Magic-less Kingdom: Disney scraps AI projects over legal fears and union pushback

Disney’s secretive AI experiments have repeatedly collapsed due to legal concerns and union tensions, forcing the entertainment giant to scrap multiple projects despite investing heavily in the technology. The company’s struggles highlight the complex challenges media companies face when trying to implement AI while protecting intellectual property and maintaining relationships with creative talent.

What you should know: Disney created an entire business unit dedicated to AI but has abandoned several high-profile projects over the past 18 months.

• The company scrapped plans to use AI to “clone” Dwayne “The Rock” Johnson for the live-action “Moana” remake, despite Johnson’s approval and 18 months of negotiations with AI partner Metaphysic, a company specializing in deepfake technology.
• Disney also killed a proposed AI-generated scene featuring the character Bit in the upcoming “Tron: Ares” film to avoid antagonizing unions during contract negotiations.

The legal nightmare: Disney’s attorneys couldn’t resolve fundamental questions about AI-generated content ownership and data protection.

• The company struggled to determine how to protect data from “digital double” filming and ensure Disney owned all intellectual property aspects of AI-generated content.
• Since frontier AI models are trained on publicly-scraped content, anything produced with them exists on “shaky copyright ground” — problematic for Disney’s notorious control over its characters and properties.

The irony factor: While Disney battles to use AI internally, the company is simultaneously suing AI companies for allegedly stealing its content.

• In June 2024, Disney joined Universal Studios in suing AI image generator Midjourney, calling it the “quintessential copyright free-rider and a bottomless pit of plagiarism.”
• This dual approach creates a contradictory position where Disney wants to use AI tools while fighting against others using similar technology on its content.

What they’re saying: Disney’s legal chief Horacio Gutierrez explained the company’s delicate balancing act to the Wall Street Journal.

• “Enable our creators to use the best AI tools available without compromising the company long term,” Gutierrez said, describing Disney’s approach to AI implementation.

Why this matters: Disney’s AI struggles reveal the broader challenges facing entertainment companies trying to adopt artificial intelligence while navigating union relations, intellectual property concerns, and public perception risks in an industry built on creative talent and original content.