Why does OpenAI have to cut Sora?

Source: GeekPark

Written by: Huálín Wǔwáng

If a few years ago someone told me that OpenAI would proactively shut down its most “popular” consumer product, I would probably think it was a joke.

After all, when Sora was released at the end of 2024, the sense of shock was real. Those videos of “inserting yourself into movie scenes” went viral on social media faster than any product launch. Within less than 5 days, downloads exceeded 1 million.

Some people call it the “iPhone moment of the AI era.”

However, on March 24, local time, OpenAI announced it would shut down the consumer app, developer version of Sora, and the embedded video feature in ChatGPT.

Those who once cheered for Sora are now probably asking the same question:

Why is OpenAI cutting Sora?

01 From “Million Downloads” to “Side Quest”

Sora’s decline actually happened much faster than most realized.

By December 2025, app downloads had dropped by 32%. By January 2026, installs continued to fall by 45%. The absolute number was still around 1.2 million, but the trend said it all:

Users stayed, but enthusiasm did not.

The reason isn’t complicated. The “insert yourself into movie scene” feature is essentially a great demo, but not a repeatable use case. Most people tried it once, found it amazing, and then didn’t know what else to do with it.

A more realistic issue is that many users are simply unwilling to give their portraits to an AI app for processing. This isn’t a technical problem; it’s a trust issue. Without celebrity faces or IP backing, the content Sora can generate quickly hits a ceiling of “interesting but useless.”

Those content licensing collaborations once hoped for are also quietly loosening.

At the same time, Variety and Hollywood Reporter both reported that Disney announced the termination of its partnership with OpenAI, along with the cancellation of a previously discussed $1 billion investment plan.

According to the original plan, Sora could generate videos from over 200 Disney, Marvel, Pixar, and Star Wars characters, and earlier this year, it opened “fan inspiration” creation to users via ChatGPT.

It’s said that a Disney team was working alongside Sora engineers the night before, only to wake up the next morning and learn the partnership was terminated. That kind of sudden change probably affected fewer people than the users.

02 Full Throttle IPO

If user attrition is the surface reason for shutting down Sora, then the IPO is the real behind-the-scenes driver.

OpenAI just completed a $11 billion funding round, pushing its valuation to $730 billion. At this point, every bit of resource allocation must be scrutinized by investors and potential public market shareholders.

Sora is an extremely resource-intensive product. Generating videos costs much more than text, and much more than images. Every time a user “plays” with an AI video in Sora, the GPU power burned could be enough for ChatGPT to answer dozens of questions.

When OpenAI’s head of applications, Fidji Simo, clearly stated at a company-wide meeting that the company needs to stop being distracted by “side tasks” and aggressively shift focus to coding and enterprise users—Sora’s fate was basically sealed.

This isn’t a difficult decision; it’s a clear-headed one.

Pulling computing resources from Sora and reallocating them to Codex (OpenAI’s AI coding assistant) makes perfect business sense.

Since this year, Codex has tripled its user base, increased usage fivefold, and now has over 2 million weekly active users. Last month, OpenAI also acquired developer tools company Astral, integrating the entire team directly into the Codex team.

The direction is set.

On the other side, Anthropic provided more straightforward data: annual revenue exceeds $19 billion, with about 80% coming from enterprise clients. CEO Dario Amodei mentioned that in February alone, they added $6 billion in revenue, almost all from Claude Code.

Enterprise clients pay, renew, and expand usage. Consumer users like, share, but don’t necessarily pay. This has been one of the most painful and important lessons in the AI industry during 2025-2026.

03 Is the “AI Video” Track Cooling Off?

The answer might be no. Or at least, OpenAI has chosen not to wade into this muddy water.

In fact, competition in AI video generation continues and is even intensifying. ByteDance’s Seedance 2.0 is still running, and Google DeepMind’s Veo 3 is recruiting filmmakers.

Sora’s exit from the consumer market doesn’t mean this direction is impossible.

But Sora faces a structural problem that competitors might not be able to avoid: the issue of “AI junk.”

When a tool can easily generate hyper-realistic videos, low-quality AI content on social media begins to flood in. This isn’t just a platform regulation challenge; it’s quietly eroding overall trust in AI-generated content. When “AI creation” becomes synonymous with poor-quality content, the brand value of an AI video app can be severely damaged.

Paul Roetzer, founder of Marketing AI Institute, said it well: he believes Sora’s underlying video generation technology is “incredible,” but OpenAI chose to turn it into an endless scrolling entertainment tool—completely opposite to the direction these labs should be heading.

This judgment somewhat explains why a technically leading product can still fail commercially.

Sora isn’t lacking in technology; it’s lacking an answer to “why would users keep using it?”

In entertainment scenarios, this answer remains vague; but in professional creation, film industry, advertising, the answer can be much clearer.

However, OpenAI now seems unwilling to find that answer itself—at least not in the form of a consumer product like Sora.

Looking back, OpenAI’s product lineup over the past year has been somewhat scattered.

ChatGPT, Sora, image generation, voice assistants, enterprise API, Codex, customized GPT… each direction was pursued, each achieved “decent” results, but “decent” is becoming less valuable in this industry.

Now, the story has changed.

The shutdown of Sora is a signal and a choice.

OpenAI is telling everyone: we know what makes money, and we’re focusing resources there. Meanwhile, the company plans to expand its staff from 4,500 to 8,000 by the end of the year, which shows it’s not shrinking but concentrating on more important things.

This company is answering a question many AI companies are still avoiding: are you building a showcase of technology, or a real business?

Sora’s fireworks were beautiful.

But once the fireworks fade, what remains is what the company truly values.