Meta Platforms Stock (NASDAQ:META) Slips as it Rolls Out a New AI Model

Social media giant Meta Platforms (META) has made a lot of advances in artificial intelligence (AI) lately, and not all of these advances have been particularly welcome. The latest advance, a new AI model known as V-JEPA 2, is rolling out and providing some new potential advancements with it. But investors are a bit concerned, and sent Meta shares down fractionally in Wednesday afternoon’s trading.

V-JEPA 2 is known as a “world model,” and is designed to provide a better understanding of the physical world, proving a bridge between code and reality. World models are something of an advance over large language models, reports note, and in turn, have attracted plenty of attention. Such models could prove very useful in things like self-driving cars, as well as delivery robots, and for Meta to have a piece of those markets would likely prove very lucrative.

With a world model in place, reports note, AI applications can learn things like object permanence, where an item that is out of sight has not simply disappeared. Basic principles of physics are also on the table, like a ball rolling to the edge of a table will fall off the table once the ball runs out of table. V-JEPA 2 focuses on the use of a “…simplified latent space…,” reports note, which allows it better understanding of physics applications within that space.

Paraphrasing: It Could Save You Billions.

But then, a much more distressing development emerged in Meta’s AI development, this time with large language model (LLM) use. We all know that many LLMs were trained using books, which makes sense; what greater storehouse of language is there than the book? But as it turns out, Meta’s models had a tendency to memorize…verbatim.

That in turn is likely to open up Meta to a lot of legal liability, with one report suggesting that Meta could be on the hook for billions of dollars’ worth of copyright infringement claims. Of course, there are still many legal questions surrounding this particular issue. After all, people are trained on language development using books, so why not artificial intelligence entities? But given that the Books3 dataset, that many AI were trained on, is using pirated content, that could open up some problems. Legal interpretations and philosophy will likely be severely tested in unraveling this mess.

Is Meta Platforms a Buy, Sell or Hold?

Turning to Wall Street, analysts have a Strong Buy consensus rating on META stock based on 42 Buys, three Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 38.04% rally in its share price over the past year, the average META price target of $698.07 per share implies 0.38% downside risk.

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