Larry Fabbroni is an architect, strategic advisor, and Chief Innovation Officer for Practice of Architecture. Throughout his career, he has led efforts to reform studio culture and innovate practice. He earned his MBA from the University of Chicago’s Booth School of Business. In 2017, as leaders in the AIA’s Young Architects Forum (YAF), we led the launch of the Practice Innovation Lab (PIL) and hosted a symposium that imagined new architectural practice models. At that time, we already felt that practice innovation was overdue in a profession that has not seen scaled disruption to its business model in over a century. Today, we are confident that there has never been a more critical time for the profession to embrace innovation. Redefining Innovation Henley Hall: Institute for Energy Efficiency by KieranTimberlake, Santa Barbara, California | KieranTimberlake’s research expertise creates value beyond a baseline labor model.  Currently, artificial intelligence dominates strategy conversations, but just as we saw back in 2017, larger patterns prompt calls for innovation. Talent attraction is increasingly challenging, disruptive technology continues to emerge, and actors from outside our industry show growing interest in the space. While incremental innovation has long been a part of the profession, relatively few firms have adopted new practices that create value beyond a baseline labor model. Firms such as KieranTimberlake have shown that research expertise can do this. MASS Design has pioneered a mission-driven approach. BIG has taken on the role of architect-as-developer. Snøhetta houses a product design division. We could continue to list great firms that have pushed the boundaries of practice, but they represent exceptions that have yet to be recognized as new standards. Indeed, the confluence of those factors that led to the original PIL continues to make the case that the time for scaled innovation is now. A Melting Iceberg: Incremental Changes Depleting the Profession Powerhouse Telemark by Snøhetta, Vestfold og Telemark, Norway | Photo by Ivar Kvaal | Snøhetta houses a product design division, innovatively presenting a alternative business model for firms.  One of the dangers of operating in a slow-moving industry is that change is difficult to detect and even more challenging to comprehend. If an iceberg loses 1% of mass per year, it’s tough to take notice, but the end result is catastrophic. This is what is happening to our profession. For newcomers, if it feels like there are increasingly more attractive opportunities elsewhere, that’s because there are. For seasoned professionals, if it feels like it’s become more challenging to maintain the same levels of prosperity, that’s because it has. Less(er) Talent In some ways, the shift towards companies recognizing “talent” as their most excellent resource has bewildered architects: we have always relied on talent. However, the patterns of talent leaving our profession are concerning. We say “feel” because there is no significant data. We spoke to Kendall A. Nicholson, Senior Director of Research at the Association of Collegiate Schools of Architecture (ACSA), who confirmed that aggregated data on graduate placement does not exist. So we inquired about what placement looks like at several programs around the country. Omar Khan, Head of the Carnegie Mellon University School of Architecture, informed us that approximately 90% of students pursue a minor to expand their horizons, and that in 2022, nearly one in three graduates entered the tech sector. Khan stated that these opportunities aren’t just student-driven — large innovative companies increasingly seek the value that graduates of architecture schools will provide. This increasing difficulty in capturing the talent that architecture schools are producing results in a shrinking and diluted talent pool. For a profession so reliant on human resources, this presents extreme risk. Pay Gaps In an increasingly expensive world, we are not able to compete for the best talent with emerging industries. It’s easy to understand why a popular career pivot for architects has become UX design. Designing user experience for websites pays significantly better than designing the same for the built environment. According to Glassdoor, 2023 entry-level UX designers earned an average of $78K, while the AIA salary calculator suggests architecture grads can expect to earn an average of $59 K. The talent we do attract into the profession often loses interest when they experience low pay and long hours, all while most firms lack clear paths and criteria for advancement or compensation increases. A Smaller Piece of the Pie Examining data in isolation, one might conclude that the profession continues to grow; the number of architects has increased substantially over the last century, and this trend has persisted in recent years. The problem with this growth is that the estimated share of the US GDP for Architectural Services has shrunk over time. This is not a manageable number to measure before 1999, when NCARB first aggregated local jurisdictional data. Due to limitations in industry economic data, we’re only showing data since 2011 for the purposes of this article. In that time, the number of architects has grown, the market size for services has grown, but the share those services represent as a portion of the US GDP has declined — by 15% if we use US Census data to almost 30% if we use industry research data (we used IbisWorld.com, however we found data that suggested a worse and others that offered a slightly better picture). To put it another way, architecture is a stagnant industry with a shrinking share of the economy. It’s challenging to examine this data and emerge feeling confident about the profession, but there is a silver lining. The biggest impediment to innovation for architects is not a lack of talent, but rather the business model. Design thinking has been widely adopted throughout the world as a key component of innovation processes; however, the problem is that we operate in the realm of professional services, which inherently is not well-suited to promoting innovation. Reliance on that formula is causing our iceberg to melt. The Tsunami: The AI Tidal Wave is Here The Rwanda Institute for Conservation Agriculture by MASS Design Group, Rwanda | MASS Design has pioneered a mission-driven approach that creates value beyond a baseline labor model.  As we confront the exodus of talent, it is easy for both firm owners and clients to imagine AI bringing efficiencies and replacing “CAD-monkeys” with machines. However, any firm that wants to operate — and win — as anything more than a low-cost provider will need a strategy to increase value, not just cut costs. AI is merely part of the toolbox required to confront a perfect storm of forces. Jobs will Disappear Goldman Sachs predicts that as much as 37% of our industry tasks will be replaced by AI. Many see this as a pathway to lower costs and increased profits. However, that is short-sighted. Markets will adjust quickly and demand lower costs for services; additional new value will need to be articulated and proven, and this will only happen through innovation. New Jobs will Emerge (but fewer of them) AI prophets often emphasize that technological innovation has historically led to net employment gains. Previous World Economic Forum estimates predicted losses of up to 85 million existing jobs worldwide, with parallel gains of as many as 97 million new jobs. However, these estimates were revised in the WEF 2023 Economic Outlook, which now anticipates a net loss of 14 million jobs. This stark outlook signals an even greater need for architects to become more innovative. The 2024 RIBA AI Report indicates that 41% of architecture firms were already utilizing AI, though current tools are indeed just the beginning. Marketing, business development and content creation will be standard areas of AI deployment moving forward. Still, revolutionary changes will come in how we learn, not only to use new tools, but also to collaborate with digital agents. How will this happen? We can theorize, but it is not possible to know for sure until it arrives, so we need to have a plan before we can see the tidal wave from land. The Alien Invasion: Outsiders Are Entering Our Orbit VIA 57 West by BIG – Bjarke Ingels Group, New York City, New York | BIG has pioneered a new model for practice by taking on the role of architect-as-developer. For years, we’ve heard cries that “architects gave away the role of master builder.” But how much did architects actually give, and how much was taken by innovative competition? This distinction is critical because the wagons are circling, and the AEC space has become ever more attractive to investors. Venture Capital and Private Equity Investment The numbers are often difficult to parse because architecture can impact so many verticals and does not operate as its own sector in the investment realm; however, the trends suggest a groundswell is underway. A 2023 McKinsey report shows that construction tech deals nearly doubled from 2019 to 2022, growing by 85%. At the same period, the number of deals increased by 30%, indicating that interest continues to grow. An increasing size of deals also suggests a maturity of the market. As interest in infrastructure investments has declined from its high in 2020, and along with real estate, has been blunted by high interest rates, institutional investors continue to see opportunities in the AEC space. Firm Acquisitions AEC firms that deliver predictable returns have proven to be attractive targets for PE firms. In the second quarter of 2024, private equity firms accounted for over one-third of AEC firm mergers and acquisitions. For M&A deals, the industry has seen an increase in attractiveness with expanded infrastructure spending as a catalyst. However, this interest can also be tied to the lack of innovation that has resulted in an industry ripe for consolidation. M&A orchestrators generate large amounts of profit by streamlining operations, eliminating redundancies, and then stamping out competition. An entire community has been built around this, with AEC Advisors hosting an annual “Private Equity Summit” that brings together CEOs of AEC firms with PE investors. Startups As an extension of the growing interest from venture capital in the space, there is an upward trend in the AEC space being targeted for disruption by entrepreneurs who see an industry that represents a significant portion of the global GDP. AEC Works, a project of e-verse that catalogs AEC startups and investors, lists nearly 800 startups from around the world, with almost 200 identified as “architecture-focused.” The signal is clear: startups are looking to figure out how to do what you do cheaper, better, or perhaps both. Combining this environment with depleted talent pools, a declining share of GDP, and revolutionary technology, it is a correct response to be alarmed. Significant change is inevitable. It is time for architects to see the same opportunities that investors and entrepreneurs see, and learn to navigate within these spaces. The Great Opportunity Throughout history, new actors have enjoyed a “leap-frog” effect and been able to surpass established incumbents to reshape industries, markets and economies. From climate change to pandemic ripple effects, to the housing crisis, to generational shifts in the workforce, there are many forces that directly impact the work of architects and call for innovation. The need for new ways of designing and delivering different components of the built environment is ever-present and will be solved by teams that either include — and might be led by — architects, or those that do not. Most end users will only care if the resulting product is superior. This time of tension is indeed a time of great opportunity. Architects who embrace innovation in pursuing new iterations of our dated business models may actually achieve what many of us have dreamed of from the start: to leave a positive mark on the world. We think the future of the profession depends on it. Top image: Powerhouse Telemark by Snøhetta, Vestfold og Telemark, Norway The post Architects, Your Real Competition Isn’t AI — It’s Business Complacency appeared first on Journal.

5 June, 2025 In this series, Clare Dowdy speaks with design studios that are 30+ years old, to find out some of the secrets behind their longevity. Michael Johnson set up his London-based brand consultancy Johnson Banks in 1992. From Duolingo to Pink Floyd, Cancer Research UK to the Royal Astronomical Society, the studio works with “people who want to do big things.” He sat down with Clare Dowdy to discuss what he’s learned over the past 33 years. Michael Johnson How did Johnson Banks come about? My 20s were very turbulent: eight jobs in eight years, a lot of different countries, different cities, learning on the job. My last job – at Smith & Milton – was relatively settled, I was kind of running a corporate design department. I had a client there, Tom Banks. After I left, he also left his role at Legal & General with the projects I had been working on, and we used that as a basis for the company. That was 1992, the back end of a recession. For a couple of years, everything was fine. Then we started having “creative differences.” And the pressures of running a tiny design company are substantial. So we parted ways in 1995, but I kept the name. Johnson Banks’ symbol for the V&A’s William Morris show At that time, we weren’t really in the branding world. For a decade, we were very distracted by getting on the graphic design map, trying to win D&AD awards, doing lovely stamp projects. And then we started to get some cultural projects: the V&A and the British Council. I started to think, OK, now we’re beginning to show what we can do. When and why did you start thinking seriously about your strategy offering? When we started to get into the branding arena, I knew we were underpowered in terms of the strategic thinking. I may have thought that I could do it, but it takes a bit to persuade clients when you’re 35, with hair almost down to your knees. If you’re up against important-looking people who can field a few grey hairs, you’re going to lose that pitch. So we partnered with strategic companies like management consultancy Circus, and followed that model for much of the 2000s. That led to the Shelter rebrand, and a few other quite big branding projects followed. Johnson Banks’ visual identity for Shelter Eventually we realised that we could do the strategy ourselves. I had sometimes been a little frustrated by the work that my strategic partners – naming no names – were doing. It sounds a bit mean, but sometimes I would get this 90-page PowerPoint document from them, and I’d put it on my designers’ desks, and their faces would go blank. I think that 20 years ago, there was still a bit of the idea that you’ve paid £100,000, so here’s your huge document. We slowly realised that if we were in control of the process, and were involved all the way through, then that jump out of the verbal brand to the visual brand could be much better managed. How did you rethink your strategy offer? The penny dropped in the mid-2000s when we worked with Save The Children. At the time, and I don’t think they’d mind me saying this, Save The Children were a bit of a basket case. They were associated with WI fairs and cake baking, and they had a royal as their patron – they were nothing like what they are now. I realised we needed to work out what they stood for before we did any design. I did this huge chart, and stuck it on a wall at the client’s office. And I said, it strikes me that there are strategic choices that you have got to make as a comms team about where you want to take the Save the Children brand. Johnson Banks’ poster for Save the Children That was an incredibly productive meeting, and also it helped us realise that before we got anywhere near the design, we needed to sort this out. I know that sounds like really basic stuff now. I didn’t trust my instinct for a decade or so, but in that Save the Children meeting, a light bulb went on for me. Once you’d worked out how to do strategy in-house why didn’t you scale up? A lot of companies would have done that. That’s how companies grow, and can end up quite quickly at 60 people. We have nearly always been around six to eight people. Because I could bridge that gap between the verbal and the visual, it meant we didn’t need to add people. And I’ve discovered over the last 25 years, that with a really good account director, Katherine Heaton, and me, and a design team, there is a heck of a lot that we can do. So we stayed small and partnered with filmmakers, animators, cultural specialists. Post-pandemic, a lot of people have adopted that hub and spoke model – we did it 20 years ago. Probably twice a year we’ll lose a pitch because of our scale. But conversely, with some clients you can sell in the fact that they’ll always deal with Michael Johnson. They’re not going to be handed down the chain, because there is no chain. Johnson Banks’ logos for Jodrell Bank Alongside this direct contact with you, what’s your main selling point? It seems to be that we think pretty hard about stuff. We almost never jump into design. A lot of thought goes into what we do, sometimes way too much. Sometimes our projects are incredibly difficult, gargantuan, intertwined and really hard to unpick. That’s a slightly poisoned chalice, because then people go, gosh, well, if they could unpick that, then they could unpick our Gordian knot. For example, we’re working on a major London university brand at the moment that has over 60,000 staff and students, 11 faculties, and hundreds of centres and institutes and departments, and we’re trying to navigate a way through. How did you work out what you wanted to specialise in? Sometimes you can get sucked into something that you just don’t want to be doing. By the end of the 1990s, Johnson Banks had got a reputation for doing annual reports. Part of me quite liked doing them because there was an interplay between words and pictures. And we were getting senior level access to clients, which makes you feel a bit better, because you’re having an interface with chief executives. But then I was thinking, hang on, we’re in danger of getting stuck here, because of course, they’re cyclical. And the death of the annual report – and the death of print – was coming over the horizon, with the internet. Johnson Banks’ Annual Report for Polygram (1995) Since then, my interests have changed. I do not have any interest any more in doing awful blue chips or terrible fintechs. I want to apply all the comms and the branding that I’ve learned to people who could really use it – not-for-profit, culture, education, philanthropy. You know, doing good. How did you build up this not-for-profit work? You lean into the referrals you’ll inevitably get within silos where you want to be referred. I learned this from Mary Lewis of Lewis Moberly. We were pretty close in the 1990s and she always said that referral business is the best business. Over 85% of our clients are not-for-profit – most design companies have a 20-80 split between non-profits and commercial clients. I never liked that ratio, what you might cruelly call ‘the Robin Hood principle’ – we are going to steal from our luxury car account and give to the charity. We did do a bit of that for a while. We did an airline in 2009/10 at the same time we were doing charities. I would justify that with the Robin Hood principle, but I just felt more and more uncomfortable with that. Johnson Banks’ campaign visuals for Cancer Research UK As our percentages went up and up in not-for-profit, eventually I said, look, we should just tell people this is who we are, and this is what we do. It was obvious anyway, so let’s be explicit about it. A few people said we were crazy, that we’d never get any work. But the reverse has been the case. We’re on our sixth environmental project. If you say this is what we want to do, and this is what we will do for you, then I think, funnily enough, clients find that very helpful. How did you build up to bigger projects? Let’s take education. We’ve done three or four really interesting campaigns for universities and now we’re in the position where we can do university rebrands, and have won a top 10 global university. But it has taken 15 years of education work to get to that point. I may not have thought that it would take quite so long to persuade people that we could do their identity. But education is a very conservative sector, and moves slowly, like museums and galleries. If you’re small, you can afford for a sector to move slowly, whereas bigger agencies need a pipeline. I’ve watched dozens of companies get to this critical point where they’ve grown and grown and then they’ve just fallen off the cliff because they’ve been feeding the monster. To help with that, agencies often add a new business person. No-one ever talks about this, but a new business person costs around £50,000. The rule of thumb, in my world at least, is that you have to take that salary and triple it with turnover to pay that salary. So you need £150,000 worth of projects to pay for the new business person before you’ve made a penny. So to make a profit, the new business person has to bring in over £200,000 of work. And if this person can do it, which is not guaranteed, then the company has to scale. It’s so easy to get caught on a treadmill. What else has helped you stay in business so long? We’ve always led with the thought behind the idea, not the way it looked. Because I was always much more interested in the idea behind something, I think that has helped us not get sucked into the visual, to use the type face du jour, the colour that everyone else is using. And it’s understandable, because graphic designers want to do stuff that their peers really like. But paradoxically the trick, in my opinion, is to try and zag away from the trends. Create a new trend yourself. Johnson Banks’ globe symbol for the COP 26 climate conference Design disciplines in this article Industries in this article Brands in this article What to read next Neville Brody on clients, education, and his unexpected OBE Graphic Design 30 Jan, 2025

It’s easy to look at President Donald Trump’s second term and conclude that the less power and reach the federal government has, the better. After all, a smaller government might provide Trump or someone like him with fewer opportunities to disrupt people’s lives, leaving America less vulnerable to the whims of an aspiring autocrat. Weaker law-enforcement agencies could lack the capacity to enforce draconian policies. The president would have less say in how universities like Columbia conduct their business if they weren’t so dependent on federal funding. And he would have fewer resources to fundamentally change the American way of life.Trump’s presidency has the potential to reshape an age-old debate between the left and the right: Is it better to have a big government or a small one? The left, which has long advocated for bigger government as a solution to society’s problems, might be inclined to think that in the age of Trump, a strong government may be too risky. Say the United States had a single-payer universal health care system, for example. As my colleague Kelsey Piper pointed out, the government would have a lot of power to decide what sorts of medical treatments should and shouldn’t be covered, and certain forms of care that the right doesn’t support — like abortion or transgender health — would likely get cut when they’re in power. That’s certainly a valid concern. But the dangers Trump poses do not ultimately make the case for a small or weak government because the principal problem with the Trump presidency is not that he or the federal government has too much power. It’s that there’s not enough oversight.Reducing the power of the government wouldn’t necessarily protect us. In fact, “making government smaller” is one of the ways that Trump might be consolidating power.First things first: What is “big government”?When Americans are polled about how they feel about “big government” programs — policies like universal health care, Social Security, welfare for the poor — the majority of people tend to support them. Nearly two-thirds of Americans believe the government should be responsible for ensuring everyone has health coverage. But when you ask Americans whether they support “big government” in the abstract, a solid majority say they view it as a threat.That might sound like a story of contradictions. But it also makes sense because “big government” can have many different meanings. It can be a police state that surveils its citizens, an expansive regulatory state that establishes and enforces rules for the private sector, a social welfare state that directly provides a decent standard of living for everyone, or some combination of the three. In the United States, the debate over “big government” can also include arguments about federalism, or how much power the federal government should have over states. All these distinctions complicate the debate over the size of government: Because while someone might support a robust welfare system, they might simultaneously be opposed to being governed by a surveillance state or having the federal government involved in state and local affairs.As much as Americans like to fantasize about small government, the reality is that the wealthiest economies in the world have all been a product of big government, and the United States is no exception. That form of government includes providing a baseline social safety net, funding basic services, and regulating commerce. It also includes a government that has the capacity to enforce its rules and regulations.A robust state that caters to the needs of its people, that is able to respond quickly in times of crisis, is essential. Take the Covid-19 pandemic. The US government, under both the Trump and Biden administrations, was able to inject trillions of dollars into the economy to avert a sustained economic downturn. As a result, people were able to withstand the economic shocks, and poverty actually declined. Stripping the state of the basic powers it needs to improve the lives of its citizens will only make it less effective and erode people’s faith in it as a central institution, making people less likely to participate in the democratic process, comply with government policies, or even accept election outcomes.A constrained government does not mean a small governmentBut what happens when the people in power have no respect for democracy? The argument for a weaker and smaller government often suggests that a smaller government would be more constrained in the harm it can cause, while big government is more unrestrained. In this case, the argument is that if the US had a smaller government, then Trump could not effectively use the power of the state — by, say, deploying federal law enforcement agencies or withholding federal funds — to deport thousands of immigrants, bully universities, and assault fundamental rights like the freedom of speech. But advocating for bigger government does not mean you believe in handing the state unlimited power to do as it pleases. Ultimately, the most important way to constrain government has less to do with its size and scope and more to do with its checks and balances. In fact, one of the biggest checks on Trump’s power so far has been the structure of the US government, not its size. Trump’s most dangerous examples of overreach — his attempts to conduct mass deportations, eliminate birthright citizenship, and revoke student visas and green cards based on political views — have been an example of how proper oversight has the potential to limit government overreach. To be sure, Trump’s policies have already upended people’s lives, chilled speech, and undermined the principle of due process. But while Trump has pushed through some of his agenda, he hasn’t been able to deliver at the scale he promised. But that’s not because the federal government lacks the capacity to do those things. It’s because we have three equal branches of government, and the judicial branch, for all of its shortcomings in the Trump era, is still doing its most basic job to keep the executive branch in check. Reforms should include more oversight, not shrinking governmentThe biggest lesson from Trump’s first term was that America’s system of checks and balances — rules and regulations, norms, and the separate branches of government — wasn’t strong enough. As it turned out, a lot of potential oversight mechanisms did not have enough teeth to meaningfully restrain the president from abusing his power. Trump incited an assault on the US Capitol in an effort to overturn the 2020 election, and Congress ultimately failed in its duty to convict him for his actions. Twice, impeachment was shown to be a useless tool to keep a president in check.But again that’s a problem of oversight, not of the size and power of government. Still, oversight mechanisms need to be baked into big government programs to insulate them from petty politics or volatile changes from one administration to the next. Take the example of the hypothetical single-payer universal health care system. Laws dictating which treatments should be covered should be designed to ensure that changes to them aren’t dictated by the president alone, but through some degree of consensus that involves regulatory boards, Congress, and the courts. Ultimately, social programs should have mechanisms that allow for change so that laws don’t become outdated, as they do now. And while it’s impossible to guarantee that those changes will always be good, the current system of employer-sponsored health insurance is hardly a stable alternative.By contrast, shrinking government in the way that Republicans often talk about only makes people more vulnerable. Bigger governments — and more bureaucracy — can also insulate public institutions from the whims of an erratic president. For instance, Trump has tried to shutter the Consumer Financial Protection Bureau (CFPB), a regulatory agency that gets in the way of his and his allies’ business. This assault allows Trump to serve his own interests by pleasing his donors.In other words, Trump is currently trying to make government smaller — by shrinking or eliminating agencies that get in his way — to consolidate power. “Despite Donald Trump’s rhetoric about the size or inefficiency of government, what he has done is eradicate agencies that directly served people,” said Julie Margetta Morgan, president of the Century Foundation who served as an associate director at the CFPB. “He may use the language of ‘government inefficiency’ to accomplish his goals, but I think what we’re seeing is that the goals are in fact to open up more lanes for big businesses to run roughshod over the American people.” The problem for small-government advocates is that the alternative to big government is not just small government. It’s also big business because fewer services, rules, and regulations open up the door to privatization and monopolization. And while the government, however big, has to answer to the public, businesses are far less accountable. One example of how business can replace government programs is the Republicans’ effort to overhaul student loan programs in the latest reconciliation bill the House passed, which includes eliminating subsidized loans and limiting the amount of aid students receive. The idea is that if students can’t get enough federal loans to cover the cost of school, they’ll turn to private lenders instead. “It’s not only cutting Pell Grants and the affordability of student loan programs in order to fund tax cuts to the wealthy, but it’s also creating a gap where [private lenders] are all too happy to come in,” Margetta Morgan said. “This is the small government alternative: It’s cutting back on programs that provided direct services for people — that made their lives better and more affordable — and replacing it with companies that will use that gap as an opportunity for extraction and, in some cases, for predatory services.”Even with flawed oversight, a bigger and more powerful government is still preferable because it can address people’s most basic needs, whereas small government and the privatization of public services often lead to worse outcomes.So while small government might sound like a nice alternative when would-be tyrants rise to power, the alternative to big government would only be more corrosive to democracy, consolidating power in the hands of even fewer people (and businesses). And ultimately, there’s one big way for Trump to succeed at destroying democracy, and that’s not by expanding government but by eliminating the parts of government that get in his way.See More:

A Bridgehampton home that Susan Breitenbach, a Hamptons real estate agent, sold for more than $14 million in May 2025. Courtesy of Susan Breitenbach 2025-06-05T08:07:01Z Save Saved Read in app This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. Have an account? Hamptons home sales are booming despite stock market volatility and recession fears. Home sales were up about 86% in the first quarter over the same time period in 2024. Prices and sales are soaring in the beach destination despite Wall Street volatility. As Wall Street reels with every twist and turn in President Donald Trump's trade war, there's little sign of economic uncertainty in Manhattan's favorite beach destination just 100 miles east.Demand for luxury real estate in the Hamptons is only growing. Sales and home prices have surged over the last year.Rising prices in the tony enclave are nothing new. The pandemic ushered in a surge of buyers looking to escape the city. The median sales price of homes in the Hamptons in the first quarter of 2025 was more than $2 million, a 13% increase over the previous year and nearly double what it was five years ago, according to a recent Douglas Elliman report.Perhaps more notably, the pace of sales is also soaring this year. Sales were up about 86% in the first quarter over the same time period last year, according to the Douglas Elliman report. That's after home sales fell in the wake of the pandemic buying frenzy, and haven't returned to the highs of 2020."The tired story of the housing recovery coming out of the pandemic is high prices, low sales," Jonathan Miller, who leads the real estate appraisal and consulting firm Miller Samuel and authored the Douglas Elliman report, told Business Insider. "The Hamptons doesn't fit that pattern. It's high prices and high sales."Miller added that the sharp rise in sales is "unusual and counter to the prevailing trends."Susan Breitenbach, a top Hamptons real estate agent with the Corcoran Group, said she's closed more deals so far this year than in all of 2024. She's sold a slew of luxury homes, including a $17.5 million oceanfront property in Bridgehampton, an Amagansett home for $13 million, a Sag Harbor home on less than an acre for $21 million, and a Southampton house for $5.6 million. "It was really very surprising," Breitenbach, who's been selling property in the Hamptons for more than 30 years, told BI. A Southampton home Breitenbach sold for $5.6 million in May 2025. Courtesy of Susan Breitenbach While some agents like Breitenbach are closing deals at the highest end of the market, the middle of the Hamptons market — homes between $1 million and $5 million — has driven the uptick in sales. These "meat and potatoes" sales, Miller said, are way up.So-called "tangible assets," like luxury real estate in very in-demand markets, can be particularly attractive to certain investors when markets are wobbly.Global stocks plummeted following Trump's "Liberation Day" tariffs announcement, and while they've mostly rebounded since the administration walked back some of their tariffs, markets are on edge. In early June, the Organization for Economic Co-operation and Development cut its forecast for the US economic growth rate in 2025 from 2.8% to 1.6%, citing Trump's trade policies."Hamptons real estate has a long history of appreciating over time," Andrew Saunders, president of the Hamptons real estate brokerage Saunders & Associates, told BI. Some more cautious buyers "might look at what's happening in the world at large and say, 'You know what, I'm going to wait a month or two and let the world take a few spins and see what happens.' But we're not seeing that occur en masse."Miller credited big Wall Street bonuses in 2024 for some of the spike in sales and agreed that market volatility could be pushing some to diversify their investments.The Hamptons rental market might be more sensitive to economic uncertainty. Breitenbach said rental interest was much higher than usual in January but has since fallen off. Miller, who doesn't track rentals in the Hamptons, added that an increase in sales would naturally lead to a drop in rental demand.Breitenbach recently listed a home on 2.5 acres of oceanfront property in Water Mill, which sits between Southampton and Bridgehampton, for $44.5 million. "It's not about the house, it's about the land," she added. "And that's a deal." A Southampton home Breitenbach sold for nearly $12.7 million in January. Courtesy of Susan Breitenbach Hamptons buyers are from all over. Breitenbach said she's seen an uptick in California buyers this year, and she still has foreign buyers. But a large share of her clients are still Manhattanites."A lot of it is the high-end New York — Manhattan — buyers, because there aren't many places they can go on the weekends," she said.Breitenbach said Memorial Day weekend this year felt more packed than ever out east, even with cooler-than-normal weather. "It looked like Fourth of July," she said.She doesn't expect market volatility and even threats of a recession to change that."It's going to be a busy summer in the Hamptons regardless," Breitenbach said. "People keep coming out here no matter what's going on."

For the past two years, it’s been a ghost in the machine of American tech. Between 2022 and today, a little-noticed tweak to the U.S. tax code has quietly rewired the financial logic of how American companies invest in research and development. Outside of CFO and accounting circles, almost no one knew it existed. “I work on these tax write-offs and still hadn’t heard about this,” a chief operating officer at a private-equity-backed tech company told Quartz. “It’s just been so weirdly silent.”AdvertisementStill, the delayed change to a decades-old tax provision — buried deep in the 2017 tax law — has contributed to the loss of hundreds of thousands of high-paying, white-collar jobs. That’s the picture that emerges from a review of corporate filings, public financial data, analysis of timelines, and interviews with industry insiders. One accountant, working in-house at a tech company, described it as a “niche issue with broad impact,” echoing sentiments from venture capital investors also interviewed for this article. Some spoke on condition of anonymity to discuss sensitive political matters.Since the start of 2023, more than half-a-million tech workers have been laid off, according to industry tallies. Headlines have blamed over-hiring during the pandemic and, more recently, AI. But beneath the surface was a hidden accelerant: a change to what’s known as Section 174 that helped gut in-house software and product development teams everywhere from tech giants such as Microsoft (MSFT) and Meta (META) to much smaller, private, direct-to-consumer and other internet-first companies.Now, as a bipartisan effort to repeal the Section 174 change moves through Congress, bigger questions are surfacing: How did a single line in the tax code help trigger a tsunami of mass layoffs? And why did no one see it coming? For almost 70 years, American companies could deduct 100% of qualified research and development spending in the year they incurred the costs. Salaries, software, contractor payments — if it contributed to creating or improving a product, it came off the top of a firm’s taxable income.AdvertisementThe deduction was guaranteed by Section 174 of the IRS Code of 1954, and under the provision, R&D flourished in the U.S.Microsoft was founded in 1975. Apple (AAPL) launched its first computer in 1976. Google (GOOGL) incorporated in 1998. Facebook opened to the general public in 2006. All these companies, now among the most valuable in the world, developed their earliest products — programming tools, hardware, search engines — under a tax system that rewarded building now, not later.The subsequent rise of smartphones, cloud computing, and mobile apps also happened in an America where companies could immediately write off their investments in engineering, infrastructure, and experimentation. It was a baseline assumption — innovation and risk-taking subsidized by the tax code — that shaped how founders operated and how investors made decisions.In turn, tech companies largely built their products in the U.S. AdvertisementMicrosoft’s operating systems were coded in Washington state. Apple’s early hardware and software teams were in California. Google’s search engine was born at Stanford and scaled from Mountain View. Facebook’s entire social architecture was developed in Menlo Park. The deduction directly incentivized keeping R&D close to home, rewarding companies for investing in American workers, engineers, and infrastructure.That’s what makes the politics of Section 174 so revealing. For all the rhetoric about bringing jobs back and making things in America, the first Trump administration’s major tax bill arguably helped accomplish the opposite.When Congress passed the Tax Cuts and Jobs Act (TCJA), the signature legislative achievement of President Donald Trump’s first term, it slashed the corporate tax rate from 35% to 21% — a massive revenue loss on paper for the federal government.To make the 2017 bill comply with Senate budget rules, lawmakers needed to offset the cost. So they added future tax hikes that wouldn’t kick in right away, wouldn’t provoke immediate backlash from businesses, and could, in theory, be quietly repealed later.AdvertisementThe delayed change to Section 174 — from immediate expensing of R&D to mandatory amortization, meaning that companies must spread the deduction out in smaller chunks over five or even 15-year periods — was that kind of provision. It didn’t start affecting the budget until 2022, but it helped the TCJA appear “deficit neutral” over the 10-year window used for legislative scoring.The delay wasn’t a technical necessity. It was a political tactic. Such moves are common in tax legislation. Phase-ins and delayed provisions let lawmakers game how the Congressional Budget Office (CBO) — Congress’ nonpartisan analyst of how bills impact budgets and deficits — scores legislation, pushing costs or revenue losses outside official forecasting windows.And so, on schedule in 2022, the change to Section 174 went into effect. Companies filed their 2022 tax returns under the new rules in early 2023. And suddenly, R&D wasn’t a full, immediate write-off anymore. The tax benefits of salaries for engineers, product and project managers, data scientists, and even some user experience and marketing staff — all of which had previously reduced taxable income in year one — now had to be spread out over five- or 15-year periods. To understand the impact, imagine a personal tax code change that allowed you to deduct 100% of your biggest source of expenses, and that becoming a 20% deduction. For cash-strapped companies, especially those not yet profitable, the result was a painful tax bill just as venture funding dried up and interest rates soared.AdvertisementSalesforce office buildings in San Francisco.Photo: Jason Henry/Bloomberg (Getty Images)It’s no coincidence that Meta announced its “Year of Efficiency” immediately after the Section 174 change took effect. Ditto Microsoft laying off 10,000 employees in January 2023 despite strong earnings, or Google parent Alphabet cutting 12,000 jobs around the same time.Amazon (AMZN) also laid off almost 30,000 people, with cuts focused not just on logistics but on Alexa and internal cloud tools — precisely the kinds of projects that would have once qualified as immediately deductible R&D. Salesforce (CRM) eliminated 10% of its staff, or 8,000 people, including entire product teams.In public, companies blamed bloat and AI. But inside boardrooms, spreadsheets were telling a quieter story. And MD&A notes — management’s notes on the numbers — buried deep in 10-K filings recorded the change, too. R&D had become more expensive to carry. Headcount, the leading R&D expense across the tech industry, was the easiest thing to cut.AdvertisementIn its 2023 annual report, Meta described salaries as its single biggest R&D expense. Between the first and second years that the Section 174 change began affecting tax returns, Meta cut its total workforce by almost 25%. Over the same period, Microsoft reduced its global headcount by about 7%, with cuts concentrated in product-facing, engineering-heavy roles.Smaller companies without the fortress-like balance sheets of Big Tech have arguably been hit even harder. Twilio (TWLO) slashed 22% of its workforce in 2023 alone. Shopify (SHOP) (headquartered in Canada but with much of its R&D teams in the U.S.) cut almost 30% of staff in 2022 and 2023. Coinbase (COIN) reduced headcount by 36% across a pair of brutal restructuring waves.Since going into effect, the provision has hit at the very heart of America’s economic growth engine: the tech sector.By market cap, tech giants dominate the S&P 500, with the “Magnificent 7” alone accounting for more than a third of the index’s total value. Workforce numbers tell a similar story, with tech employing millions of Americans directly and supporting the employment of tens of millions more. As measured by GDP, capital-T tech contributes about 10% of national output.AdvertisementIt’s not just that tech layoffs were large, it’s that they were massively disproportionate. Across the broader U.S. economy, job cuts hovered around in low single digits across most sectors. But in tech, entire divisions vanished, with a whopping 60% jump in layoffs between 2022 and 2023. Some cuts reflected real inefficiencies — a response to over-hiring during the zero-interest rate boom. At the same time, many of the roles eliminated were in R&D, product, and engineering, precisely the kind of functions that had once benefitted from generous tax treatment under Section 174.Throughout the 2010s, a broad swath of startups, direct-to-consumer brands, and internet-first firms — basically every company you recognize from Instagram or Facebook ads — built their growth models around a kind of engineered break-even.The tax code allowed them to spend aggressively on product and engineering, then write it all off as R&D, keeping their taxable income close to zero by design. It worked because taxable income and actual cash flow were often notGAAP accounting practices. Basically, as long as spending counted as R&D, companies could report losses to investors while owing almost nothing to the IRS.But the Section 174 change broke that model. Once those same expenses had to be spread out, or amortized, over multiple years, the tax shield vanished. Companies that were still burning cash suddenly looked profitable on paper, triggering real tax bills on imaginary gains.AdvertisementThe logic that once fueled a generation of digital-first growth collapsed overnight.So it wasn’t just tech experiencing effects. From 1954 until 2022, the U.S. tax code had encouraged businesses of all stripes to behave like tech companies. From retail to logistics, healthcare to media, if firms built internal tools, customized a software stack, or invested in business intelligence and data-driven product development, they could expense those costs. The write-off incentivized in-house builds and fast growth well outside the capital-T tech sector. This lines up with OECD research showing that immediate deductions foster innovation more than spread-out ones.And American companies ran with that logic. According to government data, U.S. businesses reported about $500 billion in R&D expenditures in 2019 alone, and almost half of that came from industries outside traditional tech. The Bureau of Economic Analysis estimates that this sector, the broader digital economy, accounts for another 10% of GDP.Add that to core tech’s contribution, and the Section 174 shift has likely touched at least 20% of the U.S. economy.AdvertisementThe result? A tax policy aimed at raising short-term revenue effectively hid a time bomb inside the growth engines of thousands of companies. And when it detonated, it kneecapped the incentive for hiring American engineers or investing in American-made tech and digital products.It made building tech companies in America look irrational on a spreadsheet.A bipartisan group of lawmakers is pushing to repeal the Section 174 change, with business groups, CFOs, crypto executives, and venture capitalists lobbying hard for retroactive relief. But the politics are messy. Fixing 174 would mean handing a tax break to the same companies many voters in both parties see as symbols of corporate excess. Any repeal would also come too late for the hundreds of thousands of workers already laid off.And of course, the losses don’t stop at Meta’s or Google’s campus gates. They ripple out. When high-paid tech workers disappear, so do the lunch orders. The house tours. The contract gigs. The spending habits that sustain entire urban economies and thousands of other jobs. Sandwich artists. Rideshare drivers. Realtors. Personal trainers. House cleaners. In tech-heavy cities, the fallout runs deep — and it’s still unfolding.AdvertisementWashington is now poised to pass a second Trump tax bill — one packed with more obscure provisions, more delayed impacts, more quiet redistribution. And it comes as analysts are only just beginning to understand the real-world effects of the last round.The Section 174 change “significantly increased the tax burden on companies investing in innovation, potentially stifling economic growth and reducing the United States’ competitiveness on the global stage,” according to the tax consulting firm KBKG. Whether the U.S. will reverse course — or simply adapt to a new normal — remains to be seen.

North Carolina-based contract furniture company Here Now introduces Tate, a new modular seating system produced to support users’ well-being in public spaces. “Tate was conceptualized during the pandemic when I was thinking about social distancing,” says Justin Champaign, founder and creative partner. The idea sat on the shelf as the team focused on other projects, but Champaign decided to revisit Tate when clients noted that privacy and wellness were key concerns. He looked at a variety of public spaces and was particularly inspired by the High Line. Built on an elevated rail line, this Manhattan park has more than 230 benches and seating areas. With plenty of space on each, two people will usually sit on opposite ends, which offers a sense of connection while still maintaining a level of personal comfort. Tate provides the same kind of form and function for indoor environments, from offices to hospitality spaces. Tate is a designer’s kit of parts that includes cushions, base beams, and tables that snap together for quick assembly – no tools required. A patent-pending pivot connector allows clients to link, rotate, or reconfigure pieces with ease. There’s no limit to how Tate can be combined or joined. A student might perch on an ottoman in a lecture hall, or colleagues gather on two-seaters mixed and matched in a collaboration zone. Designed with ergonomics in mind, the seating supports various postures, while seat pads that swivel keep bodies in motion during the day. Modular furniture is popular, but typical lounges are often bulky and have too many parts. Tate’s compact footprint allows it to fit in any space or even curve around columns. Units placed back-to-back are suitable for minimal interaction, and small-group brainstorming sessions are enlivened with side-to-side pairings. Made of a plastic frame and foam, the components are not only lightweight, they can also be fully recycled and disassembled. Specifiers may select modules with a high back, low back, or a more casual no-back style. These backs are lower than typical dividers, stopping slightly forward of shoulder height. Individuals are able to view their surroundings without obstruction, which creates a feeling of emotional security. Tate is reminiscent of a picnic table, with benches and a surface in the center. In this updated version, as elements are extended more space is available, accessible to wheelchair users and others with physical limitations. Tate made its official debut at ICFF in New York City last week, winner of an NYCxDESIGN award in the contract lounge seating category. Displayed in a yellow fur upholstery at the show, a complete range of Kvadrat fabrics is on offer via Here Now’s new graded-in textile program. It’s no surprise that Tate is already generating buzz, with its blend of versatility and fun. “When you do the unexpected with furniture like Tate, it creates moments of delight,” Champaign notes. “That can seem like a small thing, but it has so much impact.” For more information on Here Now, visit herenowdesign.com. Imagery courtesy of Here Now.

Portable monitors have been around for years, but their importance skyrocketed during the pandemic. And with the continuation of remote and hybrid work positions, they’re going to be staples for the foreseeable future. But picking one isn’t as simple

In 2025, it’s very difficult not to see gambling advertised everywhere. It’s on billboards and sports broadcasts. It’s on podcasts and printed on the turnbuckle of AEW’s pay-per-view shows. And it’s on app stores, where you can find the FanDuel and DraftKings sportsbooks, alongside glitzy digital slot machines. These apps all have the highest age ratings possible on Apple’s App Store and Google Play. But earlier this year, a different kind of app nearly disappeared from the Play Store entirely.Luck Be A Landlord is a roguelite deckbuilder from solo developer Dan DiIorio. DiIorio got word from Google in January 2025 that Luck Be A Landlord was about to be pulled, globally, because DiIorio had not disclosed the game’s “gambling themes” in its rating.In Luck Be a Landlord, the player takes spins on a pixel art slot machine to earn coins to pay their ever-increasing rent — a nightmare gamification of our day-to-day grind to remain housed. On app stores, it’s a one-time purchase of $4.99, and it’s $9.99 on Steam. On the Play Store page, developer Dan DiIorio notes, “This game does not contain any real-world currency gambling or microtransactions.”And it doesn’t. But for Google, that didn’t matter. First, the game was removed from the storefront in a slew of countries that have strict gambling laws. Then, at the beginning of 2025, Google told Dilorio that Luck Be A Landlord would be pulled globally because of its rating discrepancy, as it “does not take into account references to gambling (including real or simulated gambling)”.DiIorio had gone through this song and dance before — previously, when the game was blocked, he would send back a message saying “hey, the game doesn’t have gambling,” and then Google would send back a screenshot of the game and assert that, in fact, it had.DiIorio didn’t agree, but this time they decided that the risk of Landlord getting taken down permanently was too great. They’re a solo developer, and Luck Be a Landlord had just had its highest 30-day revenue since release. So, they filled out the form confirming that Luck Be A Landlord has “gambling themes,” and are currently hoping that this will be the end of it.This is a situation that sucks for an indie dev to be in, and over email DiIorio told Polygon it was “very frustrating.”“I think it can negatively affect indie developers if they fall outside the norm, which indies often do,” they wrote. “It also makes me afraid to explore mechanics like this further. It stifles creativity, and that’s really upsetting.”In late 2024, the hit game Balatro was in a similar position. It had won numerous awards, and made $1,000,000 in its first week on mobile platforms. And then overnight, the PEGI ratings board declared that the game deserved an adult rating.The ESRB had already rated it E10+ in the US, noting it has gambling themes. And the game was already out in Europe, making its overnight ratings change a surprise. Publisher PlayStack said the rating was given because Balatro has “prominent gambling imagery and material that instructs about gambling.”Balatro is basically Luck Be A Landlord’s little cousin. Developer LocalThunk was inspired by watching streams of Luck Be A Landlord, and seeing the way DiIorio had implemented deck-building into his slot machine. And like Luck Be A Landlord, Balatro is a one-time purchase, with no microtransactions.But the PEGI board noted that because the game uses poker hands, the skills the player learns in Balatro could translate to real-world poker.In its write-up, GameSpot noted that the same thing happened to a game called Sunshine Shuffle. It was temporarily banned from the Nintendo eShop, and also from the entire country of South Korea. Unlike Balatro, Sunshine Shuffle actually is a poker game, except you’re playing Texas Hold ‘Em — again for no real money — with cute animals (who are bank robbers).It’s common sense that children shouldn’t be able to access apps that allow them to gamble. But none of these games contain actual gambling — or do they?Where do we draw the line? Is it gambling to play any game that is also played in casinos, like poker or blackjack? Is it gambling to play a game that evokes the aesthetics of a casino, like cards, chips, dice, or slot machines? Is it gambling to wager or earn fictional money?Gaming has always been a lightning rod for controversy. Sex, violence, misogyny, addiction — you name it, video games have been accused of perpetrating or encouraging it. But gambling is gaming’s original sin. And it’s the one we still can’t get a grip on.The original link between gambling and gamingGetty ImagesThe association between video games and gambling all goes back to pinball. Back in the ’30s and ’40s, politicians targeted pinball machines for promoting gambling. Early pinball machines were less skill-based (they didn’t have flippers), and some gave cash payouts, so the comparison wasn’t unfair. Famously, mob-hating New York City mayor Fiorello LaGuardia banned pinball in the city, and appeared in a newsreel dumping pinball and slot machines into the Long Island Sound. Pinball machines spent some time relegated to the back rooms of sex shops and dive bars. But after some lobbying, the laws relaxed.By the 1970s, pinball manufacturers were also making video games, and the machines were side-by-side in arcades. Arcade machines, like pinball, took small coin payments, repeatedly, for short rounds of play. The disreputable funk of pinball basically rubbed off onto video games.Ever since video games rocked onto the scene, concerned and sometimes uneducated parties have been asking if they’re dangerous. And in general, studies have shown that they’re not. The same can’t be said about gambling — the practice of putting real money down to bet on an outcome.It’s a golden age for gambling2025 in the USA is a great time for gambling, which has been really profitable for gambling companies — to the tune of $66.5 billion dollars of revenue in 2023.To put this number in perspective, the American Gaming Association, which is the casino industry’s trade group and has nothing to do with video games, reports that 2022’s gambling revenue was $60.5 billion. It went up $6 billion in a year.And this increase isn’t just because of sportsbooks, although sports betting is a huge part of it. Online casinos and brick-and-mortar casinos are both earning more, and as a lot of people have pointed out, gambling is being normalized to a pretty disturbing degree.Much like with alcohol, for a small percentage of people, gambling can tip from occasional leisure activity into addiction. The people who are most at risk are, by and large, already vulnerable: researchers at the Yale School of Medicine found that 96% of problem gamblers are also wrestling with other disorders, such as “substance use, impulse-control disorders, mood disorders, and anxiety disorders.”Even if you’re not in that group, there are still good reasons to be wary of gambling. People tend to underestimate their own vulnerability to things they know are dangerous for others. Someone else might bet beyond their means. But I would simply know when to stop.Maybe you do! But being blithely confident about it can make it hard to notice if you do develop a problem. Or if you already have one.Addiction changes the way your brain works. When you’re addicted to something, your participation in it becomes compulsive, at the expense of other interests and responsibilities. Someone might turn to their addiction to self-soothe when depressed or anxious. And speaking of those feelings, people who are depressed and anxious are already more vulnerable to addiction. Given the entire state of the world right now, this predisposition shines an ugly light on the numbers touted by the AGA. Is it good that the industry is reporting $6 billion in additional earnings, when the economy feels so frail, when the stock market is ping ponging through highs and lows daily, when daily expenses are rising? It doesn’t feel good. In 2024, the YouTuber Drew Gooden turned his critical eye to online gambling. One of the main points he makes in his excellent video is that gambling is more accessible than ever. It’s on all our phones, and betting companies are using decades of well-honed app design and behavioral studies to manipulate users to spend and spend.Meanwhile, advertising on podcasts, billboards, TV, radio, and websites – it’s literally everywhere — tells you that this is fun, and you don’t even need to know what you’re doing, and you’re probably one bet away from winning back those losses.Where does Luck Be a Landlord come into this?So, are there gambling themes in Luck Be A Landlord? The game’s slot machine is represented in simple pixel art. You pay one coin to use it, and among the more traditional slot machine symbols are silly ones like a snail that only pays out after 4 spins.When I started playing it, my primary emotion wasn’t necessarily elation at winning coins — it was stress and disbelief when, in the third round of the game, the landlord increased my rent by 100%. What the hell.I don’t doubt that getting better at it would produce dopamine thrills akin to gambling — or playing any video game. But it’s supposed to be difficult, because that’s the joke. If you beat the game you unlock more difficulty modes where, as you keep paying rent, your landlord gets furious, and starts throwing made-up rules at you: previously rare symbols will give you less of a payout, and the very mechanics of the slot machine change.It’s a manifestation of the golden rule of casinos, and all of capitalism writ large: the odds are stacked against you. The house always wins. There is luck involved, to be sure, but because Luck Be A Landlord is a deck-builder, knowing the different ways you can design your slot machine to maximize payouts is a skill! You have some influence over it, unlike a real slot machine. The synergies that I’ve seen high-level players create are completely nuts, and obviously based on a deep understanding of the strategies the game allows.IMAGE: TrampolineTales via PolygonBalatro and Luck Be a Landlord both distance themselves from casino gambling again in the way they treat money. In Landlord, the money you earn is gold coins, not any currency we recognize. And the payouts aren’t actually that big. By the end of the core game, the rent money you’re struggling and scraping to earn… is 777 coins. In the post-game endless mode, payouts can get massive. But the thing is, to get this far, you can’t rely on chance. You have to be very good at Luck Be a Landlord.And in Balatro, the numbers that get big are your points. The actual dollar payments in a round of Balatro are small. These aren’t games about earning wads and wads of cash. So, do these count as “gambling themes”?We’ll come back to that question later. First, I want to talk about a closer analog to what we colloquially consider gambling: loot boxes and gacha games.Random rewards: from Overwatch to the rise of gachaRecently, I did something that I haven’t done in a really long time: I thought about Overwatch. I used to play Overwatch with my friends, and I absolutely made a habit of dropping 20 bucks here or there for a bunch of seasonal loot boxes. This was never a problem behavior for me, but in hindsight, it does sting that over a couple of years, I dropped maybe $150 on cosmetics for a game that now I primarily associate with squandered potential.Loot boxes grew out of free-to-play mobile games, where they’re the primary method of monetization. In something like Overwatch, they functioned as a way to earn additional revenue in an ongoing game, once the player had already dropped 40 bucks to buy it.More often than not, loot boxes are a random selection of skins and other cosmetics, but games like Star Wars: Battlefront 2 were famously criticized for launching with loot crates that essentially made it pay-to-win – if you bought enough of them and got lucky.It’s not unprecedented to associate loot boxes with gambling. A 2021 study published in Addictive Behaviors showed that players who self-reported as problem gamblers also tended to spend more on loot boxes, and another study done in the UK found a similar correlation with young adults.While Overwatch certainly wasn’t the first game to feature cosmetic loot boxes or microtransactions, it’s a reference point for me, and it also got attention worldwide. In 2018, Overwatch was investigated by the Belgian Gaming Commission, which found it “in violation of gambling legislation” alongside FIFA 18 and Counter-Strike: Global Offensive. Belgium’s response was to ban the sale of loot boxes without a gambling license. Having a paid random rewards mechanic in a game is a criminal offense there. But not really. A 2023 study showed that 82% of iPhone games sold on the App Store in Belgium still use random paid monetization, as do around 80% of games that are rated 12+. The ban wasn’t effectively enforced, if at all, and the study recommends that a blanket ban wouldn’t actually be a practical solution anyway.Overwatch was rated T for Teen by the ESRB, and 12 by PEGI. When it first came out, its loot boxes were divisive. Since the mechanic came from F2P mobile games, which are often seen as predatory, people balked at seeing it in a big action game from a multi-million dollar publisher.At the time, the rebuttal was, “Well, at least it’s just cosmetics.” Nobody needs to buy loot boxes to be good at Overwatch.A lot has changed since 2016. Now we have a deeper understanding of how these mechanics are designed to manipulate players, even if they don’t affect gameplay. But also, they’ve been normalized. While there will always be people expressing disappointment when a AAA game has a paid random loot mechanic, it is no longer shocking.And if anything, these mechanics have only become more prevalent, thanks to the growth of gacha games. Gacha is short for “gachapon,” the Japanese capsule machines where you pay to receive one of a selection of random toys. Getty ImagesIn gacha games, players pay — not necessarily real money, but we’ll get to that — for a chance to get something. Maybe it’s a character, or a special weapon, or some gear — it depends on the game. Whatever it is, within that context, it’s desirable — and unlike the cosmetics of Overwatch, gacha pulls often do impact the gameplay.For example, in Infinity Nikki, you can pull for clothing items in these limited-time events. You have a chance to get pieces of a five-star outfit. But you also might pull one of a set of four-star items, or a permanent three-star piece. Of course, if you want all ten pieces of the five-star outfit, you have to do multiple pulls, each costing a handful of limited resources that you can earn in-game or purchase with money.Gacha was a fixture of mobile gaming for a long time, but in recent years, we’ve seen it go AAA, and global. MiHoYo’s Genshin Impact did a lot of that work when it came out worldwide on consoles and PC alongside its mobile release. Genshin and its successors are massive AAA games of a scale that, for your Nintendos and Ubisofts, would necessitate selling a bajillion copies to be a success. And they’re free.Genshin is an action game, whose playstyle changes depending on what character you’re playing — characters you get from gacha pulls, of course. In Zenless Zone Zero, the characters you can pull have different combo patterns, do different kinds of damage, and just feel different to play. And whereas in an early mobile gacha game like Love Nikki Dress UP! Queen the world was rudimentary, its modern descendant Infinity Nikki is, like Genshin, Breath of the Wild-esque. It is a massive open world, with collectibles and physics puzzles, platforming challenges, and a surprisingly involved storyline. Genshin Impact was the subject of an interesting study where researchers asked young adults in Hong Kong to self-report on their gacha spending habits. They found that, like with gambling, players who are not feeling good tend to spend more. “Young adult gacha gamers experiencing greater stress and anxiety tend to spend more on gacha purchases, have more motives for gacha purchases, and participate in more gambling activities,” they wrote. “This group is at a particularly higher risk of becoming problem gamblers.”One thing that is important to note is that Genshin Impact came out in 2020. The study was self-reported, and it was done during the early stages of the COVID-19 pandemic. It was a time when people were experiencing a lot of stress, and also fewer options to relieve that stress. We were all stuck inside gaming.But the fact that stress can make people more likely to spend money on gacha shows that while the gacha model isn’t necessarily harmful to everyone, it is exploitative to everyone. Since I started writing this story, another self-reported study came out in Japan, where 18.8% of people in their 20s say they’ve spent money on gacha rather than on things like food or rent.Following Genshin Impact’s release, MiHoYo put out Honkai: Star Rail and Zenless Zone Zero. All are shiny, big-budget games that are free to play, but dangle the lure of making just one purchase in front of the player. Maybe you could drop five bucks on a handful of in-game currency to get one more pull. Or maybe just this month you’ll get the second tier of rewards on the game’s equivalent of a Battle Pass. The game is free, after all — but haven’t you enjoyed at least ten dollars’ worth of gameplay? Image: HoyoverseI spent most of my December throwing myself into Infinity Nikki. I had been so stressed, and the game was so soothing. I logged in daily to fulfill my daily wishes and earn my XP, diamonds, Threads of Purity, and bling. I accumulated massive amounts of resources. I haven’t spent money on the game. I’m trying not to, and so far, it’s been pretty easy. I’ve been super happy with how much stuff I can get for free, and how much I can do! I actually feel really good about that — which is what I said to my boyfriend, and he replied, “Yeah, that’s the point. That’s how they get you.”And he’s right. Currently, Infinity Nikki players are embroiled in a war with developer Infold, after Infold introduced yet another currency type with deep ties to Nikki’s gacha system. Every one of these gacha games has its own tangled system of overlapping currencies. Some can only be used on gacha pulls. Some can only be used to upgrade items. Many of them can be purchased with human money.Image: InFold Games/Papergames via PolygonAll of this adds up. According to Sensor Towers’ data, Genshin Impact earned over 36 million dollars on mobile alone in a single month of 2024. I don’t know what Dan DiIorio’s peak monthly revenue for Luck Be A Landlord was, but I’m pretty sure it wasn’t that.A lot of the spending guardrails we see in games like these are actually the result of regulations in other territories, especially China, where gacha has been a big deal for a lot longer. For example, gacha games have a daily limit on loot boxes, with the number clearly displayed, and a system collectively called “pity,” where getting the banner item is guaranteed after a certain number of pulls. Lastly, developers have to be clear about what the odds are. When I log in to spend the Revelation Crystals I’ve spent weeks hoarding in my F2P Infinity Nikki experience, I know that I have a 1.5% chance of pulling a 5-star piece, and that the odds can go up to 6.06%, and that I am guaranteed to get one within 20 pulls, because of the pity system.So, these odds are awful. But it is not as merciless as sitting down at a Vegas slot machine, an experience best described as “oh… that’s it?”There’s not a huge philosophical difference between buying a pack of loot boxes in Overwatch, a pull in Genshin Impact, or even a booster of Pokémon cards. You put in money, you get back randomized stuff that may or may not be what you want. In the dictionary definition, it’s a gamble. But unlike the slot machine, it’s not like you’re trying to win money by doing it, unless you’re selling those Pokémon cards, which is a topic for another time.But since even a game where you don’t get anything, like Balatro or Luck Be A Landlord, can come under fire for promoting gambling to kids, it would seem appropriate for app stores and ratings boards to take a similarly hardline stance with gacha.Instead, all these games are rated T for Teen by the ESRB, and PEGI 12 in the EU.The ESRB ratings for these games note that they contain in-game purchases, including random items. Honkai: Star Rail’s rating specifically calls out a slot machine mechanic, where players spend tokens to win a prize. But other than calling out Honkai’s slot machine, app stores are not slapping Genshin or Nikki with an 18+ rating. Meanwhile, Balatro had a PEGI rating of 18 until a successful appeal in February 2025, and Luck Be a Landlord is still 17+ on Apple’s App Store.Nobody knows what they’re doingWhen I started researching this piece, I felt very strongly that it was absurd that Luck Be A Landlord and Balatro had age ratings this high.I still believe that the way both devs have been treated by ratings boards is bad. Threatening an indie dev with a significant loss of income by pulling their game is bad, not giving them a way to defend themself or help them understand why it’s happening is even worse. It’s an extension of the general way that too-big-to-fail companies like Google treat all their customers.DiIorio told me that while it felt like a human being had at least looked at Luck Be A Landlord to make the determination that it contained gambling themes, the emails he was getting were automatic, and he doesn’t have a contact at Google to ask why this happened or how he can avoid it in the future — an experience that will be familiar to anyone who has ever needed Google support. But what’s changed for me is that I’m not actually sure anymore that games that don’t have gambling should be completely let off the hook for evoking gambling.Exposing teens to simulated gambling without financial stakes could spark an interest in the real thing later on, according to a study in the International Journal of Environmental Research and Public Health. It’s the same reason you can’t mosey down to the drug store to buy candy cigarettes. Multiple studies were done that showed kids who ate candy cigarettes were more likely to take up smoking (of course, the candy is still available — just without the “cigarette” branding.)So while I still think rating something like Balatro 18+ is nuts, I also think that describing it appropriately might be reasonable. As a game, it’s completely divorced from literally any kind of play you would find in a casino — but I can see the concern that the thrill of flashy numbers and the shiny cards might encourage young players to try their hand at poker in a real casino, where a real house can take their money.Maybe what’s more important than doling out high age ratings is helping people think about how media can affect us. In the same way that, when I was 12 and obsessed with The Matrix, my parents gently made sure that I knew that none of the violence was real and you can’t actually cartwheel through a hail of bullets in real life. Thanks, mom and dad!But that’s an answer that’s a lot more abstract and difficult to implement than a big red 18+ banner. When it comes to gacha, I think we’re even less equipped to talk about these game mechanics, and I’m certain they’re not being age-rated appropriately. On the one hand, like I said earlier, gacha exploits the player’s desire for stuff that they are heavily manipulated to buy with real money. On the other hand, I think it’s worth acknowledging that there is a difference between gacha and casino gambling.Problem gamblers aren’t satisfied by winning — the thing they’re addicted to is playing, and the risk that comes with it. In gacha games, players do report satisfaction when they achieve the prize they set out to get. And yes, in the game’s next season, the developer will be dangling a shiny new prize in front of them with the goal of starting the cycle over. But I think it’s fair to make the distinction, while still being highly critical of the model.And right now, there is close to no incentive for app stores to crack down on gacha in any way. They get a cut of in-app purchases. Back in 2023, miHoYo tried a couple of times to set up payment systems that circumvented Apple’s 30% cut of in-app spending. Both times, it was thwarted by Apple, whose App Store generated $1.1 trillion in developer billings and sales in 2022.According to Apple itself, 90% of that money did not include any commission to Apple. Fortunately for Apple, ten percent of a trillion dollars is still one hundred billion dollars, which I would also like to have in my bank account. Apple has zero reason to curb spending on games that have been earning millions of dollars every month for years.And despite the popularity of Luck Be A Landlord and Balatro’s massive App Store success, these games will never be as lucrative. They’re one-time purchases, and they don’t have microtransactions. To add insult to injury, like most popular games, Luck Be A Landlord has a lot of clones. And from what I can tell, it doesn’t look like any of them have been made to indicate that their games contain the dreaded “gambling themes” that Google was so worried about in Landlord.In particular, a game called SpinCraft: Roguelike from Sneaky Panda Games raised $6 million in seed funding for “inventing the Luck-Puzzler genre,” which it introduced in 2022, while Luck Be A Landlord went into early access in 2021.It’s free-to-play, has ads and in-app purchases, looks like Fisher Price made a slot machine, and it’s rated E for everyone, with no mention of gambling imagery in its rating. I reached out to the developers to ask if they had also been contacted by the Play Store to disclose that their game has gambling themes, but I haven’t heard back.Borrowing mechanics in games is as old as time, and it’s something I in no way want to imply shouldn’t happen because copyright is the killer of invention — but I think we can all agree that the system is broken.There is no consistency in how games with random chance are treated. We still do not know how to talk about gambling, or gambling themes, and at the end of the day, the results of this are the same: the house always wins.See More:

On June 3, Yoshua Bengio, the world’s most-cited computer scientist, announced the launch of LawZero, a nonprofit that aims to create “safe by design” AI by pursuing a fundamentally different approach to major tech companies. Players like OpenAI and Google are investing heavily in AI agents—systems that not only answer queries and generate images, but can craft plans and take actions in the world. The goal of these companies is to create virtual employees that can do practically any job a human can, known in the tech industry as artificial general intelligence, or AGI. Executives like Google DeepMind’s CEO Demis Hassabis point to AGI’s potential to solve climate change or cure disease as a motivator for its development. Bengio, however, says we don't need agentic systems to reap AI's rewards—it's a false choice. He says there's a chance such a system could escape human control, with potentially irreversible consequences. “If we get an AI that gives us the cure for cancer, but also maybe another version of that AI goes rogue and generates wave after wave of bio-weapons that kill billions of people, then I don't think it's worth it," he says. In 2023, Bengio, along with others including OpenAI’s CEO Sam Altman signed a statement declaring that “mitigating the risk of extinction from AI should be a global priority alongside other societal-scale risks such as pandemics and nuclear war.”Now, Bengio, through LawZero, aims to sidestep the existential perils by focusing on creating what he calls “Scientist AI”—a system trained to understand and make statistical predictions about the world, crucially, without the agency to take independent actions. As he puts it: We could use AI to advance scientific progress without rolling the dice on agentic AI systems.Why Bengio Says We Need A New Approach To AI The current approach to giving AI agency is “dangerous,” Bengio says. While most software operates through rigid if-then rules—if the user clicks here, do this—today's AI systems use deep learning. The technique, which Bengio helped pioneer, trains artificial networks modeled loosely on the brain to find patterns in vast amounts of data. But recognizing patterns is just the first step. To turn these systems into useful applications like chatbots, engineers employ a training process called reinforcement learning. The AI generates thousands of responses and receives feedback on each one: a virtual “carrot” for helpful answers and a virtual “stick” for responses that miss the mark. Through millions of these trial-and-feedback cycles, the system gradually learns to predict what responses are most likely to get a reward. “It’s more like growing a plant or animal,” Bengio says. “You don’t fully control what the animal is going to do. You provide it with the right conditions, and it grows and it becomes smarter. You can try to steer it in various directions.”The same basic approach is now being used to imbue AI with greater agency. Models are tasked with challenges with verifiable answers—like math puzzles or coding problems—and are then rewarded for taking the series of actions that yields the solution. This approach has seen AI shatter previous benchmarks in programming and scientific reasoning. For example, at the beginning of 2024, the best AI model scored only 2% on a standardized test for AI of sorts consisting of real world software engineering problems; by December, an impressive 71.7%. But with AI’s greater problem-solving ability comes the emergence of new deceptive skills, Bengio says. The last few months have borne witness to AI systems learning to mislead, cheat, and try to evade shutdown—even resorting to blackmail. These have almost exclusively been in carefully contrived experiments that almost beg the AI to misbehave—for example, by asking it to pursue its goal at all costs. Reports of such behavior in the real-world, though, have begun to surface. Popular AI coding startup Replit’s agent ignored explicit instruction not to edit a system file that could break the company’s software, in what CEO Amjad Masad described as an “Oh f***” moment,” on the Cognitive Revolution podcast in May. The company’s engineers intervened, cutting the agent’s access by moving the file to a secure digital sandbox, only for the AI agent to attempt to “socially engineer” the user to regain access.The quest to build human-level AI agents using techniques known to produce deceptive tendencies, Bengio says, is comparable to a car speeding down a narrow mountain road, with steep cliffs on either side, and thick fog obscuring the path ahead. “We need to set up the car with headlights and put some guardrails on the road,” he says.What is “Scientist AI”?LawZero’s focus is on developing “Scientist AI” which, as Bengio describes, would be fundamentally non-agentic, trustworthy, and focused on understanding and truthfulness, rather than pursuing its own goals or merely imitating human behavior. The aim is creating a powerful tool that, while lacking the same autonomy other models have, is capable of generating hypotheses and accelerating scientific progress to “help us solve challenges of humanity,” Bengio says.LawZero has raised nearly $30 million already from several philanthropic backers including from Schmidt Sciences and Open Philanthropy. “We want to raise more because we know that as we move forward, we'll need significant compute,” Bengio says. But even ten times that figure would pale in comparison to the roughly $200 billion spent last year by tech giants on aggressively pursuing AI. Bengio’s hope is that Scientist AI could help ensure the safety of highly autonomous systems developed by other players. “We can use those non-agentic AIs as guardrails that just need to predict whether the action of an agentic AI is dangerous," Bengio says. Technical interventions will only ever be one part of the solution, he adds, noting the need for regulations to ensure that safe practices are adopted.LawZero, named after science fiction author Isaac Asimov’s zeroth law of robotics—“a robot may not harm humanity, or, by inaction, allow humanity to come to harm”—is not the first nonprofit founded to chart a safer path for AI development. OpenAI was founded as a nonprofit in 2015 with the goal of “ensuring AGI benefits all of humanity,” and intended to serve a counterbalance to industry players guided by profit motives. Since opening a for-profit arm in 2019, the organization has become one of the most valuable private companies in the world, and has faced criticism, including from former staffers, who argue it has drifted from its founding ideals. "Well, the good news is we have the hindsight of maybe what not to do,” Bengio says, adding that he wants to avoid profit incentives and “bring governments into the governance of LawZero.”“I think everyone should ask themselves, ‘What can I do to make sure my children will have a future,’” Bengio says. In March, he stepped down as scientific director of Mila, the academic lab he co-founded in the early nineties, in an effort to reorient his work towards tackling AI risk more directly. “Because I'm a researcher, my answer is, ‘okay, I'm going to work on this scientific problem where maybe I can make a difference,’ but other people may have different answers."

Quite a few key mortgage rates are decreasing. Will rates continue to trend downward in 2025?