Big Technology Podcast - OpenAI’s 2026 Priority, Disney’s AI Play, Datacenter Buildout Trouble

Episode Date: December 12, 2025

Ranjan Roy from Margins is back for our weekly discussion of the latest tech news. We cover: 1) OpenAI to prioritize enterprise in 2026 2) Is the AGI dream over? 3) Could OpenAI's enterprise push help it fund infrastructure? 4) Alex is on team product? 5) Can OpenAI design for consumer and enterprise at the same time? 6) Erotic ChatGPT is coming in Q1 7) Disney and OpenAI ink a groundbreaking deal 8) Why Disney wins from giving up some control 9) The AI infrastructure trade is wobbling 10) Discord at Meta... or not? --- Enjoying Big Technology Podcast? Please rate us five stars ⭐⭐⭐⭐⭐ in your podcast app of choice. Want a discount for Big Technology on Substack + Discord? Here’s 25% off for the first year: https://www.bigtechnology.com/subscribe?coupon=0843016b From Big Technology on Substack: Enterprise Will Be a Top OpenAI Priority In 2026, Sam Altman Tells Editors at NYC Lunch https://www.bigtechnology.com/p/enterprise-will-be-a-top-openai-priority Questions? Feedback? Write to: [e-mail] -- Wealthfront.com/bigtech⁠. If eligible for the overall boosted 4.15% rate offered with this promo, your boosted rate is subject to change if the 3.50% base rate decreases during the 3-month promo period. The Cash Account, which is not a deposit account, is offered by Wealthfront Brokerage LLC ("Wealthfront Brokerage"), Member FINRA/SIPC, not a bank. The Annual Percentage Yield ("APY") on cash deposits as of 11/7/25, is representative, requires no minimum, and may change at any time. The APY reflects the weighted average of deposit balances at participating Program Banks, which are not allocated equally. Wealthfront Brokerage sweeps cash balances to Program Banks, where they earn the variable base APY. Instant withdrawals are subject to certain conditions and processing times may vary. Learn more about your ad choices. Visit megaphone.fm/adchoices

Open AI 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-superintelligence team is at odds with the rest of the company, or is it? That's coming up right after this. Capital One's tech team isn't just talking about multi-agentic AI. They already deployed one. It's called Chat Concierge, and it's simplifying car shopping.

using self-reflection and layered reasoning with live API checks. It doesn't just help buyers find a car they love. It helps schedule a test drive, get pre-approved for financing, and estimate trade and value. Advanced, intuitive, and deployed. That's how they stack. That's technology at Capital One. The truth is AI security is identity security. An AI agent isn't just a piece of code.

It's a first-class citizen in your digital ecosystem, and it needs to be trained. treated like one. That's why ACTA is taking the lead to secure these AI agents. The key to unlocking this new layer of protection and identity security fabric. Organizations need a unified, comprehensive approach that protects every identity, human or machine with consistent policies and oversight. Don't wait for a security incident to realize your AI agents are a massive blind spot. Learn how ACTA's identity security fabric can help you secure the next generation of identities, including your AI agents. Visit ACTA.com. That's OKA. a.com. Welcome to Big Technology Podcast Friday edition where we break down the news in our traditional

cool-headed and nuanced format. We have a great show for you today. We are going to go inside a meeting with OpenAI Sam Altman and top editors and media CEOs in New York to tell you what Open AI is planning for 2026. We're also going to discuss Open AI and Disney's big deal and what it means for AI content creation in general, also seeing some tumbles in the AI infrastructure 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-superintelligence team is at odds with the rest of the 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 Ranjan

Roy of Margins. Ron John, great to see you. Welcome back. Good to see you. When I 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 Disney deal was like, I'm going to go straight to Sora and try to get a video of Mickey Mouse doing some form of illicit drugs? I didn't do it.

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 we're going to get into that in a moment. But let us begin our podcast this week by bringing you into the Rosemary's Midtown on Monday around noontime. And there at Rosemary's Midtown, a fine establishment near Grand Central Station in New York City.

Sam Altman had lunch with editors and CEOs from places like the Atlantic, the New Yorker, and the New York Times. This is a group that included, according to my reporting, Andrew Ross Sorkin, at New Yorker editor, David Remnick, Atlantic, CEO, Nicholas Thompson, Fortune, editor-in-chief, Alison Chantel, and many others. And this group sits around for an unwieldy and wide-ranging conversation, and Sam Altman is his typical disarming and charming self. And the most interesting thing that happened at this meeting outside maybe of Remnick asking Sam Altman, 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, according to a couple of people who I've spoken with who know what was said in that room, Altman said that if not the top eight, a very big priority next year for Open AI is going to be Enterprise, building AI for business. Which is interesting because if you think about Open AI, it's been about a 70, 30% split, 70% consumer, 30% enterprise. Anthropic has really been the company that's led in enterprise. But the category is the fastest growing software category in history. It's expected, according to Gardner, 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. What do you make of this news?

Is it the right decision from Open AI and 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 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 Open AI 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 Altman, that's what he said, rather than any of the other things that Open AI is saying. I can definitely get into what I view is going to happen in the enterprise world with AI.

next year, but specific to Sam, it just felt like another off-the-cuff comment at that moment 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 a big technology scoop, which will link in the show notes. But for two other reasons. One is Greg Brockman, the OpenAI co-founder, 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 weekend, we'll get into it in a moment. But Open AI had a new model ship. It's called GPT 5.2. And GPT 5.2 is all about helping you do a better job of working with AI for business use cases. And that includes, you know, examples where you could prompt a. Workforce, planning sheet, do better job with the dos, do like better, deeper enterprise applications. So it is interesting.

I hear your lack of focus, right? Are they a consumer company? Are they a data company? A robotics company? Are they doing this with Johnny Iiff? Are they enterprise? But 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, Chatchip-T has done a good job making the money. They're going to make maybe $20 billion 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 area, which is where the money is. No, I agree it's going to be the biggest opportunity of 2026. And again, that's talking my own book as well.

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 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 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 Open AI 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 enterprise is 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 Allman 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 clarity about when AI erotica is coming. Most important. We can all look forward to this. Mickey Mouse, smoking weed, and AI erotica. This is the future we want, okay? And Enterprise AI. I mean, if you can bundle it all together. But, okay, it's the same engine that that does it all.

So maybe that is an exciting thing. But it is a good point. 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 said than done. And open AI is going to have to figure this out. And I got a call today even from someone who works in enterprise AI sales. And who's like, how do you think they're going to build out a team there?

And I'm like, that's like the core problem that they're going to have to deal with. So 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, with GPT right now, the GPT models.

Here's my thesis. Open AI had been working on like effective. what it believed could be a straight shot 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 Altman 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,

who 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 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? because I'm smiling here because as anyone who listens regularly knows, this question of product and application versus the model for a long time. I've been on team product. And it's nice that Sam is finally coming around. Alex, are you coming around? Are you team product now? Well, it's so interesting because I was on CNBC this week and I was asked.

you know, now that Google has what might be a better model is, does that mean Google's won or is winning, the AI is? 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 probably Gemini. So I would say 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 down, shut off my laptop and just, just my work here is done. I'm done. I mean, so specific to Open AI in this case, though, 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, and, and, and I, 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 strengthened 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 for the moment and explain what's happening, what I think is happening with Open AI 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, seeing real gains 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 this GPT 5.2 model has been designed, that it can do more things for Enterprise that it previously couldn't. But it wouldn't be a real stretch for me to say that top line improvement of the models is leveling out. That effectively we're not seeing those giant leaps. And when you don't

see those giant leaps, 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 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 opening I could be worth the valuation, even if it does, and I'm really, this is funny because I'm really channeling you here. Even if it doesn't get to AGI, it could really merit the valuation because if it makes its models 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 professional services area. And as these applications get better, can it do it for consultants? Can it do it for accounting? Can it have similar applications in research? Can it have similar applications in medicine?

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. Your thoughts. I'm asking two questions. One, why did Sam Altman, when he was talking to Brad Garsner and had that kind of output? 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 can we can we both agree that whatever sam did on that interview was maybe he was having a bad day because he saw that google was getting good which we've surmised here but let's not take that as the official okay okay that you know a temper tantrum as the official product policy of open AI. 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 like a very good reaction from listeners and around like this question of when you say 100 billion and I, I've looked for reporting, haven't seen anything around what are their actual projections about what their business looks like breaks down especially as all these new ideas the pharma idea drug development the sarah fryer had

mentioned like it's clearly on their mind you got to have some plan it's December 2025 if you're talking about two to three 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 on an Excel spreadsheet and opening 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, you add more compute, and you will get rapidly, rapid improvement in your ability and your ability to do things with these models, and they will lead to economic activity. So I don't see how they get to that number that quickly because when, 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,

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 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 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 a whole business plan. It's people. It's a sales force. It's all of this stuff. So that's the part that until I hear see more concrete things, it's a,

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 in the totem pole of priorities within Open AI, it's still unclear to me. So I actually asked 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. 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 they are into this.

But where does that sit next to ads? Well, ads are paused. But this, sorry, I think you're hitting on the real issue here. And this is something I also brought up to Fiji because I asked her. a two-parter as you do on these things. As you do. As one does. How important is Enterprise?

And now here's the risk. When you design for Enterprise, if Enterprise is really what you want, 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, 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. I remember, GPT5 was viewed by many as a personality downgrade over chat GPT40. Now, maybe that's because it's not as sycophantic, or maybe it's Because, you know, when you ask it what the weather is out, it asks you, do you want me to, like, find five places where you can find an umbrella nearby? Clearly, there's a balance between making something economically valuable and usable for enterprise and also making it personable. 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 cannibalization effect where you go for enterprise, but then you're 800 or 900 million weekly users who are using ChatchipT 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 over at Google. That's actually a really good point. Like, let's take those two things, the sycophantic 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 sycophantic 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 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 cybersex with their chat GPT. And then they're going to ask it to like organize their files. Like, I think you might. You might need two separate windows for that stuff. I'm just going to leave that one there.

I'm just saying. I'm not saying I want this to happen. Let's be realistic. This is going to happen. This is from Wired. Fiji on the call said the company now plans to roll out its adult mode. In the first quarter of 2026, Altman had previously indicated users.

Over 18 would be allowed to have erotic conversations with chat chip BT. So for anyone who is looking forward to that, just wait till Q1. We're almost there. Just a few more days. Put the countdown clock on. Get an advent calendar until you can. Chatshupita erratica, yeah.

All right. All right. We're going to go to a break. We have to gather ourselves here. Let's go to a break. When we come back from the break, we're actually going to talk about another piece of the puzzle, which is, again, if Chatchipt,

if Open AI is going to be developing for enterprise, what does that mean for its consumer products? And what is Disney now getting involved with? because Disney and Open AI came to a very big agreement. This week, we'll cover that, we'll cover the AI buildout, we'll cover meta right after this. These days, it feels like every dollar

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Capital One's tech team isn't just talking about multi-agentic AI. They already deployed one. It's called chat concierge and it's simplifying car shopping. Using self-reflection and layered reasoning with live API checks, it doesn't just help buyers find a car they love. It helps schedule a test drive. get pre-approved for financing, and estimate trade and value. Advanced, intuitive, and deployed. That's how they stack. That's technology at Capital One.

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where the path to support is clear and every step forward feels like progress, not another wrong turn. Visit camh.ca to help us forge a better path for mental health care. And we're back here on Big Technology podcast Friday edition. We're going to talk about this Disney and Open AI deal before we do quick promo on Wednesday, this upcoming Wednesday. I'm going to have a conversation with none other than Jim Kramer from CNBC 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. And then one more thing, it is the giving season. And if you feel like giving back to big technology

podcasts, we're always happy to get five-star ratings on Spotify or Apple Podcasts. That's a solid you could help us with in this holiday season. It will help us book better guests. I got real close that landing some magnificent seven CEOs in 2025. I think we'll get there if we show that we have a big audience. And, of course, five-star ratings and reviews are the best way to show it because they're the only publicly available metric that these companies can look at in terms of a podcast size. Okay.

With that being said, let's talk about this 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 Chachipi Teammaker. 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 R2D2. Ranjan, are you excited about this?

How do you feel about this? And what do you think the stakes are? All right, let's separate my personal views on this, which I'm kind of excited. I actually, from like a creative standpoint, this is very interesting, versus what this means for Open AI the business. I think first on the personal side, I find this interesting. 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 things.

video. 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 post Napster for any of the older folks in the room. 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'll be button 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 family friendly

environments like us like legitimately the second mickey mouse is like doing cocaine or voicing your uh chat chippy t erotic pal things are going to be bad disney's going to be mad I guess they believe in Open AI's ability to turn this into like a quote unquote brand safe environment. I don't know. 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, 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 Open AI 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 anything else to me. But I felt like it was surprising on that side, but it also shows that maybe they are trying to be a bit forward-looking on it. Another element of this, I thought, was interesting, was that they'd sent the cease-and-diss letter to Google one of a brown copyright infringement. So, it's clear they're choosing a horse in the race and they chose in a big way. So maybe it really, the pressure they realized this is going to happen. 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, they sent a nasty, nasty letter to Google saying they infringed, that Google infringed on Disney's copyrights on a massive scale. Google's response to me was fairly pathetic and disappointing. We have a longstanding and mutually beneficial relationship with Disney and we'll continue to engage with them. More generally, we use public data from the open web to build our AI and have built additional innovative copyright controls. It just like shows the disregard.

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 online? It drives me nuts. Yeah, I mean, that's where- For suing them. Yeah. No, that's why that part of it, I found interesting again. I 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 I think on that side, it makes sense. See, 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 crews they have the the entire ecosystem of Disney so 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 would both appear in SORA. But Iger, Bob Iger, Disney CEO, Bob Iger on 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 world of user-generated 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 it's going to happen. Really? All right. I think, 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 this story. And that is a risk that I'm sure that they thought about but this is going to get people more invested in the Disney characters like this idea of

like putting yourself in a scene with you know R2D2 or whoever it is goofy it's just 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 open AI 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 one billion investment that Disney's making in Open AI has to be some form of circular funding. Like Disney, like Open AI is going to maybe pay or Disney for the right to put its characters in SORA with Open AI stock. And that might just be a billion dollar trade. I don't know this to be true. It's just my speculation. I know. I was trying

to look into that as well. And it seemed to be. a straight equity investment with warrants, like, from what I saw, but in my mind, too, that's definitely where it went to start. But maybe they're getting free ChatsyPT Enterprise licenses as part of this, and this is actually the first push and for A&2 enterprise in a big way for Open AI. Okay, maybe this is how it all comes together. Maybe. All right, I want to tell you one more thing that I sort of came to this week.

when I opened up SORA again. 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 syntax that's like you can hear when people are speaking, when people speak in SORA videos, it sounds like this. It sounds like, oh my God, he's going to do it.

wheelie. He did a wheelie. No way. Right. It has that sort of stilted, like, kind of maybe overly excited, rhythmic. Here's what I think sort of, I want to run this by you. I think SORA trained on so, it's 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 like that theory. I'm actually more amazed. I've not been on Sora now. I actually just opened it right now as we're speaking. two tigers and French chef hats cooking. But I wonder, it's actually, to the credit, I don't come across it very much in my feeds and algorithms.

But the fact that if there's SORA voice, because I remember when TikTok really started gaining prominence, that there was that kind of monotone TikTok voice that was the default for any video created that actually became kind of a cultural artifact. So I think to Saur's credit, if they actually are getting there. That's actually impressive for the platform.

But I don't know. 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 I'm not sure where they're going with it. Well, I did get some numbers from MapTopia this week. They sent them along.

So when SOR came out, it was doing around 240,000 downloads, looks like a day, bumped up to around 400,000 or so for day. 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 this might just be what Aptopia, still around. It might be around what Aptopia measured, but it just shows like a real decline there. And it's again, we've talked about this before. It's this like sort of sameness problem that every video, every Saur video has a very similar feel. So we'll keep monitoring.

We'll see. We'll see next year, big year for Sora maybe and Mickey Mouse. I said weed Mickey Mouse for the, for the record. Oh, sorry. Did I, I upgraded weed Mickey Mouse to cocaine, Mickey? Oh, listen, I dream big. We know how. He's already hyper.

Yeah. No, we know you both. We know why excited he is. 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 behind that.

But it will be. It will be once I get my hands on that, Sora. What do you think magic means for Disney? Oh, my God. I'm going to get sued. But you won't get sued. Disney will invest in you for that creative licensing. I have to tell you, my, I am taking the Sam Altman approach to Bob Eiger and not the Elon Musk.

You are welcome, you are welcome to partner with me here. Do you think we'll get a lawyer? or I hope not. I'm just joking about all this stuff. This is our job. We have to talk about the possibilities. Can we talk about infrastructure? Let's talk about infrastructure.

Rough week for Oracle and Broadcom, right? These are the sort of cornerstones of the AI infrastructure trade. Oracle, there's a report out today that Oracle is going to delay some of its data centers to open AI. But from 27 to 2028, also the market is starting to see that their buildout for AI is lower margin than the rest. to their data centers. Surprise, surprise. Broadcom also sort of getting hit on this. It's going to have, 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 believed. And so they're getting a haircut. Both of them are. What do you think the big story is here? Is it just that

like this is and these trades are based on 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 percent i think it was like now we're starting to see real numbers even with oracle's 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 delivered some earnings this week and said that its capital expenditures is from the journal on data centers will outrun revenue for several quarters to come. And it's like, 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 Open AI announcement was the begin, kind of like the real mainstream moment for the infrastructure trade. And this idea that is 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 build out 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 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 three years stories, still one quarter of data is one quarter of data. Right. I mean, Open AI has a $300 million deal by computing from Oracle over five years. Open AI is 55% from what I understand of the remaining performance obligation for Oracle. So if Open AI can't do it, it's pretty bad news for Oracle. 300 billion.

300 billion. 300, I said million, billion. It's just this sort of unholy. combination of debt of dependency on Open AI? Well, the three letters you never want to hear were mentioned again this week. CDS. Credit default swaps. Credit default swaps. So can you just for a second explain exactly what the issue is there? 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 higher that number goes, the more expensive that insurance is, the more, you know, the more,

it's indicating that the market believes the default is more likely. And again, these numbers start to be small at a certain point. Now this week, the Oracle CDS hit the highest intraday level since April 2009. So people are starting to recognize that this is something that maybe you want to be insured against. And there is an element of risk to this that was not

priced in initially. But 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 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. 2008, 2008. That was the last time we were all talking.

Actually, from beginning of 2008 talking, mentioning. those three letters. 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 Broadcom. No, Broadcom is Google, though. They do Google Anthropics. So, but like seriously, like Oracle, Warweave is down today and Vidia is down. Do you think that 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 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 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 large scale, like economic calamity. I think it's one of those. Market goes down a bit. 401k's 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 like the

biggest thing that I think everyone piled in the and actually if we are to believe Sam Altman 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 cost efficient 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 Kramer with first question when we speak next week is basically like, here's how the AI bubble bursts.

You can compute much more efficiently. We still don't have 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 build up, 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 an all-knowing technology. Yeah, no, no, that's, I mean, how I view it, that like, especially in the enterprise when people are going to be a lot more cost conscious and like competitive around it, that the innovation happens in terms of actually. making these technologies more cost efficient to actually run this, run these processes and compete in workflows. So I think, yeah, you can you can have AI generate. Jensen said it's going to generate up 500 trillion dollars of GDP, like up from 100 trillion aggregate GDP. Maybe that's

happens, but that doesn't mean that the infrastructure trade actually pans out. You know that sounds ridiculous, but I do think that's a possibility. It's a realistic possibility. Yeah. All right. Let's close on this. Meta's new AI superstars are chafing against the rest of the company. This is from the New York Times. When Mark Zuckerberg revamped Meta's artificial intelligence operations this year, he recruited a new leader, Alexander Wing, 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 Mehta's headquarters, probably just this is what the story says, to remove them from the bureaucracy. of the company. Five 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. 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

defeats 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 OpenAI and Google before focusing on products, the people said. Can I just share quickly what my perspective on this paragraph is? Because it doesn't make too much sense to me. I mean, ideally, if you're running a superintelligence operation within meta, you're going to use meta as Instagram and Facebook data to train, right?

You'll have that data. That's proprietary data you can use to train. So why wouldn't you want to use that data to train your models? And using that data doesn't necessarily improve, you know, only improve the social media feeds and the advertising business. 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 definitely found it weird as well in the sense that, I mean, meta properties probably have. one of the richest datasets 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 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 of this. Right. The time story does say that the departures have stabilized and maybe two out of a hundred have left after that first investing period hit. I mean, the interesting thing here is, I think, I mean, we'll see what happens, because I don't disagree. There's definitely going to be clashes of interests. They did get broad. I mean, here, this is from the story. The labs researchers have come to view many meta executives as interested only in improving the social media business, while the lab's ambition to create 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. But it seems like that was always part of the equation was like if you go to meta, yeah, like you're going to be there also to improve the core business along with developing super intelligence. But I wonder, I feel Google is handled, I mean, going back to the conversation from I think a couple of weeks ago around how Savilly, Google handled the overall integration of AI within the company and kind of created that center. Like, 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 these organizations around, like, yeah, 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 4 billion users now, 3 billion users, whatever.

What's a couple billion? What's a couple billion? What's a couple billion? One Facebook friends. No, like 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.

But, I mean, they, Mark Zuckerberg should bring some clarity to that. you know how we're going to know this is really over is when meta superintelligence lab says it's focused on enterprise that's that's the end that is i think that's that's when or they become an AI cloud slash consumer wearables business well you know that's they are they are they are one of my talking about rabband meadows yeah exactly all right let's leave it there jim kramer on wednesday ron as always uh great speaking with you here on friday Thanks for coming on. All right. See you next week.

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