Is AI Hollywood’s Newest Star? Runway AI’s Vision for the Future of Film

18:26Kara Swisher:I think they're worried about total time off, but go ahead. Well, that's my point. I think there's parts of it that will definitely task that will go away. Like, there are things that just might not need people full-time dedicated for that. But to your point, I think it also opens the door for many other people to discover an entirely new task and entirely new jobs. I think it's a consistent pattern in technology and art and filmmaking that technology allows you to do just a bunch of new things you never thought of doing before. Yeah, that's the technologist's argument. We'll be back in a minute.

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23:12Kara Swisher:In every episode, we get a question from an outside expert. Let's listen to yours. Hi, it's Matt Bellany, host of The Town podcast and founding partner at Puck. I have a question for Crystal Ball. Runway has announced a couple of deals with Lionsgate and with AMC networks to integrate Runway models into their workflows internally. But there haven't been a lot of other announcements with big studios in Hollywood. And I'm curious why. Lionsgate and AMC are two of the more struggling studio outlets at this point. Lionsgate is looking for a sale. AMC has had its value drop significantly. It seems like they're a little bit more willing to do these deals because they are struggling.

23:58Is that the case? Will we see others jump on board with these types of deals to let runway into their internal workflows? Or do the others just have a little bit more power and are kind of resisting at this point? Thanks a lot.

24:13Kara Swisher:Now, just before you answer, I know that Netflix had been using your tools. Disney is said to have been looking at the technology. But answer Matt's question. What's the difference between Hollywood using your products versus integrating them into the workflows themselves? I think that for me, the question was more about who's announcing it publicly and who's actually using it. I think it's fair to assume that you should expect a lot of, if not most of like studios and people experimenting with AI in Hollywood. I think people are getting more comfortable also with announcing and speaking more publicly about it.

24:44But like the Lionsgate partnership for us was years in the making. And we announced it recently, but it's been happening for quite some time. And so we've never done relationships with studios or with other partners for the sake of announcing it. It's more of like they feel comfortable with announcing than we should. But there's a lot of work behind the scenes with other studios as well.

25:05Kara Swisher:What about integrating into their workflows? Well, that's the goal. We want to integrate. We want to make sure if you're making something, we can help you and aid you at getting that stuff done faster, cheaper, better. everyone works differently, everyone does things differently, and so there's no one-size-fits-all, to be honest. I think we want to work with a lot of them. We actually have a specific studio team inside the company. So Runway is a research technology company that has, you think about it, as a small... You're embedded. Exactly, a small studio. And the goal for that studio has two main goals.

25:39One is, we're making original content ourselves, and so we use the tools and make animations and make short films, and that helps inform the research on the product itself. And then we also go into studios and kind of have that people work alongside our clients, our customers. And that's, again, we're creating this new kind of camera, and so we need to show you how the camera works.

26:00Kara Swisher:And when they're using them, usually all the studios are trying these things out or trying these tools out or looking at them. Possibly they don't want to talk about them because of the fears around from the unions and jobs and things like that would be my assumption. I think partially it's just like competition. Like if you figure out how something works and it's giving you an edge and a very competitive landscape like the media market is, you want to make sure you can just keep that for you. And I think there's a lot of internal, unique pipelines and workflows people have been working with AI.

26:29They're, I think, very unique. And it's fair for them to try to keep them like as private as possible for as long as they can.

26:35Kara Swisher:Renway has been called the number one all-in-one powerhouse for AI video generation. But you have huge competition. There's Google Veo, Meta's movie gen, Mid Journey, and of course Sora from OpenAI, which just announced it's working on a feature-length animated film called Critters with a Z. Runway sponsored an AI short film festival that ran in IMAX theaters this summer, but OpenAI will debut at Cannes. Talk a little bit about this. This film is supposed to have a much shorter timeline, nine months instead of three years, and a much smaller budget than your typical animated feature. Yeah, so I've been working on this for seven, almost eight years.

27:16And I think we've created an industry and the idea that you can use AI for film and art. And my realization is from a market perspective, if the market is interesting enough, you're going to attract some of the biggest competitors to try to build the stuff that you're trying to build. And I think that's a great validation for us. It's like we were a small team trying to do this very hard thing. And now all of these people are now trying to build similar things. I think it makes us realize that there's something special here. And it also makes us realize that we need to continue being very independent in how we think about the roadmap of the product.

27:53I'll give you an example. We hosted our film festival for almost three years now before anyone else thought about AI and film. We celebrated our third version of the film festival a couple months ago. We sold out the Lincoln Center in New York City. We had thousands of people come and watch the films. We partnered with industry standards, including the Tribeca Film Festival and the Gothams in New York. And I think part of it is we've always thought about making sure that we can work with industry really closely. And we realized that also will attract others to try to do it.

28:25Kara Swisher:To try to do it. The worry, of course, is you're either Netscape or Google, right? You're either the one that pioneered it and won or pioneered it and got run over, essentially. Well, I think you have to... Same thing with open AI, possibly, by the way. I think, I mean, look, I think the market is competitive. There's no question around it. I think AI itself is very competitive and it's very intense. But I think we're very confident in like, well, if we pioneer it, we need to make sure we can keep on doing it. And there's no, it doesn't mean that we've reached like now as the final form. There's so much research and so much interesting ideas of products that you can continue building.

28:58And I think what I've realized over time is you have to deeply care about what you're trying to solve and work for. I work on this not because I thought it was a good business. It's my obsession. It's what I deeply care about. It's my combination of interests from software to art to research. And I think our team deeply cares about that more than anything else. I think that overall eventually becomes a much more powerful way of winning the market than just throwing money at the problem.

29:25Kara Swisher:Well, Meta was trying to beat Substack and it just didn't, for example. But let's be clear. What usually happens is that one product becomes the industry standard, the Kleenex, so to speak. And on your blog, you recently wrote, a big mistake is to think AI will play out similarly to how the Internet story developed. The truth is the Internet needs thousands of companies to build infrastructure. AI needs perhaps a dozen. Talk a little bit about this. Yeah, so I think I'm realizing that a lot of the value in AI goes to the extremes. So the chip manufacturers, the silicon, and the other side, the research lab, the model builders and the tool builders.

30:00I think what's different in AI with previous tech transformation was that the picture and shovels, everything in between there, I think it's eventually going to get captured or developed by those building the models themselves. And this is coming from an experience where I guess what I'm trying to say is we get a lot of, I don't know, products and services and companies that want to offer us things to build our models. But we've developed most of those things kind of like in-house. There's no need for us to like outsource that because it's critical to our business. It's critical to the research that we do.

30:32Right, that makes sense. And so it's more of a, I would say, like the Apple playbook where you have to build the entirety of the stack or like SpaceX. You have to build like almost to the nuts and the bolts. The value there is that allows you to have a lot of control. If I need to change something on my model or in my e-training infrastructure, I can just do it. It's difficult. It's way difficult because you have to build pretty much every part of it.

30:54Kara Swisher:But obviously, you have competitors with a lot of deep pockets. Google has a market cap of$2.8 trillion. Meta's is$1.9 trillion, give or take. OpenA's latest valuation was around$500 billion. And after your last running around, it's nothing to sneeze at. Runway was valued at$3 billion, but that is kind of small. Again, I don't want to play that down, but you're a comparably small company. and the CEOs of those companies all had dinner with President Trump at the White House last week. I noticed you weren't there, but don't worry about it. I feel better about you because of that because they were toadies upon toadies.

31:23Kara Swisher:How do you or other small AI companies compete with those deep-pocketed tech giants who are trying to get any angle they can in this sector? It's just relentless execution. The best product experience. It's David versus Goliath. These companies need to be challenged. Like we can't believe in a world where there's like one or two companies deciding every single product and experience we have. I think companies like Runway are trying to question that to the core. And I think part of it is we need to recognize if we succeed, we're going to attract them to try to even compete more with us. I think it's fine.

32:00We've done this for quite some time. We've had a lot of competition come and go, but we're still here.

32:05Kara Swisher:So what is the slingshot then? What is the weakness they have from your perspective? And what's the strength that you worry about? I think, look, I'll tell you a story I've heard recently from one of our clients and customers. He's a head of a studio. He has made movies that you probably have watched multiple times. And many folks in the audience might have watched multiple times. He told me that the reason that they can go with any of the large companies is that they fundamentally don't understand what they're trying to do. And so there's a little bit of that argument that it comes across just like the wrong way when you show some filmmakers like an AI tool and expect them to use it.

32:44And it feels a little bit, I would say, rub them the wrong way. We're different. We come more from like, I would say, a similar background to them, to the type of problems they want to solve. And we sit with them understanding the challenges of making something like a feature film or a commercial or an ad or a short film. And the tools that we build are with that in mind. And so from a user perspective, I would say there's something around knowing who you're solving for and understanding their pain that I think it's different for the people working in the arts and in media. And I think that for us has been a huge advantage for our time.

33:20I mean, they wanted to work with us and not with everyone else.

33:23Kara Swisher:Right. What's the thing you worry about? Is it just the money and their aggression? Or what is their… What do you mean from them? From competition? From them, yeah, from the bigger competition. I get it. Netflix ran circles around all of Hollywood, right? Correct. You know, there's example after example. There's also example after example of getting run over, right? Sure. Yeah, I mean, you have to just, like, keep that in mind. I do feel like if you just look, like, practically at what has happened over the last couple of years, all you're saying is true. All of these companies have a thousand times the budget we have, a thousand times the researchers and the engineers that we have, yet we're still winning on the best at what we do.

33:59So there's an argument to be said that that shouldn't be the case because all these companies have just invested way more. And they have. They have invested way more, yet they still can do it. And I think part of it, again, is it takes a different set of cultural intuitions and priorities to try to lead the way and be the one helping versus trying to catch up. I think a lot of these large companies are playing more of a catch-up game, which I think is something we're thinking about, of course. There's still competition. Right. But I think catching up is just different if you're trying to, like, make sure you're in the edge and you're helping customers, like, understand what's next versus just selling whatever the market has already, like, established is the thing.

34:39Kara Swisher:So OpenAI, Meta, and Google are offering these huge salaries, tens of millions, hundreds of millions to recruit AI researchers and engineers. Is that a difficult thing to deal with, these salaries? Because that's something that's affecting the whole market, I think. I don't know. I don't know how much of that narrative is actually true, to be honest. I think it's definitely like a good story and a good headline, but I don't think it's that true among the larger research industry. And I've compared notes with other companies and our researchers, and it's not that everyone is getting that. So I don't think it has affected most companies, to be honest.

35:15Kara Swisher:In the way, it's just a big story. That's a very good point. Yeah. Speaking of which, there was reporting earlier this year that Meta was looking at Runway as an acquisition target. Fort bought a huge share in scale AI and Aqua hired Alexander Wang. You said you're hitting an inflection point. It's getting too exciting for you not to be independent. As someone who has stayed independent myself, I get the attraction. And everyone was going to kill me. And I'm still standing. And they are not killing me. I imagine it's still very hard to stay independent when the checks keep getting bigger and bigger.

35:44Depends on what you're trying to, like, obsess around and, like, work around. Again, I don't see myself doing anything else. and like building runway. And so the team, I feel, is very similarly to that. And I think for us, like thinking about selling the company around, it will be a mistake. Like we're getting to a point, as I was saying before, it's an inflection point. The models are getting good. Adoption is growing. It's the most fun. It's like probably like similar to when you went independent. It's like now is the most exciting time to work on this. I think that's my north side right now, just making sure we can keep doing that.

36:17Kara Swisher:Meaning that you're doing well. So why should you? I just was actually talking to someone about a sale of a media company. I said, you don't sell if you're doing great. Yeah, of course. You sell because of another reason. Do you feel like you have enough control over the company to be able to resist that? Yeah. You feel like you have that if there's some crazy number came in from somebody. One of the dark flip side is we talked about the huge salaries for AI engineers. A lot of workers, as I said, in the film and advertising industry could lose their jobs, everything from actors to animators. And I know tech people always say there will be new jobs.

36:48Kara Swisher:How do you calm those concerns? What is your patter about that when you're trying to make deals with the film industry, including unions? This has become a rallying cry for them. So what is your best argument for them when this is the concern? And especially because no one quite knows, as you said, what it's going to be yet. um well first of all engage with them i've met with the unions themselves with the with the guilds and i think part of it is again helping understand what this this technology actually does and how you can benefit from it um i think my overall summary has been focused on people rather than jobs like jobs change technology will change jobs all the time look at the history of film is a history of technology it has changed many times before through many of the decades we've seen And it wasn't really about the jobs as much as like the people doing the jobs.

37:43And so if you're hiring people, if you're a guild member, if you're in a union, like, well, help your people understand how to use these tools, like train them, get them on board with the latest, understand how they can upskill what they already know. I think it changes a little bit the perspective. And I think that's been my position so far. I think it's allows us to work alongside them in much more productive ways.

38:05Kara Swisher:We'll be back in a minute. Thank you.

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39:59Kara Swisher:One of the things I think many people in Hollywood are worried about is the more realistic gen AI video gets the bigger concern for privacy and for security. Con artists are using deep fake videos of celebrities and pro athletes, but also everyday professionals like doctors to scam people out of money. It's a huge issue also for lawmakers. It's gotten their attention. There were deep fakes of Congresswoman Alexandria Ocasio-Cortez and Senator Amy Klobuchar circulating early this summer. President Trump, of course, has reposted doctored videos, including one that portends to show President Obama being arrested in the White House.

40:33Kara Swisher:Talk about this issue, because one of my big things is many of the big tech companies have no interest in safety whatsoever. But what are you doing or willing to do as a company to prevent your tools from being used for scams or even political manipulation? It may not be your full responsibility, but it certainly is partially your responsibility. Yeah. Well, I can't really speak about other companies and their approaches, but I can tell you about ours. We take it very seriously, and I think that's why most of these studios want to work with us. and are approaching us and have adopted Runway. We have a trust and safety team.

41:07We have a terms of service. There's stuff that we won't allow you to generate. I think there's a particularly consistent approach towards moderation and safety. And again, part of it is us doing things, but also learning from who we're working with. There's a little, I think we've erred sometimes on the side of being too safe. We've moderated people from users, their own likeness at Runway. And so if you come and you try to generate with your picture, we might block you. and you're like, but it's me. Like, I can do it. And so it's a hard problem because you want to make sure people understand the right way of using it.

41:41And I agree with your point. It's not that run we will solve and we'll have all the answers to a question like that. I think a lot of it has to do with just the social and cultural implications of how you help people understand what they can do and come to a world where it's going to be perhaps different from what you've seen media before. I do feel that a lot of the questions around likeness are still somehow the same that we've dealt with it before without AI. You can still get in trouble non-AI by recreating someone's likeness. That doesn't change. You still should be responsible how to use the technology itself.

42:16And it's in the user's best interest to make sure they're using it the right way.

42:20Kara Swisher:Would you support Congress codifying guardrails that were specifically related to AI? I think there needs to be norms and changes on regulation to adapt to AI. That's a reality. It's like laws change to adapt to the internet. I'm not sure how and when, to be honest, because it feels very early still. And you need to make sure you understand both innovation as an incentive for companies to keep making progress and the challenges that will come around. I think that we will and we need. I'm not sure just exactly like when and how. Speaking of which, the EU's AI Act now mandates that AI-generated content be clearly labeled and have watermarks.

43:03Kara Swisher:Right now, consumers in the U.S. pay a premium to get non-watermarked videos from Unway and other AI companies. It's part of your business model. Would you support regulations mandating watermarks or labels that would ensure that it's identifiable in some way? It doesn't necessarily have to be a watermark. There might be another system. There are different systems. We've experimented with a few. I think it's also a hard problem because there's ways of removing the watermarks. And so I think part of it is there's a technical challenge around how do you make sure you can keep watermarking and identifying things.

43:32And at the same time, I think there's more of a cultural and social watermarking of sorts. And I think we've done this before with Photoshop. People were freaking out with the idea that you can modify images back in the 90s. And I think eventually Photoshop became a verb. It was like, oh, you can just Photoshop things. I think we need somehow something similar here where you're becoming a bit more skeptical about what you see because you've seen how things can be modified. And that's just a social kind of update.

43:58Kara Swisher:Sure, but is there a technological... I mean, everyone can get around everything. I'm not naive, but should there be some sort of new provenance system for these materials? Yeah, there's an argument. You know, I heard the other day an interesting argument where we should do the other way around, which is you should validate and watermark the real content. And I think maybe that already is happening in some way where like if the amount of content given AI will expand exponentially and like you have just way more things, then we should kind of reverse maybe the question and be like, well, what actually like is editorial and it's real?

44:32And then protect or like make sure that those are verified. And look, in a way, I think that happens already. You have like community nodes in like social media. You have companies or brands or institutions that you know you're going to trust when it comes to like knowing if something is real or not. And so in a way, I think the system and sort of heading towards that space.

44:51Kara Swisher:Although you could say that that was when YouTube was telling all the companies, well, find it and we'll take it down. But that was all the work came from them versus YouTube, which was benefiting. You can also automate that with AI. You can use AI to help on that curation, a sort of process as well. Eventually they figured out and they're doing rather well with it. So last question in this area. Last week, President Trump was asked about a video of what appeared to be a black garbage bag being thrown out the window at the White House. It really was one. It was real. But Trump said it was probably AI generated.

45:18Kara Swisher:Then he told reporters, quote, if something happens, it's really bad. Maybe I'll just blame AI. Thoughts on AI video being used as a get out of jail free card from a particularly specious politician in a way to undermine public trust in reality? Are you worried about that? That's an interesting question. I think what happens actually with those kind of like questions is that we socially get and culturally get much more attuned to like identifying what's real and what's not. and probably him saying that made a bunch of people go and like debunk the video. And so it almost feels like if there's video evidence, it's easier to like debunk something versus if it's not.

45:57Like there's a lot of fake stories out there that are just words, you know, that's just like, oh, I saw something. Someone told me about it, but it's hard to debunk because you can't see it. I don't think it's going to go that far, to be honest, to rely on videos because it's very easy to see if it's real or not. I think that happened with that video. People were like, yeah, it's real. So in a way, I think it casually creates...

46:17Kara Swisher:He wants to cause chaos everywhere he goes. But it doesn't last too long. My feeling is that it's not going to be there for a long time, to be honest. Before we go, I want to talk briefly about the areas you're looking in the future. You've taken some first steps into gaming, which includes non-linear storytelling and robotics. I didn't even understand. I kept trying to figure out what the hell you're doing there. Talk about the potential for Gen AI video in these areas and what challenges do you need to overcome? Yeah, we've been trying to a couple of new avenues for our research and products, as you were saying, nonlinear stories.

46:50And so you can think about all the work we've done until this point publicly has been around films and ads and videos. And that for me is linear media. You watch something and it looks the same every time you watch it. If you think about games, those are nonlinear, right? You can move around the world in open ways. There's a lot of use cases around AI, specifically when it comes to real-time video AI, that allows you to create game-like experiences. And so we are now releasing a couple of products on that front. And now, if you think about how you use these models to create those kind of experiences, the outputs are just pixels.

47:21They're just moving images, which is not that different from how you train robots to understand the world. And so let's say you're training a robot to understand how to pick a box. What you do is you show the model or the AI a bunch of different videos of people picking that box. So the model understands, here's how I use my robotic arm to pick that box. Now, that's a very expensive thing because you have to create that actual picking of the box. Of course, you can think about that extrapolated to a thousand examples and it gets really expensive really fast. And so there's use cases of hard technology where you take the same insights of how you generate video for film, but you use it to train robots.

47:58And the robots can learn from that, like, synthetic or generated set of videos. It's something kind of new, and it only was possible because the models are getting good at it.

48:06Kara Swisher:Actually, that's how I was there when ImageNet started, and that's how they did that. Like, this is the Eiffel Tower. This is a man. This is a woman, you know. And then it iterated from there, which is the original one. Yeah, it's close to that. What are the challenges you need to overcome? What is the biggest challenge in this area with robotics, for example? For robotics, I mean, it's just getting good, high-quality data that, like, fits the specific needs of different robotics-like teams. Their company is solving different things. So driving cars on one end, I don't know, there's, like, robotic arms on other ones.

48:36There's, like, physical interactions in homes. I think robotics is a field that's moving very fast, and part of the things that it needs to keep on moving is data. It's just very hard to gather that data to train the models. And so, yeah, good data.

48:47Kara Swisher:And gaming is a huge industry. That's an obvious one. Of course. And in that way, what's the challenge there? I think the challenge is there's both. There's a real-time component to it. It's like, how do you make sure these games are rendered fast at the expectations that users are expecting for a game-like? And also, I think the mechanics. So what I mean by this is if you think about a game, you're playing something that someone already created. And so the rules are very defined. The characters are defined. In this AV of AI video, you can create worlds that no one has ever defined. And so the mechanics are open.

49:22And so the challenges there about, well, how do you make sure people have a story to follow? And what are the rules of that world? You might not be designing every single interaction. You might be designing the way you want things to behave overall and then have the system kind of like play it out. And so there's a lot of mechanics around the experience that I still need to figure out.

49:39Kara Swisher:So last question, you co-founded Runway in 2018, which seems like a million years ago. It's hard to state how much has changed in this field since then. And if you look down the road two, three, five years, what does Runway look like? Are you providing AI service to films and studios and agencies? Or have you expanded to become an original creative studio yourself? That's certainly possible. What would you imagine the next step in the evolution that will allow it to come into the companies, the dozen AI companies that survives in the long run? You know, we've always thought about Runway as a company focused on storytelling more than anything else.

50:15And our goal is to make sure that there's many stories out there that we haven't heard from before because people haven't had the means to tell those stories. And we want to be the company who's creating that new kind of camera, the new device that allows you to tell those stories. And those stories can be for AAA filmmakers making Hollywood movies, but also could be for you in your home and for your friends. And there's many opportunities around storytelling that I think we haven't kind of like tapping before because technology hasn't allowed us to get there. I think five years, 10 years in from now, I think we want to be at the forefront of that new wave of storytelling.

50:51Kara Swisher:But does that mean you become an original? I mean, you're calling yourself a camera a lot, but are you the director or the writer or the what? We're experimenting with making things in our own studio. But I think the broader opportunity is to make sure that the billions of people out there can make things. I think from a personal note, I've always wanted to be a filmmaker. I grew up in Chile. I never had the means to work around film. And I think there's many people like me back then that if they had just the right resource from a technological standpoint, maybe they're great storytellers, they're great filmmakers.

51:21I think I want to empower them more than anything else. That's what drives us.

51:25Kara Swisher:What would your movie be? I don't know. I have... Look, I'm making... I was on The Weeknd just now making a bunch of short films with runway and short ideas. And they're not like blockbuster movies. I don't want to like become a filmmaker and devote myself to it. But it's great to like, I had this idea, experimented through it. I make it and I made like four or five minutes of that scene. And I feel great. It's amazing. It's like painting. It's like writing. There are many people out there who are obsessed with AI because of that. It's an avenue. It's a way of cultivating your creative mind. That for me is extremely valuable more than anything else.

51:58Oh my God.

51:58Kara Swisher:Now everyone does want to become a director and will, you know, that old thing. Why not? But I mean, if they can, they should. Some people shouldn't become a director, but we'll see. I really appreciate it. What an interesting company you have. I really like to talk to smaller companies. I'm so tired of the large companies. I do hope they don't run right over you. I do, because I think it's... No, we'll continue. I don't necessarily think they will, because I think they're the least creative people on the planet. So in many ways, that's in your favor. Anyway, thank you so much. I really appreciate it.

52:32Thank you. It's been great. Great job.

52:39Kara Swisher:Today's show was produced by Christian Castor-Bussell, Kateri Yoakum, Michelle Eloy, Megan Burney, and Kaylin Lynch. Special thanks to Catherine Barner and Eamon Whalen. Our engineers are Fernando Arruda and Rick Kwan, and our theme music is by Trackademics. If you're already following the show, you are David, not Goliath. If not, find a slingshot stat. Go wherever you listen to podcasts, search for On with Kara Swisher and hit follow. Thanks for listening to On with Kara Swisher from Podium Media, New York Magazine, the Vox Media Podcast Network, and us. We'll be back on Monday with more.

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