Google has removed dozens of AI-generated videos depicting Disney-owned characters after receiving a cease and desist letter from the studio on Wednesday. The move reveals Disney’s complex—and seemingly contradictory—approach to artificial intelligence and its beloved intellectual property.
Disney flagged YouTube links to the videos in its letter and demanded immediate removal. The AI-generated content included Mickey Mouse, Deadpool, and characters from Star Wars and The Simpsons, many created using Google’s AI video tool, Veo. The links initially worked on Thursday but now redirect to a message stating, “This video is no longer available due to a copyright claim by Disney.”
Drawing a Line in the Sand
Disney launched this broadside shortly before announcing a deal to license 200 characters to OpenAI, which will allow Sora users to create short AI clips. The company is attempting to draw a clear line protecting its characters from unlicensed AI use.
In the cease and desist letter, Disney provided an extensive list of characters it wants removed from YouTube and YouTube Shorts, including those from Frozen, Moana, Toy Story, Deadpool, Iron Man, Lilo & Stitch, and Winnie the Pooh. The company also demanded that Google implement safeguards to prevent its AI tools from generating Disney-owned characters and cease using Disney’s characters to train its AI models.
Google responded Thursday with a diplomatic statement: “We have a longstanding and mutually beneficial relationship with Disney, and will continue to engage with them. More generally, we use public data from the open web to build our AI and have built additional innovative copyright controls like Google-extended and Content ID for YouTube, which give sites and copyright holders control over their content.”
The OpenAI Bombshell: A $1 Billion Investment
On the same day Disney was issuing cease and desist letters, the entertainment giant announced a massive partnership with OpenAI. Disney is paying $1 billion for an undisclosed stake in the company, allowing its characters to be used in AI-generated content through Sora.
Starting in the coming months, users will be able to play with Pixar, Marvel, and Star Wars characters using Sora on Disney+ or OpenAI’s platforms. Want to crouch at a race starting line next to a character from Cars? Your moment has arrived.
However, there are significant restrictions. Disney characters will be available, but not in ways that show their faces—the company is deliberately avoiding the SAG-AFTRA minefield. No voices will be included either, sidestepping voice-actor legal and ethical concerns. That still leaves a massive selection of animated characters and presumably faceless ones like Darth Vader and Iron Man.
What’s Motivating This Move?
In a word: Netflix. Bob Iger doesn’t want to repeat history. Netflix dominated streaming before Disney could respond, forcing a belated scramble to launch Disney+ in 2019. Now Iger is positioning Disney at the forefront of AI-generated entertainment before competitors can establish dominance.
Entertainment giants in the AI era will thrive based on two criteria: tech and content. Netflix has superior algorithms, data, and personalization engines. Disney has unmatched beloved characters and properties. Netflix’s recent acquisition of Warner Bros. bolstered its content library for AI training. Disney’s OpenAI deal represents its counter-move on the tech front.
The Strategy Behind Controlled AI Access
Iger is strategically keeping AI usage away from what concerns people most: live actors being manipulated. There’s both a guild issue and an uncanny-valley problem with having Chris Evans walking and talking as users see fit. Animated characters, already stylized, present a shallower valley.
“A Buzz Lightyear custom birthday card for their kid,” OpenAI leader Sam Altman said on CNBC Thursday—arguably the most benign use case imaginable.
But make no mistake: this is just the beginning. Existing actors moving in lifelike ways (or synthetic actors doing the same) is the inevitable destination. Disney just needs to establish union agreements and consumer comfort first.
A Shifted Focus
This partnership represents more than just technological advancement—it signals a philosophical shift. Iger acknowledged that “you can’t do anything about it. No human generation has ever stood in the way of technological advance, and we don’t intend to try.” He added, “if it’s going to happen, including disruption of our current business models, then we should get on board.”
Rather than fighting user-generated content’s dominance on TikTok, YouTube, and Instagram, Iger is leaning into it. He’s betting people would rather create and share content featuring characters they love, especially now that AI enables those characters to do virtually anything users want.
This doesn’t mean Disney is abandoning original content—you still need to refresh old characters or invent new ones for people to manipulate. But it does suggest a reallocation of resources, with more investment going toward enabling user-generated content than creating entirely new properties.
Will This Work?
Nobody knows. Legitimately nobody. All this supply is arriving before any evidence of demand—a strange inversion of basic economics. Will speaking characters into action become a paradigm-shifting way of interacting with screens, or just a passing novelty that makes this deal look cringe in retrospect? Will it be TikTok or MySpace?
Iger’s billion-dollar bet will soon provide answers. Disney is still Disney—but as of today, it’s a little less about finding new water sources and a little more about going back to the well.
