Juggler's Journal!

Bubbles & Bytes: Sora!

Today’s track on the boombox:
Tapes ‘n Tapes – The Dirty Dirty
https://www.youtube.com/watch?v=zyS1m_qNLuo

Photo by TomDansken. Available for free use
under the Pixabay Content License.

For those of us who have witnessed several financial crises throughout our lives, it’s easy to understand why many see bubbles in the world of AI. Strictly speaking, the market is exhibiting behaviors similar to those seen in the nineties: excess supply, exorbitant investments, and disruptions in related services. Pets.com generated losses with every sale it made, yet the promise of being the “future” of pet products kept it as a money magnet, as long as the site could become the next Amazon (https://www.npr.org/2020/11/11/933951757/the-lessons-of-pets-com).

Today, the landscape is much the same. While practically every washing machine now sports an AI label and new intelligent tools appear daily promising to change our jobs forever, there are ominous winds blowing. Whispers of past fears, limited resources, and Middle East’s current situation keep the prices of RAM in total uncertainty (https://www.pcmag.com/news/can-googles-ai-memory-compression-algorithm-help-solve-the-ram-crisis). In the midst of this chaos, OpenAI has announced the closure of Sora, its video generation application (https://www.bbc.com/news/articles/c3w3e467ewqo).

This news is significant. The shutdown also meant canceling a multi-million dollar contract between OpenAI and Disney, a partnership that in 2025 seemed to be the ultimate seal of approval for the industry. However, even the backing of entertainment giants hasn’t been enough to achieve profitability—a key trait shared with many failed .COM companies. Furthermore, being a pioneer in the intelligent assistance industry guarantees nothing in a race against rivals like Google or Anthropic.

However, the dot-com bubble of the nineties was not the only one of the contemporary era. Following the 2008 housing crisis, the risk models of the international banking industry had to be questioned and overhauled. Just as the solid Basel II agreements were replaced by the stricter Basel III regulations, markets today seem to be learning to be more cautious when yellow flags are raised. In that sense, if OpenAI’s decision is to close a business line that is not profitable, it is actually a positive signal for investors and the market.


I agree with many colleagues and friends who question the lack of results and share the concerns of investors. This is especially true for those following Oracle news closely, as they serve as a thermometer for the physical infrastructure and cloud spending that powers these models.


Personally, I believe there are lessons learned from the past and situations that are bound to repeat themselves. Whether OpenAI will become the Altavista of decades past, only time will tell. In the long run, many of the ideas and platforms of fallen companies ended up being the foundations for the future. Those .COM sites that offered grocery delivery simply demonstrated that their flaw was simply the timing of their launch, not the idea itself. OpenAI will likely retain the data generated by Sora, so they may still surprise us in the future. The best thing you can do is learn to use some of these new tools. If you are an investor, perhaps it will at least distract you a bit from the chaos.