WSJ What’s News - Why Disney Is Investing $1 Billion in OpenAI

Episode Date: December 11, 2025

P.M. Edition for Dec. 11. Disney announces a $1 billion investment and licensing deal with OpenAI that lets users put their characters in AI-generated videos. WSJ entertainment reporter Ben Fritz discusses why Disney came to terms with OpenAI and what risks it faces. Plus, Oracle shares fall nearly 11% as investors worry the company is overspending on AI, dragging the Nasdaq down with it. And in an effort to break its dependence on China, the U.S. is developing its own critical minerals industry—and, as Journal reporter Heather Somerville explains, Silicon Valley is giving it a boost. Alex Ossola hosts. Sign up for the WSJ's free What's News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

What Disney gets out of letting Open AI users drop Mickey Mouse and Buzz Lightyear into AI videos. This gives Disney a financial stake in the hottest AI company in the world. Plus, after two Senate votes fail, hope is fading for a deal to extend health care subsidies for millions of Americans before the end of the year. And how Silicon Valley is giving a boost to a U.S. push into critical minerals against China. It's Thursday, December 11. I'm Alex O'Sullough for the Wall Street Journal. This is the PM edition of What's News, the top headlines and business stories that move the world today.

Disney has licensed its characters to OpenAI for three years as part of a deal the two companies announced today. Disney is investing $1 billion in OpenAI with the possibility of buying more stock. On OpenAI's SORA video platform, users will be able to generate videos of more than 200 Disney, Marvel, Star Wars, and Pixar characters, including Darth Vader, Homer Simpson, and Spider-Man, and some of those videos can be streamed on Disney Plus. A person with knowledge of the matter says OpenAI will pay Disney to use its characters in SORA. The companies didn't disclose financial terms of that arrangement. Here's Disney CEO Bob Eiger in an interview on CNBC this morning. Open AI is both respecting and valuing our creativity, both our characters, but also those that have created those characters.

So it gives us an opportunity really to play a part in what is really a breathtaking growth in essentially AI and new forms of media and entertainment. The companies announced the deal a day after Disney sent a cease and desist letter to Google, saying the tech giant's AI system, violated Disney's copyrights. A Google spokesman didn't respond to a request for comment. But by partnering with OpenAI, WSJ Entertainment reporter Ben Fritz said, Disney isn't letting the AI wave pass it by. Disney has concluded that they need to partner with AI companies, that they can't just fight them in court. The legal situation has been mixed for entertainment companies so far as in terms of what they can prevent AI companies from doing with their copyrighted material. We've seen this in the past that when entertainment tries to fight tech, it's a very hard battle. I think they've concluded there has to be some legal way and some way that makes money for the entertainment companies to start putting their content into AI, especially into image and video generators, rather than trying to play whack-a-mole and stop it.

Both companies hope that making beloved characters accessible to users will be particularly engaging for younger audiences. Here's OpenAI CEO Sam Altman, also speaking on CNBC this morning. When it comes to putting themselves in that one lightsaber scene from, a lightsaber fight from Star Wars or making like a Buzz Lightier custom birthday video for their kid, I think this is going to be like quite a big deal for our users. Altman added that there will be guardrails around the kinds of videos users can generate. A person familiar with the matter said that there are limits around what the Disney characters can do in SORA videos, around issues like drugs, alcohol, and sex.

And the characters won't include the likenesses or voices of actors. But even so, Ben Fritz says the licensing deal does come with risks for Disney. AI is very unpredictable. You can't just easily program it and say, never show a Disney character using drugs or smoking or in a sexually inappropriate situation or cursing. So it's inevitable that no matter how many guardrails they try to put in, you're going to start seeing some weird, funny, probably inappropriate, and offensive stuff done.

with Disney characters in SORA. And I think Disney is signaling that they're willing to accept that risk. They probably know someone that's going to happen, and they're trusting that Open AI will be a good partner to try to improve and change the app when these kind of embarrassing videos end up getting generated. News Corp, which owns the Wall Street Journal, has a content licensing partnership with OpenAI. Separately, OpenAI was sued in California today for wrongful debt. by the estate of an 83-year-old woman who was killed in August by her son, Stein Eric Solberg.

He then took his own life in their Connecticut home. He had been engaging in delusion-filled conversations with chat GPT, and it appears to be the first documented killing involving a troubled person who is engaging extensively with an AI chatbot. Eli Lilly has reported dramatic weight loss in a clinical trial of an experimental drug Reda Trutide. After a year of treatment, patients lost up to about 29% of their body weight, significantly better than existing drugs. The result could help clear the path for a big-selling new product that allows Lilly, which already sells the popular drugs, Maljaro and Zepbound,

to continue its success in the weight loss market. That success last month made Lily the first health care company to join the elite club of $1 trillion companies, although its market cap has since dropped back below that level. And in Washington, a Democratic effort to extend federal health insurance subsidies that expire at the end of the year failed in the Senate today. An alternative health care bill from Republicans that would offer federal funds for out-of-pocket health care costs instead of subsidies also failed. If no bill passes, the millions of Americans covered under the Affordable Care Act face soaring costs. There's now little prospect for a deal to extend the subsidies this year.

Shares of Oracle fell almost 11% today, its worst day since January, after the company's latest earnings report. Investors are concerned that the company's overspending on AI infrastructure that might not pay off. Oracle's shares weighed on the NASDAQ, which dropped a quarter percent, while the Dow and the S&P rose to close at new records. Coming up, what it takes to create a U.S. critical minerals industry, and how Bulgaria's government became the latest brought down by young people. after the break. The U.S. pushed to develop its own sources of raw materials critical to the modern economy,

aluminum, magnesium, rare earths, is getting a boost from Silicon Valley. Venture capitalists have invested a record $600 million in U.S. critical mineral startups this year, according to Pitchbook, as part of the effort to counter China's dominance, especially as China has cracked down on exports. Heather Somerville, who covers technology and national security for the journal, joins us now. Heather, what are some of these companies and what are they doing? We have companies in Silicon Valley that are using AI and machine learning to try to improve outcomes from mining.

There's one company in particular that I profiled brimstone out here in Oakland, focusing on producing critical minerals out of rocks that are abundant and cheap. So the idea is if you can get a whole bunch of cheap rocks easily and produce these critical minerals that we need and China dominates, the U.S. might have a shot at producing economically some of these pretty precious materials that we are lacking. And it's focused on aluminum, magnesium, titanium to start. Other companies that we've looked at are focused on antimony, which is a rare earth that is essential to a lot of critical industries. And there's other companies that are focused on

rare earth magnets. Who is funding these startups? It's private and public money. On the private capital side, there's, you know, venture capital interest for the first time that I've ever seen in this space. We have a huge initiative from JP Morgan investing in all sorts of national security essential industries and critical minerals is a focus. And then there's the government money. The Trump administration has invested in, among others, Vulcan elements, a rare earth magnet startup out in North Carolina, re-element technologies, which works on recycling of those rare earth magnets. And notably, the Pentagon took a 15% stake in MP materials, a rare earth mine. So we are seeing a huge amount of state capital going into this space,

which certainly boosts investor interest because it indicates a commitment from, the administration to sustain a domestic supply. What are the challenges these companies are encountering? They're all unproven. That's what it comes down to. We haven't done this as a country in a long time. The labor force skilled in mining and processing these minerals mostly doesn't exist. And these new entrants have no track record of actually doing this stuff at scale.

this is a low margin business. China has dominated it for decades. For the U.S. to create an industry that lasts, that can be competitive with China, that's very much an open question. Over the last few decades, there have been several American-led efforts to begin to build up a domestic supply, and many, if not most of them, have fallen flat in the face of competition from China. That was WSJ reporter, Heather Somerville. Thank you, Heather. Thank you. And in one of the latest industry developments, ionic mineral technologies says it has discovered a trove of 16 rare earth and critical minerals in Utah that will help the U.S. compete with China. As we mentioned on this morning show, the U.S. has been rolling out its vision for peace in Ukraine. Today, Ukraine and its European allies responded with their own version of a peace. plan. But big gaps remain, particularly over Ukrainian territory that Moscow wants.

Yesterday, President Trump said that he hadn't decided whether he'd go to talks with Ukrainian President Volodymyr Zelensky after an invitation from European officials. In the Balkans, Gen Z has toppled Bulgaria's government. The resignation of the country's coalition government follows street protests led by young people, who were angry over corruption and the perception that the country's elite are disconnected from the struggles of ordinary citizens. Thousands of people protested in the Bulgarian capital of Sophia yesterday. What they were chanting there is resignation. The government collapse comes just weeks before Bulgaria is due to switch to using the euro as its currency and prolongs a political crisis

that has triggered seven parliamentary elections in four years. It's not just Bulgaria. Tanzania, Indonesia, the Philippines, Nepal, and Madagascar have all seen mass demonstrations of young people this year, sometimes bringing down their governments too. And back in the U.S., a federal judge has ordered the immediate release of Kilmar-Abrego-Garcia from U.S. immigration custody. He'll be detained at home with electronic monitoring and need court permission for most of his movements. Abrago-Garcia was sent to an El Salvador megap prison in March, despite a court order barring the deportation.

He was brought back to the U.S. months later. And that's what's news for this Thursday afternoon. Today's show is produced by Pierre Bienname with supervising producer Tali Arbell. I'm Alex O'Sullough for The Wall Street Journal. We'll be back with the new show tomorrow morning. Thanks for listening.