The outcry after a recent marketplace crackdown on games with adult content, seemingly due to pressure from payment processors, prompted Mastercard to release a brief statement Friday pushing back against recent headlines.

“Mastercard has not evaluated any game or required restrictions of any activity on game creator sites and platforms, contrary to media reports and allegations,” the company said, adding, “At the same time, we require merchants to have appropriate controls to ensure Mastercard cards cannot be used for unlawful purchases, including illegal adult content.”

This follows an open letter by the advocacy group Collective Shout addressed to executives at Paypal, Mastercard, Visa, and other companies, criticizing them for allowing the sale of “No Mercy” and other games that depict rape, incest, and child sexual abuse.

In the following weeks, Steam announced that it would ban games that violate the rules of its “payment processors and related card networks and banks.” Then Itch.io said it was removing games with adult content from its browse and search pages while conducting a broader audit.

While Mastercard’s statement seems to undermine the narrative that payment and card companies were the ones pressuring the game marketplaces, Steam owner Valve responded with a statement of its own, provided to PC Gamer and other gaming sites.

According to Valve, “Mastercard did not communicate with Valve directly, despite our request to do so. Mastercard communicated with payment processors and their acquiring banks. Payment processors communicated this with Valve, and we replied by outlining Steam’s policy since 2018 of attempting to distribute games that are legal for distribution.”

Valve said its response was “rejected” by the payment processors, who noted the “risk to the Mastercard brand” and pointed to a Mastercard rule against “illegal or brand-damaging transactions.”

Meanwhile, Itch.io said that it’s now re-indexing free games with adult content while negotiating with payment processors including Stripe, which for its part said it’s “unable to support sexually explicit content” due to “banking partners.”

Sarah Murray recalls the first time she saw an artificial model in fashion: It was 2023, and a beautiful young woman of color donned a Levi’s denim overall dress. Murray, a commercial model herself, said it made her feel sad and exhausted. 

The iconic denim company had teamed up with the AI studio Lalaland.ai to create “diverse” digital fashion models for more inclusive ads. For an industry that has failed for years to employ diverse human models, the backlash was swift, with New York Magazine calling the decision “artificial diversity.” 

“Modeling as a profession is already challenging enough without having to compete with now new digital standards of perfection that can be achieved with AI,” Murray told TechCrunch.

Two years later, her worries have compounded. Brands continue to experiment with AI-generated models, to the consternation of many fashion lovers. The latest uproar came after Vogue’s July print edition featured a Guess ad with a typical model for the brand: thin yet voluptuous, glossy blond tresses, pouty rose lips. She exemplified North American beauty standards, but there was one problem — she was AI generated. 

The internet buzzed for days, in large part because the AI-generated beauty showed up in Vogue, the fashion bible that dictates what is and is not acceptable in the industry. The AI-generated model was featured in an advertisement, not a Vogue editorial spread. And Vogue told TechCrunch the ad met its advertising standards.   

To many, an ad versus an editorial is a distinction without a difference. 

TechCrunch spoke to fashion models, experts, and technologists to get a sense of where the industry is headed now that Vogue seems to have put a stamp of approval on technology that’s poised to dramatically change the fashion industry. 

They said the Guess ad drama highlights questions arising within creative industries being touched by AI’s silicon fingers: When high-quality creative work can be done by AI in a fraction of the time and cost, what’s the point of humans? And in the world of fashion, what happens to the humans — the models, photographers, stylists, and set designers — performing those jobs? 

“It’s just so much cheaper”

Sinead Bovell, a model and founder of the WAYE organization who wrote about CGI models for Vogue five years ago, told TechCrunch that “e-commerce models” are most under threat of automation. 

E-commerce models are the ones who pose for advertisements or display clothes and accessories for online shoppers. Compared to high-fashion models, whose striking, often unattainable looks are featured in editorial spreads and on runways, they’re more realistic and relatable.

“E-commerce is where most models make their bread and butter,” Bovell said. “It’s not necessarily the path to model fame or model prestige, but it is the path for financial security.”

That fact is running in direct contrast to the pressure many brands feel to automate such shoots. Paul Mouginot, an art technologist who has worked with luxury brands, said it’s simply expensive to work with live models, especially when it comes to photographing them in countless garments, shoes, and accessories. 

“AI now lets you start with a flat-lay product shoot, place it on a photorealistic virtual model, and even position that model in a coherent setting, producing images that look like genuine fashion editorials,” he told TechCrunch. 

Brands, in some ways, have been doing this for a while, he said. Mouginot, who is French, cited the French retailer Veepee as an example of a company that has used virtual mannequins to sell clothes since at least 2013. Other notable brands like H&M, Mango, and Calvin Klein have also resorted to AI models. 

Amy Odell, a fashion writer and author of a recently published biography on Gwyneth Paltrow, put it more simply: “It’s just so much cheaper for [brands] to use AI models now. Brands need a lot of content, and it just adds up. So if they can save money on their print ad or their TikTok feed, they will.” 

PJ Pereira, co-founder of AI ad firm Silverside AI, said it really comes down to scale. Every conversation he’s had with fashion brands circles around the fact that the entire marketing system was built for a world where brands produced just four big pieces of content per year. Social media and e-commerce has changed that, and now they need anywhere from 400 to 400,000 pieces; it’s too expensive for brands, especially small ones, to keep up. 

“There’s no way to scale from four to 400 or 400,000 with just process tweaks,” he added. “You need a new system. People get angry. They assume this is about taking money away from artists and models. But that’s not what I’ve seen.”

From “diverse” models to AI avatars

Murray, a commercial model, understands the cost benefits of using AI models, but only to an extent. 

She lamented that brands like Levi’s claim AI is only meant to supplement human talent, not take away. 

“If those [brands] ever had the opportunity to stand in line at an open casting call, they would know about the endless amounts of models, including myself, that would dream of opportunities to work with their brands,” she said. “They would never need to supplement with anything fake.”  

She thinks such a shift will impact “non-traditional” — think, diverse — commercial models, such as herself. That was the main problem with the Levi’s ad. Rather than hiring diverse talent, it artificially generated it. 

Bovell calls this “robot cultural appropriation,” or the idea that brands can just generate certain, especially diverse, identities to tell a brand story, even if the person who created the technology isn’t of that same identity. 

And though Pereira argues that it’s unrealistic to shoot every garment on every type of model, that hasn’t calmed the fears many diverse models have about what’s to come. 

“We already see an unprecedented use of certain terms in our contracts that we worry indicate that we are possibly signing away our rights for a brand to use our face and anything recognizable as ourselves to train their future AI systems,” Murray said. 

Some see generating likenesses of models as a way forward in the AI era. Sara Ziff, a former model and founder of the Model Alliance, is working to pass the Fashion Workers Act, which would require brands to get a model’s clear consent and provide compensation for using their digital replicas. Mouginot said this lets models appear at several shoots on the same day and possibly generate additional income. 

That’s “precious when a sought-after model is already traveling constantly,” he continued. But at the same time, whenever an avatar is hired, human labor is replaced. “What few players gain can mean fewer opportunities for many others.” 

If anything, Bovell said the bar is now higher for models looking to compete with the distinctive and the digitized. She suggested that models use their platforms to build their personal brands, differentiate themselves, and work on new revenue streams like podcasting or brand endorsements. 

“Start to take those opportunities to tell your unique human story,” she said. “AI will never have a unique human story.”

That sort of entrepreneurial mindset is becoming table stakes across industries — from journalism to coding — as AI creates the conditions for the most self-directed learners to rise. 

Room for another view 

Mouginot sees a world where some platforms stop working with human models altogether, though he also believes humans share a desire for the “sensual reality of objects, for a touch of imperfection and for human connection.”

“Many breakthrough models succeed precisely because of a distinctive trait, teeth, gaze, attitude, that is slightly imperfect by strict standards yet utterly charming,” he said. “Such nuances are hard to erode in zeros and ones.” 

This is where startup and creative studio Artcare thrives, according to Sandrine Decorde, the firm’s CEO and co-founder. She refers to her team as “AI artisans,” creative people who use tools like Flux from Black Forest Labs to fine-tune AI-generated models that have that touch of unique humanity. 

Much of the work Decorde’s firm does today involves producing AI-generated babies and children for brands. Employing minors in the fashion industry has historically been a gray area rife with exploitation and abuse. Ethically, Decorde argues, bringing generative AI to children’s fashion makes sense, particularly when the market demand is so high. 

“It’s like sewing; it’s very delicate,” she told TechCrunch, referring to creating AI-generated models. “The more time we spend on our datasets and image refinements, the better and more consistent our models are.” 

Part of the work is building out a library of distinctive artifacts. Decorde noted that many AI-generated models — like the ones created by Seraphinne Vallora, the agency behind Vogue’s Guess ad — are too homogenous. Their lips are too perfect and symmetrical. Their jawlines are all the same. 

“Imagery needs to make an impact,” Decorde said, noting that many fashion brands like to work exclusively with certain models, a desire that has spilled over into AI-generated models. “A model embodies a fashion brand.”

Pereira added that his firm combats homogeneity in AI “with intention” and warned that as more content gets made by more people who aren’t intentional, all of the output feeds back into computer models, amplifying bias. 

“Just like you would cast for a wide range of models, you have to prompt for that,” he said. “You need to train [models] with a wide range of appearances. Because if you don’t, the AI will reflect whatever biases it was trained on.”

An AI future is promised, but uncertain 

The usage of AI modeling technology in fashion is mostly still in its experimental phase, Claudia Wagner, founder of modeling booking platform Ubooker, told TechCrunch. She and her team saw the Guess ad and said it was interesting technically, but it wasn’t impactful or new. 

“It feels like another example of a brand using AI to be part of the current narrative,” she told TechCrunch. “We’re all in a phase of testing and exploring what AI can add — but the real value will come when it’s used with purpose, not just for visibility.” 

Brands are getting visibility from using AI — and the Guess ad is the latest example. Pereira said his firm recently tested a fully AI-generated product video on TikTok that got more than a million views with mostly negative comments. 

“But if you look past the comments, you see that there’s a silent majority — almost 20x engagement — that vastly outnumber the criticism,” he continued. “The click-through rate was 30x the number of complaints, and the product saw a steep hike in sales.”

He, like Wagner, doesn’t think AI models are going away anytime soon. If anything, the process of using AI will be integrated into the creative workflow.

“Some brands feel good about using fully artificial models,” Pereira said. “Others prefer starting with real people and licensing their likeness to build synthetic shoots. And some brands simply don’t want to do it — they worry their audiences won’t accept it.”

Wagner said what is becoming evident is that human talent remains central, especially when authenticity and identity are part of a brand’s story. That’s especially true for luxury heritage brands, which are usually slow to adopt new technologies. 

Though Decorde noted many high-fashion brands are quietly experimenting with AI, Mouginot said many are still trying to define their AI policies and are avoiding fully AI-generated people at the moment. It’s one reason why Vogue’s inclusion of an AI model was such a shock.

Bovell pondered if the ad was Vogue’s way of testing how the world would react to merging high fashion with AI. 

So far the reaction hasn’t been great. It’s unclear if the magazine thinks it ride out the backlash.

“What Vogue does matters,” Odell said. “If Vogue ends up doing editorials with AI models, I think that’s going to make it okay. In the same way the industry was really resistant to Kim Kardashian and then Vogue featured her. Then it was okay.”

Apple CEO Tim Cook held an hourlong all-hands meeting in which he told employees that the company needs to win in AI, according to Bloomberg’s Mark Gurman.

The meeting came after an earnings call in which Cook told investors and analysts that Apple would “significantly” increase its AI investments. It seems he had a similar message for Apple employees, reportedly telling them, “Apple must do this. Apple will do this. This is sort of ours to grab.”

Despite launching a variety of AI-powered features in the past year under the Apple Intelligence umbrella, the company’s promised upgrades to its voice assistant Siri have been significantly delayed. And Cook seemed to acknowledge that the company has fallen behind its competitors.

“We’ve rarely been first,” he reportedly said. “There was a PC before the Mac; there was a smartphone before the iPhone; there were many tablets before the iPad; there was an MP3 player before iPod.” But in his telling, that didn’t stop Apple from inventing the “modern” versions of those products.