OpenAI, News Corp strike content deal valued at over $US250 million
The content-licensing pact valued at over $370m aims to cash in on a technology that promises to have a profound impact on news publishing.
News Corp has struck a major content-licensing pact with generative artificial-intelligence company OpenAI, aiming to cash in on a technology that promises to have a profound impact on the news-publishing industry.
The deal could be worth more than $US250 million over five years, including compensation in the form of cash and credits for use of OpenAI technology, according to people familiar with the situation. The deal lets OpenAI use content from News Corp’s consumer-facing news publications, including archives, to answer users’ queries and train its technology.
“The pact acknowledges that there is a premium for premium journalism,” News Corp Chief Executive Robert Thomson said in a memo to employees Wednesday. “The digital age has been characterized by the dominance of distributors, often at the expense of creators, and many media companies have been swept away by a remorseless technological tide. The onus is now on us to make the most of this providential opportunity.”
News Corp’s A shares were up 4% in after-hours trading Wednesday. The rise of generative AI tools such as OpenAI’s humanlike chatbot ChatGPT is poised to transform the publishing business. AI companies are hungry for publishers’ content, which can help them refine their models and create new products such as AI-powered search.
Publishers are seeking to ensure that they extract a hefty payment for the use of their intellectual property, setting up complex and sometimes tense negotiations across the industry. Many journalists, meanwhile, are concerned about the impact of AI on jobs in newsrooms whose ranks have already been thinned by years of cuts.
The News Corp-OpenAI deal is the latest illustration of the differing approaches adopted by publishers looking to address the rise of generative AI.
News Corp joins a growing list of publishers that have reached commercial partnerships with OpenAI, including Politico and Business Insider parent Axel Springer, the Associated Press, Le Monde, the Financial Times and IAC’s Dotdash Meredith, home of such publications as People and Better Homes & Gardens.
Other publishers, including the New York Times, have opted to battle OpenAI and its backer Microsoft in court, saying their content was used without permission to train artificial-intelligence tools and populate answers for users. OpenAI has said the lawsuit is without merit.
News Corp’s deal guarantees that content won’t become available on ChatGPT immediately after publication, according to a person familiar with the agreement.
In addition to providing content, News Corp will share journalistic expertise with OpenAI, the companies said.
News Corp’s news publications include the Journal, Barron’s and MarketWatch, as well as the New York Post, The Times of London, The Sun and The Australian. The deal doesn’t include content from such News Corp properties as the research tool Factiva or the book publisher HarperCollins.
“Together, we are setting the foundation for a future where AI deeply respects, enhances, and upholds the standards of world-class journalism, ” OpenAI Chief Executive Sam Altman said in a statement.
Many of the current discussions OpenAI is having with publishers are focused on future use of their news content in answers to queries. The talks come in the midst of concern that AI-powered search tools from OpenAI or Google will serve up complete answers based on news content, eliminating a user’s need to click on an article link and depriving publishers of traffic and advertising revenue.
OpenAI is seeking to play a key role in answering news queries from users, and is planning on attributing information to publishing partners through a series of links below a summary that appears in response to the queries, according to people familiar with the matter.
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