In a landmark move that signals a definitive shift in how major media conglomerates approach artificial intelligence (AI), OpenAI has gone from the company that had unapproved Disney princesses being made from its tools to a $1 billion partnership with the house of mouse itself. Disney CEO Bob Iger unpacked the deal jointly with OpenAI CEO Sam Altman in a TV interview with CNBC’s Squawk on the Street, explaining “we’d rather participate in the rather dramatic growth, rather than just watching it happen and essentially being disrupted by it.” He also reframed the issue of how AI is reshaping entertainment, business, even work itself: “Someone once said to me that creativity is the new productivity, and I think you’re starting to see that more and more.”
TL;DR
- Disney partners with OpenAI in a $1 billion deal to embrace AI growth and avoid disruption.
- Disney licenses approximately 200 characters for OpenAI's Sora video generation platform.
- The agreement balances IP protection with embracing technological disruption, benefiting human creators.
- Disney aims to lead in AI's entertainment landscape, integrating user-prompted content into Disney+.
The deal, which brings Disney’s intellectual property to OpenAI’s video generation platform Sora, is structured to balance “aggressive” intellectual property protection with a willingness to embrace inevitable technological disruption, Iger said. Under the terms of the three-year agreement, Disney will license approximately 200 characters for use within Sora, allowing users to create short-form videos featuring iconic figures ranging from Mickey Mouse to Star Wars personalities.
Iger described the collaboration not as yielding to AI, but as an essential advancement—and one that benefits human creators. This stems from the agreement excluding name and likeness rights, as well as character vocalizations. “And so, in reality, this does not in any way represent a threat to the creators at all, in fact, the opposite. I think it honors them and respects them, in part because there’s a license fee associated with it.” Iger emphasized multiple times that Disney aims to lead in how technology reshapes the entertainment landscape. “No human generation has ever stood in the way of technological advance, and we don’t intend to try.”
This collaboration is markedly different from Disney's dealings with other major technology firms. On the very day the agreement with OpenAI was revealed, Disney dispatched a cease-and-desist letter to Google concerning purported unauthorized use of intellectual property. Iger clarified the distinction in their methods by pointing out that, unlike Google, OpenAI has consented to “honor and value and respect” Disney’s material via a payment for usage rights and protective measures. “We have been aggressive at protecting our IP, and we have gone after other companies that have not honored our IP,” Iger stated, further mentioning that discussions with Google had not succeeded in “bear fruit.”
A win-win partnership?
For OpenAI, reportedly facing pressure from Google, whose Gemini 3 has been praised by AI experts like Salesforce billionaire Marc Benioff, this agreement signifies an endorsement of its AI-driven video creation capabilities. Altman informed CNBC that consumer interest in Disney characters was “sort-of off the charts,”, and he foresaw a time when enthusiasts could produce their own material, like a “Buzz Lightyear custom birthday video” or a unique lightsaber sequence. Altman contended that the collaboration would unleash “latent creativity” among everyday people by reducing the expertise and exertion needed to realize creative concepts.
The partnership will also encompass Disney's proprietary streaming service. Iger disclosed intentions to incorporate “user prompted Sora-generated content” into Disney+. He stated that Disney has “wanted for a long time to have what we will call user-generated content on our platform,”, indicating this alliance is a protective measure against the dominant streaming entity YouTube and the social media hub TikTok, which is partly managed by The Ellison family, also owners of entertainment competitor Paramount.
The deal includes undisclosed warrants, giving Disney a financial stake in OpenAI’s success. Iger confirmed the warrants and declined to offer more specifics. He compared this forward-thinking approach to Disney’s 2005 decision to license shows to iTunes, viewing the OpenAI partnership as the modern equivalent of boarding a “profound wave” of societal change.
Iger revealed the groundwork for this deal was laid several years ago, saying he had first met Altman in 2022, when he was retired from Disney, before his comeback as CEO. Altman gave Iger a “bit of a road map” about where OpenAI was headed, and Disney has been “extremely impressed” with OpenAI’s growth since then, with all of Altman’s predictions from 2022 coming true a lot faster than either party realized. Iger added Disney sees great opportunities to license other product from OpenAI in the years ahead, which he sees being a huge push in “essentially accomplish[ing] a lot of what we feel we need to accomplish in the years ahead.”
