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(Bronson Stamp for Sherwood Media)

OpenAI is Pixar

The “wow factor” of each company impressed the masses, but scared creatives.

A breakthrough technology captures the public’s imagination; the disruption threatens multiple creative industries; a feverish race to achieve a futuristic goal once unimaginable begins. 

You could say any of these apply to OpenAI, but decades ago, this was how people were talking about computer-graphics pioneer Pixar.

Breakthrough

When Apple founder Steve Jobs purchased Pixar from George Lucas in 1986, the fledgling animation studio was pushing the boundaries of computer-generated imagery.

While crude by today’s standards, nobody had seen anything like their animated short films “Luxo Jr.” or 1989’s “Tin Toy,” which won the Academy Award for Best Animated Short Film. (Pixar would go on to win 22 more Academy Awards, and two nominations for Best Picture.) 

“Tin Toy” was not just a technical marvel at the time, but showed that these cold, digital pixels could be capable of heartwarming, emotional storytelling. Pixar’s breakthroughs inspired a generation of programmers, digital artists, and creators to build the modern computer-graphics industry — which, incidentally, would also lead to the computing and hardware innovations that made OpenAI possible. In 2006, animation powerhouse Disney purchased Pixar for $7.4 billion.

ChatGPT took the tech world by storm from launch day in November 2022. After decades of progress in foundational AI breakthroughs like convolutional neural networks and transformers, the public finally got a chance to see what these advances could mean for regular people. Reading news coverage of ChatGPT’s initial release from just two years ago feels like stepping into a time machine to a simpler time, like in this breathless New York Times piece:

“Hundreds of screenshots of ChatGPT conversations went viral on Twitter, and many of its early fans speak of it in astonished, grandiose terms, as if it were some mix of software and sorcery.” 

Disruption

The “wow factor” of what Pixar was creating at the time impressed artists, technologists, and filmmakers, but it also signaled a disruption. Was the era of hand-drawn animation nearing its end? 

In the 1998 book “Computer Animation: A Whole New World,” Pixar cofounder Ed Catmull told author Rita Street:

“Luxo Jr. sent shock waves through the entire industry — to all corners of computer and traditional animation. You see, at that time, most traditional artists were afraid of the computer. They did not realize that the computer was merely a different tool in the artist’s kit but instead perceived it as a type of automation that might endanger their jobs."

A similar thing happened when OpenAI’s ChatGPT and DALL-E text-to-image generator popped up in front of creative writers, artists, and journalists, but with an added wrinkle. This time, not only was this startling technology putting their livelihoods at risk, but it was trained on their own copyrighted public works. Rather than shrug it off and accept this as the inevitable future, many creators have filed lawsuits and designed clever adversarial countermeasures.

Holy Grails

Now OpenAI plans to continually and rapidly improve its technology, racing to achieve a lofty goal, as Pixar did. 

The engineers and animators at Pixar saw the limitations of their technology at the time, but had their eyes fixed on the future of computer graphics. They wanted to make everything look real. 

“We people in computer graphics have known in our bones for 20 years that we would do this,” Pixar cofounder Alvy Ray Smith said in a 1989 New York Times story about the rise of computer animation and the advances that led to “Tin Toy.” 

“Our goal is not to have people say, ‘That’s computer animation,’” he said. “Our goal is photorealism.” 

OpenAI’s stated mission is to achieve “artificial general intelligence,” (AGI) — loosely defined as advanced AI systems that not just equal but surpass humans in all tasks, which has long been considered the Holy Grail of machine learning. 

OpenAI’s mission page states:

“If AGI is successfully created, this technology could help us elevate humanity by increasing abundance, turbocharging the global economy, and aiding in the discovery of new scientific knowledge that changes the limits of possibility.”

It’s clear that OpenAI’s leadership knows there’s a long road ahead to AGI, and they appear to be unimpressed with what their technology can do today. Earlier this year, OpenAI CEO and cofounder Sam Altman said

“ChatGPT is mildly embarrassing at best. GPT-4 is the dumbest model any of you will ever have to use again, by a lot.”

Pixar spent decades pushing the boundaries of computer-graphics technology, which is now so common that consumers don’t really think much about it. OpenAI has been on its quest for AGI for nine years, though recently the pace of its breakthroughs is quickening. But one question hangs over OpenAI: is AGI even possible? 


Read the other arguments for OpenAI's future here.

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Apple to pay Google $1 billion a year for access to AI model for Siri

Apple plans to pay Google about $1 billion a year to use the search giant’s AI model for Siri, Bloomberg reports. Google’s model — at 1.2 trillion parameters — is way bigger than Apple’s current models.

The deal aims to help the iPhone maker improve its lagging AI efforts, powering a new Siri slated to come out this spring.

Apple had previously been considering using OpenAI’s ChatGPT and Anthropic’s Claude, but decided in the end to go with Google as it works toward improving its own internal models. Google, which makes a much less widely sold phone, the Pixel, has succeeded in bringing consumer AI to smartphone users where Apple has failed.

Google’s antitrust ruling in September helped safeguard the two companies’ partnerships — including the more than $20 billion Google pays Apple each year to be the default search on its devices — as long as they aren’t exclusive.

Apple had previously been considering using OpenAI’s ChatGPT and Anthropic’s Claude, but decided in the end to go with Google as it works toward improving its own internal models. Google, which makes a much less widely sold phone, the Pixel, has succeeded in bringing consumer AI to smartphone users where Apple has failed.

Google’s antitrust ruling in September helped safeguard the two companies’ partnerships — including the more than $20 billion Google pays Apple each year to be the default search on its devices — as long as they aren’t exclusive.

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Netflix creates new made-up metric for advertisers

It’s not quite WeWork’s community-adjusted EBITDA but it’s also not quite a real number: Netflix announced today that it has 190 million “monthly active viewers” for its lower-cost advertising tiers. The company came up with MAVs by measuring the number of subscribers who’ve watched “at least 1 minute of ads on Netflix per month” and multiplies that by what its research assumes is the number of people in that household.

The metric builds on Netflix’s previous attempt at measuring ad viewership, monthly active users, which is the number of profiles that have watched ads (94 million as of May). The MAV measurement, of course, is a lot bigger and bigger numbers are more attractive to advertisers, who are spending more and more on streaming platforms.

“After speaking to our partners, we know that what they want most is an accurate, clear, and transparent representation of who their ads are reaching,” Netflix President of Advertising Amy Reinhard explained in a press release. “Our move to viewers means we can give a more comprehensive count of how many people are actually on the couch, enjoying our can’t-miss series, films, games and live events with friends and family.”

Netflix last reported its long-followed and more easily understood paid membership numbers at the beginning of the year, when it crossed 300 million.

The metric builds on Netflix’s previous attempt at measuring ad viewership, monthly active users, which is the number of profiles that have watched ads (94 million as of May). The MAV measurement, of course, is a lot bigger and bigger numbers are more attractive to advertisers, who are spending more and more on streaming platforms.

“After speaking to our partners, we know that what they want most is an accurate, clear, and transparent representation of who their ads are reaching,” Netflix President of Advertising Amy Reinhard explained in a press release. “Our move to viewers means we can give a more comprehensive count of how many people are actually on the couch, enjoying our can’t-miss series, films, games and live events with friends and family.”

Netflix last reported its long-followed and more easily understood paid membership numbers at the beginning of the year, when it crossed 300 million.

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Ahead of Musk’s pay package vote, Tesla’s board says they can’t make him work there full time

Ahead of Tesla’s CEO compensation vote at its annual shareholder meeting tomorrow, The Wall Street Journal did a deep dive into how Elon Musk, who stands to gain $1 trillion if he stays at Tesla and hits a number of milestones, spends his time.

Like a similar piece from The New York Times in September, this one has a lot of fun details. Read it all, but here are some to tide you over:

  • Musk spent so much time at xAI this summer that he held meetings there with Tesla employees.

  • He personally oversaw the design of a sexy chatbot named Ani, who sports pigtails and skimpy clothes and for whom “employees were compelled to turn over their biometric data” to train.

  • The chatbot, which users can ask to “change into lingerie or fantasize about a romantic encounter with them,” has helped boost user numbers, which are still way lower than ChatGPT’s.

  • Executives and board members have told top investors in the past few weeks that they can’t make Musk work at Tesla full time. Board Chair Robyn Denholm explained that in his free time, Musk “likes to create companies, and they’re not necessarily Tesla companies.”

Like a similar piece from The New York Times in September, this one has a lot of fun details. Read it all, but here are some to tide you over:

  • Musk spent so much time at xAI this summer that he held meetings there with Tesla employees.

  • He personally oversaw the design of a sexy chatbot named Ani, who sports pigtails and skimpy clothes and for whom “employees were compelled to turn over their biometric data” to train.

  • The chatbot, which users can ask to “change into lingerie or fantasize about a romantic encounter with them,” has helped boost user numbers, which are still way lower than ChatGPT’s.

  • Executives and board members have told top investors in the past few weeks that they can’t make Musk work at Tesla full time. Board Chair Robyn Denholm explained that in his free time, Musk “likes to create companies, and they’re not necessarily Tesla companies.”

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Motion Picture Association to Meta: Stop saying Instagram teen content is “PG-13”

In October, Meta announced that its updated Instagram Teen Accounts would by default limit content to the “PG-13” rating.

The Motion Picture Association, which created the film rating standard, was not happy about Meta’s use of the rating, and sent the company a cease and desist letter, according to a report from The Wall Street Journal.

The letter from MPA’s law firm reportedly said the organization worked for decades to earn the public’s trust in the rating system, and it does not want Meta’s AI-powered content moderation failures to blow back on its work:

“Any dissatisfaction with Meta’s automated classification will inevitably cause the public to question the integrity of the MPA’s rating system.”

Meta told the WSJ that it never claimed or implied the content on Instagram Teen Accounts would be certified by the MPA.

The letter from MPA’s law firm reportedly said the organization worked for decades to earn the public’s trust in the rating system, and it does not want Meta’s AI-powered content moderation failures to blow back on its work:

“Any dissatisfaction with Meta’s automated classification will inevitably cause the public to question the integrity of the MPA’s rating system.”

Meta told the WSJ that it never claimed or implied the content on Instagram Teen Accounts would be certified by the MPA.

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Dan Ives expects “overwhelming shareholder approval” of Tesla CEO pay package

Wedbush Securities analyst Dan Ives, like prediction markets, thinks Tesla CEO Elon Musk’s $1 trillion pay package will receive “overwhelming shareholder approval” at the company’s annual shareholder meeting Thursday afternoon. The Tesla bull, like the Tesla board, has maintained that approval of the performance-based pay package is integral to keeping Musk at the helm of the company, which in turn is integral to the success of the company. Ives is also confident that investors will back the proposal allowing Tesla to invest in another of Musk’s companies, xAI.

“We expect shareholders to show overwhelming support tomorrow for Musk and the xAI stake further turning Tesla into an AI juggernaut with the autonomous and robotics future on the horizon,” Ives wrote in a note this morning.

The compensation package has received pushback, including from Tesla’s sixth-biggest institutional investor, Norway’s Norges Bank Investment Management, and from proxy adviser Institutional Shareholder Services.

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