A model that can predict the next frames of a video coherently understands the world, in the only sense of the word that is doing any work.

I think to the extent that it can predict the next frames in a coherent way, that is a form of understanding, not in the anthropomorphic version of, it's not some kind of deep philosophical understanding of what's going on, I don't think these systems have that, but they certainly have modeled enough of the dynamics, put it that way