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The Hidden Layer
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Ian Krietzberg Ian Krietzberg

Welcome to The Hidden Layer. I’m Ian Krietzberg.

We’re getting deeper into September, which means chillier mornings, shorter days, and the start of another school year. Of course, the growing use of A.I. in education remains as contentious as it was inevitable. So today, I’m looking at how the technology is getting integrated into schools, whether schools want it or not, and how educators are responding. Plus, my partner Eriq Gardner swings by to weigh in on Warner Bros. Discovery suing Midjourney and Anthropic settling its copyright case.

Also mentioned today: OpenAI, Oracle, Safra Catz, Elon Musk, Larry Ellison, Donald Trump, Linda McMahon, Miriam Reynoldson, Helen Choi, Melanie Dusseau, Chris Miciek, and more.

Let’s get started…

Eriq Gardner Eriq Gardner
 

Notes on the Entertainment–A.I. War

  • Warners’ A.I. rivalry: A few months back, I gave Warner Bros. Discovery a proper thwacking for not joining Disney and NBCUniversal’s lawsuit against Midjourney, the A.I. image generator responsible for spitting out near-exact replicas of characters like Darth Vader and Homer Simpson. C.E.O. David Zaslav, I suggested, had too many plates spinning at the moment to worry about artificial intelligence. Now, the cavalry has belatedly crested the hill—Bugs Bunny, Batman, and Rick and Morty in tow—waving a complaint of their own.

    Technically, WBD’s copyright infringement suit against Midjourney, filed last week in California, is a separate action. Practically, though, it’s the same marionette show, with Jenner & Block using an identical copyright playbook, which has already been stamped “related” to Judge John Kronstadt. Odds are, the cases get consolidated, and the litigation proceeds as though WBD hadn’t shown up late, mumbling about costs and priorities.

    Still, Zaslav’s tardy arrival spotlights a few under-the-radar developments. Disney and Universal portrayed Midjourney as a “copyright free-rider and a bottomless pit of plagiarism,” threatening an entire industry. The WBD suit, however, casts Midjourney more specifically as a direct competitor. The complaint flagged the recent arrival of “Midjourney TV,” a 24/7 YouTube channel that the complaint says promotes, advertises, and streams the startup’s videos. Midjourney has insisted that it’s just a “tool.” WBD’s retort: It looks a lot like a rival studio—with a distribution platform thrown in. [Read more]
  • On the Anthropic payout: The other big headline on the A.I. legal front, of course, was Anthropic’s eye-popping agreement to pay $1.5 billion to settle a class action brought by authors who claimed the company used pirated copies of their books to train its models. The number floored me, and just about everyone I know in the industry. Yes, Anthropic was staring down a jury trial with the specter of statutory damages of up to $150,000 per infringed work, with an estimated half a million affected works. But even among the smart set who anticipated a record-setting check, few imagined a sum so large that the expected interest alone—$126 million, to be accrued before disbursement—topped most copyright settlements.

    Yet, in many ways, $1.5 billion is a bargain. Early chatter suggested the class might include millions of works. Judge William Alsup ruled that Anthropic could train its models on copyrighted books, but nevertheless found liability in the creation of its initial “pirated” library. What exactly was in that library? In the end, the class criteria appeared to capture about 500,000 works, so Anthropic would be paying about $3,000 a book. (That’s not a given: On Monday, Alsup said he won’t approve the settlement until the two parties explain how every potential claimant will be notified, to avoid future lawsuits and ensure authors don’t “get the shaft.”)

    Compare that to what Anthropic could have faced at trial. The statutory maximum was $150,000 per work, but most willful-infringement cases land in the $30,000 to $50,000 range. Anthropic, of course, had been angling for a much lower payout, claiming “innocent infringement.” But let’s say a jury had pegged it at $100,000 per work, applying the criteria that resulted in music publishers’ billion-dollar judgment against Cox Communications in 2019, before an appeals court overturned it. That would have exposed Anthropic to a theoretical $50 billion verdict—one that the company surely would’ve appealed. Even with Anthropic’s $183 billion valuation, that could have been existential. [Read more]

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Deal of the Week: The OpenAI–Oracle Alliance

OpenAI has signed a deal with Oracle, the cloud computing giant, to acquire about $300 billion worth of computing power over the next five years—a sum far in excess of OpenAI’s revenue, which means the company will need to keep raising money for the required capex. Oracle, which released its Q1 2026 earnings on Tuesday, also announced a massive backlog for its cloud business, with revenue expected to jump some 77 percent, to $18 billion, this year. Over the next four years, Oracle expects that number to continue climbing—surpassing $30 billion in fiscal 2027, before reaching $73 billion, $114 billion, and $144 billion in the following years.

Oracle C.E.O. Safra Catz said that the company signed four multibillion-dollar deals with three major customers in this quarter alone—presumably the hyperscalers at the heart of the A.I. investment cycle. It’s not clear how much Oracle will need to invest, itself, in order to secure all that revenue, but Wall Street analysts didn’t seem to care; the stock leapt some 36 percent on Wednesday, and Oracle’s Larry Ellison briefly surpassed Elon Musk as the world’s richest man. Selling shovels during a gold rush continues to be a good business.

And now for the main event…

School of Grok

School of Grok

A bracing roundtable with professors and academics about how A.I. has invaded their classrooms, whether it’s incompatible with the aims of higher education, and their recently published open letter calling on universities to reject the use of generative A.I. in schools.

Ian Krietzberg Ian Krietzberg

Predictably, the Trump administration’s push to infuse artificial intelligence across the public education system has raised more questions than answers. Linda McMahon, who runs the Department of Education, is a vocal advocate for bringing A.I. into the classroom. Yet just six months ago, the president signed an executive order to dismantle the department. Meanwhile, the president signed an executive order in April, establishing a task force on A.I. education and directing K-12 students to achieve “proficiency” with the technology—whatever that means. It’s another element of the administration’s relentless drive for adoption that comes despite the fact, as the National Education Policy Center pointed out last year, the technology in question remains opaque, unproven, and lacking in adequate oversight.

Regardless, A.I. is on a collision course with academia. In May 2024, OpenAI unveiled ChatGPT Edu, an enterprise tool designed for universities to access and deploy ChatGPT across campuses. Professors at a bunch of schools, including Arizona State, UPenn, and Columbia, were quick to get on board. A few months later, UCLA entered into an agreement with OpenAI to help “personalize” learning. This past spring, OpenAI launched its NextGenAI initiative, a partnership with 15 leading research institutions dedicated “to using A.I. to accelerate research breakthroughs and transform education.” Even more recently, the company partnered with the American Federation of Teachers, alongside Anthropic and Microsoft, to launch an initiative aimed at instructing K-12 teachers on how to use A.I. in their classrooms.

Most schools haven’t articulated clear A.I. policies—whether for teachers using it to generate homework assignments or for students using it to, you know… do their homework. And, of course, there’s plenty of ambivalence about whether any of this is actually helping anyone learn. Some polls find broad optimism about A.I. among teachers and administrators. Others find that Americans are growing more skeptical about the use of A.I. in schools, fearing it may erode critical thinking skills. It all comes as the edtech market, currently valued at nearly $200 billion, is expected to surpass $340 billion by the end of the decade.

A growing number of educators are fighting back, too. In July, nearly 1,000 academics from around the world signed an open letter calling on schools and universities to reject the use of generative A.I. in education, citing environmental concerns, reliability issues, biases, and the mounting evidence that children can form emotionally damaging relationships with chatbots (a tragic phenomenon I wrote about earlier this week).

Over the past few weeks, I spoke to several of the educators who signed the letter, including its organizers, Miriam Reynoldson and Melanie Dusseau. The following has been lightly edited for clarity. 

Mr. Altman’s Opus

Ian Krietzberg: What do you think is at the root of the increasingly universal push for rapid A.I. adoption? And what do you think it misses?

Chris Miciek, director of career development at Thomas Jefferson University: The rush is increasing, and driven by edtech vendors who are coming into that gap. For a lot of people in higher ed, this caught us as off guard as Covid lockdowns did—and higher ed still hasn’t recovered from that. Then you’re layering in all of these technology issues, some of which exacerbate the other problems we’re dealing with, like anxiety and people feeling more isolated. We’re seeing an increased drive because there’s been nothing to knock the hype cycle off. The FOMO is so salient.

In higher education, especially in the U.S., there’s always been this tension between education for education’s sake—raising and equipping citizens—and being a workforce development tool for the economy. While that tension can be useful, all the focus right now is on the workforce development side. There are years of things that led to that. But if you say, This is the future, that’s a very deterministic statement, and removes agency from most of the people involved.

Mat Osmond, senior lecturer at Falmouth University: If we agree that A.I. is global in its reach and impact, what it’s not is consensual or democratic in its creation and curation. There’s a specific network of corporations embedded within a particular cultural ideology that get to rewrite the script for human experience, creativity, and learning.

In higher education and arts education, the excitement with which A.I. is being heralded uncritically adopts the narrative about A.I. by the people selling it. I don’t accept the position of being on the back foot to justify why I would refuse to use A.I.—I would just take it as given that a kind of anti-humane, anti-literacy, extractive technology needs to be justified.

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Is A.I. compatible with the aims of higher education?

Helen Choi, senior lecturer at the University of Southern California: I teach a required writing course for engineering students, who are very proficient with lots of technology. The core point of my job is to build communication skills using writing, sometimes other forms of communication. Gen A.I. is bypassing all of that.

I had to come up with the A.I. policy for my class. And I thought about it, and I said, I know you guys use A.I. for lots of different things, but for our class, because it’s important for us to think about the skills and the communities that we’re building, let’s refrain from using it. But I think my students use it for almost everything now. I don’t think they can even imagine not being able to use it; there was a brief period of time when ChatGPT was down, and there was panic on campus. I’m not trying to paint technology as evil—it’s more like, Well, let’s look at it. Is it too much for what we’re trying to do?

Miriam Reynoldson, teaching academic and postgraduate student at RMIT University, Melbourne: College students are confused. Sometimes they don’t understand when they are misusing or abusing A.I. I think we need to put the spotlight on how not to use it, and why to avoid it, especially in creative writing. The ban on A.I. for submissions if you want to be a poet or novelist or playwright doesn’t match the drumbeat, which says you can use A.I. “ethically.” That phrase really bothers me—ethical use of unethical tech.

I think it can be a crutch for learning—especially the messy parts of writing, which are my favorite parts, the chaos of coming up with an idea. A tremendous number of [students] are coming in saying, I’m not confident in my own voice. Our job is not to say, Oh, you didn’t write this. It’s to say, What would you write, and what do you mean? I love finding ways to support people to express themselves and find their voices. We’ve been steering toward a rote standard in English for forever, which I think corrodes linguistic diversity.

Melanie Dusseau, associate professor of English at the University of Findlay: I want to lend as much weight as possible to the preciousness of linguistic diversity. Literacy is about communication in all of its forms, not just reading and writing. I think there’s a terrible danger to this incredibly averaged-out style of communicating, where we become worse at hearing each other when we don’t speak in those voices.

Students are putting other people’s poems into ChatGPT to generate feedback, which is also happening with writing instructors. There are all kinds of A.I. initiatives to make grading easier. Students don’t trust themselves to say something critical about a classmate’s work without this go-between of a bot. I’m not here to surveil students’ work—I’m here to help them understand how and why they should be avoiding large language models.

Where do you hope this debate lands?

Miciek: There’s a lot of rushing to look timely, but higher education institutions should be about deliberation, thoughtfulness, and generating the research and understanding of what’s going on—not knee-jerk responses to external pressure. Universities should do what they’re designed to do, which is be a community that wrestles with the issue, sits quietly, and listens to the ethicists in the space. From there, they can develop policies that are not driven by external forces. It can even become an admission selector—I’m going to choose to go to this school because I like their stance on this.

Dusseau: I think we have a chance to innovate. It’s so important to say that resistance and refusal is not the same as returning to the status quo, because some people have thrown that out here. It’s also important to bring in the idea of student agency and autonomy, because there are a lot of students, especially in the fine arts, who object to A.I. because of the theft of creative labor. I am hoping there’s this kind of [compromise], where the people who are saying, You must prepare students for this 21st century workforce that’s going to use A.I.—which is a misconception—are balanced by the people who say, You must have A.I.-free learning zones as well. Students have a right to those just as readily as they do to all of this integration.

Reynoldson: I’ve had some people say, Where are you going to take this campaign? And I’m like, it’s where it needs to be. I’m looking at contacting some unions and trying to build greater support and protection for those who did put their names out there, because it’s an act of vulnerability. But I expected that a lot of people would not be able to sign it because they’re using generative A.I. in some capacity, and they either have made that choice and that’s fine, or they don’t really have a choice because of their institutional constraints.

I want those people to know that that doesn’t mean we’re against them, but that we’re here. I’m astounded that we’ve actually reached so many people. We are standing up and saying these things even if you can’t, even if you’re not safe or not ready to. This is a position that is valid and safe to have—or, at least, we will make it safer.

 

That’s all for today. I’ll see you next week.

Ian

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