OpenAI licensing deal ‘jumpstarts’ Disney+’s shortform push, says Bob Iger
Disney CEO Bob Iger says the recently signed agreement with AI giant OpenAI “jumpstarts” Disney+’s move into the shortform space, and has dismissed concerns it could negatively impact the value of its IP and characters.
Under the multi-faceted licensing deal, revealed in December, users of OpenAI’s text-to-video programme Sora will be able to create and share shortform videos (up to 30 seconds) featuring around 250 Disney-owned characters. A selection of those videos will then be featured on Disney+.
“We have obviously noticed the huge growth in shortform and user-generated content on other platforms such as YouTube,” said Iger during Disney’s first quarter earnings call on Monday.
“What this deal does is, by giving us the ability to curate what has been created by Sora on to Disney+, it jumpstarts our ability to have shortform video on Disney+.”
Characters included in the agreement span franchises and studios like Disney, Marvel, Pixar and Star Wars, and include Mickey Mouse, Minnie Mouse, Lilo, Stitch, Ariel, Belle, Beast, Cinderella, Baymax, Simba and Mufasa, as well as characters from Encanto, Frozen, Inside Out, Moana, Monsters Inc, Toy Story, Up and Zootopia.
Iger added that the “hope” is Disney+ users will be able to use the Sora tools to create shortform videos within the streaming service. “It’s all, I think, a positive step in terms of adding a feature we believe will greatly enhance engagement,” he said.
Over the past few weeks, Disney has gone public with its plans to expand into vertical video, aiming to launch a vertical experience within Disney+ later this year.
Disney’s deal with OpenAI has divided opinion. Some view the pact as forward-looking and the correct way to position the Mouse House for the future. Others have criticised the deal, claiming opening up Disney’s characters to user-generated AI videos could cheapen the value of its franchises and IP.
Asked how an increase in AI-generated content could affect the longterm demand for Disney franchises and IP, Iger said: “I don’t really see that it will have any impact at all.
“We view AI as having a number of possible advantages or opportunities for the company. One, as a tool to help the creative process. Another is productivity, which is simply being more efficient. And the third I’ll call connectivity, which is creating a more intimate relationship with the consumer.”
The OpenAI deal is likely to be one of the final major deals of Iger’s tenure as Disney CEO, which is scheduled to conclude at the end of 2026.
Disney’s board is expected to meet later this week to discuss Iger’s successor, with parks and resorts head Josh D’Amaro thought to be in pole position, while TV boss Dana Walden is also in contention. Reports have suggested a successor could be selected by next week, although Disney has not publicly given a timeline for the decision.
On Monday, Disney reported that its entertainment revenues had increased 7% year-on-year to US$11.61bn in Q1, with operating income declining 35% to US$1.1bn. The revenue increase was driven by the box-office performance of Zootopia 2, Avatar: Fire & Ash and Predator: Badlands, as well as the addition of sports streamer Fubo.
This is the first quarterly report since Disney stopped disclosing subscriber totals for its streaming services, including Disney+ and Hulu. It did disclose, however, that SVoD revenue had increased 11% to US$5.35bn in Q1, while operating income for its entertainment SVoD platforms was up 72% to US$450m.
Across the entire company, including its sports and experiences divisions, revenue was up 5% to US$25.98bn, with operating income down 9% to US$4.6bn.
