Illustration: Gabriella Turrisi/Axios

Walt Disney has reached an agreement with OpenAI that will make the company the first major content licensing partner on Sora, OpenAI’s social video platform.

Why it matters: It’s a huge endorsement of AI-created content from one of the biggest media companies in the world.

Zoom in: As part of the agreement, Disney will make a $1 billion equity investment in OpenAI. It will also receive warrants to buy additional shares.

• Under the arrangement, social videos can be generated from from a set of more than 200 animated, masked and creature characters from Disney, Marvel, Pixar and Star Wars. It also gives users the ability to use hundreds of additional Disney animated props, like lightsabers.
• Users can use the visual images of the approved set of Disney characters and props to make stills or short-form videos designed to live in social media.
• They can’t use any voices associated with those characters, or make any long-form videos with Disney’s intellectual property.

Between the lines: As part of the agreement, OpenAI will commit to implementing responsible measures to further address trust and safety, "including age-appropriate policies and other reasonable controls across the service," per a statement.

• That provision is especially important to Disney, which has taken issue with how AI platforms used by children have weaponized the names and likenesses of its characters in the past.

**Of note: **The deal also gives Disney a fair amount of oversight and control over how its characters and intellectual property is being used.

• OpenAI and Disney have created a joint steering committee to monitor user creations for any content that violates a voluminous brand appendix, which outlines use cases Disney wouldn’t want its characters to be associated with.

**Zoom out: **Disney hopes its agreement with OpenAI serves as a proof point to the tech industry that it’s open to equitable agreements with AI firms, so long as its rights and creators are protected, according to source familiar with its thinking.

• It also sees the agreement as an opportunity to get creative.

• The OpenAI deal, a source familiar with the agreement told Axios, give Disney a number of ownership rights over the content created using its characters on Sora. The company also has the ability to curate the best of the user-generated videos to put them on its Disney+ streaming platform.

The big picture: The company has taken a more aggressive stance in going after AI companies for copyright infringement in recent months.

• On Wednesday, the firm sent a cease and desist letter to Google, alleging it is infringing Disney’s copyrights on a massive scale, sources told Axios.
• In September, the company sent a cease and desist letter to Character.AI with similar allegations.
• In June, the entertainment giant — alongside NBCUniversal — became the first major studio to sue a generative AI company when it filed a complaint against Midjourney. Warner Bros. Discovery sued Midjourney in early September.
• Earlier this month, Disney teamed with NBCU and WBD to sue the Chinese AI firm MiniMax, alleging large-scale piracy of their respective studios’ copyrighted works.

*Editor’s note: This story has been updated with new details throughout. *