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🤖 Situational awareness: Reid Hoffman is part of the digital twin baby boom, Axios' tech editor Megan Morrone writes.

A new streaming service for generative AI content called Dreamflare AI launches today with backing from Silicon Valley-based FoundersX Ventures.

Why it matters: The company is a bet that generative AI can be used to create premium-level content and not just short, experimental videos.

Zoom in: FoundersX Ventures invested $1.65 million in pre-seed funding.

Dreamflare is led by ex-Google executive Josh Liss and Rob Bralver, a longtime Hollywood veteran in the documentary space.

"These are the first generative AI shows that have been made to be narrative-focused," Liss tells Axios. "When you think of the AI videos that you've seen, they're all clips, like shortened things stitched together. Our shows are seven- to 20-minute-long episodes."

How it works: Dreamflare works like any other streaming service except that its content is designed to be more interactive.

"You don't just watch these things. You actually play them. You get to make choices and the choices that they make when they are watching. They dictate what actually happened, what's happening next," Liss says.

It has two main types of content called "Flips" and "Spins." Flips are similar to webtoons and other digital comics, whereas Spins are short movies that ask the viewer to make choices that dictate the story.

The service aims to release around 50 titles each month, Bralver says.

The majority of the content is behind a paywall, though there are a few free titles available each day. Subscriptions cost $2.99 a month or $9.99 for the whole year.

The big picture: Generative AI is one of the most sensitive subjects in the Hollywood community.

A growing number of AI-based startups are popping up in the entertainment industry and working to combat the narrative that AI is going to replace the creative process.

AI streaming service

Screenshot of Dreamflare's navigation page. 

Infinite Reality, which builds AI-powered virtual experiences for brands and media companies, is acquiring tech startup Landvault for $450 million, Axios has learned. Infinite Reality said it also received a $350 million investment.

Why it's the BFD: The addition of Landvault is the company's fifth acquisition this year as it continues to bet that the metaverse will still come to fruition.

Zoom in: The deal for Landvault is an all-stock transaction, and the company's existing employees and creative teams will remain.

Landvault's founder and CEO Sam Huber will be named global president of enterprise and CEO of the MENA region. The company has a big presence in the Middle East.

Landvault specializes in immersive technology and digital twins for Fortune 500 companies and government firms.

"They have massive clients throughout the Middle East and Europe and even some of the U.S., and they're looking to solve big problems, which is — how do we create an immersive product?" John Acunto, co-founder and CEO of Infinite Reality, tells Axios.

Follow the money: Infinite Reality also announced a $350 million minority investment from an unnamed family office that focuses on tech, media and real estate.

Infinite Reality has raised $750 million since 2019, and its investors include Liberty Media, Lux Capital, Lerer Hippeau, MGM, CAA, T-Mobile Ventures, Courtside VC, IAC, Live Nation, DJ and producer Steve Aoki and rock band Imagine Dragons.

The investment is separate from its previously announced SPAC deal with Newbury Street Acquisition, which it plans to finalize by September.

Catch up quick: Infinite Reality started five years ago as a social media firm, Acunto says.

Around three years ago, it pivoted to building out immersive experiences and has since announced partnerships with Vodafone and Warner Bros. Discovery Sports.

Its acquisitions this year include $250 million for The Drone Racing League and $75 million for Ethereal Engine. Most of its transactions have been all-stock and have a total value this year of $800 million.

Metaverse M&A

Illustration of a person walking along a gridded hallway towards a bright light

Following news of his Smartmatic investment, tech billionaire Reid Hoffman shared more insights on the matter with Axios yesterday.

Why it matters: Hoffman confirmed that he is helping fund Smartmatic's litigation against Fox News by investing in the company. "I am not personally part of the litigation," he said. 

What he's saying: Asked about the concern of making the defense's case about politics over law, Hoffman said, "I have complete faith in the American judicial system, and I think that Fox itself makes it about politics versus law."

"I think every single piece of actual truth and scholarship says the 2020 election was as fair as any other election in our modern times, which basically means fair and legally accurate," Hoffman said. 

"The fact that people are calling that into question and view the defense of it to be partisan is something that's wrong with those people who are calling it into question," he said.

"Those people may also call my investment into question. ... But I think we should unite around rule of law, fair democratic process. [Speaking against that] is, I think, anti-American," he said. 

Reid Hoffman chats Smartmatic

Reid Hoffman wearing sunglasses and a black polo shirt with red accents at  Allen & Co. Media and Technology Conference in Sun Valley, Idaho on July 12, 2023

Reid Hoffman. Photo: David Paul Morris/Bloomberg via Getty Images

Data: Yahoo Finance, Macrotrends; Chart: Axios Visuals

Shari Redstone's decision to finally part with Paramount comes after the company's stock has been hammered since the ill-fated decision to re-merge Viacom and CBS in 2019.

By the numbers: Paramount's stock price has fallen 72% since Viacom and CBS were brought back together. It ended yesterday down 5%, and a few analysts have since downgraded the stock.

What they're saying: Analysts are taking a wait-and-see approach.

"We think the new company has major opportunities for content production and distribution, but the challenges of competing in today's disruptive movies and entertainment industry remain," Center for Financial Research and Analysis research director Kenneth Leon wrote yesterday.

MoffettNathanson analysts wrote this morning that while their single biggest question about the company's future has been answered — who will own it and at what cost — "there is still more work to be done to help determine the future of New Paramount."

Charted: Paramount's bumpy ride 

Go deeper in our full database in the Axios Pro Deals Tracker.

• Volley, a Bay Area startup developing AI voice games, raised $55m in Series C funding. Microsoft's M12 Ventures led and was joined by Lightspeed Venture Partners, Causeway, Amazon, BITKRAFT Ventures and Y Combinator. axios.link/460mbwQ

• Hipgnosis Songs Fund shareholders voted to sell the fund to Blackstone for $1.6b. axios.link/3RZNW2O

Deal flow

• Jared Grusd was named CEO of Gracenote, Nielsen's content-solutions division. He most recently co-founded Ethiqly AI and previously served as CSO of Chime and Snap. axios.link/3Wgrrbd

• Tom Kershaw, formerly of Travelport, was hired as chief technology officer and Justin Rohde, formerly of Xplor Technologies, as chief transformation officer at BMI. axios.link/4bGVjD4

• Nicole Leverich was promoted to chief communications officer at LinkedIn, Eleanor Hawkins exclusively reports. axios.link/3VUFItW

• Louise Heseltine was promoted to SVP, corporate communications in the motion picture group at Sony Pictures Entertainment. axios.link/3WbOjcO

• Deanna Barillari, formerly consulting in physical production at MGM Features, joined Linden Productions as SVP of development and production. Mia Samuels was promoted to creative executive. axios.link/3XXFKUi

• Ron Lee was named VP of growth for platform and experience at Media.Monks China. axios.link/4cxmnpE

• Krissah Thompson was named to run the Washington Post's process of building its third newsroom. axios.link/3XUqTKc

• Rick Klein was named Washington Bureau chief of ABC News. He joined the newsroom in 2007. axios.link/4cUJxWW

• Andy Wiswell, formerly with Sony Broadcast, joined Advanced Systems Group as production technology ambassador. axios.link/3S09pIL

• Jeremy Scahill and Ryan Grim left The Intercept to launch Drop Site News, an investigative outlet on Substack. axios.link/3zIDV3n

• Dave Zohrob, CEO of Chartable, left Spotify as product director after joining from the 2022 acquisition. He said on LinkedIn he's working on something new with Chartable co-founder Harish Agarwal. axios.link/3W3sJ9o

Movin' on up (or out)

💰 Larry Ellison's family investing $6 billion into Paramount deal (Axios)

"The overall deal is valued at $8 billion, although that could change if Paramount sells any major assets before closing next year. The Ellisons and RedBird have transactional covenants that require they be consulted on any major business decisions by Paramount in the interim," Sara Fischer and Dan Primack report.

🛻 I used Ford's mixed reality tech to quality-check an engine (Axios)

"Ford is using Microsoft's $3,500 MR headsets to train factory employees in a variety of tasks, from building engines and components to changing tools in computerized factory equipment," Joann Muller writes.

☀️ Media, tech titans head for Sun Valley with streaming alliances top of mind (CNBC) 

"On a broader scale, the Paramount deal will serve as the backdrop to the larger discussion about the business of streaming and how to make it profitable. .... [T]his time the focus will be on how to come together to make the tricky business of streaming work," Lillian Rizzo writes.

Channel surfing

an illustration of a hula dancer figurine on top of a vintage television set

@tim_bays: "Beckham" on Netflix. Can't believe there was no mention of the cinematic classic "Bend it like Beckham" in this otherwise-great docuseries. 

@kerrymflynn: "Despicable Me 4" at AMC Theatres. My husband had the audacity to say there was no plot. Minions! We don't need that much else!

✏️ Thanks to Michael Flaherty for editing and Katie Lewis for copy editing this newsletter.

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July 09, 2024

1 big thing: AI streaming service