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Pixels, Pitchforks, and Panic
YouTube tweaks video quality, the internet melts down. Here’s why the tempest truly matters.
Jim Louderback
September 02, 2025
This Week: AI backlash takes a silly turn, AEO joins SEO and GEO, TikTok’s uncertain future, and a quick Dubai recap. I’ve been hanging in Vermont and enjoying a short break as we wrap up summer here in the US. Fall means action and I’m back at it.
 | Hi, I’m Jim Louderback and this is my weekly creator economy newsletter. If you’ve received it, then you are either subscribed or someone forwarded it to you. If the latter – and you want to subscribe, get it here! |
💡 TOP STORIES
THIS IS WHY WE CAN’T HAVE NICE THINGS
Last week while I was planning 1BFS in Dubai, the collective creator world went gonzo over YouTube “secretly” manipulating their videos with AI. Ars Technica called it a conspiracy, blasting YouTube for “secretly testing AI video enhancements without notifying creators.” Beta News accused Big Red of “Using AI on the Sly”. Videos looked sharper. Edges smoothed out. Strange artifacts appeared. Pixels got popped. And suddenly creators who couldn’t tell quantization from quilting stormed the castle with pitchforks and torches.
Ever the voice of reason, YouTube creator liaison Rene Richie calmly explained it was a test of a new compression algorithm as part of their 20-year effort to make the videos posted to YouTube look better as the travel from HQ through those smelly pipes to your glowing rectangle.
THIS. IS. NOTHING. NEW.
Smart mathematicians have been squeezing audio since 1937’s pulse-code modulation. H.261 made video streaming over ISDN (a sort of a digital phone line) possible in 1981. Adaptive arithmetic coding has been improving compression since 1988. And machine-learning AI started making things even better nearly 10 years ago. Machine learning AI has been making it even better for nearly a decade. Without these tricks, we’d still be watching grainy Roomba-riding cats in QCIF.
The real story isn’t YouTube’s math. It’s the outrage. The AI pile-on is starting to look a lot like the crypto backlash. Remember that? A few Logan Paul rug pulls and suddenly the whole blockchain baby got tossed out with the bad-boy bathwater. That’s where AI is headed.
Get ready for an AI Cancelapalooza 2025. Creators and platforms may soon hide their AI tools like contraband snacks smuggled into your high-school homeroom.
The irony? AI soon will be as invisible as electricity. Motors didn’t turn us into slugs, wires full of lightning didn’t zap us all to death. AI will seep deep into the fabric of our lives. But fear will make it disappear into the background. The wonks will win and the rest of us won’t even know what hit us.
Oh, also, YouTube threw in the towel and said it would add an opt-out for those new AI- compression technologies. Yah, if you want your videos to look worse than your competition, that’s your god-given luddite right. (Rene Ritchie, Ars Technica, Beta News)
TIKTOK COUNTDOWN TO….
Just 14 days left on the current divestiture extension, per my TikTok Countdown Clock. But no one really believes the app will be shut down. Now Trump says he’ll just keep extending it, likely forever. So much for that “secret deal.” And where’s that new app we were promised? It’s September, people. Everything we thought we knew, apparently, was wrong. (AP, TikTok Countdown Clock)
YOUR NEXT CUSTOMER IS A BOT
A new Cornell paper explores how autonomous AI powered shopping bots make product decisions. These agents don’t browse, instead they scan, assess and buy. Researchers built a mock marketplace, and then tweaked product position, price, ratings, reviews, sponsored tags and endorsements (think Amazon’s “Choice” or Ebay’s “Top-Rated Seller”) to see how the bots reacted.
Results? Top row placement mattered most, , but varied by column. “Sponsored” badges bad, “Endorsed” badges good. Some bots considered human price sensitivity, others ignored it. And tweaking descriptions to exploit AI biases proved wildly effective.
Welcome to AEO, AKA Agentic Engine Optimization. Yup, it’s a new EO algorithm! We’ve gone from SEO to GEO to AEO, and it’s all becoming a bit too Old MacDonald’s farm for me… E-I-E-I-O! (arxiv)
SUBSTACK BREAKS THE CREATOR PROMISE
Substack opts for platform control over creator independence, forcing writers into using Apple’s in app payment system (a 30% vig), stealing the creator’s relationship with the subscriber, and eliminating portability. Wonder why I use Beehiiv instead of Substack for this newsletter? Anti-creator stuff like this. (Big Desk)
MEET ME IN DUBAI, WIN A COOL MILLION!
Speaking of Dubai, get ready for the next iteration of what many called “The Best Creator Event Ever”. 1 Billion Followers Summit (1BFS) officially kicked off last week as part of a planning offsite. I’m again running the Economy track, with @Leslie Morgan producing the Content track and @Bob Pearson taking on Tech.
New for 2026:
A creator company accelerator with guaranteed millions invested
A $1 million dollar prize for the best AI-generated movie.
Not new but Epic:
400+ speakers across three days, three tracks, workshops, keynotes and more
Top creators and experts across every continent and region.
72 and sunny! January 9-11 during Dubai’s best weather week of the year.
Outrageous value. Just $120 if you buy now, compared to $1,000 or more for smaller, shorter events delivering less value!.
1BFS remains the only truly global gathering of creators, industry, and the world. Can’t wait to see you there.. I can’t wait to see you there! (LinkedIn)
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💡 PLATFORMS
YOUTUBE
The Power of NFL: YouTube and Fox sign streaming carriage agreement – a sentence I never thought I’d write. (CNBC)
META
TIKTOK
Carcinization Continues: With new DM voice notes and image sharing, Double-T looks to be targeting Whatsapp IG and iMessage. (WeRSM)
💡 QUIBIS
OTHER CREATOR ECONOMY
Another One Bites the Dust: @Kaya Yurieff left the Information after five years, which probably signals the sad end of one of the best newsletters in the biz. I’ll miss it - but I can’t wait to see what’s next! (LinkedIn)
Intimacy Vibe: Sara Wilson expands on the shift from attention to intimacy with an exploration of “Intimacy Theater” and brand examples. She’ll be expanding on this at 1BFS in January. (Community Catalysts)
The Death of Doomscrolling: Depth beets doom. GenZ embraces longer newsletters (like this one), TikTok curriculums and long-form YouTube. This is a trend I can fully support! (Marketing Tech News)
Perhaps She Needed a Raise? Duolingo listed @Zaria Parvez’s old role for up to $342k, requiring 7–10 years of experience. Ironically, Zaria herself wouldn’t qualify, as she’s only five years into her social career. Excited to see what she builds at DoorDash. (LinkedIn)
AI Is Coming For You! The New Yorker does its typical longish think piece on AI, creativity and unrelenting doom. (The New Yorker $)
Remaining Relevant: How to adapt global influencer marketing strategies to African audiences. (Net Influencer)
Disintermediating Ad Agencies: Brand direct buying jumped from 10% to 30% over the past five years. (VideoWeek)
Clip Yourself: Linqia launches new product to help you remix influencer content into multiple destination-specific reels. (WJHL)
CREATOR TECH – AI, AR, VR, MORE
📊 RESEARCH
📍 Where’s Jim? Back in California in time for OUR summer!
100% written by me – no human or AI ghostwriters were involved in the production (except for the cover art!) and AI was very lightly used for editing.
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