Good morning from the Financial Times.
Today is Friday, December 12th and this is your FT News Briefing.
Crypto magnate Do Kwon got a hefty prison sentence and the House of Mouse is warming to the world of artificial intelligence.
Plus, we'll introduce you to the hardliner who wants to make Chile great again.
He has been preaching a very kind of severe law and order message and also really focusing on immigration.
I'm Victoria Craig, and here's the news you need to start your day.
South Korean crypto tycoon Do Kwon was sentenced to 15 years in prison late yesterday on two counts of fraud.
Kwon's TerraUSD and Luna tokens, which he controlled, collapsed in 2022.
That caused $40 billion in losses for investors.
Kwan admitted in a New York court earlier this year that he knowingly defrauded investors.
He pleaded guilty in August.
Prosecutors said Kwan created a financial world that was quote built on lies and manipulative and deceptive techniques.
In a letter to the judge ahead of Thursday's sentencing, Kwan said he accepted full responsibility for Tara's failure.
To infinity and beyond may now be more like to artificial intelligence and beyond.
That's because Buzz Lightyear and his crew of misfit toys will soon enter the brave new world of AI.
Disney has agreed to invest a billion dollars in OpenAI.
It's a deal that unleashes more than 200 Marvel, Pixar and Star Wars characters into the universe of ChatGPT and Sora, its video generation tool.
Until now, the media and AI industries have been wary of each other.
So does this mark a turning point?
Chris Grimes is the FT's Los Angeles bureau chief, and he joins me now to discuss just that.
Hi, Chris.
Hi there.
So this is the biggest deal of its kind, but there are clear guardrails up around it.
What does this agreement allow and what doesn't it allow?
Sure.
So one of the main things that Disney has made clear is that this is for animated characters.
So it could be the animated Han Solo, but not the likeness of Harrison Ford or Harrison Ford's voice.
The actual actors and their likenesses is a whole other kettle of fish.
That would involve a lot of players that Disney doesn't have control over.
So under this agreement, users can use Sora to use Disney animated characters to make short videos.
And the other thing is that OpenAI is not going to be able to use Disney IP to train its models.
So is Disney concerned about handing over those valuable brands to AI?
No.
I think it's the heart of the value of the Disney company, right?
So, at the same time that Disney announced this billion-dollar investment into open AI, Wednesday night they sent a cease-and-desist letter to Google, claiming that Google was infringing on Disney's copyrights on a massive scale by using them to train their own AI tools with Disney IP, which is some of the most valuable IP in the world.
Disney just doesn't want to open that up to use across artificial intelligence groups for people to manipulate these however they want to and distribute it however they want to.
All right.
Clearly, there are concerns on Disney's side.
Why did they agree to this deal in the end?
Well, Bob Iger, the chief executive of Disney, has put this agreement into the context of 100 years of innovation in technology, the way animation progressed, from those early Mickey Mouse drawings that Walt Disney did all the way up to Pixar technology.
He's saying that Disney's not really in the business of fighting that kind of technology, but it needs to harness it and use it and move into the future.
So, if we look at this on a more broad level of the entertainment industry as a whole, is this deal representative of a sort of softening of relations between these two industries?
Or is it really just kind of a tacit acceptance that AI is going to play a role in the future of entertainment?
Yes, I think there has been an understanding for the past couple of years in Hollywood that this is a reality.
It's happening.
I heard this when I was out on the picket lines a couple years ago during the writers and actress strikes.
They were all concerned about their likenesses if they're actors, or their words if they're the writers.
On the other hand, these are tools that they were interested in using and seeing what they could do.
So I think the genie was already out of the bottle and Disney, being the big kahuna in Hollywood, is putting its marker out there and saying we're going to work with this.
We're going to cooperate within certain boundaries.
We are going to control this the best that we can.
So yeah, I think this is the way things are going to go from here on out.
Fascinating stuff.
Chris Grimes is the FT's Los Angeles Bureau Chief.
Thanks so much for your time, Chris.
Thank you.
Have you seen the prices for tickets to World Cup matches next year?
Well, fan groups have, and they've called price tags extortionate and consider it a quote.
Now they want FIFA, football's governing body, to halt ticket sales for the tournament in North America until a solution is found—.
Pricing tables from football federations show value tickets for the final start at more than $4,000.
That more than doubles for a premium seat.
FIFA has said in the past that ticket pricing is quote aligned with North American industry trends.
Chile looks posed to elect its most right-wing president in its 35 years of democracy.
A victory by José Antonio Cast in Sunday's second round election would mark a 180-degree turn in recent Chilean politics.
That's been spurred by concerns about an increase in crime and an economic downturn.
The FT's Kira Nugent has been following the campaign, and she joins me now to discuss.
Hi, Kira.
Hi, Victoria.
So it's been a bit of a roller coaster for the last few years for Chile's politics.
What would a cast win mean for the country?
Yeah, Chile was always one of the most kind of stable and boring countries in Latin America.
And then in 2019, it looked like that might all radically change.
We had these massive protests over the cost of living and inequality and eventually the election of Gabriel Boric, who's a left-wing former student leader, and the current president, who wanted to kind of build out a bigger welfare state and change the model.
The mood has really swung back in the last couple of years.
Boric has been unable to pass many of his reforms because he has a minority coalition.
Chile has experienced a really big increase in organized crime.
So Chileans are feeling kind of unsafe and angry and coming back to these kind of basic political issues like security and the economy, rather than, you know, the economic model and more ambitious questions like that.
So what would a CAST victory in that context then mean for the country?
CAST started out in politics in the kind of main right-wing bloc as a lawmaker, but he left in 2016 to found a party further to the right because he felt that the establishment had become kind of too soft.
And he has been preaching a very kind of severe law and order message and also really focusing on immigration, because Chile's immigrant population has increased really, really grown since around 2018 as a result of Venezuela's economic collapse.
You have almost 50% more immigrants in Chile today than you did back then.
And that has caused a lot of anxiety in some communities, especially because it has coincided with the crime wave.
And CAST has really benefited from that.
So some of these policy ideas sort of have the echoes of similar ones that we've seen from U.S.
President Donald Trump or Argentina's Javier Malay.
What kind of leader is cast likely to be if he wins?
Yeah, I think those comparisons make sense because of his focuses, migration, the economy, etc.
But I was able to meet Cass briefly, and he comes across as a very different kind of politician.
He's very formal, quite polite and probably more similar to kind of the establishment right-wing parties that we've seen in the past, or maybe even the European hard right.
He does have a family background that makes him quite divisive in Chile.
He's The son of German immigrants and his father fought on the German side in the Second World War.
And he's extremely conservative.
He's a devout Catholic.
He has nine children himself.
And in the past he's kind of campaigned on rolling back abortion rights and other kind of social issues.
But he has said that those issues won't be a part of his future government.
And it would be more traditional conservative administration, but with this focus on immigration and crime.
Yeah.
So we've talked a little bit about the issues that could help get cast elected, but what are likely to be his real first policy priorities?
So he has said he will focus on crime, immigration and the economy.
He wants to make big spending cuts, cut regulations and taxes, because he says that's essential for Chile to recover the levels of economic growth that it used to see.
And then he wants to crack down on the gangs in a kind of tough, kind of classic law and order formula of more severe sentences for criminals and beefing up security forces.
And then I would say his flagship policy is to block irregular migrants from coming into Chile using a barrier on the border, and then the detention and deportation en masse of those already in Chile.
And I'd say most of those policies have quite broad support actually among the more moderate right-wing parties that he'll need to negotiate with in Congress.
But they will still have to get support from some centrist lawmakers.
So I think you could see the most radical ideas will probably be watered down.
The FT's Kira Nugent for us.
Thanks so much for wrapping this up.
Thanks very much, Victoria.
Before we go, next week could be a big one for the war in Ukraine.
Kiev has sent a revised peace proposal to Washington, according to people familiar with the matter.
This is based off the contentious 28-point plan the U.S. drew up last month.
Some European leaders won a meeting on the proposal this weekend.
And late next week, EU leaders are expected to vote on using frozen Russian assets to fund a loan to Ukraine.
Belgium and France have had some heartburn over the fine print of that plan.
Without those funds, though, Ukraine could go bankrupt early next year.
You can read more on the flurry of news on Ukraine and all of the stories in today's podcast for free when you click the links in our show notes.
This has been your daily FT News Briefing.
Check back next week for the latest business news.
The FT News Briefing was produced this week by Mark Filippino, Julia Webster, Sonia Hudson, Fiona Simon and me, Victoria Craig.
Our show is edited by Mark Filippino and mixed by Alex Higgins and Kelly Gary.
We had help this week from Peter Barber, Michael Lello, David DaSilva, and Gavin Coleman.
Our acting co-head of audio is Topher Forges, and our theme song is by Metaphor Music.
