OpenAI shut down its AI video-generation tool, Sora, just six months after its public release, due to high operational costs and low user engagement, according to a WSJ investigation. Sora was reportedly burning through $1 million daily and its user count had declined significantly. The decision also led to the termination of a $1 billion partnership with Disney.
OpenAI’s Sora shutdown shows how quickly a high-profile consumer AI video product can become a cost center when usage drops and inference remains expensive. The decision also highlights the compute tradeoff inside OpenAI: a team was working on Sora while Anthropic’s Claude Code was winning over software engineers and enterprises that drive revenue. The most concrete signal to watch is whether OpenAI reallocates the compute that had been supporting Sora, and whether any replacement video product emerges after the Disney deal was terminated.
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