OpenAI Kills Sora at $1M/Day Loss — Google Fills the Gap with Veo 3.1 Lite at $0.05/Second
OpenAI announced on March 24 it is discontinuing Sora, its AI video generation app and API, ending one of the most hyped products in AI. The Sora app goes dark on April 26, 2026. The API follows on September 24. The reason is blunt: the product was losing approximately $1 million per day.
Daily active users peaked near 1 million after the mobile launch in late 2025, then fell below 500,000. Video generation requires substantially more compute than text or images — Sora 2 Pro ranked 19th on Artificial Analysis’s text-to-video leaderboard at shutdown, behind models from ByteDance, Kling, xAI, and Google. OpenAI redirected Sora’s compute to an internal model codenamed Spud, which now powers coding and enterprise products.
The Disney deal, announced in late 2025, is also dead. OpenAI and Disney had been working together on a $1 billion partnership that included AI-generated fan content with licensed characters. Disney confirmed it will not proceed.
OpenAI framed the exit as a pivot to robotics. The Sora research team is now focused on “world simulation research to advance robotics that will help people solve real-world, physical tasks.” The company is consolidating its browser, Codex, and the ChatGPT app into a single desktop product.
Google Moves Into the Vacuum
One week after the Sora announcement, Google launched Veo 3.1 Lite (March 31) — its cheapest video generation model. The pricing is designed for developer-scale workloads that Sora could never sustain:
| Model | Resolution | Price per second |
|---|---|---|
| Veo 3.1 Lite | 720p | $0.05 |
| Veo 3.1 Lite | 1080p | $0.08 |
| Veo 3.1 Fast | 720p | $0.10 (was $0.15) |
| Veo 3.1 Fast | 1080p | $0.12 (was $0.15) |
| Veo 3.1 | 720p–4K | $0.40 |
Veo 3.1 Lite supports text-to-video and image-to-video, 720p and 1080p output, 16:9 and 9:16 aspect ratios, and clips up to 8 seconds. It does not support 4K or Scene Extension. Google also cut prices on Veo 3.1 Fast on April 7. Both moves took effect as Sora users were evaluating alternatives.
The remaining serious competitors in AI video: Runway, Kling, Veo 3.1, and Alibaba’s Seedance 2.0. Google is explicitly targeting the volume market — rapid prototyping, batch generation, developer apps — where sustainable unit economics require a price floor that Sora never reached.
What This Signals
OpenAI’s exit from consumer video is a data point about the economics of generative AI modalities. Text and code attract enterprise spending directly. Image generation is cheap enough to amortise. Video generation is expensive to train, expensive to run, and harder to monetise at consumer price points. The Sora team produced a technically impressive product that could not cover its compute costs.
Google’s response — a tiered model family with explicit developer pricing — reflects a different theory: that video generation belongs in the infrastructure stack, billed per second like a cloud compute resource, not sold as a subscription feature inside a chatbot.
The April 26 shutdown deadline is approaching. Sora users need to export their work before that date.