Hasbro's AI Mr. Potato Head could turn hold music into a new business

Hasbro is not just experimenting with AI. It is trying to turn its characters into a licensed AI product line, starting with a system called CharacterOS from its new in-company studio, Sixth Wall. That means fully licensed versions of characters like Mr. Potato Head, Megatron, Cobra Commander, and Optimus Prime could be deployed in customer-facing products, including the surreal but very real example the company floated: a digital Mr. Potato Head that can keep you company while you are on hold.

The core move is strategic, not whimsical. Hasbro is responding to a basic business problem in the AI era: other companies are already using or imitating popular IP in machine-generated experiences, so Hasbro appears to have decided that if synthetic versions of its characters are going to circulate, it would rather authorize them, package them, and get paid for them. That logic echoes the broader industry playbook behind other licensing deals, including the short-lived deal Disney signed with OpenAI's Sora last year, which was built on the same premise that if copies are inevitable, licensed copies are better than unauthorized ones.

What makes this more than a one-off gimmick is the labor and rights model underneath it. Hasbro says it has committed to using, and paying, the actual existing voice actors for its characters to power the initiative, including long-time Optimus Prime voice actor Peter Cullen. That matters because voice is not just a creative layer here, it is part of the asset itself. In an AI market increasingly shaped by synthetic media, the question is whether brands will train systems on scraped or stolen performances, or whether they will build authorized models with real compensation and explicit permission. Hasbro is clearly trying to land on the latter side of that divide.

That distinction matters for executives because AI licensing is quickly becoming a governance issue, not just a product idea. If a company has to decide whether its most valuable characters should live only in static media, or also in interactive AI systems, then the board-level questions are obvious: who owns the training rights, who approves the outputs, who gets paid, and how does the company prevent the brand from veering into chaos. Sixth Wall's answer, according to the source, is a mix of voices and hard-coded rules for how characters should and should not behave, which is basically an attempt to give synthetic characters a script and a fence. Without that, the upside of interactivity can turn into a brand safety headache very quickly.

Rebecca Thomson, the CEO of Sixth Wall, framed the opportunity as a new way to make Hasbro's intellectual property feel alive in everyday settings. Her example was customer service: "Imagine you’re waiting on hold for a customer service agent playing a voice game of Trivial Pursuit. Suddenly, you wouldn’t mind your 10 minute wait. You might actually be like, ‘wait, I haven’t finished.'" That is the kind of pitch AI vendors love because it translates an abstract technology into a revenue-friendly use case. Instead of asking whether AI can mimic a beloved character, the question becomes whether it can reduce friction, increase engagement, and keep people interacting long enough to matter to a business.

Thomson also made a broader claim about the state of IP, saying, "Right now all of our IP is sitting in static media, trapped in a toy on a shelf, a movie, a video game." The line is colorful, and also revealing. It shows how AI companies are reframing old content libraries as underutilized databases for new interaction models. In plain English: a character that once only appeared in a film, toy, or game can now be turned into a conversational layer, a customer support tool, or a branded companion inside another product. That opens the door to licensing revenue, but it also pushes companies into a new operating model where the character is no longer a fixed asset. It becomes a live system that needs ongoing oversight.

Sixth Wall says its character packages combine voices with behavioral rules so the characters behave appropriately, and it sees licensing opportunities in "Interactive storytelling experiences, connected physical products and robotics, dynamic customer engagement agents," among other uses. That list shows where this could go next. A brand mascot could sit inside a smart device, interact with customers in a service flow, or show up in physical products with some degree of conversational behavior. For businesses, that is seductive because it turns dormant IP into a recurring engagement engine. For brands, though, the second-order implication is obvious: once characters can talk back in real time, the company has to manage not just what the character looks like, but how it behaves across contexts, channels, and third-party deployments.

That is why this Hasbro project is worth watching beyond the toy aisle. It is a small but useful test case for where consumer brands, entertainment companies, and IP-rich businesses may be headed as AI moves from novelty to licensing category. The upside is obvious: new formats, new distribution, and new ways to monetize characters that already have audiences. The risk is just as obvious: more complexity, more brand-control burden, and a future where the line between a protected character and a synthetic impersonation gets harder to police. If you run a company with prized IP, Hasbro's move is a signal that the question is no longer whether AI will touch your characters. It is whether you will authorize it first, or spend the next few years reacting to everyone else doing it for you.