Fun and games: Duo's gamification and absurd TikToks are working

2/10/24 7:00PM

Word games

‍A huge part of Duolingo’s success is in good old-fashioned entertainment, or — as critics see it — the gamification of the language-learning process.

The company has made no secret of its use of fun to liven up its educational methods, incorporating numerous game mechanics and tactics into the app. As users learn, they are rewarded with experience (XP) points, they can win “gems”, and they need to keep hold of their “hearts” in order to keep playing… all features that could be straight out of a video game. And then of course there’s the streak — arguably Duolingo’s most effective psychological hook — which keeps people coming back to the app day after day, in order to keep their streak alive, with pushy notifications to tell you if you’ve forgotten to log in.

Those mechanics are core to what makes Duolingo so successful, but they’ve also positioned the company for criticism from those who say that they oversimplify the language-learning process, favoring lessons that optimize for in-app engagement over what might be most helpful in real world situations.

Weird is working

The company has also leaned into what has been described as “unhinged” marketing on TikTok. Unlike so many brands that post polished marketing material, Duolingo’s TikTok is meme-heavy… and often just straight up weird.

Videos have included the company's legal team trying to catch the owl mascot to stop it from posting online, obsessions with celebrities (notably Dua Lipa) and non-stop nonsensical memes. That approach has set Duolingo apart, growing to nearly 10 million followers, as people follow along to see the content that they presumably can’t quite believe is coming from an official brand channel. The company is also planning a 5-second local Super Bowl ad, which executives at the company say will be “quite stunting”.

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Amazon’s self-driving Zoox launched service this week, and Google’s Waymo is testing there.

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OpenAI and Microsoft reach agreement that moves OpenAI closer to for-profit status

In a joint statement, OpenAI and Microsoft announced a “non-binding memorandum of understanding” for their renegotiated $13 billion partnership, which was a source of recent tension between the two companies.

Settling the agreement is a requirement to clear the way for OpenAI to convert to a for-profit public benefit corporation, which it must do before a year-end deadline to secure a $20 billion investment from SoftBank.

OpenAI also announced that the controlling nonprofit arm would hold an equity stake in the PBC valued at $100 billion, which would make it “one of the most well-resourced philanthropic organizations in the world.”

The statement read:

“This recapitalization would also enable us to raise the capital required to accomplish our mission — and ensure that as OpenAI’s PBC grows, so will the nonprofit’s resources, allowing us to bring it to historic levels of community impact.”

A joint statement from OpenAI and Microsoft

The statement read:

“This recapitalization would also enable us to raise the capital required to accomplish our mission — and ensure that as OpenAI’s PBC grows, so will the nonprofit’s resources, allowing us to bring it to historic levels of community impact.”

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BofA doesn’t expect Tesla’s ride-share service to have an impact on Uber or Lyft this year

Analysts at Bank of America Global Research compared Tesla’s new Bay Area ride-sharing service with its rivals and found that, for now, it’s not much competition for Uber and Lyft. “Tesla scale in SF is still small, and we don’t expect impact on Uber/Lyft financial performance in ’25,” they wrote.

Tesla is operating an unknown number of cars with drivers using supervised full self-driving in the Bay Area, and roughly 30 autonomous robotaxis in Austin. The company has allowed the public to download its Robotaxi app and join a waitlist, but it hasn’t said how many people have been let in off that waitlist.

While the analysts found that Tesla ride-shares are cheaper than traditional ride-share services like Uber and Lyft, the wait times are a lot longer (nine-minute wait times on average, when cars were available at all) and the process has more friction. They also said the “nature of [a] Tesla FSD ‘driver’ is slightly more aggressive than a Waymo,” the Google-owned company that’s currently operating 800 vehicles in the Bay Area.

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Oracle’s massive sales backlog is thanks to a $300 billion deal with OpenAI, WSJ reports

OpenAI has signed a massive deal to purchase $300 billion worth of cloud computing capacity from Oracle, according to a report from The Wall Street Journal.

The report notes that the five-year deal would be one of the largest cloud computing contracts ever signed, requiring 4.5 gigawatts of capacity.

The news is prompting shares to pare some of their massive gains, presumably because of concerns about counterparty and concentration risk.

Yesterday, Oracle shares skyrocketed as much as 30% in after-hours trading after the company forecast that it expects its cloud infrastructure business to see revenues climb to $144 billion by 2030.

Oracle shares were up as much as 43% on Wednesday.

It’s the second example in under a week of how much OpenAI’s cash burn and fundraising efforts are playing a starring role in the AI boom: the Financial Times reported that OpenAI is also the major new Broadcom customer that has placed $10 billion in orders.

Exclusive | Oracle, OpenAI Sign Massive $300 Billion Cloud Computing Deal