The Journal: Disney’s Big AI Dilemma
Episode: Disney’s Big AI Dilemma
Release Date: August 6, 2025
Hosts: Ryan Knutson and Jessica Mendoza
Production: A co-production of Spotify and The Wall Street Journal
Introduction
In this episode of The Journal, Ryan Knutson and Jessica Mendoza delve into Disney's intricate relationship with artificial intelligence (AI), exploring the company's attempts to balance innovation with the protection of its invaluable intellectual property (IP). The discussion highlights significant developments, challenges, and the broader implications of AI integration within the entertainment giant.
Live-Action Moana and the AI Experiment
Announcement and Initial Plans
The episode opens with an announcement by Dwayne "The Rock" Johnson regarding the live-action reimagining of Disney's Moana. Hosted by Ryan Reynolds and Jessica Mendoza, the segment humorously touches upon the inclusion of Heihei and Maui in the new production.
Behind-the-Scenes AI Considerations
Jessica Tunkel reveals Disney's covert plans to leverage AI in the filmmaking process:
"Disney was looking at, is there a way we could do certain shots without having Dwayne Johnson be here every single time?" [00:42]
The idea was to use deepfake technology to overlay Johnson's face onto his stunt double, aiming to reduce filming time and costs. Johnson approved this concept, setting the stage for Disney's exploration into AI-generated imagery.
Ownership and Control of AI-Generated Content
Negotiation Challenges
A pivotal concern during these discussions was the ownership of AI-generated content:
"Would Disney own that final product? Whatever was created from Dwayne Johnson's face on his cousin's body, would they still own that imagery?" [01:29]
Disney's fixation on maintaining ownership stems from its vast library of iconic characters, as Jessica Tunkel explains:
"Disney is its characters, and if they lose control and ownership of those, they risk a lot." [01:43]
Decision to Forego AI in Moana
After 18 months of negotiations, Disney opted not to incorporate AI-generated footage in Moana, highlighting the inherent conflict in embracing AI while safeguarding IP:
"After 18 months of negotiations, Disney decided not to move forward with using AI footage in the film." [01:58]
Disney’s Strategic AI Initiatives
Cost-Cutting and Revenue Growth
Jessica Mendoza discusses Disney's rationale behind utilizing AI:
"Disney puts out some of the most expensive movies in the world... they have to find ways to cut costs and grow revenue and profits." [04:55]
AI applications envisioned by Disney include pre-production tasks, special effects enhancements, and streamlining on-set operations, potentially enabling the production of more films at reduced costs.
AI in Gaming: The Darth Vader Experiment
Disney's foray into AI-driven gaming partnerships is examined through their collaboration with Epic Games:
"They created an AI generated Darth Vader within Fortnite that gamers could chat with for a few days." [06:30]
Despite initial setbacks—such as the AI Darth Vader inadvertently cursing during interactions—Disney presented the experiment as a historic advancement in gaming:
"He called it a historic moment for video games." [07:15]
The episode highlights Disney's cautious optimism and the establishment of internal guardrails to manage AI integration responsibly:
"They would need to submit that to an AI committee at Disney who would have to approve you using whatever tool you wanted to use. And, you know, some people... it would take some time to get that approval." [08:46]
Legal Battles and Intellectual Property Concerns
Lawsuit Against Midjourney
In June, Disney, alongside Universal Studios, filed a lawsuit against the AI startup Midjourney for allegedly infringing on their IP by generating images of famous characters without consent:
"Disney and Universal... filed a joint lawsuit against Midjourney, an artificial intelligence provider that lets users generate images from text prompts." [10:35]
Disney characterized Midjourney as a "quintessential copyright free rider," emphasizing the unauthorized use of their characters:
"It called Midjourney, quote, the quintessential copyright free rider and a bottomless pit of plagiarism." [10:35]
Broader Industry Implications
Jessica Tunkel contextualizes the lawsuit within a larger conflict between Silicon Valley and Hollywood:
"The core battle... is what can you or can you not, can these models train on?" [12:06]
This legal action underscores the urgent need for regulatory frameworks governing AI's use of copyrighted material.
Impact on Creatives and Industry Dynamics
Concerns Among Creatives
The rise of AI has raised alarms among actors, writers, and artists about potential job displacement:
"If we don't stand tall right now. We are all going to be in trouble." [13:45-13:48]
Union Negotiations and Protections
Following a contentious period in 2023, studios and unions reached agreements that include protections for creatives in the age of AI. However, with new contract talks looming, Disney remains cautious to avoid upsetting union dynamics:
"Disney and other studios are reluctant to make Any moves related to AI that might upset unions." [13:56]
Risks and Future Outlook
Potential Loss of Character Ownership
The potential loss of control over iconic characters represents a significant financial and cultural risk for Disney:
"Think about these characters... what they are on posters, they're on lunchboxes... they're on T shirts." [15:26]
Balancing Innovation with Protection
Disney recognizes AI as the future of entertainment but remains steadfast in protecting its vast array of beloved characters:
"They're going to be super cautious because they have the most to lose." [15:45]
Conclusion
Disney’s Big AI Dilemma encapsulates the delicate balance the entertainment titan must maintain between harnessing cutting-edge technologies and safeguarding its cherished intellectual properties. As AI continues to reshape the landscape of media and entertainment, Disney's strategies and legal battles will likely set precedents for the industry's future interactions with artificial intelligence.
Additional Reporting: Connor Hart, Amrith Ramkumar, and Eric Schwartzel.