A Meta-Morphosis: Frontier Foray and TikTok Block

A version of this story was originally published in AI, Tech & Money, a free, weekly newsletter packed with news and exclusive analysis on all things tech, platforms, and deals in advertising and media. Sign up here. Welcome back to AI, Tech & Money. This is Kendra Barnett. After a quick jaunt to Miami to check out the inaugural Jupiter Festival, which I found well-sponsored but lacking buzz, I’m dashing off to Marrakech for some time off. But before I log off, let me catch you up on the latest in tech and money moves. Prescription drug brands are now able to advertise in Google’s AI Overviews and AI Mode, as my colleague Trishla Ostwal reported exclusively. Elsewhere, The New York Times, The Economist, and dozens more publishers signed onto an initiative to support content licensing deals and track how AI systems use original journalism. It’s becoming clear that the battle over intellectual property between media and AI companies is only intensifying. Privacy-focused changes to Apple’s iOS operating system have found some adtech vendors locked out, theoretically barring them from doing millions of dollars in business. The update is sparking chatter across the industry, and raising bigger questions about where dollars will flow in mobile. Plus, Publicis was the first of the agency holdcos to file its Q3 earnings, tallying a 5% year-over-year surge in organic net revenue on the back of a series of significant account wins. Most recently, the French ad giant clinched PepsiCo’s coveted global media account. Finally, over in the Meta-verse (oh, that’s triggering, sorry), the tech giant is having a bustling start to fall, this week unveiling two frontier models on the heels of its historic Muse AI assistant rollout, and beefing with TikTok. I unpack what’s new with Meta in my feature below, so keep scrolling. A reminder that replies to this email go straight to my inbox, so please share feedback or tips. Alternatively, reach me securely at kendra.16 on Signal. The Top Line Google started testing ads for branded prescription drugs in AI Mode and AI Overviews. In EMEA, OpenAI’s strongest marketing channel for enterprise sales is face-to-face. A new job posting suggests OpenAI wants its ads offering to become a permanent fixture on agency media plans. What brands like period tracking app Flo are doing to show up in AI citations. These are the best-funded GEO startups helping brands show up in AI answers in 2026. Netflix is in the process of laying off around 6% of its staff. Publicis boss Arthur Sadoun said “a new race” between the holdcos means client conflict is no longer a dealbreaker. Meanwhile, Havas reports growth in North America, but it lagged in regions like LATAM and the U.K. United is reorienting its ads biz around seat-back screens and Starlink internet access. The Quant Video and audio combined account for some two-thirds of Americans’ active time spent consuming media. But they generate the least amount of revenue on a per-hour basis, according to research published this month by Boston Consulting Group. On the other end of the spectrum is location-based entertainment (LBE), which can encompass branded pop-ups, immersive experiences, and arcades. LBE grabs just 2% of active media time but rakes in $3.47 an hour, thanks to ticket sale revenues. Print trails in a distant second place. Meanwhile, gaming and social media produce three to four times the revenue yield of audio, thanks in large part to direct-response advertising and recurring digital spending. Deep Learning: A Meta-Morphosis: Frontier Foray and TikTok Block Meta’s on a hot streak. On Monday, the tech giant unveiled two frontier models: Muse Wonder and Muse Wonder Full. They represent Meta’s first true entry to the frontier. In benchmark tests evaluating coding, reasoning, and writing capabilities, the two models achieved scores comparable to cutting-edge models from Anthropic and OpenAI, Meta reported. The cutely packaged Muse personal assistant took off like a rocketship after its launch last month under wunderkind Alexandr Wang. The mobile app for the AI agent reached five million downloads faster than ChatGPT did, and could hit 100 million users in six to 12 months, per Evercore’s Mark Mahaney. Able to complete tasks and shop autonomously on behalf of users, the bot is already the top source of AI-agent traffic on the web, generating over 2.3 times more requests than all other agents combined, per recent findings from Human Security. The new frontier offerings, Muse Wonder and Muse Wonder Full, extend Meta’s efforts to cash in on its hundreds of billions of dollars in AI investments. Meta offers access to Muse Wonder on a pay-per-token API basis, while Muse Wonder Full is tied to premium subscription tiers costing $20 or $100 per month. The push could help the tech company diversify its revenue streams beyond paid advertising, which today generates nearly 98% of Meta’s total revenue. That’s not to say that the company isn’t pouring investment into its core ads business still. Ahead of Advertising Week New York this month, Meta announced a slate of upgrades to its AI tools for advertisers. Advertisers can now use natural language prompts to update creative, ad targeting parameters, and budgets within the system. Plus, a new Meta sales agent can pull from a brand’s website, ad content, and social posts to build interactive shopping experiences through which users can chat with a bot, shop, and add products to their cart without exiting Meta’s platforms. (Amazon, it’s worth noting, has blocked Muse from shopping on its site since 21 Sept.) The company is also encouraging advertisers to embrace Muse. A new update lets the agent connect to Meta advertising accounts and more than a dozen business tools, including Slack, Asana, Shopify, Klaviyo, and Canva. Outside of Muse, Meta allows marketers to plug in their own third-party agents and AI tools to run Meta campaigns (via a Model Context Protocol hookup). But that’s not to say it wants just anyone in its ecosystem. Late last week, it blocked TikTok’s U.S. minority owner and former majority owner ByteDance—as well as third parties running TikTok-linked campaigns—from advertising on its platforms in the U.S., Canada, Japan, and a handful of other countries. And taken with Amazon’s blockade of Meta’s Muse, platforms are increasingly closing themselves off against each other’s traffic, be that human or bot. It’s a blow to the video-sharing app, which has spent more on ads on Meta platforms than any other advertiser in the U.S. so far this year, according to Sensor Tower data. (Though all things considered, the volume amounts to just 1% of total ad spend on Meta, per the data.) Meta told Bloomberg: “We don't have to run ads from a competitor whose goal is to pull people off our apps,” and called the move “a normal business practice.” Tensions between the platforms have been rising since Meta reached an $18 billion settlement with state attorneys general in August and agreed to introduce more stringent child safety protections on Instagram and Facebook—then subsequently pressured its competitors, including TikTok and YouTube, to put similar changes in place. It was a move some PR pros and legal experts thought might work. TikTok, for its part, didn’t warm to the approach. It barred ads from Meta demanding the updates and wiped dedicated Instagram links from user profiles on its app, according to Bloomberg. In any case, it’s a timely pressure campaign on TikTok: In July, regulators found the platform in violation of EU rules around child safety and addictive design features. As a result, the company could be hit with a fine of up to 6% of its annual revenue. In the U.S., meanwhile, some lawmakers criticized TikTok for backing out of a bipartisan roundtable last month with the House Select Committee on China. The company cited ongoing litigation over child safety as the reason for its absence, though committee leaders noted the meeting’s main focus concerned national security and data privacy. The spat between Meta and TikTok is only intensifying now thanks to Meta’s new block on TikTok and TikTok-linked ads (even as some claim to see Meta ads for Muse on TikTok). While a traffic war may play out over the coming months, there’s an immediate ripple effect for advertisers, who aren’t necessarily concerned with Meta snubbing a rival, but take issue with Meta deciding where paying advertisers can send their own customers. As David Nyurenberg, svp of digital at InterMedia Advertising, told my colleagues and me: “If I'm a brand paying Meta to reach consumers, why should Meta get to decide whether I can send them to a TikTok campaign or creator partnership?” For now, it would seem, Meta feels it doesn’t need the dollars it’s leaving on the table, even as it barrels ahead with plans to shell out up to $145 billion this year, much of that on AI infrastructure and compute. At least its Muse push could provide some padding; the agent could generate roughly 8% of Meta’s revenue by 2030, or approximately $36 billion, according to one Deutsche Bank analyst. The company’s stock popped this week on the heels of its Muse Wonder and Muse Wonder Full announcement. The tech titan is set to report third-quarter earnings on October 21. Deals, Deals, Deals Amazon is reportedly weighing a $7 billion takeover of AI video upstart Decart; Anthropic previously considered acquiring the business. Chip giant Nvidia is in talks to pump more money into Reflection AI—or possibly to acquire the open-weight model lab outright. Anthropic reportedly signed a multiyear deal with AI infrastructure company IREN. Axel Springer-owned Bonial picked up a majority stake in Tjek, a Nordic digital retail marketing platform. Buzzy AI marketing upstart Hightouch acquired Strata, an AI platform that connects marketing tools; terms were not disclosed. Salesforce will acquire Israeli AI analytics platform Loops for $30 million. Indie agency Chemistry picked up Boston-based creative agency Colossus for an undisclosed sum. DAZN acquired Latin America-focused basketball streamer Basket.TV. Terms were undisclosed. Revolving Door Paramount’s revenue chief Jay Askinasi will helm ad sales for the newly reconfigured Skydance business. WBD U.S. ad sales presidents Ryan Gould and Bobby Voltaggio are heading for the exit. Spectrum CMO Sharon Peters and chief commercial officer Adam Ray will depart at year’s end, per a leaked memo. Apple reportedly has a new M&A exec in Steve Smith. Meanwhile, former M&A leader Adrian Perica will oversee iCloud, Fitness+, and Apple News. Brand licensing biz Authentic Brands Group tapped USA Today alum Lark-Marie Antón to serve as chief communications officer. McCann boss Tyler Turnbull is leaving the shop to become CEO of WPP Creative. OpenAI’s Asia-Pacific public policy head Sanghyun Lee is set to depart after half a year in the role. Omnicom Media elevated Sharon Dhillon to CEO of Initiative UK. WPP’s Landor promoted James Withey to become its first global executive vice president of strategy; he’ll also help develop WPP’s agentic strategy. Airtable is cutting a “large part” of its workforce just weeks after Bending Spoons announced it would acquire the software company.

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