The Walt Disney Company has entered into a landmark strategic agreement with OpenAI that positions Disney as a major investor and content partner for OpenAI’s generative AI video platform Sora. Under the terms of the three-year arrangement, Disney will make a $1 billion equity investment in OpenAI and license more than 200 of its most iconic characters and creative assets for use within Sora and associated generative tools.
Background and Scope of the Agreement
Sora is a text-to-video generation platform developed by OpenAI that enables users to create short, user-prompted video clips based on text inputs. It represents one of the most high-profile applications of generative AI in consumer media.
Under the licensing component of the Disney–OpenAI agreement, users of Sora and OpenAI’s ChatGPT Images tool will have the ability to generate short videos and images featuring a curated selection of characters, settings, props, and environments drawn from Disney’s extensive intellectual property portfolio, including Disney Animation, Pixar, Marvel Studios, and Star Wars franchises. These licensed elements encompass beloved characters such as Mickey Mouse, Elsa, Black Panther, Iron Man, Luke Skywalker, and many others, though the agreement expressly excludes the use of real-world talent likenesses and voices.
The licensing terms will explicitly govern the scope of authorized use, and the parties have stated their intention to implement responsible guidelines and safety measures to address potential misuse, protect creators’ rights, and maintain brand integrity.
Financial and Strategic Considerations
In addition to the content licensing arrangement, Disney will take an equity stake in OpenAI through the $1 billion investment. The investment will also include warrants that provide Disney with the opportunity to acquire additional shares in OpenAI in the future. Beyond the equity component, Disney is expected to become a significant commercial customer of OpenAI’s technology, including use of OpenAI’s APIs and ChatGPT tools across its business operations and digital platforms.
A selection of AI-generated content created by Sora using Disney’s licensed assets is planned to be made available to stream on Disney’s subscription service, Disney+, enabling the entertainment company to integrate fan-generated video content into its own ecosystem.
Industry Context and Intellectual Property Considerations
The announcement comes amid a broader period of legal and strategic activity involving AI and copyrighted content within the entertainment industry. Disney has recently taken a more assertive stance in pursuing legal claims against other AI companies, including cease-and-desist demands alleging unauthorized use of its copyrighted materials by platforms such as character generation services.
By contrast, this partnership represents a proactive approach to generative AI, seeking to establish a structured and licensed framework that both expands creative engagement with audiences and preserves control over the use of valuable intellectual property. The exclusion of real-world talent voices or likenesses and the adoption of content safety guardrails within Sora reflect ongoing efforts to balance innovation with legal and reputational risk management.
Implications and Next Steps
For intellectual property and media law practitioners, the Disney–OpenAI deal illustrates the evolving landscape of AI content licensing and the strategic value of aligning legacy creative assets with emerging technologies. The three-year term of the agreement will provide a real-world test case for how established brands can work with generative AI developers while maintaining oversight of brand use and adherence to ethical standards.
The launch of licensed character-based AI content is anticipated in early 2026, when Sora and ChatGPT Images begin supporting Disney’s intellectual property under the new terms. As these tools are adopted, legal issues may arise around user-generated content, copyright, trademark, and creator rights, making this partnership a focal point for future developments in entertainment and technology law.
As major entertainment companies and AI developers forge high-value licensing and investment partnerships, businesses working with generative AI must carefully navigate intellectual property rights, content licensing, and risk management. Romano Law advises clients on AI-driven content deals, IP licensing, and compliance strategies at the intersection of technology and media.
If your organization is exploring generative AI tools or negotiating content partnerships, we welcome the opportunity to help you structure agreements that protect your brand and maximize long-term value.
Contributions to this blog by Kennedy McKinney.