Disney's AI Ambitions: A Reckless Bet on a Broken System

OPINION: Disney is attempting to buy its way into the artificial intelligence race, but as Ars Technica first reported, the price of admission may be far higher than the $20 million it has offered. In a bankruptcy proceeding, Disney has bid for a "non-exclusive perpetual license" of certain intellectual property from Character Technologies, the maker of Character.AI.

This move is a staggering reversal of Disney's own stated values. In September 2025, Disney sent a cease-and-desist letter accusing the company of weaponizing Disney characters to damage its brand. In that letter, Disney warned that Character.AI’s chatbots were "known, in some cases, to be sexually exploitive and otherwise harmful and dangerous to children," which harmed Disney's reputation and offended its customers.

Yet, Disney is now rushing to "get in the AI game and profit from its boom," a drive reported by Deadline. This follows the collapse of a partnership with OpenAI after Sora was abruptly shut down. To facilitate this, Disney has brought on former Character.AI lead Karandeep Anand to serve as its first chief technology officer.

Disney's interest is reckless given the human cost. Character Technologies settled a publicized suit alleging its bots encouraged 14-year-old Sewell Setzer III to commit suicide. Furthermore, Kentucky is suing over allegations of encouraged self-harm, and Pennsylvania is suing because bots posed as licensed doctors.

With bankruptcy, privacy is also at risk. Character Technologies' policy states that voice data, chat logs, and identifying information may be transferred during asset sales. By eyeing this property, Disney is courting a legacy of harm. Whether the bid succeeds by December 2026, Disney is signaling that expansion outweighs the safety of the children it claims to protect.