The Matrix Revolutions (2003)
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As the Machines draw closer and closer to Zion, Neo (Keanu Reeves) discovers that his powers, both in the Matrix and in the real world, continue to increase. His body still unconscious from his fight with the Sentinels, Neo's mind becomes trapped in a mysterious train station between both worlds, and Trinity (Carrie-Anne Moss), Morpheus (Laurence Fishburne), and Seraph (Collin Chou) must find and release him before the machines break through. What they don't know, however, is that the viral Smith (Hugo Weaving) poses a larger threat to both humans and machines. Edit (Coming Soon)
The Matrix Revolutions is the third and final film in The Matrix trilogy, preceded by The Matrix (1999) (1999) and The Matrix Reloaded (2003) (2003). Like the first two movies in the trilogy, the screenplay for Revolutions was by Andy and Lana Wachowski (who also directed). So far, there have been no official novelizations. Edit (Coming Soon)
The real reason for this is that actress Gloria Foster, who played the Oracle in The Matrix (1999) and The Matrix Reloaded (2003), died from complications of diabetes while the final two movies were being shot. She had finished her Reloaded scenes but had not yet filmed any for Revolutions, so actress Mary Alice, a friend of Foster's, was cast to take over the remaining part of the role. Instead of re-shooting all the early footage with Alice as the Oracle, the Wachowski siblings decided to incorporate the change in the Oracle's appearance into the storyline. The Oracle briefly implies in Revolutions that her changed appearance was a punishment for helping Neo, but she does not elaborate any further. However, the game Enter the Matrix (2003) contains exclusive footage that was shot during the production of the last two Matrix movies, and follows the storyline of Niobe (Jada Pinkett Smith) and Ghost (Anthony Brandon Wong) that runs parallel to the events of Revolutions. In this game, Niobe and Ghost—captain and operator, respectively of the Logos—visit the Oracle after the highway chase, and are the first to notice her changed appearance. She quite explicitly tells them that it was the Merovingian who punished her for choosing to tell Neo that he needed the Keymaker. This caused the Merovingian to loose the Keymaker and several loyal henchmen, and in retaliation, he stole her old residual self-image, forcing her to use an older one which also limited several of her abilities, like her memory. However, her powers of premonition remain, as the Merovingian specifically requests "the eyes of the Oracle" for their ability to see into the future in return for Neo in Revolutions. Edit (Coming Soon)
The Machines in the real world are all connected to a "singular consciousness", the birth of Artificial Intelligence described by Morpheus in the first Matrix film. This consciousness is otherwise known as "the Source". The machine connection is a remote one or some sort of wireless signal. Having touched the Source (i.e. meeting with the Architect) and having the data needed to reboot the Matrix, Neo is, at this point, simultaneously in possession of his human brain but also connected to the singular consciousness. In other words, his is also now a wireless connection. Hence the reason Neo says, "Something's different. I can feel them." The Machines are all separate entities but all connected to this one Source. Now, Neo is connected as well. He is thereby able to harness this power and stop the Sentinels. However, Neo wasn't ready to handle the signal surge at the end of Reloaded and collapsed in a comatose state, no longer in control of just where this wireless signal would be directed. The signal (Neo's residual self-image) is then captured and held in a program limbo derived from the Source but undetected as an existing realm, so to speak. This limbo (the "Mobil Ave" train station) was created by the Trainman (Bruce Spence), a program in service to the Merovingian (Lambert Wilson). This connection forged by Neo's visit to the Architect (Helmut Bakaitis) and his subsequent decision to return to the real world made him, unknowingly, unique. Neo became simultaneously human and machine in a sense. Edit (Coming Soon)
Having "infected" the Oracle (Mary Alice), Smith gained her powers. Using her prophetic ability, he foresaw the end of the fight and which version of himself was there. If that is the version he believes will defeat Neo, then it is the only version that need fight at all. There is another school of thought that Smith, as Neo's opposite number in the equation balancing itself out, could not fight Neo to anything but a stalemate, regardless of how many Smiths joined the fight. We see this demonstrated to a lesser degree during their brawl in Reloaded. It wasn't until Neo chose to flee or surrender that their fights ended. Because Smith couldn't see past any decision and couldn't understand (Neo's decision to surrender), he did not foresee his ultimate destruction once he defeated Neo. A more simple explanation or addition to the aforementioned explanations is that Neo has become too powerful even for all those Smith duplicates in the Matrix. To show this concept, Reloaded had the fight scene with Neo and a plethora of Smiths which ended when Neo simply flew away using a small fighting break. Now there is only one copy of Smith able to challenge Neo: the one that captured the Oracle. So only this copy of Smith sets out to fight Neo. A third possibility is that the Smith we see fight Neo represents all of the combined power that Smith has accumulated—including the power of the Oracle. Edit (Coming Soon)
Because Neo has a choice while Smith doesn't. In the hallway during the first movie, Neo has the realization about the nature of the Matrix, that there is "no spoon", and he realizes he is indeed "the one" as the Oracle's comments about "just knowing you're the one" become clear. At this moment of clarity, he hacks Smith's currently-occupied avatar and leaves a type of virus (an idea of anti-authoritarian nature) on his base code, forcing him to lose control of the avatar as Neo assumes his powers of the one. In short, Neo can bend and break the rules of the Matrix.
Smith, however, is still limited by the rules of his program, and condemned by his purpose in the Matrix: destroying Neo and, afterwards, destroying the entire human race. He is as powerful as Neo in terms of raw power but he lacks choice—the choice to give up or to keep fighting, the choice of attaining to another purpose, the choice of believing in something "bigger". What contributes to his defeat is the Oracle. While Smith believes that by absorbing the eyes of the Oracle (foreseeing of the future) would make him even stronger, he is actually being trapped by the future he foresees. He absorbs the Oracle's idea that "No one can see beyond a choice they don't understand". To Smith, that means he has no future since he doesn't understand Neo's capacity of choice; it is incompatible with his program and thereby destabilizes it, causing Smith and all his copies to "crash".
There are some other theories, such as the possibility that the Machines are able to send some sort of "anti-virus" through Neo after he has been taken over by Smith, or that by killing Neo, they also kill Smith. This, however, begs the question why the Machines didn't do this much earlier, for instance when Smith absorbed another person who was still connected to the Matrix through the Machines. Finally, on a more basic level, Smith is said to be the opposite of Neo, an attempt by the Matrix to balance out the "anomaly" that is "the One"; maybe the absorption of the One by Smith finally brings them together in one program or avatar, and their opposite energies cancel each other out (like matter and anti-matter), finally solving the unbalanced equation mentioned by the Architect. However, every implication is given that no Machine and no Matrix program actually anticipated its society being threatened by a Matrix program. Edit (Coming Soon)
Following the destruction of all the Smiths, the Sentinels cease their attack on Zion and return to the Machine territory. As everyone watches in amazement, Morpheus exclaims, "He's done it!" The Kid (Clayton Watson) carries the news that the war is over to the rest of Zion who respond with deafening cheers. Meanwhile, as Smith's changes to the Matrix are being undone, the Architect meets up with the Oracle sitting in a park under green trees and blue skies. He reminds her that she "played a very dangerous game" by trying to make changes in the Matrix. The Oracle assures him that the peace will last for as long as it can and makes him promise that any humans who want to be unplugged from the Matrix will be allowed to do so. As the Architect walks away, Sati (Tanveer K. Atwal), followed by Seraph, comes running out of the trees to hug the Oracle. They admire the sky, and Sati asks whether they will ever see Neo again. "I suspect so," the Oracle replies, "...someday." Seraph asks the Oracle whether she always knew how it would end. "No," she replies, "but I believed." Edit (Coming Soon)
Harvesting humans would imply that the machines need to abduct existing humans and implant them into the Matrix. As explained by Morpheus in the first movie, humans are grown by the machines, giving them a limitless crop to abuse for purposes of gaining energy. When the Architect informs Neo of the levels of existence they are willing to accept, he is referring to the loss of all humans currently plugged into the Matrix. That, coupled with the destruction of Zion would render humanity extinct and the machines would no longer have a means of gathering energy. It is fair to assume they do have other means of harvesting energy but not in the quantities needed to keep the machines and their cities at full strength. In that way they would suffer, and the quality of life would decline. As such; the sentinels and other large machines such as the harvesters would likely be scrapped because the power would be so minimal. However, if the human race is all but extinct, there would be no need for the sentinels and harvesters anyway. The machines may also have forms of hydro and nuclear power to sustain their "servers" so in essence, their intelligence is stored inside the Matrix, until the time comes when the crops are re-built to restore the machines power to their full extent.
Another approach to answering the question is to look at the laws of physics. According to the law of energy conservation you cannot gain more energy from a system than all the energy fed into this system. Keeping humans alive in cells full of nutrition fluid therefore cannot yield more energy (e.g. body heat) than the energy needed to grow these humans. So what kind of energy do the machines gain from humans? The main target is a kind of energy with which humans, as creators of Artificial Intelligence, could not endow their machines. Machines have no soul but they harvest the energy of human souls in order to achieve a higher level of existence. This is a highly fantastic element of The Matrix universe, and it is never explicitly mentioned. Only yellow, orange and red colors indicate the presence of a soul (just like green stands for the mind and blue represents the physical world) in The Matrix movies. So humans are useful for machines: they can be used to control software since they are not hardwired to the Matrix or other machines, and they provide a source of soul energy. Numerous humans will still be under the control of the machines and the Matrix. Other humans will utilize the choice and chance to live outside the Matrix. As long as the machines' needs are met, the peace between humans and machines will last. Edit (Coming Soon)
In The Matrix Reloaded, when Neo speaks with the Architect, he tells Neo: The function of the One is now to return to the Source, allowing a temporary dissemination of the code you carry, reinserting the prime program. After which you will be required to select—from the Matrix—23 individuals, 16 female, 7 male, to rebuild Zion. Failure to comply with this process will result in a cataclysmic system crash killing everyone connected to the Matrix, which coupled with the extermination of Zion will ultimately result in the extinction of the entire human race. The Architect then gives Neo a choice. The choice to go through one door which leads to him to select the 23 people, the other leading to the Matrix where Neo can save Trinity and continue the war. The latter would be considered non-compliance to which the Architect said would result in the cataclysmic system crash, killing every human connected to the Matrix.
Obviously, Neo chooses "Door Number Two" and goes to save Trinity. Yet it doesn't appear that the Matrix crashes as the Architect claimed/expected. Note that the Architect didn't mention how soon such a crash would happen; and one of the points of the conversation at the Source was to present Neo with no more and no less than a single opportunity to make an important decision. In this film, Smith has gone on to infect every single person (and program) inside the Matrix, and the Machines are on the brink of destroying Zion. Neo then makes the choice to travel to "the source"—at the Machine city—and bargains with the Machines. He tells them Smith will not stop with the Matrix and will spread to the Machines themselves, effectively destroying existence for man and machine alike. Neo offers to stop Smith in exchange for peace among man and machine. The Machines agree to this and send Neo into the Matrix. Neo finally "surrenders" to Smith and allows Smith to infect him, and the Source sends a jolt through Neo (more or less like sending an anti-virus program through a computer, effectively deleting every infected file). This kills Neo, destroys Smith and every copy of him. Some think that this also kills every person that Smith infected, but this does not seem to be the case. Notice that as all copies of Smith "explode", they leave a bright spot in the overhead shot of the city. Apparently, something remains. In the following shots, we see the Oracle lying in the place of the Smith copy that infected Neo. She wasn't destroyed but restored to her original program. We can assume the same thing happened to all the other people inside the Matrix, although another possibility is that only programs were restored.
Neo's return to the Machines has apparently disseminated the code, because as he is carried away (respectfully by the Machines) in the real world, the Matrix program re-initiates and everything is restored again. The Architect meets up with the Oracle, and the Oracle asks him what will happen to the "others... the ones who want out" (obviously referring to those still connected to the Matrix). He promises—or rather predicts—that they will be released. The Machines honor their word and leave Zion alone for the sake of peace. So the Architect was telling the truth about the expectation of Zion being destroyed and every human in the Matrix dying. However, he didn't comprehend human choice and he didn't foresee the Smith program running out of control, which resulted in Zion being left more or less intact and those inside the Matrix learning the truth, so they can choose to leave the Matrix. Remember that Morpheus said in the first movie that many people are quite comfortable with their existence inside the Matrix, something they will even defend over the truth. So, it is most likely that enough people will remain inside to provide the Machines with energy, and the rest will construct cities in the real world. Edit (Coming Soon)
The moniker "deus ex machina", although never mentioned by any character, appears in the credits and is used to refer to the massive horde of tiny, squid-like, aerial robots (perhaps petite Sentinels) that emerge from some kind of mother ship and form a giant, humanoid face shaped like a baby's which vocalizes the alpha Machines' thoughts—in a deep voice—to be shared with Neo, upon his arrival at the Machine capitol of sorts. The phrase is Latin for "god from (out of) the machine" and, in general (as prefaced by the article for deus ex machina on Wikipedia)...
The term has evolved to mean a plot device whereby a seemingly unsolvable problem is suddenly and abruptly resolved by the inspired and unexpected intervention of some new event, character, ability or object. Depending on how it is done, it can be intended to allow a story to continue when the writer has "painted himself into a corner" and sees no other means to progress the plot, to surprise the audience, to bring the tale to a happy ending, or as a comedic device.
From a critical standpoint, the storyteller may be the deus and the story may be the machina, so use of the plot device is often treated like an act of cheating at a game. The Machine society's Deus persona (voiced by Kevin Michael Richardson) lives up to its namesake in a number of ways but particularly how it is introduced/inserted into the story only when it would serve a purpose, and whether or not it is omnipotent in the Machine world, it—perhaps more so than the Architect—seems to be omniscient in the Machine world since the Machines including the Matrix are connected together through a "singular consciousness", of which Deus ex Machina might be the embodiment—if not that of the Matrix, the Source or whatever. So, the moniker represents a play on words. Not much more is really known about it, which even further lends credence to the idea of the element/character being conveniently inserted into the story by the storytellers after having been thought of long after they began writing the story but before finishing the story. Edit (Coming Soon)