Disney, Universal Keeping Tabs on Legislation To Take Away Their Tax Breaks If AI Replaces Workers

Disney is up to shadier things than running advertisements of questionable legality, and Universal is joining in. The Walt Disney Company and NBCUniversal are keeping their beady little corporate eyes glued to New York state legislation, Senate Bill 7422, which is has been sponsored by New York Senator Lea Webb (D) and Assembly member Demond Meeks (D).

The bill, which prohibits companies from using artificial intelligence in place of flesh-and-blood people in film and TV productions while simultaneously lining their pockets with a hefty state tax break, has gained the attention these two entertainment juggernauts, who collectively received over $107 million in tax credits for New York productions since 2022 and very much want to keep that cash while dumping the cost of human workers.

Introduced just before the legislative session ended in June 2023, the bill seeks to address a growing concern over the role of AI in the entertainment industry. With both SAG-AFTRA and WGA strikes ongoing, actors and writers fear being replaced or plagiarized by AI, which could lead to job displacement and a whole heap of consent violations. If passed, the proposal could set a legal precedent for other states to rule against AI double-dealing and potentially cost media companies oodles of dollars in the future savings they were planning.

NBCUniversal, who began using AI in advertising in 2019, has received $96.7 million in tax credits for 14 New York productions, including Tonight Show with Jimmy Fallon and Saturday Night Live. Disney has received $10.9 million for The Eyes of Tammy Faye and Monster Island season one. Both companies are known for their growing interest in AI, with Disney’s CEO Bob Iger expressing “bullish” views on the technology (while rubbing his sweaty palms together and adjusting his Monopoly Man monocle, no doubt).

The two corporations have hired Albany-based lobbyists to monitor the bill and are shelling out thousands of dollars a month to do so. While neither Disney nor NBCUniversal has taken a public position on the legislation, disclosures filed with the state Commission on Ethics and Lobbying in Government show that they have obvious financial reasons for watching the bill.

Assemblyman Demond Meeks spoke about the situation, saying, “Big business tends to look for quick ways to save money and, you know, this may be another means of that.” They certainly do, and AI is quickly becoming the latest way for such businesses to cut costs at the expense of human workers.

Both companies have attempted to downplay their attention to the bill. According to a Disney spokesperson, the company’s focus on the bill is “standard,” and they “track, monitor and review any bills introduced that could potentially impact our business in compliance with New York State law.” Additionally, they “transparently report those information-gathering efforts in our lobbying disclosures.” Their representatives, including Albany lobbyists Patricia Lynch Associates Inc. for Disney and Plummer & Wigger for NBCUniversal, argue that this bill is just one of hundreds of bills that have attracted their attention. Yeah, right.

New York Governor Kathy Hochul has not yet commented on the AI proposal, but has previously championed an expansion of the state’s tax credit program, striving to maintain a balance between the needs of corporations and their employees.

Criticism of Disney’s stance on AI appears to be coming even from relatively pro-Disney websites, including Inside The Magic, who recently weighed in on Disney’s decision to reduce its amount of human employees. Disney fans themselves have been equally critical of the company’s decision to incorporate AI Disney content. Marvel’s latest Disney+ series, Secret Invasion, received heavy backlash for its AI-generated opening credits. Viewers are also afraid that Disney will increasingly use AI to “de-age” actors as they did with Harrison Ford in Indiana Jones and the Dial of Destiny, rather than allowing other actors to play younger roles.

With a total program offering $700 million in tax breaks for filming in New York, the potential financial impact of the bill is massive. The laser focus of entertainment industry heavyweights on legislation represents a part of the ever-growing debate over the ethical use of AI in entertainment and the protection of human talent. However, it’s important to remain hopeful. AI is nowhere near advanced enough to replace human beings, and even if it were, the backlash against companies abusing the technology is likely to become more widespread than ever before. The point of technology is that the robots do all the mundane jobs while humans enjoy creative pursuits, not the other way around—especially in a society that puts no effort into making sure workers, rather than just employers, actually benefit from technology that supposedly makes their lives easier.

(featured image: Jaime Nogales/Medios y Media/Getty Images)