NextFin news, OpenAI on Monday, October 6, 2025, announced significant updates to the copyright policy of its AI video generator, Sora, after facing intense criticism from entertainment industry stakeholders over unauthorized use of copyrighted characters. The company pledged to provide rights holders with more granular control over how their characters are used in Sora-generated videos, moving away from its initial opt-out approach.
The original policy required copyright owners to proactively request that OpenAI block their characters from being generated, a system widely criticized as inadequate and reactive. This led to a proliferation of videos featuring popular characters such as SpongeBob SquarePants, Pikachu, and others without explicit permission, sparking concerns about intellectual property infringement and potential legal action.
OpenAI CEO Sam Altman, in a blog post published on October 6, acknowledged the feedback from rights holders and users, stating that the company is working to implement an opt-in style model for fictional characters, similar to the existing model for personal likenesses. Altman emphasized that rights holders will be able to specify how their characters can be used, including the option to prohibit usage entirely.
Altman also revealed that OpenAI is exploring a revenue-sharing system to compensate creators and companies who allow their intellectual property to be used in user-generated Sora videos. This move aims to monetize the platform sustainably while rewarding rights holders, although the exact details of the payout model remain under development.
The update comes amid widespread reports of Sora videos featuring copyrighted content that raised alarms across Hollywood and international markets, including Japan, where anime studios have expressed strong concerns about AI-generated reproductions of their characters. Legal experts warn that OpenAI’s initial opt-out policy could have exposed the company to lawsuits, as studios and talent agencies urged clients to opt out or file takedown requests.
Industry observers note that OpenAI’s shift toward more proactive copyright controls reflects broader challenges in balancing AI innovation with intellectual property rights. The company’s approach mirrors ongoing debates about fair use and the need for clearer regulations governing AI-generated content.
OpenAI’s Sora platform, launched recently as a TikTok-style app for AI-generated short videos, quickly gained popularity but also drew criticism for enabling the creation of videos depicting copyrighted characters in unauthorized or controversial scenarios. The company has since implemented content blocks and other guardrails to address misuse.
Altman compared the current phase of Sora’s development to the early days of ChatGPT, highlighting the company’s commitment to rapid iteration and responsiveness to stakeholder feedback. He acknowledged that while some missteps have occurred, OpenAI aims to refine its policies and technology to better serve users and rights holders alike.
The entertainment industry continues to watch closely as OpenAI navigates the complex legal and ethical landscape surrounding AI-generated media. The company’s efforts to collaborate with rights holders and establish revenue-sharing mechanisms may set important precedents for future AI content platforms.
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