Critters as a proof-of-concept for AI feature film

Edward Saatchi has been building at the frontier of AI storytelling for a decade—from Oculus Story Studios to Fable (where his AI character Lucy made her own films at Sundance) to his current venture, Amazon-backed Showrunner. His thesis is provocative: AI-generated content is stuck in a four-year rut of short-form experiments with no commercial marketplace, no monetization path, and no artistic value. Creators are working solo, making 10-second clips that can't compete with Rick and Morty or Netflix originals. The solution? Band together, make features and TV shows, and build platforms where creators get paid every time someone remixes their work.

Edward's most audacious project proves the point: reconstructing Orson Welles' lost masterpiece, The Magnificent Ambersons (44 minutes destroyed by studio cuts in 1942), using motion-capture actors and AI to seamlessly restore what was erased. The irony is intentional—it's a film about technology destroying beauty, restored by technology. Edward's approach isn't text-to-video slop. It's human performance driving AI synthesis: hire stage actors, capture their performances, use the original cutting continuity as a blueprint, and let AI fill the gaps. The result is cinema-quality work that would cost $100 million traditionally but costs $10 million with AI assistance.

In AI XR News This Week:

Amazon announces 16,000 layoffs (mostly middle management) while ramping robotics—replacing humans with machines in warehouses. Amazon Go and Amazon Fresh stores close after years of investment; the self-checkout convenience experiment dies. Snap spins off Spectacles AR glasses into a separate business, signaling lack of cash or confidence. Apple and OpenAI both developing AI wearables to launch in 2027, powered by Gemini and Google AI. Google launches Project Genie, a generative AI model that creates fully interactive 3D game worlds you can navigate and remix in real time. Walkabout Mini Golf (one of the 10 most popular Quest apps) lays off half its staff. Atlas V, the acclaimed French VR studio behind Spheres and Battle Scar, pivots to location-based entertainment. Darren Aronofsky launches an AI animated series on YouTube called On This Day.

Key Moments Timestamps:

[00:05:00] Amazon's 16,000 layoffs paired with robotics expansion; the canary in the coal mine for white-collar work

[00:06:00] Amazon Go/Fresh failure: humans reject automated futures when given the choice

[00:07:14] Snap spinning off Spectacles; Ted's thesis on AR glasses remaining "exotic," not mainstream

[00:10:00] Apple wearables running Gemini + Google AI; the winning formula for wearable AI domination

[00:12:48] Walkabout Mini Golf layoffs and Atlas V's pivot; VR right-sizing continues

[00:15:25] Google Genie: generative 3D worlds, playable and remixable in real time; Epic should be scared

[00:19:11] Edward Saatchi joins: the state of AI video and why there's no marketplace after 4 years

[00:22:00] Edward's concern: AI content is "derivative but worse" with no commercial value

[00:28:00] The marketplace problem: no buyers, no revenue, no sustainability for creators

[00:34:00] Ted's thesis: AI is quietly disrupting VFX and screenwriting behind the scenes

[00:44:00] Critters: the proof-of-concept for AI-assisted theatrical animation ($10M vs. $100M traditionally)

[00:49:00] Showrunner's business model: creators earn money every time someone remixes their show

[00:52:00] The Magnificent Ambersons project: restoring Orson Welles' lost masterpiece with AI

Edward makes a case that reads like a manifesto: AI's killer app isn't making derivative work faster or cheaper. It's remix, interactivity, and personalization at scale—letting audiences co-create with AI while creators get paid. His challenge to the industry: hold yourself to "derivative but better" (can you make a better Simpsons episode than the last 15 seasons?) or "original and good" (something from a non-human intelligence's perspective). Until creators band together to make features and TV shows with commercial value, AI video will remain stuck in the trough of disillusionment.

This episode is brought to you by Zappar, creators of Mattercraft—the leading visual development environment for building immersive 3D web experiences for mobile headsets and desktop. Mattercraft combines the power of a game engine with the flexibility of the web, and now features an AI assistant that helps you design, code, and debug in real time, right in your browser. Build smarter at mattercraft.io.

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