Disney Exits Controversial OpenAI Deal As Generative-AI Video Creation App Sora Is Discontinued

Disney Exits Controversial OpenAI Deal As Generative-AI Video Creation App Sora Is Discontinued

Disney has decided to exit a $1 billion deal with OpenAI, as the company has announced that it plans to shut down its Sora AI video app, just months after it was launched...

By MarkCassidy - Mar 25, 2026 09:03 AM EST
Filed Under: Disney
Source: Via THR

OpenAI has announced that it has decided to shut down Sora, the generative-AI video creation app that was launched last year.

“We’re saying goodbye to Sora. To everyone who created with Sora, shared it, and built a community around it: thank you,” the company said in a statement (via THR). “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 recent news that Disney had entered into a $1 billion partnership with OpenAI stirred up a significant amount of controversy, and the Mouse House has now announced that it has exited the deal.

As part of the three-year licensing agreement, Sora was going to have access to over 200 masked, animated or creature characters from Disney, Marvel, Pixar and Star Wars to utilise for user-prompted videos. Sora and ChatGPT Images were to generate “fan-inspired videos with Disney’s licensed characters in early 2026 — with Disney+ adding a curated selections of Sora-generated videos."

"Technological innovation has continually shaped the evolution of entertainment, bringing with it new ways to create and share great stories with the world," Disney CEO Bob Iger said at the time. "The rapid advancement of artificial intelligence marks an important moment for our industry." 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."

OpenAI hasn't given a reason for its decision to shutter Sora, but it obviously left Disney with little choice.

“As the nascent AI field advances rapidly, we respect OpenAI’s decision to exit the video generation business and to shift its priorities elsewhere,” a Disney spokesperson said. “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 probably fair to say that very few people outside of Disney's top brass were too put out by this news, but the company exiting this deal doesn't mean it will be getting out of the AI business altogether. Though nothing has been confirmed, Disney is expected to enter into a deal with another AI company at some point.

What do you make of this news? Drop us a comment down below.

About The Author:
MarkCassidy
Member Since 11/9/2008
Mark Cassidy is a writer, photographer, amateur filmmaker, and Rotten Tomatoes-approved critic from Dublin, Ireland.
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