Disney Strikes $1 Billion Deal to Invest in OpenAI for Three Years

Disney is making a major move into artificial intelligence with a $1 billion investment in OpenAI. The deal will allow OpenAI’s short-form video platform, Sora, to use Disney characters to create short, user-generated videos.

According to a person familiar with the arrangement, the licensing agreement runs for three years and covers over 200 characters from Disney, Pixar, Marvel, and Star Wars. Some of these videos will be available to stream on Disney+.

The characters included in the deal range from Mickey Mouse and Elsa to Darth Vader. The agreement does not use the likenesses or voices of actors, which helps Disney avoid complicated compensation issues.

It also includes rules limiting the use of its characters in content related to drugs, alcohol, s**, or interactions with other companies’ properties.

“Disney is trusting OpenAI to work with them to address problems that may arise from AI-generated videos,” said the source. They noted that because AI outputs can be unpredictable, some videos might still violate Disney’s standards, especially in the early stages.

The announcement comes after Disney sent a cease-and-desist letter to Google. The letter accused Google of “infringing Disney’s copyrights on a massive scale” by using its characters and content in AI systems like Gemini, Nano Banana, and Veo.

Disney included dozens of images and screenshots showing Google-generated videos featuring characters such as Darth Vader, Homer Simpson, and Spider-Man. A Google spokesperson did not immediately respond to a request for comment.

In addition to the $1 billion investment, Disney will receive warrants allowing it to buy more stock in OpenAI at its current $500 billion valuation. OpenAI will pay Disney for the rights to use its characters in Sora.

The deal highlights Disney’s dual approach to AI: it is willing to partner and monetize its content with trusted companies like OpenAI while taking legal action against others, like Google, that it believes are using its intellectual property without permission.

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