Lots of AI Marketing News

**SPEAKER_1** (0:06)
This is Marketing Over Coffee with Christopher Penn and John Wall.

**John Wall** (0:14)
Good morning, welcome to Marketing Over Coffee. I'm John Wall.

**Christopher Penn** (0:17)
I'm Christopher Penn.

**John Wall** (0:19)
Oh, and yeah, the hits never stop. So the new fronts were about a week and a half ago, and I had planned to go down there, and everything was just so on fire. And there was like, I had no time to go do some kind of, you know, half boondoggle trip to New York and see what was going on. So I apologized to the folks from LinkedIn and Google that I had talked about meeting up with, but that didn't happen. So, but yeah, you know, jumping into everything. The big story this week that caught my eye was that OpenAI closing down Sora, which they had just done this huge deal with Disney. So what's going on there? What's the real story?

**Christopher Penn** (0:54)
I mean, OpenAI is in kind of a really tough spot at the moment. They're continuing to burn cash like crazy. They're kind of a revolving door for talent. And they just raised a whole bunch of money, but their models and what they're doing in the space isn't as good as it used to be. When you look at what competitors are doing, particularly Anthropic, also, a lot of people very understandably were not thrilled about Sam Altman's behavior when it came to the whole Anthropic Department of War business, how openly I very pretty clearly tried to cut Anthropic off at the knees. And so the business is facing a lot of challenges, but Sora as a video model, it was good, but not as good as what's available. Now, when you look at what's on the market, like Halo, O, Kling, you look at Google's VO 3.1, in fact, a new version of VO 3.1, VO 3.1 Flash just came out last night. These models are just killing it in terms of ByteDance's Cdance 2.0. Cdance 2 is so good that it immediately spawned lawsuits from major Hollywood production houses, because the demo video they made of Brad Pitt fighting Tom Cruise in a fist fight was incredibly high quality. And obviously, Chinese AI companies are not bound by Western IP. So ByteDance basically told Hollywood to take a long walk off a short pier. But Sora couldn't keep up. And OpenAI stretched so thin, trying to keep services running, trying to keep building new models. And what's interesting is from a very tactical perspective, it doesn't appear, this is an outsider's view. I don't have any insight information, but it doesn't appear like they're publishing and producing like the latest and greatest. Google, for example, very recently published a new paper called TurboQuant that showed how you can take open models and dramatically compress them. We're talking six to eight times more efficient. Google basically came up with this algorithm. It's all just math, an algorithm that makes data centers, particularly theirs, huge surprise, six to eight times more efficient. So they can serve obviously six to eight times more customers. That's stuff that companies like OpenAI don't have on, you know, on deck. OpenAI in particular doesn't have its own hardware. This is one of the reasons why Google is is just sort of eating everything because Google owns its own TPUs, the Tensor Processing, so they can scale way faster. They are so efficient that like Anthropic just signed a multi-year, multi-billion-dollar deal to rent more compute time from Google. That's which is is fascinating. So that's a lot of what's happening. And OpenAI is basically saying, yes, Sora melts our GPUs. And as a result, we have less capacity to generate, to work on catching up to where the rest of the industry is going.

**John Wall** (4:12)
Oh, that's an interesting point. Yeah, I hadn't thought of that. When you're looking at the pile of cycles being burned, that video is right at the top of the list of work for benefit. How about the Disney side of it, too, though? The fact that they let them train all the Disney assets on that. I mean, isn't that this is like a classic thing for me. People like, oh, it's closed down and it's gone. It's like, well, no, there's now this group of like 10 people that have a briefcase with all the Disney assets in it that can go wherever the heck they want. Right. I mean, isn't that? I mean, we've seen this kind of stuff before.

**Christopher Penn** (4:44)
You have. And it wouldn't surprise me if there was some internal deals with Disney to allow like Disney teams to produce content faster, but letting the general public do it. That's kind of a money loser.