The Rise and Fall of the World’s Most Controversial AI Video Tool
In December 2024, OpenAI launched Sora — a text-to-video generator capable of producing photorealistic videos from a simple written prompt. Imagine typing “Tom Cruise dancing tango in the rain” and getting a cinematic clip in seconds. It was extraordinary technology. It was also, as we argued from the beginning, a legal disaster waiting to happen.
>On March 24, 2026, OpenAI confirmed it is shutting down Sora. The company posted on X: “We’re saying goodbye to Sora. What you made with Sora mattered, and we know this news is disappointing.” No exact shutdown date was given. The model’s underlying research will be redirected toward robotics and physical-world problem solving.
What Killed Sora?
Three factors converged to end the project.
1. Unsustainable economics. OpenAI was estimated to be spending $15 million a day on inference to enable users to produce videos — a cost the head of Sora himself called “completely unsustainable.”
2. Collapsing engagement. Monthly active users peaked in December 2025 and declined sharply in 2026, with downloads falling to just over 1 million in February. Yahoo Finance
3. Legal and reputational pressure. Sora was never just an expensive toy. It was a machine for producing potentially copyrighted, brand-sensitive, and easily misleading videos at scale. Hollywood agencies called it a “significant risk” to creators’ rights. OpenAI was forced to crack down on AI-generated likenesses of Michael Jackson, Martin Luther King Jr. and Mister Rogers — but only after outcry from family estates and actors’ unions.
The Disney Deal: A Billion-Dollar Casualty
Disney had inked a landmark three-year deal with OpenAI in December 2025, licensing more than 200 characters from Disney, Marvel, Pixar, and Star Wars — and pledging a $1 billion equity investment. No money ever changed hands. The deal was the first time Disney licensed its intellectual property to an AI platform. The Cool Down It is now dead.
What This Means for IP and Copyright Law
Sora’s shutdown does not make the legal questions disappear. It crystallizes them.
The core issues remain unresolved — and will resurface with every AI video tool that follows:
Training on copyrighted works. OpenAI relied on a “fair use” defense under U.S. law. In Italy and the EU, this defense does not exist. Using protected works to train AI without consent is likely a violation of Law 633/1941 and conflicts with the EU AI Act’s transparency obligations.
Deepfakes and image rights. Under Italian civil law (Art. 10 c.c.) and the GDPR, publishing someone’s likeness without consent is prohibited. Facial data is biometric data — requiring explicit legal basis under GDPR Art. 9. Sanctions can reach €20 million or 4% of global turnover.
Copyright in AI-generated output. Both the U.S. Copyright Office and Italian law agree: AI-generated content, absent meaningful human authorship, is not protectable. Invest heavily in AI video production — and anyone can copy it freely.
The Real Lesson
Sora was a striking demonstration of what AI could do with video. It just could not turn that attention into a sustainable business — and the legal exposure it created was never adequately managed. The technology outpaced regulation. Sora’s closure buys time — but the next tool is already here. The legal framework for AI-generated video remains the urgent unfinished business of the entire creative industry.
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