OpenAI’s Ongoing Data Licensing Drive Promises to Transform Media Revenues, Content Delivery

Despite still fending off a slate of copyright lawsuits from a list of publishers, including the New York Times, the New York Daily News, and the Chicago Tribune, ChatGPT developer OpenAI has begun sealing agreeable licensing deals with a number of popular media outlets. In the wake of previous agreements with similar outlets, OpenAI just yesterday signed a deal with News Corp, allowing it to display content from its catalogue of publications, as well as train large language models (LLMs) with their content.

Proceeds from the News Corp deal can be paid to the company via cash or credits that allow the publisher to access OpenAI’s tech. Many news outlets already utilize some form of automation software to generate online content, but the formalization of ties between the AI and media industries will likely proliferate the optimization of content generation with the use of machine learning. Licensed data is also be utilized by LLMs via partnerships with social media outlets like Reddit.

Related ETF & Stocks: Roundhill Generative AI & Technology ETF (CHAT), News Corporation (NWSA), The New York Times Company (NYT), Reddit, Inc. (RDDT)

Since OpenAI’s ChatGPT product became a breakout generative artificial intelligence (AI) product, the startup has been hit with a wave of lawsuits from publishers that claim their content has been captured for training OpenAI large language models (LLMs) without proper compensation for its use. In an ongoing suit filed last year, The New York Times argues that OpenAI’s chatbots now compete with the news outlet as a source of reliable information and the defendants should be held responsible for “billions of dollars in statutory and actual damages” related to the “unlawful copying and use of The Times’s uniquely valuable works.”

OpenAI faces similar high-profile suits from the New York Daily News, Chicago Tribune, Orlando Sentinel, San Jose Mercury News (all owned by hedge fund Alden Global Capital), and others. These cases could soon be compounded by further legal action from actress Scarlett Johansson who claims OpenAI ripped off her voice for use in a new chatbot, named Sky, even after she refused an offer to voice the bot. Though there would be some interesting precedent backing a potential Johansson case, the early results for publishers in court have not been promising. A previous lawsuit brought by Sarah Silverman, Ta-Nehisi Coates, and other authors against OpenAI over the use of copyrighted books was dismissed by a federal judge in February. OpenAI and Microsoft, named as a co-defendant in the NYT suit for its stake in the ChatGPT developer, have…