The 'uncanny valley' is where near-realistic digital humans feel unsettling. The founder believes once AI video avatars become indistinguishable from reality, they will break through this barrier. This shift will transform them from utilitarian tools into engaging content, expanding the total addressable market by orders of magnitude.

As CGI becomes photorealistic, spotting fake hardware demos is harder. An unexpected giveaway has emerged: the use of generic, AI-generated captions and descriptions. This stilted language, intended to sound professional, can ironically serve as a watermark of inauthenticity, undermining the credibility of the visuals it accompanies.

AI video tools like Sora optimize for high production value, but popular internet content often succeeds due to its message and authenticity, not its polish. The assumption that better visuals create better engagement is a risky product bet, as it iterates on an axis that users may not value.

People are wary when AI replaces or pretends to be human. However, when AI is used for something obviously non-human and fun, like AI dogs hosting a podcast, it's embraced. This strategy led to significant user growth for the "Dog Pack" app, showing that absurdity can be a feature, not a bug.

While many pursue human-indistinguishable AI, ElevenLabs' CEO argues this misses the point for use cases like customer support. Users prioritize fast, accurate resolutions over a perfectly "human" interaction, making the uncanny valley a secondary concern to core functionality.

Avoid the "slot machine" approach of direct text-to-video. Instead, use image generation tools that offer multiple variations for each prompt. This allows you to conversationally refine scenes, select the best camera angles, and build out a shot sequence before moving to the animation phase.

As AI makes creating complex visuals trivial, audiences will become skeptical of content like surrealist photos or polished B-roll. They will increasingly assume it is AI-generated rather than the result of human skill, leading to lower trust and engagement.

To prevent audience pushback against AI-generated ads, frame them as over-the-top, comedy-first productions similar to Super Bowl commercials. When people are laughing at the absurdity, they are less likely to criticize the technology or worry about its impact on creative jobs.

YouTube's AI-powered "Super Resolution" feature, which upscales low-res videos, is more than a technical fix. It's a strategic move to enhance the viewing experience on large TV screens. This positions YouTube to compete more directly with streaming services like Netflix for the premium, "lean-back" living room audience.