CNBC’s Julia Boorstin joins 'Money Movers' to discuss Hollywood's high stake AI investment.

Hollywood

The release of Open AI's ChatGPT has accelerated the development of artificial intelligence and warnings about its impact on society.

Rise of AI

Hollywood is experiencing a significant shift as artificial intelligence (AI) tools become increasingly integrated into film and television production. The annual AI Film Festival, hosted by Runway in partnership with IMAX, highlights the growing use of AI-assisted short films and the industry's complex relationship with the technology. Major studios, including AMC Networks, Lionsgate, Netflix, Fox, and Disney, are experimenting with AI tools to enhance visual effects and manage production costs, with some productions using AI to generate dozens of shots.

Industry projections suggest that generative AI could reduce production costs by up to 30 percent. However, this technological advancement has raised concerns among actors' and writers' unions about job security and the preservation of creative roles. Legal disputes, such as Disney and Universal's lawsuit against Mid Journey over intellectual property issues, underscore the challenges Hollywood faces as it seeks to balance innovation with protecting the interests of its creative workforce.

Hollywood's high stakes AI moment

The annual A.I. Film Festival, hosted by the startup Runway, kicked off yesterday in partnership with IMAX. The festival features A.I.-assisted short films, but might also represent Hollywood's increasingly complicated relationship with the technology. Julia Boyston digs into that for today's Tech Check. Hey, Julia. Hey, Carl. Well, this is a high-stakes moment for Hollywood. Studios need A.I. tools to help them cut production costs, though A.I. does risk drawing backlash from creators and fans, and it could raise concerns from the actors' and writers' unions. And studios also need to work to protect their intellectual property on these new platforms. Now, one winner so far, Disruptor 50 company Runway A.I., valued at about $3.5 billion. It recently launched new A.I. tools to edit scenes. A prompt can add fog in the background or remove the car. Now, Runway is holding its third annual A.I. Film Festival this week, showcasing short films created with this technology. This is the first year that IMAX is partnering to screen the top A.I. films at 10 U.S. locations. Runway has deals with AMC Networks and with Lionsgate. Sources tell us that Netflix and Fox are also customers and that Disney has experimented with the tools. Amazon Prime Video's historical series, House of David, used Runway and other A.I. tools to create over 70 shots throughout the show to help address budget constraints. Now, sources across the studios tell me that it is not winner take all, that they are using a range of A.I. tools and hiring new employees to integrate A.I. software. Another leading A.I. startup, Stability A.I., has drawn James Cameron as an investor and a board member. He's helping the company develop tools to streamline pre- and post-production processes, such as visual effects and editing. It's also partnering with studios to train specialized models. Now, the financial implications of these A.I. tools could be massive. Morgan Stanley projects that generative A.I. tools could lead to up to a 30 percent decrease in costs for film and TV companies. This all comes against the backdrop of Disney and Universal teaming up to sue another A.I. company, Mid Journey, calling that company a bottomless pit of plagiarism. So, Carl, a complicated time here. Yeah, it feels like there's a lot of thorny issues to distill here. How do the multitude of unions view this technology and are there guardrails in place to protect the workers who are a part of those unions while also setting kind of expectations with the studios? Well, as you might remember, Leslie, the WGA and SAG, the Writers Guild and the Screen Actors Guild are very concerned about the role that A.I. might play in hurting their members and their ability to work in the industry going forward. Now, what's interesting is what I'm talking about here is not anything that would threaten writers or actors. It's really about visual effects. For decades, forever, Hollywood has used visual effects. What's happening now is that those visual effects are powered by generative A.I. So I think it is a very touchy issue with those guilds. They want to make sure that actors are not going to be replaced by A.I., that writers are not going to be replaced by A.I. And I think what we're increasingly seeing is this question of who's going to be able to manage these questions sensitively and make sure that they're using A.I. to streamline, to cut costs, but also are preserving the filmmakers and all of those elements that make content made by Hollywood appealing. Right. I'm still thinking to David Ellison's interview with Faber a week or two ago, where he talked about the ability to, say, wash a script through the script doctoring process with more frequency before it actually goes to market, which doesn't necessarily displace a writer, but certainly leans on the technology in ways that we haven't seen before. Yeah, before there would be a storyboarding process where you might take an important scene and have literally a drawing of the key moments from a scene so the producers, the director could really visualize what was happening in that scene. Now, you could visualize it by taking a script and turning that into sort of a visual storyboard. So you still need the writer there. The question is what A.I. tools help you bring that to life. Yeah. It's a far cry from the days where Ridley Scott would draw 200 pages of the Alien storyboards before selling it to Fox. Julia, talk soon. Julia Boorstin, this morning.

Hamas on Monday informed mediators that it had accepted a ceasefire deal proposal submitted to it the day before, according to international and Israeli outlets.

Jerusalem

Middle East Conflict

Reports: Hamas accepts latest Gaza ceasefire proposal

Hurricane Erin will bring dangerously rough surf to parts of the U.S. East Coast. Over the weekend, Erin's outer bands lashed Puerto Rico with up to 7 inches of rain and flooding parts of the island.

East Coast of the United States

Erin expected to bring dangerous conditions to U.S. East Coast

Ahead of his Monday meeting with President Trump, Ukrainian President Volodymry Zelenksyy says his country will not give up any territory to Russia, even as the White House insists potential land swaps will be necessary. Willie James Inman reports.

Kyiv

Ukraine Invasion

Ahead of Trump meeting, Zelenskyy says won't give territory to Russia

Thousands of Israeli protesters demanded a deal to secure the release of hostages still held by Hamas in one of the biggest demonstrations since the war in Gaza began. Debora Patta reports.

Thousands of Israelis protest in Gaza, call for end to fighting

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Paris

European leaders stress unity with Ukraine ahead of peace talks

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Israeli military prepares to move Palestinians to southern Gaza

Thousands of people took to the streets on Sunday in a nationwide strike amid fears further fighting could endanger the 50 hostages believed to still be in Gaza.

Tel Aviv-Yafo

Dozens of Israelis arrested in protest to demand end to Gaza war

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Anchorage

Trump told Zelenskiy that Putin wants more of Ukraine, source says

Efforts by Texas Republicans to redraw the state's congressional maps got new pushback from protesters at rallies across the country Saturday. Nearly 280 events took place in 34 states, according to organizers.

Washington

"Fight the Trump Takeover" protests held across U.S.

West Virginia's governor says he will send up to 400 National Guard troops to the nation's capital at President Trump's request. They'll join other National Guard troops and federal agents already deployed with local police on the streets of Washington, D.C.

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President Trump reversed course Saturday, saying he is no longer seeking an urgent ceasefire in Ukraine, but now agrees with Russian President Vladimir Putin that pursuing a peace deal is the best way to end the war.

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Russian President Vladimir Putin described his meeting with President Trump as "frank, substantive and bringing us closer to making the necessary decisions." But the Alaska summit couldn't have been more far removed from the battlefields of Ukraine.

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Being a Category 1 hurricane, Erin underwent a 'rapid intensification' which helped the storm to grow and strengthen to a powerful Category 5. Hurricane Erin won't make a direct hit on the U.S., but it will produce dangerous surf conditions for the entire East Coast.

San Juan

Hurricane Erin 'rapidly intensifies' to a Category 5

The Washington, D.C., police chief will remain in command of the local force following a settlement with the Trump administration over the federal takeover, but they are required to cooperate with the White House's immigration policy.

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The Atlantic Ocean's first hurricane of the season, Erin, has continued to gain strength and currently sits off the coast of Anguilla.

Hurricane Erin strengthens in the Atlantic

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Israel's far-right finance minister approved the construction of a controversial new settlement in the West Bank, saying it "finally buries the idea of a Palestinian state." But it's unclear if this move will actually go through. Rights groups swiftly condemned the plan.

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Ukrainian President Volodymyr Zelenskyy met with British Prime Minister Keir Starmer in London. This comes one day before U.S. President Donald Trump is set to meet with Russian President Vladimir Putin in Alaska to discuss a possible ceasefire in Ukraine.

London

Zelenskyy, Starmer meet ahead of Trump, Putin summit in Alaska

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Hollywood's high stakes AI moment

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Rise of AI