Graphics Design Tool Giant Picsart Adds AI Image and Text Generators
Text-to-X Gets More Distribution
Picsart is an easy-to-use online graphics creation and editing tool with more than 150 million monthly active users. The company raised $130 million in 2021 and cemented its position as a unicorn with a valuation of more than a billion dollars. The company announced today that it added AI-based image and text generation tools for users.
Hovhannes Avoyan, Founder & CEO of Picsart, commented, “Generative AI is a powerful new resource for visual creators and anyone who needs content. There are two huge advantages of this technology: the first is making creativity accessible to new people and the second is increasing productivity for those who already create. The tools we’re launching today are the first of many generative AI features we plan to roll out.”
There you have it. The twin benefits of synthetic media from Synthedia’s market framework: hyper-creativity and hyper-automation (productivity). AI image and text generators enable anyone to begin the creation process and simply sort through more creative ideas than humans alone can generate. The solutions also dramatically improve output productivity.
Move Over Jasper AI
You may recall that Jasper AI just raised $125 million at a one-billion-dollar-plus unicorn valuation on the back of over $80 million in expected 2022 revenue. Its solution began as AI text-to-text generation offering to speed up blog post, marketing copy, and email writing. It is one of the most successful repackagings of GPT-3. More recently, Jasper added text-to-image generation from a DALL-E integration.
Jasper AI says that over 70,000 people are using its AI-based writing solution. That’s a lot less than 150 million. Granted, those Picsart users are employing online graphics design solutions and not generative AI. But let’s do the math. If Picsart converts just 0.05% of its monthly users to text-to-text generation, it will surpass Jasper in generative AI users.
Of course, having the most users isn’t the only metric that matters. Jasper AI has a far higher monthly price point than Picsart and can command far higher margins. It is unclear how adding this feature to Picsart will generate more revenue to accompany the increased cost of running the AI generator models. The answer will probably be the same way that every other text-to-x solution does this. They will charge more as you use the service more often. These services may be a catalyst for free Picsart users to convert to paid and to raise the average revenue per user (ARPU) for paying customers.
The bigger issue for Jasper and its competitors is Picsart may be shrinking the available market while also lowering the industry pricing umbrella. AI-based text generation solutions can still differentiate via their feature sets, but the availability of a low-cost alternative will make it harder to convert users to high-priced plans.
Is Canva Next?
Canva is a popular alternative to Picscart and also boasts more than 100 million monthly active users. It would seem logical that it, too, will at least add a text-to-image generation solution. If Canva and Picsart offer these solutions, the available market for companies such as Jasper AI and Midjourney will shrink rapidly.
This is not to say those users cannot be won over. Rather, it is a recognition that the user acquisition will quickly migrate to switching users from a competing service as opposed to winning brand new users to the solution segment.
It is likely that only power users of these solutions will notice a difference between the services. That also means the favored tools already in use for other services and those with lower price points will have a distinct advantage. Given that Picsart’s starting solutions appear to be free, that will be a significant hurdle to overcome.
Is Picscart Using OpenAI?
Picsart has not revealed what generative AI solutions it is using to power its new offering. Given that it is rolling out both text-to-text and text-to-image generation services, the likely candidate is a single integration with OpenAI, the creator of GPT-3 and DALL-E. That is precisely the formula Jasper has taken to market.
The more complex approach for Picsart would be to employ either GPT-3 or a proprietary version of an open source competitor for text-to-text generation along with a private instance of Stable Diffusion for text-to-image. It is hard getting around using GPT-3 for text generation as the open source solutions are not delivering as high quality for broad-based queries out-of-the-box. However, Stable Diffusion is an able competitor to DALL-E. Using open source models for one or both of the text and image generation solutions could offer a superior cost structure.
From Obscurity to Ubiquity
Two years ago, there was limited or no access to text-to-text and text-to-image generators. The availability is nearly ubiquitous today. That change reflects the fact that these AI tools offer clear benefits and are easy enough for almost anyone to use. You should expect to see a lot more adoption of these tools very quickly.
