'Million dollar' reason why OpenAI shut down its once 'hot' app

OpenAI has quietly shut down Sora, its AI video generation tool, just six months after opening it to the public — ending one of the company's most high-profile bets in generative AI after mounting costs and dwindling users made it impossible to justify keeping the lights on.According to a report by The Wall Street Journal, Sora was costing the company approximately $1 million a day to operate at its peak. Video generation at the scale Sora promised is extraordinarily compute-intensive, with every AI-rendered clip drawing from a limited and expensive pool of high-end chips — costs that were never offset by sustained user engagement or meaningful revenue.The user numbers told a similar story. Sora's global base peaked at around one million before falling below 500,000.

That kind of drop-off can be forgiven early in a product's life — but not when the daily burn rate looks like this. With no clear path to recovery, OpenAI CEO Sam Altman made the call to shut the product down and reallocate its compute resources to areas that actually move the needle.The fallout was swift and, for at least one major partner, blindsiding.

No fun and games for Disney

The Walt Disney Company, which had reportedly committed around $1 billion to a partnership built around Sora, was notified less than an hour before the shutdown became public, the Journal reported.

A billion-dollar deal, collapsed overnight, with barely enough notice to make a phone call.It also says something about where the real AI money is going these days. Flashy consumer tools are quietly losing out to products built for developers and businesses — the kind that people actually pay for month after month. While OpenAI was trying to make Sora work, rivals like Anthropic were winning over enterprise customers through tools like Claude Code.

Unglamorous, perhaps. But profitable in a way Sora never managed to be.There had been earlier murmurs that Sora's face-upload feature raised data privacy concerns, with some speculating the app may have doubled as a data-harvesting exercise. The WSJ's reporting suggests the truth is less sinister — and more mundane. The product was simply too expensive to run and too hard to monetise.The demos were stunning. The coverage was breathless. For a moment, it genuinely felt like AI video had arrived. But a great demo and a product people keep coming back to are very different things — and Sora, in the end, was only ever one of them.OpenAI has not publicly commented on the shutdown.