In 2011, I was at the Guggenheim Museum in New York watching Rupert Murdoch announce the start of a “new digital renaissance” in news, as the newspaper mogul unveiled an iPad-inspired publication. daily“The iPad demands a fundamental rethinking of our technology,” he said. daily It closed the following year after reportedly burning through $40 million.
For as long as I've been reporting on internet companies, I've watched news industry leaders try to bend their business to the will of Apple, Google, Meta and the like. Chasing tech distribution and cash, news companies make deals to ride the next digital wave. They concede to platforms that want to take away all the viewership (and trust) that good journalism garners without doing the complex and expensive work of journalism itself. And it never works out as planned.
Publishers like News Corp did the same thing with Apple and the iPad. They invested heavily in flashy content that didn't generate profits but helped sell Apple hardware. They were paid by Google to offer their journalism for free through search, only to find that it undermined their subscription business. They produced original video shows for Facebook, reformatting articles to work well in the new apps. Then the social media companies canceled the shows and the apps. Many news organizations went out of business.
The Wall Street Journal Recently, they laid off staff who were part of a Google-funded program to encourage journalists to post to their YouTube channels when the program's funding dried up.And now, as the news industry finds itself in a death spiral, these same publishers are making the same mistakes, or worse, when it comes to AI.
Publishers are in hot negotiations with technology companies like OpenAI to sell their journalism as training for these companies’ models. Accurate, well-written news has turned out to be one of the most valuable sources of information for these models that have been siphoning human intellectual artifacts without permission. These AI platforms need timely news and facts to gain consumer trust. And now, faced with the threat of litigation, they are pursuing business deals to absolve themselves of charges of theft. These deals are meant to be settled without litigation. Publishers willing to bend in this way are not only failing to protect their intellectual property, but also giving up their hard-earned credibility to grab a few quid-pro-quo cash from companies that undervalue them and are developing products that are clearly meant to replace them.
Late last year, European publisher Axel Springer POLITICO and Business InsiderNews Corp has reportedly signed deals with OpenAI worth tens of millions of dollars over the years. OpenAI has offered other publishers $1 million to $5 million a year to license content. News Corp's new five-year deal with OpenAI is reportedly worth $250 million in cash and OpenAI credits. Negotiations are heating up. With talks with OpenAI failing, The New York Times Alden Global Capital, which owns the New York Stock Exchange, also sued the company. Daily News And that Chicago TribuneThose were courageous moves, but I fear they will likely end in trade.
It's extremely worrying that media companies are rushing to make these deals after being hurt by past tech deals. And these AI partnerships are even worse for publishers. Ten years ago, there was at least reason to believe that tech companies would get serious about delivering news to consumers. They were developing actual products like Google News. Today's AI chatbots are still in their early stages and make mistakes often. Just this week, Google's AI suggested that cheese should be glued to keep pizza crusts from slipping off.
OpenAI and other companies have said they are interested in building new models for news distribution and crediting, and many news industry executives I respect believe that. But it's hard to imagine that the AI products built by tech companies will create meaningful new value for news distribution and revenue. These companies are using AI to disrupt internet search: to help users find a single answer faster than it would take to browse several links. So why would anyone want to read reams of news articles when an AI can provide the answer and credit the publisher in a tiny footnote that users probably never click on?
Companies act in their own self-interest. But OpenAI isn't even a normal company. It's a nonprofit (and for-profit sector) that wants to advance artificial general intelligence to benefit humanity, but they can't agree on what that means. Even if its executives fervently believe in the importance of news, supporting journalism is not going to be a long-term priority.
All of this before we talk about pricing news. Ask six publishers how they should be compensated by these tech companies, and you get six different ideas in quick succession. One common idea publishers state is to take a cut of the tech companies’ revenue based on a percentage of the total training data included in their publications. This is untraceable, and there’s no way that tech companies would agree to that. Even if they did, there’s no way to verify the calculations, because the data sets used for training are huge and arcane. And let’s not forget that these AI companies themselves are struggling to find consumer-facing business models. How do you negotiate to get a piece of something that doesn’t exist yet?
The news industry is once again finding itself in this precarious position, in part due to a lack of long-term thinking and strategic patience. The Washington Post And that Los Angeles Timeswas sold to an interested billionaire. The Wall Street Journalare stock market-bound and facing a generational change of ownership. Television journalism is subject to the whims of the largest media conglomerates, which are now trying to fragment and sell off their empires at the peak of their market value. Many large media companies are run by executives who want to survive until the next quarter, not build their companies for the next 50 years. At the same time, the power of industry lobbying is weakening. A recent congressional hearing on AI and news was overshadowed by a meeting between OpenAI CEO Sam Altman and House Speaker Mike Johnson. Technology companies clearly have much more influence than media companies.
It's getting worse. Media, established and new, are losing money and talent every week. More media may be shut down, others will fall into the hands of those in power and be used for their own purposes (see the activist efforts of former Republican presidential candidate Vivek Ramaswamy). BuzzFeed).
The long-term solutions are still unclear. But the answers for now are painfully obvious: Publishers should be patient and refrain from licensing their content for relatively small amounts. Publishers should protect the value of their works and archives. Publishers should have the integrity to say no. It is still too early to partner with companies that train models without permission on professional content and have no compelling justification for how they can help build the news business.
Instead of keeping their business development departments busy, news organizations should focus on what they do best: producing great journalism and delivering it to readers. Technology companies are not the news industry, and they shouldn't be. Publishers must stop relying on tech companies to bail out the news industry. We must start saving it ourselves.
