OpenAI’s 2026 Priority, Disney’s AI Play, Datacenter Buildout Trouble

Channel: Alex Kantrowitz

Published at: 2025-12-17

YouTube video id: lqQOtfWkCs8

Source: https://www.youtube.com/watch?v=lqQOtfWkCs8

OpenAI is going big on enterprise in
2026. Disney brings the magic to AI
video creation. The AI infrastructure
trade is wobbling hard after tumbles
from Oracle and Broadcom. And Meta Super
Intelligence team is at odds with the
rest of the company. Or is it? That's
coming up right after this. Welcome to
Big Technology Podcast Friday edition
where we break down the news in our
traditional coolheaded and nuanced
[music] format. We have a great show for
you today. We are going to go inside a
meeting with OpenAI Sam Alman and top
editors and media CEOs in New York to
tell you what OpenAI is planning for
2026. [music] We're also going to
discuss OpenAI and Disney's big deal and
what it means for AI content creation in
general. We're also seeing some tumbles
in the AI infrastructure [music] trade.
So, we'll talk about what that means.
And of course, we're going to talk about
this fascinating story from the New York
Times that says Meta Super Intelligence
team is at odds with the rest of the
[music] company. And we will do our best
to dissect the wording in that story and
tell you whether that's actually true or
not. So joining us as always on Fridays
to do it is Ran John [music] Roy of
Margins. Ranjan, great to see you.
Welcome back.
>> Good to see you. When I am able to do
weird things with Mickey Mouse on Sora
thanks to this new Disney and Open AI
deal, I will declare artificial general
intelligence. So, I'm ready. I'm ready.
Is it a problem that my first thought
when I saw this open AI uh Disney deal
was like, I'm going to go straight to
Sora and try to get a video of Mickey
Mouse uh doing some form of illicit
drugs. I didn't do it. I I knew that the
content filter would get me, but that
was my initial desire right off the bat.
But we will do it. We will do it very
soon thanks to this deal.
>> Or will we? All right. So, but we're
going to get into that in a moment. But
let us begin our podcast this week by
bringing you into the Rosewood, sorry,
Rosemary's Midtown on Monday around noon
time. And there at Rosemary's Midtown, a
fine establishment near Grand Central
Station in New York City, Sam Alman had
lunch with editors and CEOs from places
like The Atlantic, The New Yorker, and
the New York Times. Uh this is a group
that included according to my reporting
Andrew Ross Sorcin uh and New Yorker
editor David Remnik, Atlantic CEO
Nicholas Thompson, uh Fortune uh
editor-inchief Allison Shantel and many
others. And this group sits around for a
unwieldy and wide-ranging conversation
and Sam Alman is his typical disarming
and charming self. And the most
interesting thing that happened at this
meeting outside maybe of Remnick asking
uh Sam Alman if he felt like Oppenheimer
which we can get to is they asked what
is the priority going to be for open AI
and what Altman said uh according to a
couple of people who I've heard who I've
spoken with who know what was said in
that room um Alman said that that if not
the top a very big priority next year
for open AI is going to be enterprise
building AI for businesses which is
interesting because if you think about
OpenAI, it's been about a 70 30% split,
70% consumer, 30% enterprise. Anthropic
has really been the company that's led
in enterprise. Uh but the category is
the fastest growing software category in
history. It's expected according to
Gartner to bring in 37.5 billion in
revenue next year, enterprise AI. That's
up from zero in 2022 or effectively zero
in 2022. Ranjan, turn it over to you. Uh
what do you make of this news? Is it the
right decision from OpenAI and did did
it surprise you at all?
>> Well, I have very strong thoughts on
this given longtime listeners will know
I work for writer.com and uh our focus
is enterprise AI and work with a number
of Fortune 500 companies. So, I have a
very clear view into what this world
looks like. When I heard this news, it's
definitely it makes for a splashy
headline, but all it did for me is kind
of just affirm the lack of focus. the
lack of focus we talked a lot about for
OpenAI last week. Are they going to
develop an AI cloud? Is it going to be a
consumer devices company? Any of the
above? They did just hire the former
Slack CEO. So that's obviously they're
making moves into this. But to me, the
most interesting part of this headline
is that Sam Alman, that's what he said
rather than any of the other things that
OpenAI is saying. I can definitely get
into, you know, what I view is going to
happen in the enterprise world with AI
next year, but but specific to Sam, it
just felt like another off-the- cuff
comment at that moment with for whatever
was on his mind at that, you know, at
that time.
>> All right, I'm going to disagree with
you strongly here, not only because I'm
the one that wrote that splashy
headline. This is big technology scoop,
which we'll
>> we'll link in the show notes. Uh, but
for two other reasons. One is Greg
Brockman, the OpenAI co-founder, uh,
looked at the tweet that I shared of my
story and he sort of triple confirmed it
and wrote, "Enterprise AI is going to be
a huge theme of 2026." I don't think
that's an off-the cuff thing. And then
also this week, and we'll get into it in
a moment, but OpenAI had a uh had a new
model ship. It's called GPT 5.2. And GPT
5.2 into is all about helping you do a
better job uh of working with AI for
business use cases and that includes uh
you know examples where you could prompt
a workforce planning planning sheet uh
do better job with to-dos do like better
um deeper enterprise applications. So it
is interesting. I I hear your lack of
focus. Uh right. Are they a consumer
company? Are they a data company? A
robotics company? Are they doing this
with Johnny IV? Are they enterprise? Uh
but I I think they're really serious
about enterprise. And I'll just say one
thing and turn it back to you. This is
why it makes sense to me from a logical
standpoint. This is a very big business.
And you know, Chachi PT has done a good
job making the money. They're going to
make maybe 20 uh billion uh uh this year
or have a 20 billion run rate at the end
of the year, but they're going to need
to show substantial revenue growth next
year. And one way to do that is by
attacking this enterprise uh area, which
is uh which is where the money is.
>> No, I I agree it's going to be the
biggest opportunity of 2026 and I again
that's talking my own book as well. But
but what I genuinely believe is going to
happen is the way cursor and AI coding
just completely exploded this year. I
think is going to pass on to business
end users and enterprises are going to
actually see the promise of AI that has
been there for the last few years and
has not been realized. So, so I do
believe it's a massive opportunity. But
what I was thinking about when I read
your story is, you know, how did Google
approach this? How did Microsoft
enterprise first from the beginning and
then kind of working their way towards
some kind of consumer applications?
Google going in the opposite way having
just a massive consumer business and
then building Google cloud into this
behemoth. But OpenAI is trying to do
everything at once. And I don't believe
you can't give up the consumer business
and to try to do this in parallel when
enterprises a completely different
beast. And again, you have the Slack
CEO, but who's going to get the final
word over any decision? When Sam Alman
wants to do AI erotica to actually juice
engagement numbers, and that's going to
freak out every enterprise CIO, who's
going to get the last word on that?
Well, that's a great question. By the
way, we did get some uh clarity about
when AI erotica is coming sometime.
>> Most important most look forward to this
>> Mickey Mouse weed and AI erotica. That's
the [laughter]
>> this is the future we want. Okay.
>> And enterprise AI.
>> I mean, if you can bundle it all
together, but okay, it's [laughter]
look, it's the same engine that that
does it all. So, uh maybe that is uh an
exciting thing, but it is it is a good
point. Uh when you sell to enterprises,
you need to build out an enterprise
sales infrastructure. This is something
that took Google like what a decade to
do with Google Cloud. It's much easier
uh said than done. And OpenAI is going
to have to figure this out. And I got a
call today even from someone who works
in enterprise AI sales and was like what
do you think is how do you think they're
going to build out a team there? And I'm
like that's like the core the core
problem that they're going to have to
deal with. Um so we we'll see what
happens there. But let's go let's
actually look at like why they might
have made this shift. So maybe it's
about money, but maybe it's about
something else because it does come on
the heels of Google's Gemini effectively
equaling and some might say surpassing
and surpassing in some ways. Let's just
say it's Google's Gemini is basically on
par with uh with chat GP with GPT right
now, the GPT models. Here's my thesis.
uh OpenAI had been working on like
effectively what it believed could be a
straight shot uh towards AGI which it
believed it could lead. Then an
interesting thing has happened in the
second half of this year. First of all,
even though models are improving, you're
starting to see the limits of the model.
It's not broad improvement anymore. It's
improvement in specific areas. And the
second thing that's happened is the
models have commoditized. So you've had
both no straight shot to AGI and the
models are commoditized and that means
that the real competition is going to be
based off of the applications here. And
actually interestingly in the lunch what
Sam Alman said was it is not a training
problem. It is an application problem.
It's not about the model's intelligence.
It's about building the applications to
get the most intelligence out of them.
And so that is I think what we're seeing
right now with these developments is
open AI and I think everybody else in
the AI world is realizing that um you
are maybe not going to get that far
developing a better model because they
are starting to tighten up. It is all
about productization and that's why
they've hit this point. They see that
AGI isn't going to solve or or even
smarter models won't solve all the
problems. There's just some limits there
and now they're going to the application
front. That's why you see the enterprise
use case as the one bubbling up out of
that company right now.
>> I'm sorry. Can you repeat that, Alex?
Cuz [snorts] I'm smiling here because as
as anyone who listens regularly knows,
this question of product and application
versus the model. For a long time, I've
uh been on team team product. And it's
nice that Sam is finally coming around.
Alex, are you coming around? Are you are
you team product now?
>> Well, it's so interesting because um I
was on CNBC this week and I was asked uh
you know now that Google has what might
be a better model is does that mean
Google's won or is winning the AI race?
And I bottled up my pride. I took a gulp
and on national television I said this
>> isn't the issue who has the better model
and right now the marketplace is saying
it's probably Gemini.
>> So I would say it it absolutely isn't
who has the better model right now. I
think right now what matters is what you
do with that model and how you
distribute it.
>> I might have to shut shut off my laptop
and just [laughter] just my work here is
done. I'm done.
I mean, so specific to Open AI in this
case though, I I still feel this is kind
of Sam saying things because like he
that cannot be the bet. You can't raise
this much money and like say all of
these things for so long and then just
kind of about face and just go and and I
say this recognizing Open AI has been
great at the product layer. Like I think
I've always believed that's actually
been one of their stronger suits in
terms of like they innovated on the they
created the chat UI and made it a thing.
So so they have strengthen that. But I
mean if that's the case they're not
worth what they're supposed to be worth
just simply like as an application
company they're not they're not open AI
they're not worth that. So, I think like
it's still surprising to me. Again,
that's why I'm like not thinking fully
through these statements and just kind
of like reacting at that moment is how I
feel and read this.
>> Okay. So, I want to both explain why
I've come along to team product uh for
the moment and explain what's happening
what I think is happening with OpenAI
and it's not as dreadful as you think.
Okay. I've come along to this the
product now matters more than the model
because previously when I was on team
model we were seeing real gains uh when
the models got better and when the
models got better they could just do
more stuff and they hallucinated less
and you're even seeing that with a
little bit with the way that uh this GPT
5.2 2 model has been designed that it
can do more more things for enterprise
that it previously couldn't. But it
wouldn't be a uh a real stretch for me
to say that topline improvement of the
models is leveling out that effectively
we're not seeing those giant leaps. And
when we don't see those giant leaps, uh
you basically have started to lose this
promise of like, well, we're just going
to get to AGI and then AGI is going to
solve everything. At this point, you
have a model that's that's, you know,
the the frontier models are very
intelligent. And at this point, what you
need to do is take that intelligence and
channel it into different applications
for business. And I think OpenAI could
be worth the valuation. Uh, even if it,
and I'm really, this is funny because
I'm really channeling you here. um even
if it doesn't get to AGI, it could
really um merit the valuation because if
it makes its models
uh valuable and applicable in many
different professions, that's where it's
going to see the economic boost. We just
spoke about this on Wednesday with Malia
Russell from Business Insider doing an
entire episode about how AI can change
the legal field. That's just one, you
know, professional services area. And as
these applications get better, can it do
it for consulting? Can it do it for
accounting? Can it have similar
applications in research? Can it have
similar applications in medicine? Uh,
all this is on the table now. And if it
just adds that level of application and
orchestration on top of the very smart
models that it has today, maybe that's
where it becomes this economically
valuable powerhouse that it's been
expecting to be.
>> Ask two questions. one, why did Sam
Alman when he was talking to Brad
Gersonner and had that kind of outburst
and talk about like don't question our
revenue, we're going to get to 100
billion 28. Like why didn't he say
enterprise? He mentioned AI, cloud,
consumer devices. He did not say
enterprise at the time.
>> That I can't tell you. We can we can we
both agree that whatever Sam did on that
interview was maybe he was having a a
bad day because he saw that Google was
getting good which we've surmised here.
Um but let's not take that as the
official okay that that's number one
>> temper tantrum as the official product
policy of OpenAI.
>> Now now number two Sam says 100 billion
in 2028 in revenue. How do you see that
breaking down? because I had asked this
and we got a like a very like good
reaction from listeners and around like
this question of when you say 100
billion and I we look I've looked for
reporting haven't seen anything around
what are their actual projections about
what their business looks like and
breaks down especially as all these new
ideas the pharma idea drug development
that Sarah Frier had mentioned like it's
clearly on their mind you got to have
some plan it's December 2025 if you're
talking about 2 to 3 years now there's
some plan in place what do you think
that business is going to look like at
100 billion
>> well I've told you that like we asked
like where did they get these
projections from and I think that's you
they've been sprinkling some fairy dust
on the uh on an Excel spreadsheet and
hoping that gets them there I don't know
I don't think they know exactly what's
going to go there I think they're
betting that rapidly that they've bet it
previously that you know you scale up
these models you add more data uh you
add more compute uh and you will get
rapidly rapid improvement in your
ability in this your ability to to do
things with these models and they will
lead to economic activity. I just don't
I I don't see how they get to that
number that quickly because once we both
know this because you're working in this
I've done reporting on this once you get
into enterprises what happens even if
you have a product that works really
well uh you have to engage in business
transformation and even worse approvals
and that does not move fast. That's what
I'm saying that if that truly is the
path to let's say 2027
the amount like that they're going to
have to build the infrastructure which
I'm sure they are starting to with the
hiring of Denise Dresser but still like
that's a big bet if pharma revenue from
drug development and partnerships you
you got to hire people you got to like
build out that entire business. So if
they're really getting to this point
where these are true businesses that
they want to build in lines of revenue,
it's not just product at all. It's not
even just application as you said. Yeah.
It's it's a whole business plan. It's
people. It's a salesforce. It's all of
this stuff. So So that's the part that
until I hear see more concrete things,
it's it's it's just tough to read in
terms of like what they're actually
thinking on this. Again, it's clear this
is a bet based on the hires, but how
they're actually where this sits in the
Mickey Mouse smoking weed on Sora or
whatever else uh in the totem pole of
priorities within uh OpenAI. It's still
unclear to me.
>> So, I actually asked uh Fiji Simo, we
had a press call with her about this new
model. I asked her how important
enterprise is to the company. She says
enterprise is absolutely critical for
us. uh we fundamentally transform uh we
take our breakthroughs and turn them
into intelligence that's useful for
people and the professional space is a
huge driver of creating value and
turning that intelligence into
usefulness for the world. So,
>> but
>> they are into this, but
>> but where where does that sit next to
ads? Like,
>> well, ads are paused. But this Sorry, I
I think you're hitting on the real issue
here. And and this is something I also
brought up to Fiji cuz I asked her a
two-parter as you do on these things.
>> As you do,
>> as one does.
How important is enterprise? And and now
here's the risk. when you design for
enterprise, if enterprise is really what
you want, uh how do you then make sure
that the chatbot that's so popular is
still something that regular people want
to use for consumer use cases. Here's
Fiji's answer. She said, "Uh, you're
correct that some things are different
between enterprise and consumer. We
think that increasing intelligence
overall benefits everyone and raises all
boats. If we're building a personal
assistant, it's going to be more
important to figure out how to do
shopping, how to do travel, how to do
all of these things. Whereas on the
enterprise, we are much more focused on
complex long horizons and ambiguous
tasks. Uh I I remember GPT5 was viewed
by many as a personality downgrade over
chat GPT40. Now, maybe that's because
it's not as sick of fantic or maybe it's
because, you know, when you ask it what
the weather is out, it it asks you, do
you want me to like find five places
where you can find an umbrella nearby?
Um, clearly there's a balance between
making something economically valuable
and usable for enterprise and also
making it personable. Uh, this is why I
believe they're really going to have to
separate those two models out. But
that's the risk is you might have this
this cannibalization effect where you go
for enterprise but then your 800 or 900
million weekly users who are using
chatbt as a personal whatever consumer
application are like well I don't want
to use this go somewhere else and Gemini
had been working on making a warmer
assistant uh over at Google. So it
>> that's actually a really good point like
let's take those two things the
sicopantic nature and the following
follow on annoying engagement tactics.
Neither of those will work in the
enterprise. Again, like even though I'm
sure every business user wants a
sycopantic assistant, still at a certain
point, you have to get the right answer
or you have to like be led in the right
direction as opposed to simply the one
that you already wanted to go to. And if
you don't, there will be negative
outcomes in terms of like uh user
engagement. Would you like five
additional things? like that kind of
stuff just won't fly because when
someone wants to do something it's just
please do this work for me get it done
and let's move on not I want to just sit
here and kind of be pulled into this
rabbit hole of engagement so so trying
to develop the product simultaneously in
those two directions which they kind of
have to it's tough it's tough and she I
mean she even said they want it both
they want it both ways so it's clear
they're shooting for that
>> I think eventually they're going to have
to split out into separate models. I
mean, are you going to have the same I
mean, people are going to do this.
They're going to have relationships and
they're going to have cyber sex with
their chat GPT and then they're going to
ask it to like organize their files.
Like I think you might need two separate
windows for that stuff. [laughter]
>> I'm just going to leave that one
[laughter] there.
>> I'm just saying I'm not I'm not saying I
want this to happen. Let's be realistic.
This is going to happen. This is from
Wired. Uh Fij Fiji on the call said the
company now plans to roll out its adult
mode in the first quarter of 2026. Uh
Alman had previously indicated users uh
over 18 would be allowed to have erotic
conversations with chatbt. So for anyone
who's looking forward to that just wait
till Q1.
>> We're almost there. Just a few more
days. Put the countdown clock on.
>> Get advent calendar until you can uh
>> erotica. Yeah.
>> All right. All right. We're going to go
to a break. Uh we have to gather
ourselves here. Um let's go to a break.
When we come back from the break, we're
actually going to talk about uh another
piece of the puzzle, which is again if
ChachiPT, if OpenAI is going to be
developing for enterprise. Um what does
that mean for its consumer products? And
what is Disney now uh getting getting
involved with? Because Disney and OpenAI
came to a very big agreement this week.
We'll cover that. We'll cover the AI
buildout. cover meta uh right after
this. Uh yeah, let's go to break. We'll
go to break and come back right after
this. And we're back here on Big
Technology Podcast Friday edition. We're
going to talk about this Disney and
OpenAI deal. Before we do, quick promo
on uh on Wednesday. Uh this upcoming
Wednesday, I'm going to have a
conversation with uh none other than Jim
Kramer from CNBC uh about the state of
the AI bubble and whether it's a bubble,
the AI trade, the market, his takes on
personal investing. It's going to be a
really fun show. So definitely stay
tuned for Wednesday. I would definitely
when that episode comes out, uh save it
and maybe you can, you know, listen to
it on the plane or in the drive as you
go somewhere uh for the holidays. Um,
oh, and then one more thing. It is the
giving season and uh if you feel uh like
giving back to Big Technology Podcast,
we're always happy to get five star
ratings on Spotify or Apple Podcast.
That's uh a solid you could help help us
with on uh in this holiday season. It
will help us book better guests. I got
real close to landing some uh
Magnificent Seven CEOs uh in 2025. Uh I
think we'll get there if we show that we
have a a big audience and of course
fivestar ratings. uh and reviews are the
best way uh to show it because they're
the only publicly available metric that
um these companies can look at in terms
of a podcast size. Okay. Uh with that
being said, let's talk about this um
Disney and OpenAI deal. It's from the
Wall Street Journal. Disney on Thursday
announced a blockbuster deal with OpenAI
to invest $1 billion for an equity stake
in the chat maker. As part of the deal,
OpenAI will license more than 200
characters from Disney, so users can
create AI generated videos in Sora.
Through the three-year licensing
arrangement, fans will be able to
generate videos of themselves surfing
with Stitch off the shores of Hawaii or
wielding a lightsaber in front of R2-D2.
Uh, Ranjan, are you excited about this?
How do you feel about this? And what do
you think the stakes are? All right,
let's uh let's separate my personal
views on this whether which I'm kind of
excited. I actually from like a creative
standpoint, this is very interesting
versus what this means for OpenAI the
business. I think first on the personal
side, I find this interesting. Um, it's
hard to say I like it, but I kind of
like it in the sense that like fandom
and actually licensing IP for generative
video I the moment I started playing
with any of this I was convinced had to
become a thing. So doing it in a kind of
structured way I saw a bunch of kind of
like people talking about how this is
kind of the Apple Music. So this is the
iTunes postnapster for any of the older
folks in the room. Um, so like I think
it's good that people are trying to
figure this out and I think it's good
for I do think it's good for fandom like
of fans of Disney. I think it's it's
it'll be fun.
>> Right. Well, there's this whole question
of like are the content creators going
to fight this or are they going to lean
into it effectively? I'm surprised at
how quickly Disney has said you know
what uh we because Disney is a company
that likes control, right? wants it
stuff in like familyfriendly
environments like as like legitimately
the second Mickey Mouse is like doing
cocaine or voicing your uh chat chippy
erotic pal things are going to be bad.
Disney's going to be mad. I guess they
believe in OpenAI's ability to turn this
into like a quote unquote brand safe
environment. I don't know. It's a it's a
I think this is a major major deal and
it's just going to lead to many other
content deals being made um you know
with other studios. It's going to be fun
for us the users to be able to do this
type of thing.
>> Yeah, I think going but like I was
shocked too that Disney of all companies
is the one that did it. I saw one tweet
where it was like they know that people
are going to do it anyways because
OpenAI has a hands-off policy so they
might as well kind of try to bring some
structure to it which sounded more like
extortion than uh anything else to me.
But I felt like it was surprising on
that side. But it also also shows that
maybe they are trying to be a bit
forwardlooking on it. Another element of
this I thought was interesting was that
they had sent the cease and desist
letter to Google one of uh around
copyright infringement. So it's clear
they're choosing a horse in the race and
they chose in a big way. So, so maybe it
really the pressure they realize this is
going to happen. We have we aren't able
to control it. So, we have to try to at
least take part in some kind of
productive way is the only way I can
kind of see this.
>> Yeah, that they sent a nasty nasty
letter to Google saying they infringed
that Google infringed on Disney's uh
copyrights on a massive scale. Um,
Google's response to me was fairly
pathetic and disappointment
disappointing. We have a long-standing
and mutually beneficial relationship
with Disney and will continue to engage
with them. More generally, we use public
data from the open web to build our AI
and have built additional innovative uh,
copyright controls. It just like shows
>> God bless the God bless the PR
professionals out there who have to come
up with statements like that. I mean,
doesn't this statement just betray the
disregard that so many of these
companies have for copyrighted work uh
online? It drives me nuts.
>> Yeah. I mean,
>> for suing them.
>> Yeah. No, that's why that that part of
it I found interesting. Again, agreed.
Like it's like we're going to not we're
going to sue, but we're also going to
take action here directly at you as
well. So, so I think on that side it
makes sense. The other the only way I
was starting to think about this from
Disney standpoint though is building
fandom for your characters is the core
of the business and they monetize it in
a million ways. Like Disney the business
is the one that understood that a movie
is not just a movie. Like that character
engaging with them in all different
types of ways is there's a lot of money
to be made there. anyone who's gone to
Disney World and in recent years for how
much those tickets cost, like they have
Disney cruises, they have the the the
entire ecosystem of Disney. So, so
anything to actually boost that
connection fans have with these
characters should probably make them a
lot of money. So, from that standpoint,
I guess I can kind of see it.
>> Yeah. And where is this going to appear?
So, it'll both appear in um in Sora, but
uh Iger, Bob Iger, Disney CEO Bob Iger
on uh Thursday on CNBC said that the
plan is to curate some of these Sora
videos and then put them on Disney Plus
and allow them to create Sora powered
videos on its streaming service. So, not
only is this like the okay, go ahead,
it's him saying this is also content for
us. Okay, I both start to see that and
can see some like genuinely creative
things coming out of it. But on the
other hand, the the world of
usergenerated content and trying to like
bring that into Disney Plus, I feel that
actually kind of captures the tightly
guarded garden of Disney versus making
it more of a rough and tumble place.
Like that's not Disney and never has
been. So that stuff still I don't think
is going to happen
>> really. All right. I I think let let me
put it this way. I think whatever they
end up doing here, this is a massive net
positive for Disney. That's just the way
I look at this story. It's a bold move.
It's a risky move. Like we've been
joking about Cocaine Mickey Mouse
through the story, and that is a risk
that I'm sure that they thought about.
Uh but this is going to get people more
invested in the Disney characters. like
this idea of like putting yourself in a
scene uh with, you know, R2-D2 or
whoever it is, Goofy. Um, it's just uh
it's a cool thing for people. I think
this is really going to work out well
for them. Wait, one question I do have
though, why does Disney have to invest
in Open AI and commit to buying OpenAI
Enterprise licenses if they're giving
their characters to Open AI? I don't
know this to be true, but my hunch in
seeing the funding was that like the 1
billion investment that Disney's making
in Open AI is has to be some form of
circular funding. Like
>> Disney like OpenAI is going to maybe pay
Disney for the right to put its
characters uh in Sora with Open AI stock
and that might just be a a billion
dollar trade. I don't know this to be
true. It's just my speculation.
>> I know. I I was trying to look into that
as well and it it seemed to be a
straight equity investment with warrants
like from what I saw but to in my mind
too that that's definitely where it went
to start but maybe they're getting free
Chachi PT enterprise licenses as part of
this and this is actually the first push
and for into enterprise in a big way for
open AI. Okay, maybe maybe this is how
it all comes together. [laughter]
>> Maybe. All right, I want to tell you one
more thing that I sort of uh came came
to uh this week uh when I opened up Sora
again. U I don't know if you've been
seeing these Sora videos make their way
around the internet, but they certainly
have. And one thing that really annoys
me about Sora, I mean, I see it on
TikTok all the time passed off as the
real video. And there is a particular
Sora um syntax that's like you can hear
when when people are um speaking when
when people speak in Sora videos, it
sounds like this. It sounds like, "Oh my
god, he's going to do a wheelie. He did
a wheelie. No way." Right? It has that
sort of stilted like kind of maybe
overly excited rhythmic. I Here's what I
think sort of I want to run this by you.
I think Sora trained on so its audio on
so many video games that it is a
distinctly video game type dialogue that
you're hearing come through in these
videos and that's why it's so distinct.
>> I I like that theory. I'm actually more
amazed. I've not been on Sora in a
while. I actually just opened it right
now as we're speaking and I see two
tigers in French chef hats cooking. Um,
but I wonder it's actually to the credit
I don't come across it very much in my
feeds and algorithms. Um, but the fact
that if there's Sora voice because I
remember when Tik Tok really started
gaining prominence that there was that
kind of monotone Tik Tok voice that was
the default for any video created that
actually became kind of a cultural
artifact. So I think to Sor's credit if
they actually are getting there that's
actually impressive for the platform.
But but I don't know like they're
certainly not advertising any user
numbers around it. And again, going back
to the focus thing, they came out big.
It kind of faded away a bit. Now, I
guess it's a content creation tool to
use for other platforms. So, so I'm not
sure where they're going with it.
>> Well, I did get some numbers from
Apptopia this week. They sent them
along. Uh, so when Sora came out, it was
doing around 240,000 downloads. looks
like a day uh bumped up to around
400,000
or so per day. Uh it has actually
dropped significantly and this won't
come as a surprise to you. It looks like
it's like around maybe 150,000 downloads
a day right now. So, uh this might just
be what Apptopia still around. It might
be around what Apptopia measured, but it
just shows like a real decline there.
And it's again, we've talked about this
before. this like sort of sameness
problem that every video every Sora
video has a very similar feel.
>> Yep.
>> So, we'll keep monitoring it.
>> We'll see. We'll see. Next year, big
year for Sora maybe. And Mickey Mouse. I
said weed Mickey Mouse for the for for
the record.
>> Oh, sorry. Did I I upgraded weed Mickey
Mouse to cocaine Mickey.
>> Oh, listen. I I dream big. We know.
>> Hyper. Yeah.
>> No, we know you Well, we know why
excited he is. [laughter] Yeah. So,
obviously
what what Mickey is. It's not like that
that personality is not stoner Mickey.
Give me a break. We know what he's been
doing.
>> But it will be it will be once I get my
hands on that Sora.
>> But what do you think magic means? Uh
for Disney. [laughter]
>> I'm going to get sued.
>> This just in. Uh Broadcom and Oracle are
struggling dramatically.
>> But but you won't get sued. Disney will
invest in you for
>> that'll be good
>> for that creative licensing. I have to
tell you my I'm I am taking the uh the
Sam Alman approach to Bob Iger and and
not the Elon Musk. Uh you are welcome.
You are welcome to partner with me here.
Do you think we'll get a lawyer letter?
I hope not. I'm just joking about all
this stuff. Um this is our job. We have
to talk about the possibilities. We talk
about infrastructure. Let's talk about
infrastructure. [snorts] Rough week for
Oracle and uh and Broadcom, right? These
are the the sort of cornerstones of the
AI infrastructure trade. Uh Oracle,
there's a report out today that Oracle
is going to delay some of its data
centers to OpenAI um by from 27 to 2028.
Uh also the market is starting to see
that their buildout for AI is lower
margin than the rest of their data
centers. Surprise, surprise. Uh Broadcom
also sort of getting hit on this. It's
going to have uh it it has orders that
are coming in for AI, but it just hasn't
been as big as AI hardware, but hasn't
been as big as a lot of people in the
market uh believed. And so they're
they're getting a haircut, both of them
are. Um what do you think the the big
story is here? Is it just that like this
is a an these trades are based off um
have a level of uncertainty and every
time they wobble the market just runs
away because they know how bad it could
get if it really goes south.
>> Yeah. I think it's just we see real
numbers each one of these times like or
when was it September the Oracle
partnership news first came out there
was that day it was up 37% I think it
was like now we're starting to see real
numbers even with Oracle starting to
understand like the actual logistics of
building out these data centers
independent of the actual demand for the
compute but the actual work it's going
to take to build these out that even if
the demand is there is that going to be
possible so I think like overall it's
just bringing a degree of reality to
this entire the trade like the entire
infrastructure trade that just is you
know reminding people that it's not
going to be that straightforward
>> right and Oracle brought delivered some
earnings this week and said that its
capital expenditures is from the journal
uh on data centers will outrun revenue
for several quarters to come and it's
like why why is the market surprised
here. Maybe the market believed so much
in AI that it took this overly rosy
picture of how this stuff can work. I
don't know. Tell me a little bit about
why you think the market was so
positive. No, I think the market was
positive because I think it really felt
like the Oracle OpenAI announcement was
the be kind of like the real mainstream
moment for the infrastructure trade and
this idea that it's not just going to be
open AI, it's going to be all of the
builders who are actually going to like
drive the data center buildout and the
like that's going to feed in all of that
compute over the years as everyone is
using more AI. It was a sound story. it
kind of captured that moment of mania,
but it's pretty quickly coming back down
to earth. And and I think in a good way,
like in the sense that having that more
reasonable discussion around how this
all plays out, it's just becoming a
little more real and people are actually
looking at some numbers because they're
starting to come out at least a little
bit. Even though these are all two to
threeyear stories, still one quarter of
data is one quarter of data,
>> right? I mean, OpenAI is has a $300
million deal to buy computing from
Oracle over 5 years. OpenAI is 55% from
what I understand of the remaining
performance obligation for Oracle.
So,
if OpenAI can't do it, uh it's pretty
bad news for
>> 300 billion. 300 billion
>> 300 million billion. Yeah. Uh it's just
this sort of unholy combination of debt
of uh dependency on OpenAI. Um I don't
know.
>> Well, the three letters you never want
to hear were mentioned again this week.
>> CDS,
>> credit default swaps.
>> Credit default swaps.
>> So, so can you just for a second explain
exactly what the issue is there again?
Well, credit default swaps again as
we've talked about in the past like the
cost of insuring against the default of
any kind of corporate credit and it's
just the the higher that number goes the
more expensive that insurance is the
more it's indicating that the market
believes a default is more likely and
again these numbers start to be small at
a certain point. Um now this week the
Oracle CDS hit the highest intraday
level since April 2009. So, so it's
people are starting to recognize that
this is something that maybe you want to
be insured against and it's there is a
element of risk to this that uh that was
not priced in initially but but as we as
we discussed before you never want to
talk about CDS like anytime it's
entering the mainstream conversation
it's not a good thing for anyone and the
more we start to hear about Oracle CDS I
I mean, that's where everyone should get
a little bit more worried.
>> Did anything bad happen in mid to late
2009? Sorry, I'm forgetting.
>> Uh, 2008, 2008. That was the last time
we were all talking actually from
beginning of 2008 talking mentioning
those three letters. I honestly outside
of like CDS traders, I don't think
anyone anywhere had ever thought about a
credit default swap until 2008. So
hopefully we don't hear that much more.
>> Yeah. One last thing about this. This
seems to be contained in the open AI
axis, right? Like uh Broadcom, no
Broadcom is Google though. They do
Google Anthropic. So, but like seriously
like Oracle uh Orweave is down today,
Nvidia is down. Do you think that these
these are like is it a systemic problem
or is it sort of more contained right
now or too early to tell?
>> I think it's an industry problem. So I
like I've seen kind of these like you
can trade buckets of open the open AI
ecosystem versus the Google ecosystem. I
I still think whatever hits Oracle and
Open AI will hit a Broadcom and a Google
at least in the in terms of how people
are pricing in the infrastructure side
of things. So but I I I still don't
think it's systemic. I think even though
the stock market is gains have been
heavily predicated on this, I still
don't think it leads to some kind of
like largecale
uh like economic calamity. I think it's
one of those market goes down a bit,
401ks get hit, people are a little
unhappy, but I don't think it's
systemic.
>> Let me let me put it this way. Is this
the beginning of the unraveling of the
AI trade or do you think the AI trade
remains strong? I think it is a shift in
what the AI trade is. I think that to me
that's [clears throat] like the biggest
thing that I think everyone piled into
the and actually if we are to believe
Sam ultimate earlier and like the idea
that the application layer is going to
be this big battle you have to start to
imagine like I mean building
applications that run in a more compute
efficient way start to become a
competitive advantage especially if
you're going to the enterprise where you
need to be costefficient like all of
that side of the story runs counter to
the actual compute, data center,
infrastructure side of the story. Like
there's some coexistence of them, but
there's also like a lot of, you know,
like opposing pressures within those two
stories, and they're trying to tell them
both. That's kind of what I think I'm
going to go to uh Kramer with first
question when we speak next week is
basically like here's how the AI bubble
bursts. Um, you can compute much more
efficiently. We still don't have uh real
clear indications that this stuff is
going to be economically valuable on the
scale that people imagine. So what we
could see is a conversion from a high
infrastructure cost, big buildup, big
dreams to like getting more practical,
getting more efficient, and then all of
a sudden it becomes an economically
useful thing, but not this, you know,
sort of godpile of money chasing um an
all- knowing technology.
>> Yeah. No, no, that that's I mean how I
view it that like especially in the
enterprise when people are going to be a
lot more costconscious and like
competitive around it that the
innovation happens in terms of actually
making these technologies more
costefficient to actually run this run
these processes and and workflows. So,
so I think yeah, you can you can have AI
generate Jensen said it's going to
generate a 500 trillion dollars of GDP
like up from a hundred trillion
aggregate GDP. Maybe that's happens, but
that doesn't mean that the
infrastructure trade actually pans out.
>> I know that sounds ridiculous, but I do
think that's a possibility.
>> A realistic possibility. Yeah. All
right, let's close on this. Meta's uh
new AI superstars are chafing against
the rest of the company. from the New
York Times. When Mark Zuckerberg
revamped Meta's artificial intelligence
operations this year, he recruited a new
leader, Alexander Weing, a 28-year-old
entrepreneur, to build a team of top
researchers from rivals like OpenAI and
Google. The team was placed in a siloed
space next to Mr. Zuckerberg's office at
the center of Meta's headquarters.
Probably just this what the story says
to remove them from the bureaucracy of
the company. 5 months later, the divide
has become more than physical. Mr. Wang
has privately told people he disagreed
with some of Zuckerberg's longtime
lieutenants, including Chris Cox, the
chief product officer, and Andrew
Bosworth, the chief technology officer.
Uh, in one case, Mr. Cox and Mr.
Bosworth wanted Mr. Wang's team to
concentrate on using Instagram and
Facebook data to help train Meta's new
foundational AI model to improve the
company's social media feeds and
advertising business. But Mr. Wing, who
is developing the model, pushed back. He
argued that the goal should be to catch
up to rival AI models from open and
Google before focusing on products. The
people said, can I just share quickly
what my perspective on this paragraph
is, cuz it doesn't make too much sense
to me. I mean, ideally, if you're
running an a super intelligence
operation within meta, you're going to
use meta's Instagram and Facebook data
to train, right? You'll have that data.
That's that's proprietary data you can
use to train. So why wouldn't you want
to use that that data to train your
models? Uh and using that data doesn't
necessarily improve,
you know, only improve the social media
feeds in the advertising business. It's
a it's a training situation, not a
product situation. Very weird story to
me, I have to say. Maybe this is
happening, but weird.
>> Yeah, I I definitely found it weird as
well in the sense that I mean meta
properties probably have one of the
richest data sets in the world. I mean
the only comparison I can imagine is
YouTube which like in terms of just
richness of overall data but Meta's got
plenty of video to work with as well
now. So like to not to have some kind of
difference in opinion and purity or
preciousness around like we don't want
to be sullied by the the advertising
business. I think like that was
surprising to me. But I think the bigger
story is we talked about this from the
beginning like this could be this could
just fall on its face from a personality
standpoint to bring in this level of
personality around this splashiness the
amount of money they're throwing at this
already. I saw on Twitter a few people
like announcing their departure within
just a matter of months from TBD Lab. So
I think that that's the more concerning
part to me that if the politics of this
are actually getting in the way of the
technology that's not a good start for
this,
>> right? The time story does say that the
departures have stabilized and maybe two
out of a hundred have left after that
first vesting period hit. Um I mean the
interesting thing here is I think that I
mean we'll see what happens because I I
don't disagree there's definitely going
to be clashes of interests. uh they did
bring get brought I mean here here this
is from the story the lab's researchers
have come to view many meta executives
as interested only in improving the
social b social social media business
while the lab's ambition to create uh is
to create a godlike AI super
intelligence I think that's natural I
mean it's not very surprising to me
although you could see that really
turning into a big fissure within the
company uh but it seems like that was
always part of the equation was like if
you go to Meta
like you're going to be there also to
improve the core business along with
developing intelligence.
>> But I wonder I feel Google has handled I
mean going back to the conversation from
I think a couple of weeks ago around how
savily Google handled the overall
integration of AI within the company and
kind of created that center. Um like it
there's always going to be that natural
tension. It could be a healthy tension I
think but there has to be some kind of
overarching like clarity within the
these organizations around like you know
what are we actually trying to do here
and meta in the end they have a billion
I mean sorry what am I talking about
like four billion users now three
billion users whatever it is
>> what's a couple billion
>> what's a couple billion Facebook friends
um no like uh improving the product just
brings such a massive scale into
anything that you do that focusing on
that the actual potential business
impact of that or even societal impact
is so massive that trying to just be
kept to the side and like be a pure
research lab does not make much sense.
Um but I mean they Mark Zuckerberg
should bring some clarity to to that.
>> You know how uh we're going to know this
is really over is when uh Meta Super
Intelligence Lab says it's focused on
enterprise.
[laughter]
>> That's that's the end. That is
>> I think that's that's when or they
become an AI cloud/consumer wearables
business.
>> Well, you know, because they are they
are what am I talking about? Rayban
Metas. Yeah,
>> exactly. All right, but let's leave it
there. Jim Kramer on Wednesday. Ranjan,
as always, [music]
uh, great speaking with you here on
Friday. Thanks for coming on.
>> All right, see you next week.
>> All right, everybody. Thank you for
listening and watching. We will see you
next time on Big Technology Podcast.