The promise and peril of AI is a not a brand-new phenomenon. But it was not until this week that studios and top agency CAA collectively sounded the alarm over one of its most recent and threatening developments – Sora 2.
The new OpenAI generative video model allows users to create social-media-ready videos with just a brief text prompt. The result can be a product of the user’s imagination, or a fan-fiction-like story using recognizable properties. The app’s “Remix” feature allows for mind-bending mash-ups like Tupac Shakur sitting on the set of Mr. Rogers’ Neighborhood, Michael Jackson doing Jackass-like stunts or Pikachu strapping on a helmet to fight in The Thin Red Line.
In response to the furor from content creators over the unauthorized use of their works, OpenAI’s Sam Altman walked back the company’s initial approach of having IP owners opt out of having their stuff fed into the model. He wrote last week that “we will give rightsholders more granular control over generation of characters, similar to the opt-in model for likeness but with additional controls.”
Hollywood isn’t acquiescing. Disney and several other players opted out from the beginning. CAA on Wednesday evening put out a stern statement. Sora 2, the mega-agency said, “exposes our clients and their intellectual property to significant risk.”
The MPA‘s Charles Rivkin, speaking for Hollywood’s major studios, said in a statement that it was OpenAI’s responsibility to “prevent infringement on the Sora 2 service. OpenAI needs to take immediate and decisive action to address this issue. Well-established copyright law safeguards the rights of creators and applies here.”
OpenAI has yet to issue a public response.
Left unchecked, AI holds the possibility of allowing for rampant piracy of content. That is why three studios – Warner Bros., Walt Disney Co. and NBCUniversal – have filed suit against San Francisco-based AI firm Midjourney over the use of protected IP, ranging from DC superheroes to Star Wars characters, in their service. The three studios recently sued a Chinese AI firm MiniMax for “willful and brazen” copyright infringement. Last week, Disney sent a cease-and-desist letter to Character.ai for allowing users to rip off original IP including Spider-Man and Darth Vader, Moana and Elsa.
None of the studios, however, have sued OpenAI, which last week reached a valuation of $500 billion. The biggest and best known of AI companies to burst on the scene in recent years counts Microsoft as a major backer and gained wide traction with its large-language model, ChatGPT. Individual Hollywood players, instead, have been vocal in warning of potentially dire consequences to the country’s art and culture if copyright is not protected.
“We firmly believe that America’s global AI leadership must not come at the expense of our essential creative industries,” read a letter to the White House in March signed by over 400 power players. “For nearly 250 years, U.S. copyright law has balanced [a] creator’s rights with the needs of the public, creating the world’s most vibrant creative economy,” the missive says. “We recommend that the American AI Action Plan uphold existing copyright frameworks to maintain the strength of America’s creative and knowledge industries, as well as American cultural influence abroad.”
Here’s a look at where things stand:
Sora 2: The Reawakening
Sora first launched in December of 2024, with Sora 2 following almost a year later. The latest version, which OpenAI calls its “flagship video and audio generation model” just debuted. The invitation-only app immediately became the top title in the Apple Store. It is only available on iOS devices. In the days leading up to the new app’s launch, according to the Wall Street Journal, the company told talent agencies and studios they would need to opt out to avoid having copyright material – i.e. characters — appear in videos created in the tool. But CEO Sam Altman shifted gears to an “opt-in” model, saying in a blog post that Sora would instead move to that more “granular control” stance.
“We want to … let rightsholders decide how to proceed (our aim of course is to make it so compelling that many people want to). There may be some edge cases of generations that get through that shouldn’t, and getting our stack to work well will take some iteration.”
He also held out the possibility of remuneration down the line. But it’s vague and it’s on OpenAI’s terms.
“We are going to have to somehow make money for video generation … We are going to try sharing some of this revenue with rightsholders who want their characters generated by users. The exact model will take some trial and error to figure out, but we plan to start very soon. Our hope is that the new kind of engagement is even more valuable than the revenue share, but of course we want both to be valuable.”
OpenAI is private and doesn’t report earnings. Given its heavy investment, the company generated around $4.3 billion in revenue in the first half of 2025, according to The Information, which cited financial disclosures to its stakeholders.
“Please expect a very high rate of change from us; it reminds me of the early days of ChatGPT. We will make some good decisions and some missteps, but we will take feedback and try to fix the missteps very quickly.
Studio Deliberations
Studios are split, caught in a limbo state between the promise of efficiency and innovation and the risk. Bruised by the epic battle with the WGA and SAG-AFTRA in 2023, with the unions’ dual strike largely fueled by fears about AI, they have settled into a curious phase of inaction. a longtime major studio veteran, “The big boys in our industry need to challenge OpenAI,” one longtime studio exec tells Deadline in an interview. “And that hasn’t happened yet.”
For years, Hollywood content creators have warned about piracy, whether through bootleg VHS tapes, or BitTorrent, or renegade streaming providers. The fear has always been that out-of-control technology will enable unauthorized content that undercuts the entertainment business. That is still the case, and studios are still pressing for tougher copyright and anti-piracy laws.
But when the Copyright Office solicited input on how it would handle AI, the response from studios, through the MPA, was that existing laws were sufficient. Sources say there’s a simple reason for the approach: Not all studio members are on the same page, as the MPA membership includes not just legacy studios but now Netflix and Amazon.
But there also has been caution among the studios over any law that may stifle the growth of AI, a technology that holds the promise of greatly reducing out-of-control production costs.
OpenAI’s Sora, though, appears to have been a bridge too far. The question is whether it is also one too late, given past trends in technology.
Trump’s Influence
In taking a much more hands-off approach to AI than his predecessor, Donald Trump has made it clear that content creators can’t expect to be owed money when their works are used in AI. “You can’t be expected to have a successful AI program when every single article, book or anything else that you’ve read or studied, you’re supposed to pay for,” he said. “You just can’t do it because it’s not doable,” he said as the White House unveiled its AI Action Plan in July. “China’s not doing it,” he said. In lobbying for a looser interpretation of copyright regs, the big AI players have played up the fact that restrictions would give China an edge in the AI race.
Trump appeared to buy that, signing a trio of executive orders that would fast-track federal permitting, review and construction of all major AI infrastructure projects.
He also fired the Register of Copyrights, Shira Perlmutter, many suspect over AI. Challenging her dismissal in a lawsuit, Perlmutter has noted that her opinion of the use of copyrighted works in training models contradicts Trump’s views. Her report did not provide a blanket statement that AI companies were in the clear in using content without permission, but that the circumstances were more nuanced.
The legal battle: A major question that will be before the courts is whether the unauthorized use of copyrighted works in training models actually infringes on protected IP.
Sen. Josh Hawley (R-MO) and Sen. Richard Blumenthal (D-CT) have introduced a bill that includes a provision that requires content owners’ consent, but it’s unlikely to get very far in a Congress that has been unable to even legislate on issues like privacy.
Instead, courts will likely weigh in. That happened during the summer, when a judge determined that another AI company, Anthropic, was not violating copyright when it fed authors’ books into its training models. The judge found potential liability a step earlier in the process where, when Anthropic, in accessing the authors’ works, downloaded them via pirate sites and other illegitimate channels The company recently agreed to settle the case for $1.5 billion.
The studio lawsuits against Midjourney are focusing less on the training model inputs, and more on the video service outputs. That is, if a user is able to churn out Superman and Minions at the click of a button, there’s got to be an obvious copyright violation.
TikTok Twist
Aside from the digital civil war that Sora is poising for Hollywood between the tech-lords (Apple, Amazon & the now David Ellison-owned Paramount), the old guard (Disney, Sony, NBCU, and WBD, for now) and the kingpins (Netflix, YouTube), the real player and victim in all this may end up being TikTok.
Once users make the leap of convenience and faith into the synthetic and/or slop, the Trump favored TikTok could seem very niche. In that sense, as much as the studios and streamers may be intending to haul OpenAI into court to protect their IP, it is TikTok that could suffer the biggest hit.
More so than any other major AI venture so far, the OpenAI product has positioned itself as the natural companion to TikTok. The still ByteDance-owned app probably doesn’t know whether to be flattered or frightened as Sora-created short videos floods the platform with AI slop. In architecture, interface, format and overall vibe, the currently invite-only Sora 2 (which launched on Sept, 30) is a social media network in all but name.
Skimming the look of the hugely popular (and soon to be partially Larry Ellison-owned) TikTok, self-proclaimed “world simulator” Sora is designed to attract the under 30-year-old users who remain the dominate demographic on TikTok. A demographic accustomed to smashing and grabbing any and all content, that also gets most of their news and other information from the platform.
Contrary to myths and hopes that audiences will reject AI, Sora is not totally synthetic. The “Cameo” component allows users to drop their own or other human faces into the action. Unlike the effort that still goes into TikTok (even with the use of other AI apps), Sora in seconds and with no external sourcing besides your own face creates personalized videos where you can be seen pulling off a lot more than dance moves.
Creative Angst
The creative community is tied in knots by the advent of Sora 2 and the boundary-blurring innovations that will surely follow. With traditional film and TV down at the heels, AI-enhanced production is something of a tonic for a battered industry. A number of startups have taken root on the very studio backlots where silent films were made more than a century ago. No less a luminary than James Cameron has aligned with a major AI firm, joining the board of Stability AI, and the AI Film Festival unspooled last spring at Alice Tully Hall, longtime home of the New York Film Festival.
Yet the techno-optimism sweeping the production community is accompanied by a gnawing anxiety about the way established IP is at risk of being ripped off and remixed. Not only recognizable characters from popular culture, but history itself.
“I’ve seen stuff where they’ve got Martin Luther King and Tupac walking down the street, I am definitely not a fan of that,” one production company chief tells Deadline. “It’s kind of fun to play with, but I wouldn’t want to see it used on a daily basis,” another company head said. “We are in a political time where people want to whitewash everything, and that’s why I don’t like it.”
Stars who also produce are in a particularly delicate bind, especially those with millions of social media followers. If TCM host Ben Mankiewicz can nearly get canceled by Film Twitter for touting the new Wizard of Oz at the Sphere, then the mission for talent is to stay out of the fray. “It’s too hot right now, especially with the Lily Norwood situation,” one adviser to a top star says. “There is a future here with Sora and these other models,” one producer posits, “but right now we are in the R&D phase and we’re going to see the lawsuits come. Once that’s settled we’ll hopefully know what emerges on the other side.”
Dade Hayes contributed to this report.
