Disney and OpenAI have resolved their prior video-generation rights dispute by entering into a three-year licensing and technology partnership that makes Disney the first major content partner for Sora, OpenAI's generative video platform.

"As part of this new, three-year licensing agreement, Sora will be able to generate short, user-prompted social videos that can be viewed and shared by fans, drawing from a set of more than 200 animated, masked and creature characters from Disney, Marvel, Pixar and Star Wars, including costumes, props, vehicles, and iconic environments," Disney wrote in a press release.

As part of the agreement, Disney will invest $1 billion in OpenAI and receive warrants for additional equity.

Disney will feature a curated selection of fan-generated Sora videos on Disney+, and both companies will collaborate to develop innovative AI products and enhance experiences across Disney's platforms.

In addition to enhancing the user experience with AI, Disney will adopt OpenAI tools for employees and use OpenAI APIs to build new internal and consumer-facing applications. So does that mean a restructuring of coders at the studio is just ahead?

"Technological innovation has continually shaped the evolution of entertainment, bringing with it new ways to create and share great stories with the world," Disney CEO Robert Iger wrote in a press release.

Iger continued, "The rapid advancement of artificial intelligence marks an important moment for our industry, and through this collaboration with OpenAI we will thoughtfully and responsibly extend the reach of our storytelling through generative AI, while respecting and protecting creators and their works."

He noted, "Bringing together Disney's iconic stories and characters with OpenAI's groundbreaking technology puts imagination and creativity directly into the hands of Disney fans in ways we've never seen before, giving them richer and more personal ways to connect with the Disney characters and stories they love."

Disney shares are up 2% in early trading. Year-to-date, the stock is down 2% and has been trading sideways since its peak in early 2021.

The resolution follows Disney and other major studios raising serious concerns about the unlicensed use of their characters in early Sora-generated videos. Disney has found a solution. Will other studios follow?