Perplexity in the crosshairs of News Corp. Publishers do not like Ai engines

News Corp's lawsuit, like that of the New York Times against OpenAI, also contains allegations other than copyright infringement. There is also an image damage issue at stake.

Perplexity allegedly attributed fabricated quotes to a Wall Street Journal article. In short, it is 'hallucinations' that are under indictment. The lawsuit also cites a Wall Street Journal article about the US arming F-16 jets destined for Ukraine with advanced weapons. Again, Perplexity attributed quotes to the article that never appeared.

The publishers involved in the News Corp lawsuit are asking the court to order Perplexity to stop using and copying their copyrighted content without permission, to destroy all databases containing the material, and to award damages of up to $150,000 for each incident of copyright infringement.

Legal problems have not deterred investors from Perplexity, which is in talks to raise more than $500 million in its fourth funding round in a year. The latest round would value the company at $8 billion.

We await the outcome of the first lawsuits, against OpenAI, to draw a clear line on what AI can do and what licensing agreements should be signed with publishers. Much depends on the interpretation that the US courts will give to the concept of 'fair use' in copyright law, assuming that the companies do not reach an agreement first. However, this concept is absent in Italian law. In Europe, things may therefore be different. OpenAI, in its formal response on the most important case now pending, that of the New York Times, argued that: "in the real world, people do not use ChatGPT or any other OpenAI product" to replace the NYT subscription. "Nor could they. In normal use, you can't use ChatGPT to serve up Times articles at will."

In short, the legal assessment to be made is whether there may be a real economic loss for publishers for this re-use of their content. It has to be said that for many publishers, copyright infringement is at the heart of the AI action.

Similar is the April lawsuit of eight US newspapers owned by Alden Global Capital against OpenAI and Microsoft: the New York Daily News, the Chicago Tribune, the Orlando Sentinel, the Sun-Sentinel in Florida, the Mercury News in San Jose, the Denver Post, the Orange County Register and the St. Paul Pioneer Press.

"The misappropriation of news content by OpenAI and Microsoft undermines the news business model. These companies are building artificial intelligence products clearly intended to supplant news publishers by repurposing stolen content and providing it to their users,' the publisher stated.

"Even worse, when they do not provide the verbatim reports of our hard-working journalists, they erroneously attribute false information to our publications, damaging our credibility. We employ professional journalists who adhere to the highest standards of accuracy and fairness."

Another notable lawsuit against OpenAI and Microsoft was filed in June, by the non-profit news organisation The Center for Investigative Reporting, which produces Mother Jones (after its merger this year) and Reveal.

Some publishers, led again by the New York Times, also expressed concern to Google about the AI Overviews product, which integrates summaries of results into the search engine, here including journalistic articles.

It should also be mentioned that there is a much richer list of publishers or newspapers that have found cooperation agreements with AI services, with revenue sharing or other initiatives.

In Italy, RCS (Corriere della Sera) and Gedi (Repubblica).

With OpenAi, Hearst (more than 20 magazines and 40 newspapers in total in the US), Conde Nast (Vogue, Wired, Vanity Fair and GQ), Time, Vox Media, The Atlantic, News Corp, Reuters, Axel Spinger, Financial Times, Le Monde.

With Perplexity, Time, Der Spiegel, Fortune, Entrepreneur, The Texas Tribune and Automattic (WordPress) agreed.