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Notes -
Sora is dead
It turns out that spending hundreds of millions for users to make useless slop videos was having a meaningfully negative financial impact. The bizarre thing is that Disney signed a $1b deal with OpenAI just a few months ago - who fucked up here? Of course, there are many more video AI tools out there, with fewer considerations for copyright law. But for now, Hollywood doesn't have much to worry about, at least on this front.
Startups like Runway and Chinese companies like Kling are still around, and AI video generation is only getting more popular. The big players like Google and Tiktok have better in house models than OpenAI. It is a crowded space. Sora was first to market for this caliber of video models, but the space has left Sora behind.
There are 2 reasons OpenAI abandoned Sora, and it has little to do with the viability of AI video gen.
The primary reason is because OpenAI was spread too thin. Enterprise agents are the trillion dollar market, and OpenAI is currently losing to Anthropic. It spooked OpenAI and late last year, they changed focus to Codex. Since then, OpenAI has deprioritized ChatGPT, voice models, music models and ofc, Sora. It's not that video generation is not a lucrative market. But, it's 2 orders of magnitude smaller than the enterprise agents market.
The secondary reason is that OpenAI is not well positioned to win here. Video generation and editing is primarily about control and iterative improvement. You start with a story board -> create a 1st draft -> use a vast tool-kit to iteratively get it to the final version. Sora is great at creating the 1st draft, but the likes of Adobe & Apple have the whole tool-kit built out. Unless the model is capable of fine edits, it will not be a useful substitute for filming it manually. ChatGPT: the product is a thin wrapper on top of ChatGPT: the model. The effort needed to turn it into a commercially viable product is minor when compared to the research effort of creating a GPT v-next model. On the other hand, most of the effort with a commercially viable video generation product is in the product engineering, not the model itself. That's asking a lot lot of effort from OpenAI in an area they are not best equipped to beat seasoned product engineering teams at.
tl;dr: Video generation will survive. The bubble isn't popping. A better analogy is - 'The gold rush ended because someone just discovered a Diamond mine'.
For context, I worked for an LLM/diffusion based content-gen AI startup for a few years. I was very early to this. Frankly, it an indictment of my judgement that I am not yet a millionaire. Should've joined OpenAI or Anthropic in early 2023 while I still had the chance. SMH
I fully endorse this take.
My minor add is that there is a nice website https://fal.ai that provides easy-to-use API access to all of these video models. It is profitable and so not going away. Openrouter (https://openrouter.ai) previously only specialized in serving text models, but they have made recent experimental API improvements to add multimedia output as well.
The media APIs aren't quite as interchangeable as the text APIs, and providers are making an effort to provide some sort of moat around weird features in their APIs to make no frontier model a drop-in replacement for another frontier model. But media generation obviously isn't going away.
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