Disney just picked a side in the AI fight

Mickey Mouse … brought to you by OpenAI.

Disney lending out its iconic characters to be leveraged by AI seemed a far-fetched idea a few months ago. But thanks to a $1 billion deal between the House of Mouse and OpenAI, that's exactly what's happening.

It's representative of a larger question companies, especially those in media and entertainment, are grappling with: Are AI companies friend or foe?

For Bob Iger, the answer is very much friend.

"It gives us an opportunity, really, to play a part in what is really a breathtaking, breathtaking growth in essentially AI and new forms of media and entertainment," the Disney CEO told CNBC on Thursday.

The deal will allow Disney+ to post users' AI-generated content, a goal that Iger mentioned last month. Doing so could help boost engagement on the streamer's platform, which has been stagnant in recent years, writes BI's Lucia Moses.

(I should probably mention Axel Springer, Business Insider's parent company, also falls in the "friend" camp. It cut a deal with OpenAI almost two years ago.)

Others aren't as willing to rub shoulders with OpenAI. The startup has a history of using someone's intellectual property without permission and then apologizing for it. That has resulted in several lawsuits, including those from The New York Times and "Game of Thrones" author George R.R. Martin.

So who's right? It's too early to say, but it could easily go both ways.

The longer one waits to cut a deal with an AI company, the worse the terms could be. (The benefits of first-mover advantage.) On the other hand, opening yourself up to AI could be a kind of Pandora's box you can't close.

Here's what some smart people in media, tech, and business are saying about the deal.

The deal isn't just beneficial to Disney.

Disney characters coming to Sora 2 could be a big boost for a video platform that hit a bit of a lull after a hot start a few months ago.

Bringing characters from "Frozen" and "Moana" to life on your app is also a great way to generate interest and build loyalty with a younger audience. OpenAI CEO Sam Altman recently touted the personal benefits he finds from using ChatGPT as a new parent.

But pursuing a younger demographic also comes as some countries are putting up more guardrails around kids' use of tech. Australia recently installed a ban on social media for anyone under the age of 16.

The Disney-OpenAI deal also comes as competition keeps mounting against the startup from the likes of Google and others. And while so much of AI is about pushing cutting-edge tech, sometimes you just need a little bit of old-school magic.