OpenAI Shuts Down Sora Just Months After Signing Disney Deal

OpenAI shut down its Sora AI video-generation app Tuesday in a move that immediately unwound what had been one of the most closely watched content partnerships in the brief history of generative AI. The announcement came just three months after Disney inked a groundbreaking deal with OpenAI under which Sora would have generated user-prompted videos from a set of more than 200 masked, animated, and creature characters from Disney, Marvel, Pixar, and Star Wars.

The transaction never closed. Disney is also exiting the deal it signed with OpenAI last year, in which it had pledged to invest $1 billion in the company and agreed to license some of its characters for use in Sora. As part of the agreement, Disney was to make a $1 billion equity investment in OpenAI and receive warrants to purchase additional equity.

OpenAI shuttered the standalone app to focus on other priorities. "As we focus and compute demand grows, the Sora research team continues to focus on world simulation research to advance robotics that will help people solve real-world, physical tasks," an OpenAI spokesperson said. The company added that it needed to make trade-offs on products with high compute costs. The closure also comes ahead of an expected initial public stock offering, with OpenAI set to reallocate computing chips to more lucrative coding, reasoning, and text-generation tasks.

In December, The Walt Disney Co. had surprised Hollywood by announcing a three-year deal with OpenAI to bring many of its popular characters to Sora's AI video generator. The scope of the agreement was sweeping: Sora would generate short, user-prompted social videos drawing from more than 200 animated, masked, and creature characters from Disney, Marvel, Pixar, and Star Wars, including costumes, props, vehicles, and iconic environments. A selection of those fan-inspired short-form videos was also to be made available to stream on Disney+. Disney CEO Bob Iger said in a statement at the time that "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."

While Sora proved wildly popular with users, hitting one million downloads less than five days after its launch in late September, the platform was perpetually shadowed by copyright disputes. When Sora launched, the app rocketed to the top of Apple's App Store and generated a storm of controversy as users flooded the platform with videos of popular brands and characters. The Motion Picture Association said in October that OpenAI needed to take "immediate and decisive action" to prevent copyright infringement on Sora. Observers noted the platform's TikTok-like feed was dominated by characters from SpongeBob SquarePants, Rick & Morty, and Nintendo franchises, with one viral video depicting an AI-generated Sam Altman standing alongside Pokémon characters, the digital Altman quipping, "I hope Nintendo doesn't sue us."

Disney itself had been simultaneously aggressive and pragmatic about AI's advance. Shortly before it announced the pact with OpenAI, Disney sent Google a cease-and-desist demand, alleging the internet giant was engaging in copyright infringement on a "massive scale" using AI models and services. The deal with OpenAI was framed at the time as a more strategic path: licensing characters to a compliant partner rather than fighting unauthorized use across every platform.

OpenAI had also faced controversy over a policy requiring users and copyright holders to "opt out" of being able to be generated by Sora 2. Disney had originally opted out before eventually agreeing to license its characters, even as it sued other AI companies for infringing on its IP.

A Disney spokesperson said the company respects "OpenAI's decision to exit the video generation business and to shift its priorities elsewhere," adding that it appreciated "the constructive collaboration between our teams and what we learned from it." With Sora gone, Google is positioned as essentially the only player in the AI video generation space with scale, though it has thus far not inked deals with major IP holders and has been facing lawsuits from some of them.

With the shutdown of the Sora app, ChatGPT will also no longer generate video based on text prompts. OpenAI said it is exploring ways to support users in exporting and preserving their content from the platform.