Why Corporate America Is Now Rationing AI

Summary

WSJ What’s News (PM Edition) — Why Corporate America Is Now Rationing AI

Date: May 29, 2026
Host: Alex Osola
Guests: Brad Olson (Deputy Tech Bureau Chief), Ben Fritz (Entertainment Reporter)

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Episode Overview

This episode aims to uncover why major U.S. companies are suddenly limiting how much their workers use cutting-edge AI tools. The discussion explores the rapid shift from enthusiasm for AI adoption to concerns about runaway costs, particularly the expenses tied to AI "tokens"—the units that represent usage of these systems. Additional segments touch on breaking business and political news, the resurgence of New Jersey as a filmmaking hub, and a quirky viral job hunt for “ranchbassadors.”

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Main Segment: Corporate America Rations AI

Starts: 00:30

The Problem: AI Spending Spirals Out of Control

• Corporate Push to AI: Many companies strongly encouraged employees to use AI, hoping to signal innovation and readiness for disruption to Wall Street.
  • "Companies wanted their workers to use more AI until it started costing too much." — Alex Osola [00:30]
• Costly Experimentation: Open access led to lots of employee queries, many of which were trivial or inefficient, consuming expensive computational resources.
  • "There's lots of queries that were happening at companies that were costing lots of tokens for these essentially useless or, you know, queries that could have been free." — Brad Olson [00:36]

What Are AI Tokens? Why Do They Matter?

• AI tokens are the basic unit for computing costs in large language models and generative AI tools.
• Several companies hit their annual AI budgets in just three months, with some seeing costs double or triple.

How AI Usage Got Out of Hand

• Phase One: Full encouragement for all employees to experiment with AI.
• Result: Well-meaning experimentation quickly turned into waste.
  • “...the incentives that exist can become kind of perverse. And if employees hear ‘use AI at all costs and we're going to grade you on your AI use,’ then all of a sudden employees can be like, sure, I'll use AI as much as you want. And then you're not really discerning between, like a good use and a bad use.” — Brad Olson [03:37]
• Real-world Example:
  • Matan Grinberg, founder of Factory (a code automation startup), recounted how a financial institution spent hefty sums letting employees ask the AI about the weather—hardly a good use of resources.
  • “It’s not a great use of tokens to spend a lot of model energy and computing energy being like, what is AI? You know, very basic queries like that.” — Brad Olson [04:10]

Rationing Begins: How Companies Are Cutting Back

• Restricting access: Some AI models and capabilities now limited to specific employee groups.
  • Example: Microsoft restricted access to the “Claude Code” tool to avoid redundancy with internal offerings.
  • “Some of them have basically made certain advanced models and capabilities available only to a small subgroup... That's the kind of steps I think companies are taking trying to help employees be like, okay, you don't need to use Opus. You can, you know, go on a Google search.” — Brad Olson [05:02]
• Companies still support spending on AI but are refocusing on high-value, differentiated uses.

Key Takeaways

• Initial corporate AI rollouts valued quantity over quality, leading to soaring costs.
• A recalibration is underway: expect more limits, more oversight, and a focus on proven, valuable applications.

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Notable Quotes & Moments

• “There's lots of queries that were happening at companies that were costing lots of tokens for these essentially useless or, you know, queries that could have been free.”
  — Brad Olson [00:36]

• "And if employees hear ‘use AI at all costs and we're going to grade you on your AI use,’ then all of a sudden employees can be like, sure, I'll use AI as much as you want."
  — Brad Olson [03:37]

• “It’s not a great use of tokens to spend a lot of model energy and computing energy being like, what is AI? You know, very basic queries like that.”
  — Brad Olson [04:10]

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Important Segment Timestamps

• 00:30 — Introduction to AI rationing in corporate America
• 03:37 — Brad Olson explains how incentives led to runaway AI costs
• 05:02 — How companies are restricting AI tools and access for cost control
• 05:51 — Wrap-up of AI segment

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Additional Headlines & Business News

• Trump’s Anti-Weaponization Fund Paused:
  Federal judge halts the $1.8 billion fund pending legal review. [00:46]

• Banking Sector Optimism:
  Jamie Dimon (JPMorgan Chase CEO): “Things are, quote, gung ho. Sponsors are busy, companies are busy.” [02:24]
  — Brad Olson: “You know, there's a lot of exuberance out there. So yeah, right now it's good.” [02:28]

• Universal Music Group Rejects $65B Buyout:
  Universal’s board and largest shareholder say Bill Ackman's bid undervalues the company. [02:47]

• Markets Update:
  Stocks hit record highs on news of a possible Trump-brokered peace deal with Iran; oil prices drop sharply. [06:00]

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Deep Dive: New Jersey—The New Hollywood?

Starts: 08:50

• Long-Term Tax Incentives:
  NJ’s filming incentives now locked in through 2049, giving studios confidence to invest for decades.
  • “They have authorized their tax incentive program... through 2049. So the studios can be confident the money is not going to disappear...” — Ben Fritz [08:50]
• Studio Investments:
  Netflix building a billion-dollar facility with 12 soundstages in Fort Monmouth.
• Economic Impact:
  Both short- and long-term job creation, economic boost for the region.
• Local Sentiment:
  Initial excitement gives way to inconvenience; LA’s drop in production is now “missed”.

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Viral Moment: America’s First “Ranchbassadors”

Starts: 10:38

• Hidden Valley Ranch launched a “ranchbassador” search, fielding 6,000+ applications for social media enthusiasts to spread ranch dressing culture worldwide.
• New hires will tour Europe, promoting ranch in countries like France, Germany, Ireland, Spain, Portugal, and the UK.

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Closing Notes

• What's Next: Look out for the “Markets Wrap-Up” Saturday and a health-focused Sunday segment on the risks and hype of peptide drugs.
• Episode Credits:
  Production by Danny Lewis & Anthony Bansi; Theme by Michael Lavelle; Development producer Aisha El Musleam; Deputy editor Chris Sinceley.

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For a fast yet comprehensive take on why your office’s AI tools may soon be locked down, this episode provides an accessible, real-world look at the intersection of innovation and cost control in today's corporate America.

Transcript

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[Alex Osola]

Companies wanted their workers to use more AI until it started costing too much.

[Brad Olson]

There's lots of queries that were happening at companies that were costing lots of tokens for these essentially useless or, you know, queries that could have been free.

[Alex Osola]

Plus, a federal judge puts a temporary pause on the creation of President Trump's, quote, anti weaponization fund and why film studios are rushing to set up shop in New Jersey. It's Friday, May 29th. I'm Alex Osola for the Wall Street Journal. This is the PM edition of what's the top headlines and business stories that move the world today. We begin today's show in Virginia, where a federal judge has hit pause on The Trump administration's $1.8 billion anti weaponization fund because of a legal challenge to stop it. The order temporarily prevents officials from transferring money into it or paying claims out of it. The Justice Department didn't immediately respond to requests for comment. And in another legal ruling against Trump today, a federal judge in Washington, D.C. said that the president's name must be removed from the Kennedy Center. He said the decision to change the name must come from Congress, and he gave the Cultural Arts center two weeks to remove Trump's name from the building. The judge also said that the Kennedy center can't be closed for two years while it's under renovation, but he said that the repair work can go forward. Turning to the banking industry, several of the largest banks in the US Say business is humming along. Deal making, trading and lending appear to all be going as planned, despite geopolitical unease that has rattled markets. At a banking conference this week, JPMorgan Chase CEO Jamie Dimon said things are, quote, gung ho. Sponsors are busy, companies are busy.

[Brad Olson]

You know, there's a lot of exuberance out there. So yeah, right now it's good.

[Alex Osola]

Dimon said his bank might outperform the increase in markets and investment banking revenue that analysts are expecting for the current quarter. Universal Music Group today rejected the $65 billion buyout offer from Bill Ackman's Pershing Square Capital. Universal's board said the bid undervalues the music company Universal's largest shareholder is also opposed to the deal for the same reason. A Pershing Square spokesperson declined to comment. We've heard it from companies in ways large and small. This year, employees need to start using AI more in their work. The companies want to send a message to Wall street that they won't be left behind in a coming wave of disruption. But all that enthusiasm for AI has come at a big cost spread, specifically with the money they spend on tokens, the basic unit of measurement for AI computing. Some businesses have hit their annual budget in just three months or seen their AI spending bills double or even triple. Deputy tech bureau chief Brad Olson has been following corporate use of AI and is here to tell us more. Brad, why is it getting so expensive? I mean, are the tokens themselves more expensive or are companies using more of them, or is it both?

[Brad Olson]

I think in the beginning, companies were just wanting to encourage all their workers to use AI to try to think about how to do work and measure things that they could do better. And that was kind of like phase one. And now they're confronting the cost of widespread uncontrolled experimentation and rethinking things that, you know, ended up being very costly. As we know something may start in a very well meaning way, and then the incentives that exist can become kind of perverse. And if employees here use AI at all costs and we're going to grade you on your AI use, then all of a sudden employees can be like, sure, I'll use AI as much as you want. And then you're not really discerning between, like a good use and a bad use. I spoke to a startup founder named Matan Grinberg. He runs a company called Factory, which automates coding. One of the companies he was consulting with, which he just said was a financial institution, had racked up huge amounts of charges from, like, very simple queries like the weather. It's not a great use of tokens to spend a lot of model energy and computing energy being like, what is AI? You know, very basic queries like that.

[Alex Osola]

So the companies got to this place where they're not allocating the tokens in the right places. So what are they doing to reduce their use of tokens?

[Brad Olson]

Some of them have basically made certain advanced models and capabilities available only to a small subgroup. So one example was Microsoft. And to be clear, Microsoft said, we didn't do this because of cost. They don't want to send a message to the market that, like, they're scrimping on AI. So there was this group of employees that had access to a program called Claude Code, and then they stopped making that tool available because those employees have access to a Microsoft tool that does similar things. That's the kind of steps I think companies are taking trying to help employees be like, okay, you don't need to use Opus. You can, you know, go on a Google search. But I think a lot of the companies still want to spend money. I just think they want it to go toward kind of the best use cases.

[Alex Osola]

That was WSJ Deputy Tech Bureau Chief Brad Olson. Thanks so much, Brad.

[Brad Olson]

Thanks for having me.

[Alex Osola]

Stocks are back in record territory after President Trump said he was considering a possible peace agreement with Iran. In a truth Social post today, Trump said he'd be making a, quote, final determination about a deal. The Dow led the gains in the three major indexes and closed up 0.7%. And oil prices slid with the international gauge brent crude dropping 1.7% to just over $92. Futures dropped 19% in May, their worst month since March 2020. Coming up, a Russian drone crashes into an apartment building in Romania and we tell you what a ranchbassador is. Those stories and more after the break.

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[Alex Osola]

In international news, a Russian drone crashed into an apartment building in southeastern Romania today, injuring several people. The drone incursion raised alarms among NATO allies who worry that Russia is trying to escalate military conflict beyond Ukraine. It's not clear if the drone was intentionally sent across the border. Russian President Vladimir Putin questioned whether the drone was Russian. He added that Russia didn't want conflict with the west, but that Moscow would counter direct military threats in the Middle East. The Journal has learned that the United Arab Emirates has been more deeply involved in attacking Iran than was previously known as in coordination with the US And Israel, the UAE carried out dozens of airstrikes against Iran beginning in the early days of the war and continuing through the day after the April ceasefire was announced. The scale of the UAE's response has deepened divisions within the Gulf, with Saudi Arabia saying the UAE's attacks raise the risk of more strikes on energy infrastructure from Iran. The Movie business ain't what it used to be. Studios are producing less overall for streaming services, and big budget movies are being made overseas to save money. There's just one state in the US where film and TV production is actually thriving, and it's New Jersey. Journal entertainment reporter Ben Fritz visited the state recently to get a glimpse of what's going on there. Ben? First, of course, it was LA. Then a few years ago it was LA, then there was Georgia. Why is Jersey now the hub for film and TV production?

[Ben Fritz]

So in New Jersey, they've actually done this thing no other state's done before where they have authorized their tax incentive program for filming TV production through 2049. So the studios can be confident that the money is not going to disappear if there's a tight budget in a few years from now. And in exchange, studios like Netflix, Lionsgate, Paramount, they're making big investments in soundstage facilities. So I'd say that the administration in New Jersey is optimistic that they've solved the problem that ended up causing a boom and bust in other states like Georgia and Louisiana.

[Alex Osola]

Here in Brooklyn, I see film crews set up all the time. And it's like both kind of cool when you see the names you recognize on the little paper, but it's also like kind of annoying to work around it.

[Ben Fritz]

Yeah, I think a lot of people in New Jersey are excited right now because Steven Spielberg's there, Timothee Chalamet's there. You know, that's pretty cool. I'm sure in a few years they'll start to feel like you do, where they get sick of the traffic being blocked all the time and the giant trucks in the way. And I will say, on the other hand, living in Los Angeles, where we used to constantly have production and now we have so much less. We all used to complain and now we miss it because it brings a lot of jobs and a lot of economic stimulus.

[Alex Osola]

How much of an economic benefit is it to have Hollywood come to your town?

[Ben Fritz]

The short term is, hey, they're here shooting this month, which means hundreds of people are there. It's a great short term economic stimulus. But these big tax credits that they're giving are only if the studios make a long term commitment. So Netflix is building a billion dollar plus facility in Fort Monmouth where are going to have 12 sound stages. That's obviously a lot of construction jobs. Those are long term investments in the economy where there'll be production happening for years or if all goes really well, decades to come.

[Alex Osola]

That was WSJ reporter Ben Fritz. Thanks so much, Ben.

[Brad Olson]

Sure.

[Ben Fritz]

My pleasure, Alex.

[Alex Osola]

And finally, the hottest job this summer seems to be a spokesperson for one of my least favorite condiments, ranch dressing.

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[Alex Osola]

Hidden Valley Ranch fielded more than 6,000 applicants and they posted about their love for ranch on social media. Makes sense, since social media posts would be part of the job. Hello, everybody. This is my formal interview to be the Hidden Valley Ranch ambassador. And we're looking to be the Hidden Valley Ranch ambassadors. Stay tuned for 19 days. 19 days. 19 days. We'll be squirting ranch on all different things. If y' all think for one second that I'm not applying to be a ranch bassador for Hidden Valley, then you don't know me. Okay? Today the company announced the three pairs of hires. Their stops will include France, Germany, Ireland, Spain, Portugal and the uk and that's what's news for this week. Tomorrow you can look out for our weekly markets wrap up what's news in markets. Then on Sunday, we'll be discussing peptides, drugs that people all over social media are using to look and feel better. But that may come with risks that users don't think about. That's in what's New Sunday. And we'll be back with our regular show on Monday morning. Today's show is produced by Danny Lewis and Anthony Bansi with supervising producer Tali Arbel. Michael Lavelle wrote our theme music. Aisha El Musleam is our development producer. Chris Sinceley is our deputy editor. And I'm Alex Osola. Have a great weekend and thanks for listening.

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