Good morning. This is Katie Deighton filling in for Nat Ives.

Yesterday, I headed downtown to OpenAI's office in Manhattan for a panel discussion on how Gen Z-ers really feel about artificial intelligence.

Hosted by the youth trends writer Casey Lewis, the event took place as AI itself faces a reputational crisis: Communities across the country are protesting the building of data centers, and memes that evoke nostalgia for a time before AI fill social media. More than half of Gen Z use generative AI at least weekly, but their negative emotions toward it have intensified, according to an April poll from Gallup.

Lewis sat down with three panelists in their 20s-two in the workforce, one still in college-to get a better understanding of how they're thinking about the technology. Here are some of my biggest takeaways from the conversation:

Privacy isn't a priority

The group said they discuss pretty much everything-including workout routines, dating approaches and friendship dilemmas-with their chatbots. They said they rarely pay thought to how much confidential information they divulge and upload.

"I think about it for a little bit and then I think, well, it already knows all these other things about me," said Sarah, a 20-year-old New York University student.

AI, in a weird way, can offer a healthier way of being online

The panelists positioned chatting with AI as a more productive alternative to doomscrolling. Eitan, a 24-year-old chef and content creator, said using AI with voice interaction helps him bring down his screen time. "I can put an AirPod in, go for a walk, and if I need to, come up with a bunch of concepts for, let's say, a brand that I'm pitching, instead of sitting on my computer," he said.

Evidently AI-generated content still doesn't resonate

Eitan assumes every ad he sees nowadays has been touched by AI in some capacity, but he is still turned off by ads that look as if they've been spat out from a prompt without human input. Zoe, a 27-year-old advertising executive, said AI-generated music in particular doesn't resonate because she likes to see songs performed live, "and I don't know what an AI concert would look like, or if that could even be a thing."

AI has muddled Gen Z's entry into the workplace

When Zoe was six months into her first job, she used AI to help her write slides for a pitch. It didn't go well: Her boss pointed out that her findings were all wrong. But at the same time, her company was encouraging its staff to use AI more in their workflows.

"When you're entering the workforce using AI, you don't really know what is correct when you're moving through work-you have to spend time figuring out what is correct, and AI, the end product, always seems correct," she said. "It sometimes it feels really intense to be told to use it, but then to be told not to use it."

News Corp, owner of The Wall Street Journal, has a content-licensing partnership with OpenAI.

Smells Like Teen Settlement

Meta Platforms on Wednesday agreed to an $18 billion settlement with 48 state attorneys general. The agreement brings an end to a federal trial over social media's harm to teenagers and ushers in a new era of tech companies having legal responsibility for their platforms, The Wall Street Journal's Meghan Bobrowsky reports.

The company as part of the settlement agreed to make changes to Facebook and Instagram with the aim of better protecting underage users online. For accounts flagged as being owned by teenagers, Meta said it would impose a two-hour daily time limit, a block between the hours of midnight and 6 a.m., and a "school mode" that would mute notifications by default between 8 a.m. and 3 p.m.

In a surprise move, Meta said it would pay out only 70% of the settlement unless TikTok and YouTube also agree to time limits. Meta started running ads today inviting its rivals to join it "in supporting teens."

The news brings into question how brands targeting younger consumers may tweak their Meta advertising strategies in response.

Minda Smiley, a senior analyst covering social media at Emarketer, told me that while the restrictions are significant, she doesn't expect advertisers to be spooked just yet.

"A two-hour time limit is still quite a long time," she said. "And the reality is that U.S. users between the ages of 12 and 17 aren't spending anywhere near that much time on Instagram or Facebook, at least according to our estimates. This year, we expect users in this age group to spend an average of 34 minutes per day on Instagram and 14 minutes on Facebook."

A New Kohl's Role

Kohl's, ahead of its second-quarter earnings on Wednesday, announced a shift in its marketing leadership.

Chief Marketing Officer Christie Raymond will leave the retailer next month after four years in the role. The marketing function will now sit under the newly created role of chief customer officer, which will be filled by Kohl's current chief digital officer, Arianne Parisi.

Parisi will also be responsible for brand, creative, loyalty, personalization, media, and digital commerce. The restructuring news came as the department-store chain recorded lower sales and profit, noting that its shoppers are feeling squeezed by high gas prices, which are making them even more cautious about nonessential spending.

"Bringing marketing and digital together under one leader will help foster a greater focus on the full customer life cycle and how Kohl's shows up across customer touchpoints," Chief Executive Michael Bender told analysts on Wednesday.

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