Updated Version 2 - Meta's Charm device carries CEO Zuckerberg's bold ambitions in the field of artificial intelligence

Paragraphs 8 and 9 have been updated with the latest stock information.

Aditya Soni

Reuters, Menlo Park, California, September 24 - At Meta's META.O annual conference on Wednesday, Mark Zuckerberg repeatedly took jabs at Apple before pulling a move reminiscent of Steve Jobs with a surprise unveiling: a pocket watch-sized device bringing Meta’s popular Muse AI assistant into the real world.

The device, called “Muse Charm,” highlights the social media giant’s broader transformation—long seeking to escape dependence on Apple’s AAPL.O and Google’s GOOGL.O operating systems by building its own platform. Users can access Muse directly with a tap, without needing an AI app on their smartphone.

Zuckerberg once saw the metaverse—the immersive digital world that inspired the company’s 2021 name change—as the next-gen computing platform. But after that costly bet fell flat, he now believes “personal superintelligence” is the bigger and more urgent breakthrough.

“It's actually very clear that personal superintelligence will not only come first, but it will also be larger in scale and more significant,” Zuckerberg said at the annual Meta Connect conference.

“So we've shifted our focus to building the devices that are best suited for personal superintelligence,” he added, noting that Muse features will soon roll out fully in Meta’s smart glasses lineup as well.

This announcement comes as Muse has experienced a blockbuster few days (link), with millions of downloads. Some analysts claim this may be the biggest U.S. app launch since ChatGPT ignited the AI craze in November 2022.

Investors are optimistic about Muse’s potential to automate everything from booking flights to filing taxes, boosting shares of partners like Shopify SHOP.TO, while selling off companies seen as vulnerable to disruption, including online travel agency Booking BKNG.O and TurboTax creator Intuit INTU.O.

Meta’s stock rose more than 3% on Thursday and is up nearly 24% since Muse’s launch on September 8. As of Wednesday’s close, the company’s market value had increased by about $324 billion, with another $56 billion potentially to be added.

Could Attract Gen Z, But Mass Adoption Remains a Challenge

Analysts point out that as digital cameras, flip phones, and MP3 players make a comeback due to nostalgia, “Muse Charm” could resonate with younger consumers.

Gen Z (ages roughly 14 to 29) see AI assistants as companions or brainstorming partners rather than simple search tools. Unlike their older counterparts who are more used to computers and smartphone apps, they typically interact with technology through voice memos, short videos, and AI chatbots.

“Muse Charm may get some market response among Gen Z and younger consumers. The combination of AI, fashion, and personalization may appeal to younger users, especially if it's affordable and user-friendly,” said Linda Sui, founder of market research firm Smart Analytics Global.

The device comes with a roughly 2-inch (5 cm) screen, operable with the thumb, featuring a customizable Muse virtual character in the center. The built-in 5G modem allows use of Muse even without Wi-Fi, but it cannot make calls.

“This product appeals to people who may not want to wear glasses or don't trust smart glasses,” said IDC director Jitesh Ubrani.

“Some may even remember Tamagotchi, and this device could evoke those memories,” Ubrani said, referencing the colorful virtual pets that became a cultural phenomenon in the late 1990s. “It could potentially run a small language model locally. So you can run AI on such a small device.”

Whether Muse can maintain its momentum, and whether the device can build on that appeal, remains to be seen in the coming months.

Similar devices have only seen limited success in the past. Startup Rabbit Inc.’s handheld generative AI device Rabbit R1 (with screen and buttons) generated buzz in early 2024 but ultimately failed due to overpromising on AI features and underdelivering in real-life use.

“I’m cautious about its mainstream market potential,” Sui said. “Unless Muse Charm can deliver unique features that are hard to replace with a smartphone, smartwatch, earbuds, or smart glasses, it may remain an ‘add-on’ for early adopters rather than a truly mainstream product.”

(For the convenience of non-English speakers, Reuters has provided automated translations of its reports in several other languages. As automated translations may contain inaccuracies or lack necessary context, Reuters does not guarantee the accuracy of the translated text. Automated translations are provided purely for the convenience of readers. Reuters assumes no liability for any damages or losses arising from the use of automated translation functions.)