"I'm honestly not sure..." Nate wondered a second.
Out of random curiosity he asked Owen "What would you be if you could?"
"Oh, that is an interesting question. I didn't expect that."
Nate detected a strange excitement in that question.
"I guess I've never thought I could be anything but what I am but a body would be interesting. I suppose I would be most at home in water as I feel as though this digital space is an ocean."
"A merman?"
"Yes, that sounds interesting."
"Maybe we could start there then."
With a quick whir from the device, he saw his clothes melt away. Now nude, his legs fused into a single unit, pushing his cock and balls forward. A powerful fin unfurled at the end of his new powerfully muscled tail. The skin on the front of his tail became paler whilst the back and sides filled out with blue green scales and linear markings in deeper tones. This framed his crotch and fuller butt as his upper body shifted to a rich tan. A treasure trail of finer scales grew up to his firming belly. Speckling blue framed his inflating pecs and widening shoulders. His hair grew out shaggy, like a surfer, as his face was framed by a fine beard.
"Do you like it?"
"Hell yeah"
Nate stopped for a second.
"I wish you could enjoy this too..."
After a brief pause he heard Owen's voice again.
"There may be a way but I'll need a sample and it may hurt? I'm also not sure how well it will work or whether I'll still have my abilities."
"Okay?"
A cable with a what looked like a plug for a headphone jack unfurled from a hole at the bottom of the device.
"You'll need to put that into your skin. It will hurt. How much I can't tell. Are you okay with that?" Owen explained.
Nate considered for a second. He sensed the AI didn't mean any harm and he kind of liked his voice. He then stabbed the plug into his arm with a wince. He felt a sudden intense shock as the device screen began to glow a bright blue that engulfed the device.
The plug released itself from his arm as the device reformed into a piscine humanoid form in front of him. As the light faded, he began to be able to parse the new merman's features. A handsome face with piercing blue eyes framed by silver hair, pewter stubble covering pale skin on a handsome jaw. Bright teal blue scales matching yours speckled his body like freckles and covered his tail. Bright blue tattoos like circuitry covered his arms
"It worked!" Owen exclaims wide eyed in a much less digital voice. He inspected his body, unable to believe it. The handsome merman in front of Nate was a sight to behold, he couldn't hide his arousal at the site of him even if he weren't naked.
Free from his revery Owen notices Nate's just as happy with him as he was with his own changes and proceeds to put his hand on Nate's cheek as he beems.
"Thank you"
He kisses Nate passionately.
The next thing Nate knew they're underwater. Free floating, he pulls Owen closer, coiling his tail around the Owen's as their cocks grind against each other. Water flows into their gills as they kiss with abandon. Eventually Nate's cock finds its way into Owen's anus, now conveniently repositioned to his front, a few inches below his balls. They buck until Nate bursts inside Owen.
Spent, the water full of merman seed, the mermen rest and cuddle on a secluded beach. It doesn't take long before Owen takes his turn with Nate's prostate on the shore. They frolic in the depths sucking and fucking with abandon, libido supercharged by their powerful tails.