Tech
Pixar/OpenAI logo
(Bronson Stamp for Sherwood Media)

OpenAI is Pixar

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

12/26/24 7:00AM

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.

More Tech

See all Tech
tech
Jon Keegan
9/11/25

OpenAI and Microsoft reach agreement that moves OpenAI closer to for-profit status

In a joint statement, OpenAI and Microsoft announced a “non-binding memorandum of understanding” for their renegotiated $13 billion partnership, which was a source of recent tension between the two companies.

Settling the agreement is a requirement to clear the way for OpenAI to convert to a for-profit public benefit corporation, which it must do before a year-end deadline to secure a $20 billion investment from SoftBank.

OpenAI also announced that the controlling nonprofit arm would hold an equity stake in the PBC valued at $100 billion, which would make it “one of the most well-resourced philanthropic organizations in the world.”

The statement read:

“This recapitalization would also enable us to raise the capital required to accomplish our mission — and ensure that as OpenAI’s PBC grows, so will the nonprofit’s resources, allowing us to bring it to historic levels of community impact.”

Settling the agreement is a requirement to clear the way for OpenAI to convert to a for-profit public benefit corporation, which it must do before a year-end deadline to secure a $20 billion investment from SoftBank.

OpenAI also announced that the controlling nonprofit arm would hold an equity stake in the PBC valued at $100 billion, which would make it “one of the most well-resourced philanthropic organizations in the world.”

The statement read:

“This recapitalization would also enable us to raise the capital required to accomplish our mission — and ensure that as OpenAI’s PBC grows, so will the nonprofit’s resources, allowing us to bring it to historic levels of community impact.”

tech
Rani Molla
9/11/25

BofA doesn’t expect Tesla’s ride-share service to have an impact on Uber or Lyft this year

Analysts at Bank of America Global Research compared Tesla’s new Bay Area ride-sharing service with its rivals and found that, for now, its not much competition for Uber and Lyft. “Tesla scale in SF is still small, and we dont expect impact on Uber/Lyft financial performance in 25,” they wrote.

Tesla is operating an unknown number of cars with drivers using supervised full self-driving in the Bay Area, and roughly 30 autonomous robotaxis in Austin. The company has allowed the public to download its Robotaxi app and join a waitlist, but it hasn’t said how many people have been let in off that waitlist.

While the analysts found that Tesla ride-shares are cheaper than traditional ride-share services like Uber and Lyft, the wait times are a lot longer (nine-minute wait times on average, when cars were available at all) and the process has more friction. They also said the “nature of [a] Tesla FSD ‘driver’ is slightly more aggressive than a Waymo,” the Google-owned company that’s currently operating 800 vehicles in the Bay Area.

APPLE INTELLIGENCE

Apple AI was MIA at iPhone event

A year and a half into a bungled rollout of AI into Apple’s products, Apple Intelligence was barely mentioned at the “Awe Dropping” event.

Jon Keegan9/10/25
tech
Jon Keegan
9/10/25

Oracle’s massive sales backlog is thanks to a $300 billion deal with OpenAI, WSJ reports

OpenAI has signed a massive deal to purchase $300 billion worth of cloud computing capacity from Oracle, according to a report from The Wall Street Journal.

The report notes that the five-year deal would be one of the largest cloud computing contracts ever signed, requiring 4.5 gigawatts of capacity.

The news is prompting shares to pare some of their massive gains, presumably because of concerns about counterparty and concentration risk.

Yesterday, Oracle shares skyrocketed as much as 30% in after-hours trading after the company forecast that it expects its cloud infrastructure business to see revenues climb to $144 billion by 2030.

Oracle shares were up as much as 43% on Wednesday.

It’s the second example in under a week of how much OpenAI’s cash burn and fundraising efforts are playing a starring role in the AI boom: the Financial Times reported that OpenAI is also the major new Broadcom customer that has placed $10 billion in orders.

Yesterday, Oracle shares skyrocketed as much as 30% in after-hours trading after the company forecast that it expects its cloud infrastructure business to see revenues climb to $144 billion by 2030.

Oracle shares were up as much as 43% on Wednesday.

It’s the second example in under a week of how much OpenAI’s cash burn and fundraising efforts are playing a starring role in the AI boom: the Financial Times reported that OpenAI is also the major new Broadcom customer that has placed $10 billion in orders.

Latest Stories

Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate, including Robinhood Markets, Inc., Robinhood Financial LLC, Robinhood Securities, LLC, Robinhood Crypto, LLC, or Robinhood Money, LLC.