What's up: a new OpenAI model; Trump's EO on state AI laws; a take on AI gadgets; AI hacking tools get dangerously good

Good morning. Disney’s $1 billion investment in OpenAI is a relatively small equity stake, but it’s highly consequential in its potential to bring mass media and entertainment fully into the age of AI.

Disney also struck a three-year licensing deal for over 200 characters, so that users can create AI-generated videos in OpenAI’s Sora app. “Through the three-year licensing arrangement, fans will be able to generate videos of themselves surfing with Stitch off the shores of Hawaii or wielding a lightsaber in front of R2-D2,” the Wall Street Journal reported on Thursday. It characterized the agreement as a blockbuster deal.

And as the WSJ notes, one day earlier Disney sent a cease-and-desist letter to Google, one of OpenAI’s main rivals in the AI space. “Disney’s letter accused Google of “infringing Disney’s copyrights on a massive scale.” Disney executives had grown frustrated that Google’s image generators had been going viral—but, from Disney’s point of view, without the output guardrails that OpenAI was offering copyright holders,” the Journal said.

The conflict with Google wasn’t surprising, given the long-standing relationship between the entertainment industry and disruptors in the tech sector. But the Disney relationship shows a willingness to come to terms with emerging ways of doing business, as long as the right commercial and governance terms are in place.

The legal picture has become a bit clearer in the past year. “The results of two cases suggested that training AI on copyright material might be fair use in some circumstances, in large part because it is considered transformational,” the Journal says.

More highlights:

Recent lawsuits filed by content owners, such as Disney and Universal’s Midjourney complaint, have focused less on the training process and more on the allegedly infringing images the AI programs create.

“I think the legal landscape is clarifying,” said Matthew Sag, a professor at Emory University School of Law. “It’s pretty clear that the fair-use answer isn’t always or never, it’s sometimes.

The establishment of broad legal and governance frameworks makes it easier for AI to transform entire industries.

OpenAI also unveiled a new version of ChatGPT. The WSJ Leadership Institute’s Belle Lin has the story below. It follows the release of more powerful models from rival Google. Taken together, model developers are advancing the cutting edge of AI at a sufficient pace to draw more companies from Disney to Walmart to their platforms.

OpenAI on Thursday announced the release of GPT-5.2, calling the AI model its most advanced for professional knowledge work, WSJ Leadership Institute's Belle Lin reports.

The release comes about a week after Chief Executive Sam Altman declared a “code red” effort to improve the quality of ChatGPT and to delay development of some other initiatives, including advertising. The company has been on high alert from the rising threat of Google’s latest Gemini AI model, which outperformed ChatGPT on certain benchmarks including expert-level knowledge, logic puzzles, math problems and image recognition.

The new OpenAI model was described by the company as better at math, science and coding benchmarks.

President Trump signed an executive order Thursday that aims to override state laws on AI, WSJ reports.

The order would allow the Justice Department to punish states with rules deemed restrictive for AI, in a move to bring the U.S. under one federal standard. Silicon Valley executives had been lobbying the president to ban state AI laws that they said could cause the U.S. to lose the AI race to China.

WSJ's Joanna Stern tried eight AI wearables this year, including bracelets, pendants, glasses and rings.

"Every big tech company will want you to try this new category, too. Google’s promising AI glasses in 2026. Meta bought Limitless, the startup behind a mic-equipped pendant I tested, while Amazon bought one of my favorites, the Bee bracelet. Sam Altman says OpenAI is going after Apple with its future AI devices, developed in partnership with famed Apple designer Jony Ive," Joanna writes.

Read the story for why these gadgets let her down, and where she's hoping for big improvements soon.

After years of misfires, AI hacking tools have become dangerously good. So good that they are even surpassing some human hackers, according to a novel experiment conducted recently at Stanford University, WSJ reports.

Rivian is doubling down on an AI-centric approach to develop fully autonomous vehicles, as the money-losing electric-vehicle maker faces a tough market for its trucks and SUVs, WSJ reports. Shares fell after the company unveiled its own AI chip designed to replace Nvidia technology, Bloomberg reports.

Broadcom reported rapid revenue growth on Thursday as demand continues to rise for chips to fill data centers that power AI models. But shares fell in after-market trading as analysts raised questions about the company’s sales forecasts, contracts backlog and anticipated future margins, WSJ reports.

OpenAI is being sued for wrongful death by the estate of a woman killed by her son, who had been engaging in delusion-filled conversations with ChatGPT, WSJ reports.

Palantir is expanding its legal campaign against a rival AI company, accusing the CEO and two other employees of engaging in a sprawling effort to poach Palantir’s workers and customers, WSJ reports.

This February 10–11, technology leaders will gather in Palo Alto for The WSJ Technology Council Summit to explore the realities of enterprise AI, the evolving role of tech leadership and the urgency behind building meaningful, business-driving AI strategies. Join the Technology Council and be part of the conversations shaping the future of corporate innovation.

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The Trump administration’s seizure of a tanker full of Venezuelan crude hits Nicolás Maduro much harder than airstrikes on alleged drug boats. It raises an existential crisis for a regime that runs on oil revenue. (WSJ)

Investors are warming to bonds again, underscoring how hopes for further interest-rate cuts have boosted Wall Street’s outlook. (WSJ)

President Trump says Ukraine is losing the war against Russia. That’s not what it looks like to Ukrainian Army Maj. Oleh Hlushko, a battalion commander whose men repelled another assault on their part of the southeastern front this week. (WSJ)

The WSJ CIO Journal Team is Steven Rosenbush, Isabelle Bousquette and Belle Lin.

The editor, Tom Loftus, can be reached at thomas.loftus@wsj.com.