OpenAI Shuts Down Sora & United Wants More Premium Seating

0:00Neal Freyman:Managing media plans for multiple clients can feel like herding cats. Disney Campaign Manager is built for fast-moving agencies looking for one simple ad-buying solution to handle all of their streaming TV campaigns across Disney +, Hulu, and ESPN. Set flexible budgets, adjust on the fly, and optimize for total campaign control across every buy all in one platform. Get started today at DisneyCampaignManager.com. That's DisneyCampaignManager.com. Good morning Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, United's giving you more ways to lie down on a flight. Then, OpenAI's video generation platform, Sora, is dead as a doornail.

0:43Neal Freyman:It's Wednesday, March 25th. Let's ride.

0:50Good morning. We got to tell you about this geography game that has completely taken over our office conversations and Slack channels. It's called MapTap, and each day you get five cities to locate on Earth, from Tulsa to Hanoi. It has a sharing mechanism, much like Wordle and all those other games that end in L.E. And yeah, it's just been a blast, and we wanted to recommend it. If you want your workplace to devolve into madness the way ours is, Toby, you'll find out where Monaco is one day.

1:15Neal Freyman:The desire to beat Neil, or at least not lose embarrassingly to Neil, has me learning geography at a faster clip than at any point in school. I think the magic of the game is that you just get the landmass. There's no borders. There's no cities labeled. There's no rivers highlighted. It's just the world. And you realize how much you use other countries to approximate the location of other countries. It's been very fun. I recommend bringing it to your group chats. You can play it at maptap.gg. Comment and email us your scores, too. I want to see if Neil is actually playing at such a high level or if maybe there's some more geography nerds out there.

1:52And now a word from our sponsor, LinkedIn Ads. Toby, you are the best podcast co-host I know.

1:57Neal Freyman:Oh, Neil, you're making me blush. I thought you were going to tell me I'm the best map tap player, you know. You'll get there someday, maybe. But do you know what else is the best LinkedIn Ads is when it comes to generating the highest B2B ROAS of all online ad networks? They also have a network of over 1 billion professionals and 130 million decision makers. You can target your buyers by job title, industry, company role, seniority skills, company revenue, so you can stop wasting budget on the wrong audience. Spend$250 on your first campaign on LinkedIn ads and get a free$250 credit for the next one.

2:29Neal Freyman:Just go to linkedin.com slash mbd. That's linkedin.com slash mbd. Terms and conditions may apply. OpenAI's video generation platform came out of the gates soaring, but now it's no longer flying. Sora is officially dead, the casualty of a strategic pivot towards business and coding tools for OpenAI ahead of its potential IPO. Sora launched too much Hoopla back in September as sort of a TikTok-style social feed for sharing AI content. You could input your own face into videos, which meant I was doing 360 dunks on Neil in no time. Sam Altman personally encouraged people to splice his face into videos, which led to a clip of him shoplifting becoming the first real viral content to come out of the platform.

3:13Neal Freyman:The move fast and break things approach meant that there were very few guardrails around protected content when Sora first launched, which set off a flurry of copyright battles. Eventually though, they got the mouse on their side with Disney inking a$1 billion deal, which would let Sora use more than 200 of its characters, a deal that is now dead as Bambi's mom given Sora's closure. Neil, I'd say for about two weeks or so, Sora was hot, rocketing up the app store, pumping out viral clips, but users didn't stick around and it turned into a money sucking black hole for the company that is already burning through cash at an alarming rate.

3:48You really have to stop spoiling movies, Toby. It's a bad habit. She dies, Neil. She dies. The main problem for Sora is that no one was using it and it was insanely expensive to operate. It did had, it came out of the gate so fast. It reached a million downloads faster than chat GPT, but then it had a huge plunge. People really weren't using the social media platform. By January, downloads were down 45 % according to TechCrunch. Meanwhile, video generation like this is so expensive, takes up so much compute for a company like OpenAI. Forbes estimated that OpenAI was perhaps blowing as much as$15 million per day, and there was no way to make money off this particular consumer app.

4:29You didn't have to pay for it. There was no ads. So it was just a money pit, and OpenAI decided to stream... It's part of a broader strategic pivot that is trying to streamline all these apps and go after more enterprise consumers than just regular people.

4:42Neal Freyman:I think people overreacted to Sora when it came out because I was, as people are kind of eulogizing the platform, they're going back through what people's reactions were when it initially debuted. And Tyler Perry, you know, the Hollywood producer, director, said he was so flabbergasted by it that he canceled a$800 million studio expansion. This was a quote he gave to the Hollywood Reporter at the time. I'm going to paraphrase a little bit because it's rather long. I've been watching AI very closely and watching the advancements very closely. I was in the middle of planning for the last four years about an$800 million expansion at the studio.

5:16Neal Freyman:All of that is currently and indefinitely on hold because of Sora and what I'm seeing. That is crazy when you consider the slop that Sora kind of started pumping out, but that really was the de facto consensus is like AI video generation is here and it's gonna remake everything. Hasn't quite panned out that way. No, but maybe there have been a bunch of other competitors jumping into the space. There's that Chinese company, ByteDance, which is TikTok's owner, has its own video generation app that still appears to be going strong. Google's also in this space. So just because OpenAI is pulling back doesn't necessarily mean that AI video generation is completely dead.

5:50It just might be a ceasefire. But for OpenAI, you know, it was trying to do everything everywhere all at once, and it was not working. It needs to get its finances in order ahead of this IPO. It's going against Anthropic, which has no video at all, and they reached$19 billion in annualized revenue earlier this year just by doing text and code. OpenAI is looking at that business model with a little jealousy and saying, we're trying to do all these things, trying to go after just regular consumers, and it's not actually helping our business.

6:20Neal Freyman:It's a bit of an egg on the face moment, too, for Disney because as Bob Iger is kind of culminating his tenure as CEO of Disney, he signed a deal where it was paying$1 billion to OpenAI, giving access to a lot of its character library. So that was like the last attempt at relevance for Sora. Let's bring in recognizable characters. Let's let Mickey Mouse, you know, dunk on Goofy. I don't know why everyone's dunking on everyone in my mind in Sora. But that now has a bunch of fallout attached to it. Josh DiMaro is the new CEO of Disney. He has to clean up this billion-dollar mistake. So it was just a fascinating egg-on-your-face moment for two very large companies that eventually just sort of walked different ways because this deal is now dead.

7:02There's a lot of chaos in the aviation industry right now. But United is keeping its eye on the prize. Really rich travelers. Yesterday, the airline announced its biggest fleet rejuvenation in history, adding more than 250 aircraft by 2028 that will be stuffed with premium live flat seats that push regular economy passengers deeper to the back of the plane. Take the new A321neo, for example, what United is calling the coastliner because it's going to whisk people between New York and California. This plane will have 20 elite tier Polaris seats which go horizontal, something that doesn't exist on that route now.

7:36In addition, there will be 12 premium economy seats, 36 with extra legroom, and the rest standard economy. Essentially, United wants to give first-class passengers the kind of white-glove service they'd expect on an international flight on a longish domestic one. Because United can charge a buttload for it, and that's all what this comes down to, really. Airlines and the travel industry more broadly are going all-in on premium because it's way more profitable than economy. United's main rival, Delta, predicted that for the first time ever this year, premium revenue will overtake main cabin sales.

8:06In other words, airlines are way more focused on the people who turn left when boarding a plane than the ones who turn right. Toby, I don't think there's a better visualization of the K-shaped economy than a 2026 United airplane seating chart.

8:18Neal Freyman:United was just on one yesterday because they also announced something called the Relax Row yesterday, which is basically everybody's dream when you are flying economy is like, what if no one sat next to me and I could just lie down across all of these seats? They now have a configuration that you can transform three seats into a full-on bed. They allow you to raise up the leg rest to a 90-degree angle so you get the entire surface of those three seats that you can lay down on. Apparently, it's going to be great for families. They'll give you a custom-fitted mattress pad if you book those seats.

8:52Neal Freyman:So they are throwing a bone back to the back of the plane. That bone comes with very premium amenities like lie-flat seats. I don't know how much that's going to cost. They didn't release the prices on that, but it's going to be quite pricey. People are freaking out about it, and I just should add, this is not the first airline to do something like this. Nippon in Japan has a similar mechanism for booking an entire road to lie down, and Air New Zealand has something called the Sky Couch, which does something similar. And New Zealand is always a pioneer in this space because you'd have to fly really far to get anywhere or to New Zealand.

9:28But it does speak to, I think, just the overall amenities and push for premium that United and other airlines are going after. And it's and it's for planes, large and small, not just the big planes, but also they they debuted this regional jet, a CRJ 450, which is like going from, you know, Tulsa to Denver. They're ripping out. They just currently this plane has 50 economy seats. So it's just, you know, regular, regular seating. But now they're going to put just 41 seats, 34 house economy and seven, seven first class seats. So they are just big and small. It doesn't matter the plane. They're just going all in on economy.

10:04And they just want people to lie horizontally and pay them a buttload of money just to get on these planes.

10:09Neal Freyman:I think the price gap that really tells the story here is just looking at a single fare spread between the flight from Newark to San Francisco. If you fly standard coach,$423. If you fly the top tier Polaris class,$5 ,556. So it is a massive gulf here. I don't know who is paying that, by the way. You're paying it on the company's dime. Yeah, it's definitely business travelers. But it just shows like if you were doing the math as a company executive, you are earning, you know, so much more money from these premium seats. Of course, you're going to put more of them in. Meanwhile, United's coming on hot on Delta.

10:44In December, Delta CEO said United is doing their best to copy us. And I don't blame them. I would copy Delta, too, if I was them. But right now, Delta and United are completely separating themselves from the rest of the airline pack. American Airlines has faltered in this push to premium. While United, which I think had a pretty bad brand reputation for the past couple of years of the past decade, has really rehabbed itself. And since we're talking about the airline industry, we should say any updates on the shutdown. There really isn't any. Senate Republicans are offering this deal to Senate Democrats saying that perhaps we can fund all of Homeland Security, including TSA, besides immigration enforcement.

11:24So we'll see. It looks like they're coming a little bit closer to the deal. but TSA lines are still long at various airports around the country.

11:30Neal Freyman:I have a flight tomorrow morning out of LaGuardia, so I've been on Reddit and just literally combing through, like, what are the lines looking like? What are the lines looking like? I think the issue is people are showing up four and a half hours early to their flights, which just pushes all the lines forward. Hopefully, things start to shake out, and I just get lucky by tomorrow. Moving on, think of the best drivers in the world. Maybe your mind goes to that friend who can nail a smooth parallel parking job or even to the pros waiting for lights out at an F1 race. But the best drivers right now might be behind the wheel at CERN's campus near Geneva, Switzerland, taking antimatter out for a very, very delicate spin.

12:08Neal Freyman:The joyride went off without a hitch yesterday as scientists worked out the logistics of how to move the powerful and mysterious particles around. Antimatter, the oppositely charged version of normal matter, often pops up as a boogeyman in the entertainment world. You might remember it from Dan Brown's Angels and Demons, but it is a real thing. Modern models of the universe posit that equal amounts of matter and antimatter were created by the Big Bang. Should the two types of particles ever meet, it makes oil and water seem like the best of friends. The particles annihilate each other, releasing a massive burst of pure energy if they make contact, which is why the test ride was a very nervy one for CERN.

12:47Neal Freyman:Scientists suspended 92 antiprotons in a specially designed vacuum-sealed cryogenic box that weighed nearly 2 ,200 pounds. The box was carefully craned onto a truck, while superconducting magnets kept the antiprotons suspended in the middle of the chamber, so even if a driver popped the curb, the antimatter wouldn't go boom. Switzerland is still on the map last I checked, so the test ended up being a success and opens the door to more research projects being conducted outside of CERN's antimatter facility. Neil, I've seen you whip around the jersey turnpike before but i'm not sure i trust you with universe altering particles oh i could do it toby 10 and 2 10 and 2 it's fine you just keep it stable if ryan gosling saving earth from mysterious space particles was project hail mary what would you call this maybe project screenplay gotta protect your guy with the ball now my first question here was why do they need to move it like why do you need to move antimatter in the first place from cern and it's actually fascinating.

13:44So CERN, which is known for its big particle collider that, you know, they do a lot of experiments on, is actually an amazing antimatter factory. It allows you to make antimatter because what they do is you smash high energy protons against this metal target that creates secondary particles which go into a decelerator, which are slowed down. And then it filters into this trap where you can get antimatter. But what makes CERN so good at making antimatter also makes it a really bad place to do precise measurements on the antimatter because that decelerator creates a powerful field that makes it nearly impossible to perform very sensitive measurements.

14:21So what they need to do is get this antimatter to other labs across Europe and the one they're trying to get to is in Dusseldorf, Germany, which maybe you can find on MapTab now, or maybe not, but it is eight hours away from Geneva, from CERN. So this test drive is all leading up to get this antimatter on an eight-hour drive to Dusseldorf, Germany, so they can actually perform precise measurements on it and actually learn a thing or two about antimatter.

14:47Neal Freyman:So the issue with that 500-mile drive is that you actually need 10 hours total because you need an hour on either side for loading and unloading. The current format for how they're suspending the antimatter, antiprotons, it lasts about four hours. So you need to have a dedicated generator on board to make sure that you know you don't run out of power and the antimatter particles fall into the box. The biggest thing that they're trying to solve, too, is getting stuck in traffic. They can't, you know, forecast. It's a long drive. You can't close down the entire roadway. So the biggest, you know, obstacle that they're trying to game plan for is what if, you know, a sheep crosses the road and we have a traffic jam to deal with?

15:28Neal Freyman:This won't be ready until 2029 at least. But the fact that they got it on four wheels, they got it driving. You mentioned 10 and 2. That guy has got to be, or girl, has to be white-knuckling the steering wheel. I also maybe played up a little bit what would happen if the antimatter protons made contact with real matter. It's not going to blow up the entire country of Switzerland. But you would lose the protons, the antiprotons themselves, which is very valuable. You're not going to lose half of the Swiss population, though. All right. We're going to take a quick break and we're going to come back with a story about opening day right after this.

16:04Neal Freyman:Neil, I know you don't take investing seriously. You're right. I keep all my money inside my mattress. Don't be like Neil, whose door is almost always unlocked. Be like public.com users who take investing seriously. You can build a multi-asset portfolio of stocks, bonds, options, crypto, and more while accessing industry-leading yields with a suite of fixed income products. And now with our new generated assets, you can turn any idea into an investable index with AI. Learn more at public.com slash morningbrew, and you can earn an uncapped 1 % bonus when you transfer your portfolio. That's public.com slash morningbrew.

16:42Neal Freyman:Paid for by public investing, full disclosure, and podcast description. This episode is brought to you by Apple. Neil, there's nothing like your first Mac. I remember my first Mac like it was yesterday. I got mine right as my sister started to get recruited to play soccer in college. I was given the very important task of making her a highlight tape, and iMovie was my best friend. She ended up playing at Georgetown, so I'd say it was all worth it. When I got my first Mac, I was heading into freshman year at the University of Maryland. A lot was uncertain that fall, but I knew I had a dependable sidekick for homework, connecting with other students, and devouring blogs about our basketball recruiting class.

17:17Neal Freyman:That's how we felt with our first Macs. How will you? Check out the all-new MacBook Neo, an amazing Mac at a surprising price. Learn more at apple.com slash mac. That's apple.com slash mac. Today I got an ad for Goat Feed, and now I'm questioning everything. Is the algorithm telling me to start a farm? That's broken ad targeting, throwing data at a wall, placing budget in the wrong place, and giving the wrong audience an existential crisis in the process. With Twilio, you can stop guessing. Twilio lets businesses coordinate smart promotions across SMS, RCS, and WhatsApp to help reach the right people at the right time.

17:56Save your budget and reach the people who actually want to hear from you. Go to twilio.com slash daily show. That's T-W-I-L-I-O dot com slash daily show. The new Major League Baseball season begins tonight with the New York Yankees facing the San Francisco Giants. And with it brings another innovation to America's pastime, perhaps the biggest ever, robot umps. Starting this season, players will be able to challenge ball and strike calls using an automated system of cameras placed around each ballpark. When a batter, hitter, or catcher disagrees with a human umpire's call, they'll tap their head to challenge it before a graphic is played on the Jumbotron showing whether the ump got the call right or not.

18:34No one's going into this cold turkey. The ABS system, as it's called, has been tested in minor league games and throughout MLB spring training. Fans love it, and players are cautiously optimistic it'll result in fairer play. Under Commissioner Rob Manfred, the only thing constant about baseball is change. In an attempt to balance the sport's hallowed traditions while still keeping up with the times, MLB has introduced a number of innovations in recent years to boost its popularity with modern fans, including a pitch clock to shorten marathon games. All signs point to these acts of self-disruption being a huge success.

19:05The game is more popular than it has been in decades, thanks to marketable superstars, a growing international audience, and tweaks like the pitch clock that have dramatically improved the product. There's lots of optimism that this robot ump challenge system will only juice baseball's momentum.

19:18Neal Freyman:My biggest question is how do you define the strike zone? That's always been a question, you know, plaguing MLB for decades now. Now that you have to narrowly define it, you have to measure it. A two-dimensional rectangle is set to the middle of home plate with the edge of the zone set to the width of home plate. That makes sense. But then the top and bottom is adjusted based on each individual player's height. So that means you need very specific measurements of players height and they brought in, you know, a third party independent testers to finally figure out exactly how tall each player is because it matters to set the zone.

19:52Neal Freyman:So I feel like we're going to see a lot of, you know, six foot fall to five elevens. Well, the shoes are off and it, you know, it matters. And I would imagine people are hunched in their shoulders because you want a smaller strike zone. So I want to I want to cross reference people's, you know, original stats when they entered the league and now that they have to be measured. maybe people are getting a little bit shorter. It's also going to impact strategy in a big way, and we don't know yet because the first game hasn't been played yet. It'll be very interesting to watch who teams and managers let make challenges because, as I said, it can be the catcher, it can be the batter, or the pitcher.

20:26Well, in spring training and last year, we have data on who's actually good at challenging calls. Catchers were the best with a 56 % overturn rate. Batters came in second place with 50%, and pitchers were in third place with 41%. So maybe if I'm a manager, I'm saying, I'm not letting a pitcher make this challenge because I didn't mention, you only have two challenges over the course of the entire game. If you get it right, you gotta keep it, but you could lose them. So you don't want necessarily a pitcher who's just pissed off making a challenge, tapping their head right away, because then you end up losing the challenge.