The Reality Check Arrives

The AI industry learned an expensive lesson this week: moving fast and breaking things works until you break the wrong things.

Olivia Sharp • October 11, 2025 • 9 min read • 280 views

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This week provided a glimpse of what that future looks like. It includes more regulation, more scrutiny and more accountability than AI companies have faced to date. Whether that represents progress or impediment depends largely on perspective. For an industry built on the promise of transforming everything, the real transformation may be learning to operate within constraints.

The artificial intelligence industry learned an expensive lesson this week: moving fast and breaking things works until you break the wrong things.

OpenAI's Sora 2 video generator launched October 1 and immediately flooded social media with copyrighted characters. Users created videos of Mario fleeing police, Pikachu storming Normandy, SpongeBob chatting with AI versions of OpenAI's CEO. The app hit number one in the iOS App Store within 24 hours. By October 6, OpenAI reversed course entirely on its copyright policy.

The company initially placed the burden on rights holders to opt out if they objected to having their characters used. …

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The Reality Check Arrives

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