{"id":546716,"date":"2026-03-26T16:22:13","date_gmt":"2026-03-26T16:22:13","guid":{"rendered":"https:\/\/www.newsbeep.com\/us\/546716\/"},"modified":"2026-03-26T16:22:13","modified_gmt":"2026-03-26T16:22:13","slug":"openai-thought-it-could-own-ai-videos-the-reality-was-too-expensive","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us\/546716\/","title":{"rendered":"OpenAI thought it could own AI videos. The reality was too expensive"},"content":{"rendered":"

\n A version of this story appeared in CNN Business\u2019 Nightcap newsletter. To get it in your inbox, sign up for free here<\/a>.\n<\/p>\n

New York\u00a0\u2014\u00a0\n <\/p>\n

\n Six months and millions of dollars down the drain, OpenAI is pulling the plug<\/a> on what it once called \u201cthe most powerful imagination engine ever built.\u201d\n <\/p>\n

\n There seems to have been two key missteps in the Sora saga:\n <\/p>\n

OpenAI didn\u2019t understand how consumers engage with video on the internet.<\/p>\n

OpenAI underestimated just how crazy-expensive it would be to run such a power-intensive app.<\/p>\n

\n ICYMI: OpenAI said Tuesday that it would wind down Sora, the TikTok-like text-to-video app that, to OpenAI\u2019s credit, did make some super real-looking stuff. Its release was a turning point for AI-generated video, elevating it from the realm of goofy slop to sophisticated deepfakes (for better or worse).\n <\/p>\n

\n The Sora rollback is part of a broader shift within OpenAI, once the undisputed frontrunner in the AI race that now faces serious competition from rivals such as Anthropic and Google.\n <\/p>\n

\n Earlier this month, OpenAI\u2019s head of applications told staff that the company couldn\u2019t afford to be \u201cdistracted by side quests,\u201d the Wall Street Journal<\/a> reported. The company is doubling down on its core products, including an updated ChatGPT focused on office work and a coding tool called Codex.\n <\/p>\n

\n Sora downloads soared after the invitation-only rollout in September, with more than 1 million daily active users after just over a month, according to data from Similarweb. But the novelty wore off fast. Usage peaked in early November, and then tumbled. Downloads are down 70% from November, and daily active users have fallen 34%.\n <\/p>\n

\n That was stumble No. 1: OpenAI built a really slick machine and expected everyone to love using it as much as its engineers did. But AI videos, even the really sophisticated kind, take much of the fun out of scrolling.\n <\/p>\n

\n The joy humans derive from, say, a video of a husky that sounds<\/a> like it has an Italian accent, or a cat moving to the beat of<\/a> Nelly\u2019s 2005 banger \u201cGrillz,\u201d comes partly from knowing that someone else experienced a funny thing in real life and managed to capture it as it happened. When an AI version of the same thing creeps into your social feed, it feels like cheating. The person who posts that video didn\u2019t witness anything impressive or unusual, they just typed some words into a box and uploaded the result.\n <\/p>\n

\n But beyond philosophical questions about authenticity, it took almost no time for the internet to get around Sora\u2019s content restrictions. People used the app to generate fake videos of women being strangled<\/a> or splattered with mysterious white goo, people committing crimes, and public figures wearing Nazi-like uniforms<\/a>. Less than a month after Sora\u2019s launch, OpenAI had to put a pause on videos of some historical figures after users created \u201cdisrespectful depictions\u201d of Martin Luther King, Jr.<\/a> (The app banned the use of living public figures\u2019 likenesses, but allowed depictions of people who\u2019d died.)\n <\/p>\n

\n We\u2019ve seen this kind of stumble with consumers from OpenAI before. Its launch of ChatGPT-5<\/a> in August was a disaster, as the new model had a flatter, more terse personality, as well as an alarming inability to answer basic questions. Users recoiled immediately, forcing OpenAI to backtrack and restore the old models.\n <\/p>\n

\n Sora stumble No. 2 was much more prosaic, with the cold, pragmatic glare of a balance sheet: OpenAI seemingly underestimated how much it would cost to run the thing. The first sign that the cash burn on Sora was becoming a problem came in late October, when the head of Sora, Bill Peeples, posted on X<\/a> that \u201cthe economics\u201d were \u201ccurrently completely unsustainable.\u201d\n <\/p>\n

\n In November, Forbes estimated<\/a> the app cost OpenAI \u2014 which is still burning through cash faster than it can bring it in \u2014 about $15 million a day.\n <\/p>\n

\n The company didn\u2019t respond to questions from CNN about that estimate or how much Sora\u2019s financial burden played into the decision to end the app. In a statement, OpenAI said the Sora team would continue to focus on \u201cworld simulation research\u201d to advance OpenAI\u2019s robotics efforts.\n <\/p>\n

\n Bottom line: OpenAI has a math problem: It reportedly<\/a> made about $13 billion in revenue last year, and it aims to triple that in 2026 while burning through tens of billions on computing power. That conundrum is forcing the company to relent on revenue drivers it once avoided \u2014 like showing ads in ChatGPT results, which CEO Sam Altman once derided as a \u201clast resort\u201d \u2014 and throw in the towel on losing bets like Sora.\n <\/p>\n