That deal. How real is it? The process, the production of making a film in partnership, using your technology? Yeah. So it's a first of its kind kind of deal. And the idea behind it really is to tag the Lionsgate team further with the technology. But we're at the crossing point where A.I. is becoming really useful for filmmaking, and so we really want to make sure is that we help creatives, filmmakers, artists, studios really understand how to use it in the best way possible. And so what we did with Lionsgate, it's, I think, something we've been trying to do for a long time, basically to bridge the gap between A.I. and Hollywood and bring this technology in much more accessible ways to many folks. As you know, I love the detail. Yes, the things we talking about filmmakers at Lionsgate, sitting at a computer using your your your software

as part of that process. Yeah, that's kind of the point. There's many times in the development of a movie where you can in bad A.I. or our models and make that cheaper and faster. Right? So if you're iterating through storyboarding or previously sessions or visual effects, you can use our models and filmmakers are now understanding how to use this models in ways that are very useful for that. I think that's the key aspect of it, which is for a long time it has been seen as this kind of AI system that creates movies on its own right, and it's really not like that. It's really a tool for directors and filmmakers. And with the Let's get deal where we really want to make sure they they understand is that they can take that further for the movies and becomes really a cost effective tool to use. So again, if you're spending hundreds of dollars in making a shot, making a visual effects scene, you can now use

runway to kind of reduce that cost and move faster and to a better result. You've been improving your models. Yes. How costly does that remain? There's definitely research that has to be done to train the models and the person, but then running the models and using them has become much more cost-effective over time. And I don't think we're yet at the point where you will see an optimization like we're going to optimize the models even more so the costs of running them will be even cheaper and faster. Let's just talk a little bit about that. For as you're building your offering, you're winning over new clients like Lionsgate. We think about where we were this time last year. We think about Hollywood in strike mode because in large part because of artificial intelligence. What sort of conversations have you had to have to get people comfortable with this technology? Well, the first thing that I think is important to remember is that Hollywood is the history of technology.

Like we are here because of a criminological breakthrough. Right. And so we sometimes forget that art and technology kind of come together always. And for us, it's like this redefined a little bit of technology. Again, if you understand it, it's a tool for humans. Then it changes the narrative and it's less about fearing it and more about embracing it, and you realize how you can actually use it. And I think what we need to do right now is kind of like educate more and show the potential. There's also challenges of the technology. It's not a perfect kind of technology. It's not a perfect tool. There are things that are not exactly working as they should, but that's kind of the point. So you need to improve them and make it even better. And I think part of it is just like showing more people, more producers, more Hollywood studios, really the potential of it and use it.

Chris About Caroline and I use text to text, text, image, text, video tools every day. I love technology, but I also just love film. Yeah, and there comes a point where I just want to ask if I really can give the same feeling, create film and movie and content that is as authentic as the great filmmakers can make it with their hands and their eyes and camera. What do you think about that? Well, the interesting thing is filmmaking and stories and art are never really about the technology, are about conveying feeling and emotion, are about connecting with the viewer and telling and making you feel something, right? You never watch a movie because how it was made right, or the cameras that were used to make the movies. Once you're a real nerd like me. Yes, but maybe even though, like for the fact that you like the movie, right. You can go deeper into how it was made. But 99% of the world watch the movie

because they feel something because they connect with it. And so, yeah, if you think about it as a tool, it can help you kind of connect with your audience, can help you deliver that message, can help you tell a story. And so right now, I think we're fascinating. But the technology itself, because it is fascinating, it's revolutionary, it's changing the game. It's incredibly new and exciting. But at the same time, if you want to focus on art and filmmaking, it's important that we switch the narrative to storytelling, to people, and to how they use it and how they convey stories with technology and less about how which A.I. or which technology was used behind the scenes. You've been telling stories to raise money, and you've got some really interesting investors because not many of them are going to be in the world of art and creation. In fact, you've got Nvidia, Salesforce. What do they want to see out of you?

Why do you have this? A strategic investor's coming on like an invader. And what do they earn you? Well, I think they are. They are telling stories, and their users are also telling stories. Again, you can think about storytelling as Hollywood, as media films, but you think about companies. Companies are also telling stories when they're advertising, when they're doing marketing, when they're communicating with their users. And so if you can help them also deliver better messages, then that's also a form of storytelling. Perhaps it's not as the art form, but it's still like a former villain. We want to make sure we can work with companies like that that are great and have been great partners for us for at least a year. I've been hearing about Runway, and your name comes up a lot. Open Air has Sora on the show. In the last week, we talked about matters New tool. Yeah, but you have a very singular focus.

Where do you think you stand in your competence and as a business relative to that competition of open air matter? Yeah. Look, when we started this seven years ago, it was a very new field, and I think we've proven over time that it's a really exciting and worthwhile field to spend time in. It's an industry that's going on, it's changing. And I think when you create a market and you create a good opportunity, you will have competition. I think it's unreal to think that no one else will try to build what we're building. But at the same time, we're very much in the long-term horizon strategy. Like everything we're building, it's not really about video to the end; it's around everything else that we can build to create better tools for storytellers around the world. And so video is only a first kind of stepping stone, but working towards audio, towards images, towards 3D. Just a collective system, a collective

set of tools, and a system that can help you in all forms of storytelling. So you want to tell who you raise some more money for that long. We will have to do whatever we have to do to deliver on that mission. You will have to work within kind of like racing almost every year from now since we started seven years and an IPO. We're just focused on building right now.

How Runway Tells Stories Using AI in Hollywood

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