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title: hookin’ up with OpenAI
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| Gold for glitter. $250M licensing deal. Media's crumbs.    View in browser June 4, 2024 More than words Hi there,    OpenAI and other LLM makers are skillfully getting media companies to trade gold for glitter.   Let me explain using OpenAI.    The company is locking in content to train its models and enrich ChatGPT responses.    Last week, the AI company announced tie-ups with both The Atlantic and Vox Media.    Those are on top of a flurry of content and product partnerships OpenAI has landed with a range of publishers in the last year.   These deals can run into the hundreds of millions. OpenAI’s multiyear deal with News Corp, for instance, is valued at over $250M.  CB Insights customers can track all of OpenAI’s partnerships on its profile here.  OpenAI is not the only model developer striking licensing agreements.    Google has similar deals with Reddit and Stack Overflow, and Amazon has had discussions with the BBC, for example.    The deals are coming as proprietary sources become harder to scrape.    Reddit locked down its API a year ago, while The New York Times is suing OpenAI and Microsoft for copyright infringement.    As we predicted previously, companies with proprietary content are becoming hot licensing and acquisition targets.  For many publishers, linking up with AI developers (vs. pursuing costly litigation) is a matter of necessity — especially as genAI shakes up not only content production but also the search landscape.     The Atlantic CEO Nicholas Thompson said in the magazine’s press release, “We believe that people searching with AI models will be one of the fundamental ways that people navigate the web in the future.”    Both The Atlantic’s and Vox’s deals last week with OpenAI will make their content discoverable to OpenAI users — with attribution links.    As part of the agreements, the companies will also get access to OpenAI’s tech to build new journalism products.     Some thoughts: While I think this is probably a necessary move by these publishers right now to capture some short-term dollars, they’ve accelerated their decline with these deals.  As Google, OpenAI, etc. compress these articles via their LLMs, they benefit greatly from the substantial value of this content. And what do media companies get beyond this cash bump? They get some crumbs in the form of attribution and links. Outside of a handful of successful players, the media business model has been declining for quite some time. That trend looks like it will continue. I love you.   Anand @asanwal    P.S. Organizations’ partnerships, licensing agreements, and joint ventures give insight into where competition, markets, and technology are going. Unlock this data with CB Insights. Get started with CB Insights Start your free trial CB Insights' emerging technology insights platform provides all the analysis and data from this newsletter. Our data is the easiest way to discover and respond to emerging tech.  Was this email forwarded to you? Sign up here Copyright © 2024 CB Insights, All rights reserved. 498 7th Avenue, NY, CB Insights, New York,10018 About Us \| Update Preferences \| Research \| Newsletter |
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