC.

“As we’re progressing to the next phase of the next generation of Synthesia technology, it’s all about making the avatars more expressive, be able to do more things, walk around in a room, have conversations,” he added.

Riparbelli explained Nvidia isn’t just a semiconductor manufacturer — it’s also a powerhouse of research and development talent with an army of engineers, academics and researchers who produce papers on the subject.

“They’re not just a chip producer,” he said. “They have amazing research teams that are very much leading in terms of, how do you actually train these large models? What works, what doesn’t work?”

Investor interest in A.I.

Business Insider previously reported that Synthesia was in talks with investors to raise between $50 million and $75 million in new funds at a valuation of around $1 billion.

The report didn’t include detail about Nvidia’s involvement, nor mention the total $90 million sum raised.

Synthesia is one of many firms attracting interest from investors with AI and enterprise software that can reduce costs involved in certain business processes. Companies are looking to reduce expenses everywhere they can to combat climbing inflation and prepare for a possible recession. 

Last week, French business planning software company Pigment raised $88 million from investors including Iconiq Growth, Felix Capital, Meritech IVP and FirstMark, in part to ramp up its investment in AI.

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Generative AI has been a rare bright spot in a European tech market reeling from declining funding and a pullback in valuations. Investors have rotated out of high-growth tech firms into value sectors with more resilient income generation, such as financials, industrials, energy and consumer staples.

Recently, a report from the venture capital firm Atomico showed funding for Europe’s technology startups was on track to fall a further 39% in 2023 to $51 billion from $83 billion in 2022.

However, AI was one area that drew more investments, Atomico said, with generative AI accounting for 35% of total investment into AI and machine learning firms last year — the highest share ever and a big jump from 5% in 2022.

Ethical concerns about deepfakes

There are concerns that the use of video AI tools as advanced as Synthesia could lead to deepfakes, videos which take a user’s likeness and manipulate it to make it appear as though they are saying or doing something they’re not.

There has also been an increasing number of calls from tech leaders and academics for a global pause on AI development beyond systems like OpenAI’s GPT-4, because of fears that the technology is becoming so advanced it may pose an existential risk to humanity.

Synthesia first attracted mainstream attention in 2019 for a deepfake video that featured a digitally animated version of celebrity footballer David Beckham speaking about a campaign to end malaria in nine languages.

While that was done with the consent of Beckham and for a good cause, more widespread use of deepfake technology has led to worries about the potential for misinformation.

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To address that, Synthesia says it has kept ethics in mind while developing its software. The company requires consent from the people who feature as avatars in its software, and uses a mix of humans and machine learning to target material such as profanity and hate speech.

It is also signed up to Responsible Practices for Synthetic Media, a voluntary industrywide framework for the ethical and responsible development, creation and sharing of synthetic media.

“There are many different discourses going on right now. There’s one about the very long-term existential sort of risk scenarios. I think they’re important to talk about as well. But I’d love to see more focus on where are we today?” Riparbelli told CNBC in an interview.

“These technologies are already powerful. How do we deal with hallucinations? How do we deal with all of the problems that arise?” he added. “There’s definitely pitfalls. But there’s also just so much opportunity in it, I think, leveling the playing field and enabling people to do much more with less.”

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How Elon Musk’s plan to slash government agencies and regulation may benefit his empire

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How Elon Musk’s plan to slash government agencies and regulation may benefit his empire

Elon Musk’s business empire is sprawling. It includes electric vehicle maker Tesla, social media company X, artificial intelligence startup xAI, computer interface company Neuralink, tunneling venture Boring Company and aerospace firm SpaceX. 

Some of his ventures already benefit tremendously from federal contracts. SpaceX has received more than $19 billion from contracts with the federal government, according to research from FedScout. Under a second Trump presidency, more lucrative contracts could come its way. SpaceX is on track to take in billions of dollars annually from prime contracts with the federal government for years to come, according to FedScout CEO Geoff Orazem.

Musk, who has frequently blamed the government for stifling innovation, could also push for less regulation of his businesses. Earlier this month, Musk and former Republican presidential candidate Vivek Ramaswamy were tapped by Trump to lead a government efficiency group called the Department of Government Efficiency, or DOGE.

In a recent commentary piece in the Wall Street Journal, Musk and Ramaswamy wrote that DOGE will “pursue three major kinds of reform: regulatory rescissions, administrative reductions and cost savings.” They went on to say that many existing federal regulations were never passed by Congress and should therefore be nullified, which President-elect Trump could accomplish through executive action. Musk and Ramaswamy also championed the large-scale auditing of agencies, calling out the Pentagon for failing its seventh consecutive audit. 

“The number one way Elon Musk and his companies would benefit from a Trump administration is through deregulation and defanging, you know, giving fewer resources to federal agencies tasked with oversight of him and his businesses,” says CNBC technology reporter Lora Kolodny.

To learn how else Elon Musk and his companies may benefit from having the ear of the president-elect watch the video.

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Why X’s new terms of service are driving some users to leave Elon Musk’s platform

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Why X's new terms of service are driving some users to leave Elon Musk's platform

Elon Musk attends the America First Policy Institute gala at Mar-A-Lago in Palm Beach, Florida, Nov. 14, 2024.

Carlos Barria | Reuters

X’s new terms of service, which took effect Nov. 15, are driving some users off Elon Musk’s microblogging platform. 

The new terms include expansive permissions requiring users to allow the company to use their data to train X’s artificial intelligence models while also making users liable for as much as $15,000 in damages if they use the platform too much. 

The terms are prompting some longtime users of the service, both celebrities and everyday people, to post that they are taking their content to other platforms. 

“With the recent and upcoming changes to the terms of service — and the return of volatile figures — I find myself at a crossroads, facing a direction I can no longer fully support,” actress Gabrielle Union posted on X the same day the new terms took effect, while announcing she would be leaving the platform.

“I’m going to start winding down my Twitter account,” a user with the handle @mplsFietser said in a post. “The changes to the terms of service are the final nail in the coffin for me.”

It’s unclear just how many users have left X due specifically to the company’s new terms of service, but since the start of November, many social media users have flocked to Bluesky, a microblogging startup whose origins stem from Twitter, the former name for X. Some users with new Bluesky accounts have posted that they moved to the service due to Musk and his support for President-elect Donald Trump.

Bluesky’s U.S. mobile app downloads have skyrocketed 651% since the start of November, according to estimates from Sensor Tower. In the same period, X and Meta’s Threads are up 20% and 42%, respectively. 

X and Threads have much larger monthly user bases. Although Musk said in May that X has 600 million monthly users, market intelligence firm Sensor Tower estimates X had 318 million monthly users as of October. That same month, Meta said Threads had nearly 275 million monthly users. Bluesky told CNBC on Thursday it had reached 21 million total users this week.

Here are some of the noteworthy changes in X’s new service terms and how they compare with those of rivals Bluesky and Threads.

Artificial intelligence training

X has come under heightened scrutiny because of its new terms, which say that any content on the service can be used royalty-free to train the company’s artificial intelligence large language models, including its Grok chatbot.

“You agree that this license includes the right for us to (i) provide, promote, and improve the Services, including, for example, for use with and training of our machine learning and artificial intelligence models, whether generative or another type,” X’s terms say.

Additionally, any “user interactions, inputs and results” shared with Grok can be used for what it calls “training and fine-tuning purposes,” according to the Grok section of the X app and website. This specific function, though, can be turned off manually. 

X’s terms do not specify whether users’ private messages can be used to train its AI models, and the company did not respond to a request for comment.

“You should only provide Content that you are comfortable sharing with others,” read a portion of X’s terms of service agreement.

Though X’s new terms may be expansive, Meta’s policies aren’t that different. 

The maker of Threads uses “information shared on Meta’s Products and services” to get its training data, according to the company’s Privacy Center. This includes “posts or photos and their captions.” There is also no direct way for users outside of the European Union to opt out of Meta’s AI training. Meta keeps training data “for as long as we need it on a case-by-case basis to ensure an AI model is operating appropriately, safely and efficiently,” according to its Privacy Center. 

Under Meta’s policy, private messages with friends or family aren’t used to train AI unless one of the users in a chat chooses to share it with the models, which can include Meta AI and AI Studio.

Bluesky, which has seen a user growth surge since Election Day, doesn’t do any generative AI training. 

“We do not use any of your content to train generative AI, and have no intention of doing so,” Bluesky said in a post on its platform Friday, confirming the same to CNBC as well.

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The Pentagon’s battle inside the U.S. for control of a new Cyber Force

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The Pentagon's battle inside the U.S. for control of a new Cyber Force

A recent Chinese cyber-espionage attack inside the nation’s major telecom networks that may have reached as high as the communications of President-elect Donald Trump and Vice President-elect J.D. Vance was designated this week by one U.S. senator as “far and away the most serious telecom hack in our history.”

The U.S. has yet to figure out the full scope of what China accomplished, and whether or not its spies are still inside U.S. communication networks.

“The barn door is still wide open, or mostly open,” Senator Mark Warner of Virginia and chairman of the Senate Intelligence Committee told the New York Times on Thursday.

The revelations highlight the rising cyberthreats tied to geopolitics and nation-state actor rivals of the U.S., but inside the federal government, there’s disagreement on how to fight back, with some advocates calling for the creation of an independent federal U.S. Cyber Force. In September, the Department of Defense formally appealed to Congress, urging lawmakers to reject that approach.

Among one of the most prominent voices advocating for the new branch is the Foundation for Defense of Democracies, a national security think tank, but the issue extends far beyond any single group. In June, defense committees in both the House and Senate approved measures calling for independent evaluations of the feasibility to create a separate cyber branch, as part of the annual defense policy deliberations.

Drawing on insights from more than 75 active-duty and retired military officers experienced in cyber operations, the FDD’s 40-page report highlights what it says are chronic structural issues within the U.S. Cyber Command (CYBERCOM), including fragmented recruitment and training practices across the Army, Navy, Air Force, and Marines.

“America’s cyber force generation system is clearly broken,” the FDD wrote, citing comments made in 2023 by then-leader of U.S. Cyber Command, Army General Paul Nakasone, who took over the role in 2018 and described current U.S. military cyber organization as unsustainable: “All options are on the table, except the status quo,” Nakasone had said.

Concern with Congress and a changing White House

The FDD analysis points to “deep concerns” that have existed within Congress for a decade — among members of both parties — about the military being able to staff up to successfully defend cyberspace. Talent shortages, inconsistent training, and misaligned missions, are undermining CYBERCOM’s capacity to respond effectively to complex cyber threats, it says. Creating a dedicated branch, proponents argue, would better position the U.S. in cyberspace. The Pentagon, however, warns that such a move could disrupt coordination, increase fragmentation, and ultimately weaken U.S. cyber readiness.

As the Pentagon doubles down on its resistance to establishment of a separate U.S. Cyber Force, the incoming Trump administration could play a significant role in shaping whether America leans toward a centralized cyber strategy or reinforces the current integrated framework that emphasizes cross-branch coordination.

Known for his assertive national security measures, Trump’s 2018 National Cyber Strategy emphasized embedding cyber capabilities across all elements of national power and focusing on cross-departmental coordination and public-private partnerships rather than creating a standalone cyber entity. At that time, the Trump’s administration emphasized centralizing civilian cybersecurity efforts under the Department of Homeland Security while tasking the Department of Defense with addressing more complex, defense-specific cyber threats. Trump’s pick for Secretary of Homeland Security, South Dakota Governor Kristi Noem, has talked up her, and her state’s, focus on cybersecurity.

Former Trump officials believe that a second Trump administration will take an aggressive stance on national security, fill gaps at the Energy Department, and reduce regulatory burdens on the private sector. They anticipate a stronger focus on offensive cyber operations, tailored threat vulnerability protection, and greater coordination between state and local governments. Changes will be coming at the top of the Cybersecurity and Infrastructure Security Agency, which was created during Trump’s first term and where current director Jen Easterly has announced she will leave once Trump is inaugurated.

Cyber Command 2.0 and the U.S. military

John Cohen, executive director of the Program for Countering Hybrid Threats at the Center for Internet Security, is among those who share the Pentagon’s concerns. “We can no longer afford to operate in stovepipes,” Cohen said, warning that a separate cyber branch could worsen existing silos and further isolate cyber operations from other critical military efforts.

Cohen emphasized that adversaries like China and Russia employ cyber tactics as part of broader, integrated strategies that include economic, physical, and psychological components. To counter such threats, he argued, the U.S. needs a cohesive approach across its military branches. “Confronting that requires our military to adapt to the changing battlespace in a consistent way,” he said.

In 2018, CYBERCOM certified its Cyber Mission Force teams as fully staffed, but concerns have been expressed by the FDD and others that personnel were shifted between teams to meet staffing goals — a move they say masked deeper structural problems. Nakasone has called for a CYBERCOM 2.0, saying in comments early this year “How do we think about training differently? How do we think about personnel differently?” and adding that a major issue has been the approach to military staffing within the command.

Austin Berglas, a former head of the FBI’s cyber program in New York who worked on consolidation efforts inside the Bureau, believes a separate cyber force could enhance U.S. capabilities by centralizing resources and priorities. “When I first took over the [FBI] cyber program … the assets were scattered,” said Berglas, who is now the global head of professional services at supply chain cyber defense company BlueVoyant. Centralization brought focus and efficiency to the FBI’s cyber efforts, he said, and it’s a model he believes would benefit the military’s cyber efforts as well. “Cyber is a different beast,” Berglas said, emphasizing the need for specialized training, advancement, and resource allocation that isn’t diluted by competing military priorities.

Berglas also pointed to the ongoing “cyber arms race” with adversaries like China, Russia, Iran, and North Korea. He warned that without a dedicated force, the U.S. risks falling behind as these nations expand their offensive cyber capabilities and exploit vulnerabilities across critical infrastructure.

Nakasone said in his comments earlier this year that a lot has changed since 2013 when U.S. Cyber Command began building out its Cyber Mission Force to combat issues like counterterrorism and financial cybercrime coming from Iran. “Completely different world in which we live in today,” he said, citing the threats from China and Russia.

Brandon Wales, a former executive director of the CISA, said there is the need to bolster U.S. cyber capabilities, but he cautions against major structural changes during a period of heightened global threats.

“A reorganization of this scale is obviously going to be disruptive and will take time,” said Wales, who is now vice president of cybersecurity strategy at SentinelOne.

He cited China’s preparations for a potential conflict over Taiwan as a reason the U.S. military needs to maintain readiness. Rather than creating a new branch, Wales supports initiatives like Cyber Command 2.0 and its aim to enhance coordination and capabilities within the existing structure. “Large reorganizations should always be the last resort because of how disruptive they are,” he said.

Wales says it’s important to ensure any structural changes do not undermine integration across military branches and recognize that coordination across existing branches is critical to addressing the complex, multidomain threats posed by U.S. adversaries. “You should not always assume that centralization solves all of your problems,” he said. “We need to enhance our capabilities, both defensively and offensively. This isn’t about one solution; it’s about ensuring we can quickly see, stop, disrupt, and prevent threats from hitting our critical infrastructure and systems,” he added.

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