Disney Pulls Out Of $1 Billion OpenAI Deal
Late last year, Disney announced it was teaming up with OpenAI for a three year licensing deal, that would allow users of the AI software system, Sora, to generate short, user-prompted social videos that can be viewed and shared by fans, drawing on more than 200 Disney, Marvel, Pixar and Star Wars characters.
Some of these vertical video shorts were also going to be made available to stream on Disney+, as part of its new “Verts” system. As part of this deal, Disney was going to make a $1 billion equity investment in OpenAI.
The initial feedback from Disney fans to this announcement was not positive, with many questioning why Disney+ needs AI generated “slop” and how the company should be focused on creating original content by humans.
However, today, this project is no longer moving forward as OpenAI has announced that it will be closing down its Sora AI video making program, stating:
We’re saying goodbye to the Sora app. To everyone who created with Sora, shared it, and built community around it: thank you. What you made with Sora mattered, and we know this news is disappointing. We’ll share more soon, including timelines for the app and API and details on preserving your work. – The Sora Team
Only last week Josh D’Amaro took control of Disney as the new CEO and this might be a great way for the company to get fans back on side regarding its use of AI.
In a statement regarding the news, Disney responded:
“As the nascent AI field advances rapidly, we respect OpenAI’s decision to exit the video generation business and to shift its priorities elsewhere. We appreciate the constructive collaboration between our teams and what we learned from it, and we will continue to engage with AI platforms to find new ways to meet fans where they are while responsibly embracing new technologies that respect IP and the rights of creators.”
It’s also unclear if Disney will continue to invest in OpenAI, or if the AI company will still have access to those Disney characters, but it looks like the deal is dead.
Roger’s Take: Personally, I think this is a blessing in disguise for Disney+. Nobody wanted AI slop videos featuring Disney characters, except for stock holders wanting to boost profits from the AI boom. Disney+ subscribers have been very vocal about this being a slippery slope and unwanted. I think Disney should listen to the feedback from its audiences, especially with so many celebrating this news. AI can be useful, but in the world of creative works like films, shows, etc, audiences don’t want to see AI generated content. Hopefully, Disney takes the hint and doesn’t sign any other deals for this type of content. But it’s also possible they sign a similar deal with another major AI company.
It’s also a telling time for AI companies, as while stocks continue to soar, they aren’t making a profit, with reports that each generated video was costing them more to make then they got back in subscriber revenue, as it takes a huge amount of processing power to create videos.
What do you think of Sora closing down? Let me know on social media!
