By Gary Symons
TLL Editor in Chief
The Walt Disney Company has signed the first major content licensing for OpenAI’s Sora platform, raising fears of job losses among content creators.
Disney frames the debate differently, however, saying the deal brings “… these leaders in creativity and innovation together to unlock new possibilities in imaginative storytelling.”
The deal includes a billion dollar equity investment by Disney into OpenAI, making the entertainment giant a major shareholder. Disney will also receive warrants allowing it to purchase additional equity.
The three-year licensing agreement allows two-way sharing of content.
Disney says Sora “will be able to generate short, user-prompted social videos that can be viewed and shared by fans, drawing from a set of more than 200 animated, masked and creature characters from Disney, Marvel, Pixar and Star Wars, including costumes, props, vehicles, and iconic environments.”
As well, users of ChatGPT Images will be able to use text prompts to create images featuring the same Disney characters.
On the other side of the content divide, Disney will become OpenAI’s biggest customer to date. It will be allowed to use Sora’s API (Access Protocol Interface) to build new products, tools and experiences. As well, Disney can deploy the top tier, paid ChatGPT service for its employees.
Alongside the licensing agreement, Disney will become a major customer of OpenAI, using its APIs to build new products, tools, and experiences, including for Disney+, and deploying ChatGPT for its employees.
“Disney is the global gold standard for storytelling, and we’re excited to partner to allow Sora and ChatGPT Images to expand the way people create and experience great content,” said Sam Altman, co-founder and CEO of OpenAI. “This agreement shows how AI companies and creative leaders can work together responsibly to promote innovation that benefits society, respect the importance of creativity, and help works reach vast new audiences.”
As part of the agreement, Disney will make a $1 billion equity investment in OpenAI, and receive warrants to purchase additional equity.
Disney CEO Bob Iger says the deal sees his company and OpenAI committing to the responsible use of AI in a way that protects both user safety and the rights of content creators. He sees the collaboration as a way to both protect the intellectual property created by human content creators, while also improving the ability of Disney to tell stories in film.
“Technological innovation has continually shaped the evolution of entertainment, bringing with it new ways to create and share great stories with the world,” Iger pointed out. “The rapid advancement of artificial intelligence marks an important moment for our industry, and through this collaboration with OpenAI we will thoughtfully and responsibly extend the reach of our storytelling through generative AI, while respecting and protecting creators and their works.”
Iger also says the deal opens the door to user-created content by fans, who will be able tor create their own stories based on Disney’s vast library of characters and content.
“Bringing together Disney’s iconic stories and characters with OpenAI’s groundbreaking technology puts imagination and creativity directly into the hands of Disney fans in ways we’ve never seen before, giving them richer and more personal ways to connect with the Disney characters and stories they love,” Iger said.
The deal has certainly drawn mixed reactions in the world of entertainment and tech.
Some believes the agreement is a great boost for OpenAI, but could be a long-term drag on the value of Disney’s IP over the coming years.
“Looks like OpenAI used the #jedimindwarp on The Walt Disney Company, not the other way around,” Karl Haller, an IBM partner and the leader of the firm’s Consumer Center of Competency, said in a post on LinkedIn. “And what does Disney receive for this? Negative $1 billion. Rather than receiving a heftly license fee, Disney is instead investing $1B in OpenAI and receiving warrants to buy more in the future.”
Other analysts felt that Disney’s pivot from fiercely defending its IP with cease and desist letters to embracing a deal with Open AI represents the reality that trying to quash millions or billions of copyright infractions is a losing battle.
Carline Giegerich is vice president at the Interactive Advertising Bureau and once headed emerging tech at HBO. She says Disney’s deal with OpenAI is an if you “can’t beat ’em, join ’em” moment.
“When I was at HBO from ’05–’09, I marveled at the sheer volume of cease and desists from the legal team when mobile video was up and coming,” she says. “I thought it seemed difficult to fight against the entire internet, and it turns out it was. And AI presents a similar challenge.”
James Miller, the head of business development at Amazon for media, entertainment, and Amazon Creators, said he suspects it’s a matter of “controlling the inevitable,” and that Disney is turning a losing battle into a winning content strategy
Miller points out that, in addition to the difficulty of playing legal Whack A Mole with every AI company on Earth, IP eventually enters the public domain. In fact, a number of Disney copyrights have already expired, including the original version of Mickey Mouse, Winnie the Pooh, Snow White, Cinderella, and a handful of others.
“By officially licensing these characters now, Disney does three things,” Miller says. “1. Monetizes the AI trend rather than just fighting it in court. 2. Sets the quality standard for how their characters appear in AI video (likely drowning out lower-quality unauthorized versions). 3. Captures data on how fans want to use their IP before they lose exclusive rights.”
The deal does in fact create new content streams for Disney.
The company says fans will be able to watch curated selections of Sora-generated videos on Disney+, and OpenAI and Disney will collaborate to utilize OpenAI’s models to power new experiences for Disney+ subscribers, and create new ways to connect with Disney’s stories and characters. Sora and ChatGPT Images are expected to start generating fan-inspired videos with Disney’s multi-brand licensed characters in early 2026.
Creators of fan fiction will be salivating this week at the prospect of using popular Disney characters in their own stories. When the deal closes, fans will be able to create videos and images of Mickey Mouse, Minnie Mouse, Lilo, Stitch, Ariel, Belle, Beast, Cinderella, Baymax, Simba, Mufasa, as well as characters from the worlds of Encanto, Frozen, Inside Out, Moana, Monsters Inc., Toy Story, Up, Zootopia, and many more.
As well, fans will be able to use animated or illustrated versions of Marvel and Lucasfilm characters like Black Panther, Captain America, Deadpool, Groot, Iron Man, Loki, Thor, Thanos, Darth Vader, Han Solo, Luke Skywalker, Leia, the Mandalorian, Stormtroopers, Yoda and more.
The agreement does not allow Sora or ChatGPT to use the likenesses of human actors, so representations of Marvel or Star Wars characters from the live action films are not included.
The deal also gives Disney a lot of control over how its IP is used, which is seen as critical for such a family-friendly brand.
OpenAI has committed to implementing responsible measures to address trust and safety, including age-appropriate policies and other reasonable controls across the service.
In addition, OpenAI and Disney have committed to maintaining robust controls to prevent the generation of illegal or harmful content, to respect the rights of content owners in relation to the outputs of models, and to respect the rights of individuals to appropriately control the use of their voice and likeness.
It is very likely Disney will continue to pursue legal action against AI companies that use its IP without a license. In that sense, the deal is seen as not only protecting Disney copyright, but also driving users to Sora, since fans can legally create fan fiction videos without fearing any legal backlash.