Disney’s big bets on the metaverse and AI slop aren’t going so well | The VergeSkip to main contentThe homepageThe VergeThe Verge logo.The VergeThe Verge logo.TechReviewsScienceEntertainmentAIPolicyHamburger Navigation ButtonThe homepageThe VergeThe Verge logo.Hamburger Navigation ButtonNavigation DrawerThe VergeThe Verge logo.Login / Sign UpcloseCloseSearchTechExpandAmazonAppleFacebookGoogleMicrosoftSamsungBusinessSee all techReviewsExpandSmart Home ReviewsPhone ReviewsTablet ReviewsHeadphone ReviewsSee all reviewsScienceExpandSpaceEnergyEnvironmentHealthSee all scienceEntertainmentExpandTV ShowsMoviesAudioSee all entertainmentAIExpandOpenAIAnthropicSee all AIPolicyExpandAntitrustPoliticsLawSecuritySee all policyGadgetsExpandLaptopsPhonesTVsHeadphonesSpeakersWearablesSee all gadgetsVerge ShoppingExpandBuying GuidesDealsGift GuidesSee all shoppingGamingExpandXboxPlayStationNintendoSee all gamingStreamingExpandDisneyHBONetflixYouTubeCreatorsSee all streamingTransportationExpandElectric CarsAutonomous CarsRide-sharingScootersSee all transportationFeaturesVerge VideoExpandTikTokYouTubeInstagramPodcastsExpandDecoderThe VergecastVersion HistoryNewslettersArchivesStoreVerge Product UpdatesSubscribeFacebookThreadsInstagramYoutubeRSSThe VergeThe Verge logo.Disney’s big bets on the metaverse and AI slop aren’t going so wellComments DrawerCommentsLoading commentsGetting the conversation ready...StreamingCloseStreamingPosts from this topic will be added to your daily email digest and your homepage feed.FollowFollowSee All StreamingAICloseAIPosts from this topic will be added to your daily email digest and your homepage feed.FollowFollowSee All AIEntertainmentCloseEntertainmentPosts from this topic will be added to your daily email digest and your homepage feed.FollowFollowSee All EntertainmentDisney’s big bets on the metaverse and AI slop aren’t going so wellThe studio’s $1 billion plans to collaborate with OpenAI and Epic Games seem to be falling apart.The studio’s $1 billion plans to collaborate with OpenAI and Epic Games seem to be falling apart.by Charles Pulliam-MooreCloseCharles Pulliam-MooreFilm & TV ReporterPosts from this author will be added to your daily email digest and your homepage feed.FollowFollowSee All by Charles Pulliam-MooreMar 25, 2026, 8:02 PM UTCLinkShareGiftEpic GamesCharles Pulliam-MooreCloseCharles Pulliam-MoorePosts from this author will be added to your daily email digest and your homepage feed.FollowFollowSee All by Charles Pulliam-Moore is a reporter focusing on film, TV, and pop culture. Before The Verge, he wrote about comic books, labor, race, and more at io9 and Gizmodo for almost five years.Less than a week into his tenure as Disney’s newly-appointed CEO, Josh D’Amaro is already dealing with two separate crises that have cast a shadow over the company’s future plans. OpenAI is shutting down its Sora image-generation program just months after Disney announced a $1 billion dollar collaboration to bake the tech into Disney Plus. And Fortnite maker Epic is laying off 1,000 employees at a time when we’ve heard basically nothing about the game studio’s $1.5 billion investment deal with Disney to build a metaverse.Disney could still integrate generative AI into its streaming service, and we might end up seeing some version of the company’s metaversal dreams become reality. But yesterday’s news from OpenAI and Epic point to an uncertain future for some of Disney’s biggest bets.There have always been signs that Sora was far from being ready for the big leagues (read: used to produce studio-approved entertainment). But OpenAI’s decision to shutter Sora came as a surprise, in part, because of how the Disney deal helped normalize the idea of major companies getting into bed with gen AI firms. In addition to giving OpenAI a massive influx of capital, the deal with Disney — which would put user-generated AI content directly onto Disney Plus — gave Sora a level of legitimacy that could have had a huge impact on how the public thinks about and engages with this kind of tech.Disney Plus would have also become flooded with AI slop that truly no one would see as a compelling reason to sign up for the service. But the legacy studio could have still patted itself on the back for being a trailblazer in the AI space and spun that to investors as a sign of it having a deep understanding of how to capitalize on tech trends. The situation reads very differently now — especially with OpenAI currently being under fire for helping the Pentagon conduct mass surveillance. Disney seems like it wants to cut its losses by distancing itself from OpenAI, which makes sense, but that move only highlights how ridiculous it was for D’Amaro to spearhead the collaboration in the first place.Disney-provided examples of its characters in Sora AI content. Image: DisneyRelatedDisney wants to drag you into the slopWho is AI nostalgia slop even for?Hollywood cozied up to AI in 2025 and had nothing good to show for itYou don’t need a background in corporate leadership to understand how ridiculous Disney’s plan to pay OpenAI $1 billion so that Sora could churn out slop featuring some of the studio’s characters was. Disney appears to have figured that out now, and late is better than never, but the OpenAI deal falling apart is going to make any future AI plans the company announces feel like they might be just as misguided and doomed to fail the same way.While the Epic layoffs haven’t been attributed to anything Disney-related, the sheer number of people who just lost their jobs gives us some insight into how things are changing at the company. Like every other live-service game, Fortnite has been struggling to keep its momentum going, and in-game currency price hikes could only do so much to offset lower player engagement and higher operating costs. Epic CEO Tim Sweeney told staffers that the layoffs and $500 million reduction in spending will put the company “in a more stable place,” which might be true, but it raises some questions about how the Disney partnership is being prioritized.Last week, Epic announced that Fortnite creators will soon be able to build Star Wars-themed games on the platform. That was the first bit of concrete news about the Epic / Disney collaboration the company shared since releasing a batch of Disney-focused minigames last fall. But what we haven’t heard about or seen is the ambitious “persistent universe” the two companies planned to build together as part of Disney’s $1.5 billion investment in Epic back in 2024. While Fortnite isn’t going away anytime soon, its struggles as one of the biggest online games in the world don’t bode well for the idea of a Disney-branded metaverse, which would be competing in the most cut throat segment of the games industry. And now Epic will be building it with a significantly smaller team.With both the Sora and Epic deals, Disney was clearly trying to get ahead of the game by making a big bet on the future through investments in AI and the metaverse. But in a single day that future looks much less certain — which means Disney may have made a pair of very expensive mistakes.Follow topics and authors from this story to see more like this in your personalized homepage feed and to receive email updates.Charles Pulliam-MooreCloseCharles Pulliam-MooreFilm & TV ReporterPosts from this author will be added to your daily email digest and your homepage feed.FollowFollowSee All by Charles Pulliam-MooreAICloseAIPosts from this topic will be added to your daily email digest and your homepage feed.FollowFollowSee All AIAnalysisCloseAnalysisPosts from this topic will be added to your daily email digest and your homepage feed.FollowFollowSee All AnalysisDisneyCloseDisneyPosts from this topic will be added to your daily email digest and your homepage feed.FollowFollowSee All DisneyEntertainmentCloseEntertainmentPosts from this topic will be added to your daily email digest and your homepage feed.FollowFollowSee All EntertainmentFortniteCloseFortnitePosts from this topic will be added to your daily email digest and your homepage feed.FollowFollowSee All FortniteGamingCloseGamingPosts from this topic will be added to your daily email digest and your homepage feed.FollowFollowSee All GamingOpenAICloseOpenAIPosts from this topic will be added to your daily email digest and your homepage feed.FollowFollowSee All OpenAIReportCloseReportPosts from this topic will be added to your daily email digest and your homepage feed.FollowFollowSee All ReportStreamingCloseStreamingPosts from this topic will be added to your daily email digest and your homepage feed.FollowFollowSee All StreamingMost PopularMost PopularNvidia CEO Jensen Huang says ‘I think we’ve achieved AGI’Welp, I bought an iPhone againOpenAI just gave up on Sora and its billion-dollar Disney dealSony and Honda ain’t feelin’ the Afeela anymoreDonut Lab’s solid-state battery could barely hold a charge after getting damagedThe Verge DailyA free daily digest of the news that matters most.Email (required)Sign UpBy submitting your email, you agree to our Terms and Privacy Notice. 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Disney’s ambitious plans to integrate generative artificial intelligence (AI) and establish a metaverse presence, initially slated as a $1 billion investment involving collaborations with OpenAI and Epic Games, are facing significant challenges and appear to be substantially curtailed. According to Charles Pulliam-Moore, reporting for *The Verge*, the studio’s CEO, Josh D’Amaro, is navigating two key crises stemming from these ventures. OpenAI has abruptly shut down its Sora image-generation program, a move surprising given the extent of the Disney partnership had normalized such collaborations. Simultaneously, Epic Games is undergoing a 1,000-employee reduction in workforce, coupled with a $500 million spending cut, impacting the development of the envisioned Disney-Epic metaverse.

The initial premise involved Sora generating studio-approved content for Disney Plus, potentially flooding the streaming service with AI-generated material. However, the sudden shutdown of Sora, coupled with OpenAI’s current scrutiny regarding surveillance applications, casts a considerable doubt on the viability of relying upon this technology. Disney's attempt to utilize Sora for character representations and AI-driven entertainment appears increasingly precarious. The situation underscores a broader trend of prematurely embracing nascent AI technologies without fully considering their implications and potential pitfalls.

Furthermore, the Epic Games layoffs and the related reduction in spending raise questions about the prioritization of the Disney collaboration within the gaming giant's strategy. The announcement of Star Wars-themed games being built on Fortnite by Epic creators adds another layer of complexity, as it's unclear how these initiatives align with the broader vision of the Disney-Epic metaverse. The reduced team size at Epic further diminishes the likelihood of realizing the ambitious “persistent universe” that had been initially conceived.

Disney’s strategic bet on AI and the metaverse, motivated by a desire to stay ahead of technological trends, is now viewed as a potentially costly misjudgment. The timeline surrounding the unfolding events suggests a recognition of the inherent challenges and a likely retreat from some of the most ambitious elements of the strategy. The studio’s attempts to integrate generative AI into its streaming service and build a fully-fledged metaverse represent a significant risk, and the current setbacks highlight the difficulty of translating technological aspirations into commercially successful realities. The circumstances paint a picture of hasty investment and growing concerns about the potential for “slop”— low-quality, unappealing content—to damage the Disney brand and undermine its streaming service.