The Futures - No. 55

The shift to the allocation economy / Gen AI in gaming development / Gen Z’s way of socializing

May 14, 2024

In this issue

The Quantumrun team shares actionable trend insights about the emerging allocation economy, generative AI changing the face of game development, the drugs that enable Gen Z to socialize, and the hidden carbon deposit about to be unleashed on us.

Future signals to watch

Hallucinogen use among Gen Z has significantly increased since the COVID-19 pandemic, with trends like microdosing and ketamine therapy becoming more popular as alternatives to alcohol during lockdowns. Despite the reopening of social venues, the preference for hallucinogens continues to grow, suggesting a shift in how young people are relying on these drugs to socialize.
The Dead Internet Theory, where humans are supposedly equally sharing the web with bot accounts, appears to be coming true.
Google Maps has enhanced its features to support the growing number of electric vehicle owners, making it easier to locate charging stations with detailed information and plan energy-efficient routes.
Meta announced its Meta Horizon OS, a mixed-reality operating system that allows developers to build immersive social experiences and integrate them in apps.
The Pentagon's 12-ton RACER Heavy Platform autonomous tank recently completed rigorous testing. It successfully navigated complex off-road terrain autonomously at speeds up to 25 mph.
The completion of the 3,200-megapixel Legacy Survey of Space and Time (LSST) Camera at the SLAC National Accelerator Laboratory will allow scientists to deeply explore dark matter and energy, and other celestial phenomena.
The Bank of Spain has indicated that the country will need approximately 24 million migrant workers by 2053 to maintain a sustainable pension system due to its aging population and rising pension costs.
Scientists discovered that the top two meters of global soil contain about 2.3 trillion tonnes of inorganic carbon. Around 1% (23 billion tonnes) could be released into the atmosphere over the next three decades.

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Culturally // Trending

YouTube → The Boys Season Four // X → This Met Gala gown // Reddit → Japan customer service // TikTok → Airbnb launches ‘Icon’ listings // Instagram → Star Wars celebrates May The 4th in Fortnite // Spotify → “Million Dollar Baby”

🖱️ AI is changing the knowledge economy into an allocation economy

In the traditional knowledge economy, value was predominantly created through the accumulation and application of knowledge. This paradigm is shifting as AI technologies—particularly advanced models like ChatGPT—begin to automate the processing of vast amounts of information. As AI takes over these foundational cognitive tasks, the critical human role evolves from being a content producer to a manager or 'allocator' of AI resources.

For instance, in law, finance, and marketing, AI tools are increasingly deployed to handle routine data analysis and content generation to free up human workers to focus on higher-level strategy and decision-making processes. Research highlighted by the Harvard Business Review indicates that generative AI tools are being integrated into workflows to enhance productivity and cognitive capacity. This suggests a future where the ability to effectively manage and direct AI resources becomes a pivotal skill.

However, the shift towards an allocation economy also raises questions about broader workforce implications. The skill sets required in this new economy emphasize management, strategic oversight, and the nuanced use of AI tools. Even non-managerial roles are beginning to require a managerial background concerning AI. This evolution could lead to a stratification in the workforce, where the 'haves' and 'have-nots' are distinguished by their ability to work well with AI technologies.

Moreover, businesses might lean towards flatter organizational structures with a premium placed on roles that manage multiple AI processes and cross-functional teams. This change emphasizes the need for workers who not only understand AI capabilities but who are also proficient in soft skills like leadership, empathy, and strategic decision-making—skills that AI has yet to master.

Actionable trend insights as knowledge workers transition to AI managers:

For entrepreneurs

Entrepreneurs could launch coaching businesses that educate workers on how best to apply AI to their workflows, as well as specialized consultancies and workshop services that facilitate the integration of AI into niche markets, such as artisanal industries and crafts. For example, creating workshops that teach small-scale furniture manufacturers how to use AI to optimize wood usage, reduce waste, and enhance design precision.

For corporate innovators

Companies could partner with design firms to restructure their work environments physically and culturally to support AI-driven management roles. For example, an automotive company could redesign its R&D department to include spaces that facilitate easy interaction between AI systems and engineers, enhancing the development of new vehicle technologies with faster prototype testing and feedback loops.
Large corporations could spearhead initiatives to create shared AI resource pools that allow companies from different sectors to access AI tools and data analytics services on a subscription basis. For example, a consortium of construction firms could share access to AI models that predict material needs and labor allocation, optimizing building schedules and reducing overhead costs.

For public sector innovators

Government agencies could establish simulation centers that use AI to model and predict the outcomes of public policy decisions. These centers could help in planning urban development, environmental regulations, and transportation systems by providing data-driven insights into potential impacts.
Governments could develop specialized training academies to upskill public sector workers in AI management and deployment. For example, a training curriculum could teach health department officials how to use AI to allocate medical resources efficiently during a health crisis, predict outbreak patterns, and optimize response strategies for better public health outcomes.

Trending research reports from the World Wide Web

Deloitte’s Generative AI and government work report discovered that tasks like documenting regulatory compliance, which require moderate creativity, variability, and accuracy, are well-suited for generative AI.
The Verge explores the fascinating global network of undersea cables that all businesses depend on—from banking to social media to governments.
A McKinsey & Company report reveals that Millennials and Gen Zers now prioritize splurging on groceries over traditional luxury items like dining out, travel, and designer clothes.
About 46% of consumers who sometimes purchase PBA (plant-based alternative) meat continue to do so, likely because they perceive improvements in taste, environmental sustainability, and animal welfare.

🎮 Generative AI is rapidly turning game development on its head

Generative AI is increasingly influencing the video game industry by enhancing development processes and gameplay experiences. For example, chipmaker NVIDIA has integrated AI into their graphics processing units to improve game visuals and efficiency. The company's Deep Learning Super Sampling (DLSS) technology allows games to run at higher resolutions without compromising frame rates, effectively enhancing visual fidelity using AI. Moreover, NVIDIA's ACE technology enables non-playable characters (NPCs) to have realistic facial animations and communicate engaging dialogue for more nuanced interactions.

Another area being enhanced by gen AI is sound design, where it can generate realistic sound effects and dynamic musical scores that adapt to gameplay changes. This capability not only enhances the immersive experience for players but also streamlines the sound design process, allowing for more efficient production timelines. In addition, AI algorithms can automate the modeling of complex 3D objects and terrains, reducing the manual labor required and enabling a more scalable creation process, which is particularly beneficial for expansive open-world games.

However, despite the potential of generative AI to assist game developers, its ability to automate increasingly complex tasks traditionally performed by humans have disrupted employment. As a result, industry workers are planning to unionize, with Microsoft already recognizing a 600-member Activision quality assurance (QA) union.

Aside from layoff concerns, the use of AI in games raises questions about the ownership of AI-generated content and the ethical implications of its use. AI tools often require large amounts of data, which can include player behavior and interactions. How this data is collected, used, and stored raises significant privacy issues.

Actionable trend insights as generative AI disrupts the game development industry: