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Snap continues to lead the way in not only consumer AR, but the technology’s fusion with the latest force multiplier, AI. Its latest integration lets users turn Snaps or photos into AI-powered 5-second cinematic videos. Known as AI Clips, they can be activated with just a tap.
Examples include AI clips that turn your family photos into snackable videos that display everyone scuba diving or mountain climbing. Glamor-themed AI Clips could turn your existing selfies into videos of you posing amidst a barrage of camera flashes at an awards-show red carpet.
One thing that differentiates AI Clips is that their one-tap activation makes them frictionless. While most consumer-facing AI relies on users’ imaginative prompts (which Snap also offers), AI Clips are a closed-prompt system in that the themes and animations are pre-ordained.
But “pre-ordained” doesn’t mean that experiences are limited or narrow in their experiential range. They will work on the fly with infinite variations of existing media – which is where the variance comes in. And the broad library of AI Clips that are built will further that creative range.
Creative Control
AI Clips’ closed prompt system also means that creative control resides with Lens Studio creators. They build specific animation styles or themes, which are then applied to users’ media on the fly. This makes AI Clips much like Lenses themselves, differentiated by creator intent.
In fact, one way to think about AI Clips is that they’re like lenses for existing media. While lenses transform your selfies or rear-facing camera fodder into whimsical scenes, AI Clips turn your photos and Snaps into cinematic AI videos. And like Lenses, the results will be serendipitous.
Back to creators, they’re a key puzzle piece. AI Clips will generate revenue (more on that in a bit), and Snap will share that revenue through its Lens+ Payouts program. This could incentivize creators en masse, which boosts the AI Clips library, which in turn drives user engagement.
To further entice creators, Snap lowered the barriers to entry. AI Clips are native to the GenAI Suite in Lens Studio, letting existing lens creators easily jump in. All the above pulls from Snap’s Lens Studio playbook to get the flywheel spinning, starting with attracting creators to build things.
From Specs to Subscribers: Snap’s Revenue Diversification Moves
Strategic Imperative
The other notable factor for AI Clips is that they are reserved for Lens+ paid subscribers. This is logical, given the hard costs of generative AI. But it’s also noteworthy in that it’s another hook for Snap’s already-momentous subscription business, which is a strategic imperative.
As we examined recently, Snap’s broader subscription business was quantified in its Q4 earnings as reaching 25 million subscribers and $1 billion in annual recurring revenue. This is a proof point in Snap’s revenue diversification play, which is critical in the advertising world right now.
But in a larger sense, consumers paying for AR experiences is a key moment in the industry’s maturation. As background, this has been rare in consumer AR. With the exception of Pokémon Go, an outlier, most AR experiences are brand-sponsored, rather than user-purchased.
If Snap can reverse that trend with Lens+, it will be a critical vector for the AR industry. The behavior could be conditioned to pay for AR experiences because they’re good enough – similar to how users gladly pay for digital goods in mobile gaming. AI Clips should accelerate that end.