How big data is transforming creative commerce

Transcript

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Judy Woodruff: One of the fundamental economic shifts of our time is the way that big data is disrupting commerce and everyday life.

Artificial intelligence, which involves machines learning, analyzing and using enormous sets of data, is expected to have an ever-wider impact, transforming industries and eliminating some jobs.

That data also can be used to appeal more directly to what customers want, including in creative industries.

Special correspondent and Washington Post columnist Catherine Rampell has the first of two stories on that for our segment Making Sense.

David Apel: This is called Petit LU. It's an interpretation of a little French butter cookie.

Catherine Rampell: Oh, it smells so good.

David Apel: And that's it.

Catherine Rampell: I don't know that I want to smell like this, but I want to eat this.

David Apel: Right. But you want a little of that.

Catherine Rampell: David Apel is a master perfumer at Symrise, one of the world's largest fragrance and flavor design companies.

It's also on the creative cutting edge, harnessing the power of big data to make artistic decisions, part of the second digital disruption, as legal scholars Christopher Sprigman And Kal Raustiala call it in a new paper.

Kal Raustiala: So, the first digital disruption was really about the ability to distribute digitally.

Catherine Rampell: Legally, or not, given the piracy on file-sharing platforms like Napster. Creative industries had to adapt to the new ways people were getting their music and movies,

Kal Raustiala: The second one, which is happening right now, is really about data and not just distributions. It's streamed out to you, but then, in turn, the company is receiving data from you.

So this is all about targeting consumption to the consumer. What do you want? If you go a little bit further, you get into actually investing in content.

Catherine Rampell: Companies like Netflix pay close attention to the details of what people watch, down to when they hit pause. User data is mined, analyzed, and then used to create new products. The classic example? "House of Cards."

Christopher Sprigman: Netflix was willing to green-light that series without producing a pilot. They were confident enough in what they thought they knew that they spent a huge amount of money kind of sight unseen.

Kal Raustiala: They identified that people like this particular original British version. They like David Fincher. They like Kevin Spacey. And so we're going to put those things together, and we know there's an audience for that kind of combination.

Christopher Sprigman: That turned out, at least until Kevin Spacey ran into some trouble, to be a very successful show.

Catherine Rampell: Even savvier at using big data to create content? The porn industry.

Kal Raustiala: For a few reasons, they probably use data more than other companies do in their creative efforts, one, because, typically, adult films are short. People watch a lot of them. They get a lot of data. They have massive viewership. And they're cheap to make.

Actor: Well, I have been approaching it scientifically as of late. Why not, right?

Actor: Better porno through science.

Catherine Rampell: Of course, even in pre-Internet days, the porn industry was studying customer tastes.

The professors cite the peep show operator in HBO's "The Deuce," set in the '70s.

Actor: Last couple of months, I have installed the quarters in each machine separately. Now I know what film I'm running in each machine, and I never mix it up before we do the weight. It's starting to give me a real sense of what stuff is bringing in the most quarters.

Christopher Sprigman: What we were living in the past, you could think of as the data bronze age, right? So, this has now become a gusher of data that's much cheaper to gather and much cheaper to analyze.

Catherine Rampell: Now, most academics shy away from studying porn. But these two used it as a case study, because it's been so innovative, down to using data to write scripts.

So what are examples of the kinds of creative choices, let's say, an adult film company might make based on an analysis of data? Is it like, if there's a plumber at the door or a pizza delivery guy, or...

Kal Raustiala: Absolutely. What does the background look like? What does the room look like? What is the person wearing? Those are all things that can be altered and manipulated in different ways to see what's most popular.

Catherine Rampell: Of course, sex sells in any industry. And what smells sexy? Robots are surprisingly good at figuring that out too.

That's a commercial for Egeo, marketed by the Brazilian cosmetics company O Boticario.

Achim Daub: It has this new hot milk, honey kind of note.

Catherine Rampell: The fragrance was designed by Symrise, with some help.

Achim Daub: And there you go, the world's first ever A.I. fragrance.

Catherine Rampell: That's thanks to a partnership with IBM Research.

Man: This is "Jeopardy."

Catherine Rampell: It's been nearly a decade since Watson won "Jeopardy."

Alex Trebek: Now we come to Watson. "Who is Bram Stoker?"

(CHEERING AND APPLAUSE)

Catherine Rampell: Since then, IBM's artificial intelligence technology has gone to work in medicine, science, manufacturing, business. But, recently, it's taken on more artistic tasks.

Richard Goodwin: For a long time, people have been asking whether computers can be intelligent, which is kind of a hard philosophical question to answer. So our group decided that we were going to tackle a different problem, which was creativity.

Catherine Rampell: But, says IBM's Richard Goodwin, a lot of people were already working on android art or A.I. music.

Richard Goodwin: So, our original idea was to actually build a robot that would go on a cooking show and actually, you know, compete with the other chefs. But we then realized it would be like 10 years before we could get the robot to, like, chop up the carrots.

Catherine Rampell: The dexterity is the problem.

Richard Goodwin: And so the idea then was, well, what really wins the show is having novel dishes that taste good.

Catherine Rampell: Enter chef Watson, and then a collaboration with McCormick spices.

From flavors, a short leap to fragrances, a labor-intensive industry seemingly ripe for disruption.

David Apel: The work of a perfumer is mostly frustrations.

Catherine Rampell: Designing a new fragrance has historically required a lot of human capital. It takes four years of schooling to become a junior perfumer, years more to become a master like David Apel, who has four decades under his belt.

He's got access to over 1,000 raw ingredients, millions of existing formulas. Infinitely more could be tried.

So if you were tasked with creating a new fragrance, what would your process look like?

David Apel: People will come. And they give imagery and storylines and visuals, sometimes even music or textures.

And so the first process is, what things in my brain connect to the things they're trying to say? I made a fragrance for Pavarotti back in the day, and I built it around patchouli because patchouli is a material that has like this deep, like, bass kind of resonance, you know, the way I saw his voice.

Catherine Rampell: That flash of inspiration, hear Pavarotti, think patchouli, isn't enough. It can take years of tinkering before a formula becomes aesthetically and commercially successful.

Achim Daub: If you think about perfumery, it's an inherently complex business, because every creation is a unique product.

Catherine Rampell: Achim Daub is president of scent at Symrise.

Achim Daub: Manufactured out of many ingredients, very often too many for my liking.

So there is an inherent inefficiency. And so one of the aspects of using artificial intelligence is to become faster, become leaner, become more agile.

Catherine Rampell: So, A.I. can cut costs, but can it actually be creative?

David Apel: I'm going to start with this, which is called beurre, which is...

Catherine Rampell: Butter?

David Apel: Butter.

Catherine Rampell: David Apel gave me a demonstration of how the software, called Philyra, works. He starts with two existing elements.

David Apel: And the first thing that Philyra will do is, she will put them together 50/50.

Catherine Rampell: And then cranks up the creativity, literally.

David Apel: So, sliding this creativity scale up to 10, I just want her to play.

Catherine Rampell: In 90 seconds, 1,000 possible candidates...

David Apel: And here we go.

Catherine Rampell: ... 12 top contenders.

David Apel: I like the suggestions that she's given me, and I just push a button, and it's sent to the lab and compounded, and I can smell and evaluate.

Catherine Rampell: How has the introduction of A.I. changed this world for you?

David Apel: What's really amazing for Philyra is that she knows not just my style of perfumery, but everybody's style of perfumery. And she can...

Catherine Rampell: You say she?

David Apel: She. She's a she, yes.

They joke here that she's my girlfriend because I have spent nights and weekends to kind of try to understand the way that this machine seems to think.

Catherine Rampell: It's hard not to anthropomorphize software doing something that seems so fundamentally human.

David Apel: I want to be immortal.

(LAUGHTER)

David Apel: You know, it's that vain of an occupation, in some sense.

Every perfumer wants to create that uniqueness, that sort of -- that magic of something that you haven't seen before in a perfume. And that's what Philyra has done for me.

Catherine Rampell: Could we get to a point where robots take the jobs of artists? In a blind smell test for that Brazilian client, Philyra's fragrance did beat out a scent created by David Apel.

Kal Raustiala: They're definitely not going to take all the jobs. They're going to help people who are creators give the public what they want.

Catherine Rampell: Getting better at giving the public what they want raises some legal and economic questions, though, questions we will explore in our next segment.

For the "PBS NewsHour," I'm Catherine Rampell in New York.

Judy Woodruff: A lot to worry about.