Meet The Middlemen Forging Deals Between Content Creators & AI Companies

Forbes

With media companies scrambling to adjust to a world in which AI scrapes and repurposes their work, a new cohort of middlemen is emerging to forge licensing deals between content creators and AI companies.  Read the full story on Forbes: https://www.forbes.com/sites/rashishrivastava/2024/12/23/these-startups-are-making-sure-ai-companies-pay-up-for-taking-content/  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

Transcript

00:00Today on Forbes, these start-ups are making sure AI companies pay up for taking content.

00:08Publishers grappling with AI start-ups scraping their content to train powerful large language models often have two choices.

00:16They can either sue the company for copyright infringement or strike a one-off deal to license their archives.

00:22Now, a new class of companies is offering a third option,

00:26promising to help publishers get paid when their work is cited or summarized by AI,

00:31providing some compensation for lost page views.

00:35One such company, Tollbit, acts like a digital tollbooth of sorts,

00:39charging AI companies a price every time they scrape a publisher's content.

00:44Another is ProRata, which develops technology to help AI companies compensate publishers

00:50based on how much of their content shows up in an AI-generated output.

00:54Then there's ScalePost, which is building a library of licensed content that AI companies can pay to access.

01:01The stakes are high for publishers right now.

01:04AI heavyweights like OpenAI, Anthropic, and Perplexity,

01:08which early in 2024 repurposed an exclusive paywalled Forbes investigation across multiple platforms,

01:15are notorious for ignoring the protocols they set to block web crawlers from scraping content.

01:21It has resulted in high-profile lawsuits by the likes of The New York Times and Dow Jones,

01:27who've argued this unauthorized scraping violates copyright law.

01:31Other media companies have decided to partner rather than fight.

01:35OpenAI, for instance, is paying .-Meredith at least $16 million per year to license its content, according to Adweek.

01:44And Thomson Reuters recorded $33 million in year-to-date revenue

01:48from AI content licensing deals in its latest quarterly earnings report.

01:53But as AI systems ingest content in real time so they're able to provide up-to-date information,

01:59and as AI-powered search engines become increasingly popular,

02:03publishers are concerned that revenue-generating traffic is increasingly being driven away from their sites.

02:09Burhan Hamid, CTO of Time, told Forbes,

02:14There's no secret that publishers are struggling right now,

02:17so we were looking for opportunities to get the value for our content that it deserves.

02:22Time is one of some 400 firms, including Adweek and Hearst Corporation, that have signed up to use Tollbit,

02:29which Hamid said has given him more information about which bots are trying to access Time's content.

02:35AI leaders in the space, including OpenAI CEO Sam Altman and Google CEO Sundar Pichai,

02:42articulated the need for a new way of paying creators for their work in the age of AI scraping.

02:47Speaking at the New York Times Dealbook Summit in December,

02:50Altman says he sees value in micropayments as one potential method.

02:54Altman said,

03:02Also speaking at the Dealbook Summit, Pichai said,

03:12AI companies can use Tollbit's platform to access publishers' archives,

03:16filtering out content to which the publisher may not have rights or content it doesn't want to license.

03:22It provides media companies with data analytics on how often bots are scraping their sites

03:27and sets up a so-called, quote,

03:36Tollbit charges AI companies a transaction fee

03:39and provides them with a marketplace of licensed data and a dashboard to manage it.

03:44CEO Tulsit Panigrahi, who co-founded the company with former colleague Olivia Jocelyn in 2023,

03:50said Tollbit is in talks with major AI companies but didn't name them.

03:55Investor interest in the fledgling space is still small compared to the billions of dollars

04:00that have gushed into AI startups themselves and the companies providing them compute or processing power.

04:06Tollbit has raised about $30 million in venture capital from Lightspeed Venture Partners and others.

04:12ProRata closed a $25 million Series A round late last year.

04:17For full coverage, check out Rashi Srivastava's piece on Forbes.com.

04:23This is Kieran Meadows from Forbes. Thanks for tuning in.

04:36Thanks for tuning in.

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