The Disney-OpenAI Deal Redefines the AI Copyright War
THURSDAY, Disney and OpenAI have announced a deal that might have seemed unthinkable not so long ago. Starting next year, OpenAI will be able to use Disney characters like Mickey Mouse, Ariel and Yoda in its Sora video generation model. Disney will take a billion-dollar stake in OpenAI and its employees will have access to the company’s APIs and ChatGPT. None of this makes much sense: unless Disney is fighting a battle it couldn’t win.
Disney has always been a notoriously aggressive litigator when it comes to intellectual property. Alongside Universal, another IP powerhouse, he took Midjourney to court in June over productions that allegedly infringed on classic film and TV characters. The day before the OpenAI deal was announced, Disney reportedly sent a cease-and-desist letter to Google alleging copyright violations on a “massive scale.”
On the surface, there appears to be some dissonance with Disney embracing OpenAI while pushing its rivals. But it’s more than likely that Hollywood will take a similar path to that of media publishers when it comes to AI, signing licensing deals where possible and resorting to litigation when it’s not. (WIRED is owned by Condé Nast, which signed a deal with OpenAI in August 2024.)
“I think AI companies and copyright holders are beginning to understand and come to terms with the fact that neither side is going to have an absolute victory,” says Matthew Sag, a professor of law and artificial intelligence at Emory University. Although many of these cases are still pending in court, so far it appears that the model inputs (the training data these models learn from) are covered under fair use. But this deal is about outcomes – what the model returns based on your prompt – for which intellectual property owners like Disney have a much stronger case.
Reaching an outcome agreement resolves a multitude of complicated and potentially intractable problems. Even if a company tells an AI model not to produce, say, Elsa in a Wendy’s drive-thru, the model might know enough about Elsa to do so anyway — or a user might be able to prompt it to create Elsa without asking the character’s name. It’s a tension that lawyers call the “Snoopy problem,” but in this case we might as well call it the Disney problem.
“Faced with this increasingly clear reality, it makes sense for AI companies and entertainment giants like Disney to consider licensing deals,” says Sag.
