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‘Billions at stake’ as OpenAI, Microsoft face copyright lawsuit from New York Times

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The New York Times has filed a lawsuit against OpenAI and Microsoft, accusing them of copyright infringement in the development of AI technologies, including the widely-used ChatGPT. This marks the first major legal clash between a major media organisation and AI creators.

The New York Times Headquarters(Getty Images)
The New York Times Headquarters(Getty Images)

The allegations: Unlawful use of NYT’s intellectual property

The lawsuit claims that OpenAI and Microsoft used millions of articles from The New York Times to train their automated chatbots, turning them into competitors for delivering reliable information. The suit demands accountability for “billions of dollars in statutory and actual damages” and urges the destruction of any AI models using copyrighted NYT material.

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The legal battle is expected to define the legal boundaries of generative AI technologies, holding major implications for the news industry. The NYT is concerned about the potential loss of web traffic and revenue as AI-generated content competes with traditional journalism.

Financial impact and valuation: Billions at stake

OpenAI, valued at over $80 billion, and Microsoft, which invested $13 billion in OpenAI, now face the financial impact of the lawsuit. The lawsuit alleges that the defendants exploited NYT’s journalism without payment, leading to potential damage to the newspaper’s revenue streams.

The legal action comes after unsuccessful negotiations between The New York Times, Microsoft, and OpenAI. The NYT sought an amicable resolution, including a possible commercial agreement and technological safeguards around AI products, but talks reached an impasse.

AI in the news business: A double-edged sword

The lawsuit paints AI systems like ChatGPT as potential competitors in the news industry. When chatbots rely on past journalism to answer queries, they become direct competitors, threatening traditional news outlets’ revenue streams.

The complaint highlights the risk of AI-generated “hallucinations,” where chatbots insert false information wrongly attributed to sources. The NYT fears potential damage to its brand if misinformation generated by AI is linked back to the newspaper.

Concerns about AI’s uncompensated use of intellectual property extend beyond news organizations. Previous cases involving celebrities and authors, such as Sarah Silverman and Jonathan Franzen, reflect the broader conversation about protecting intellectual property in the age of AI.

This lawsuit will likely become a legal test case for the boundaries of generative AI technologies. As AI continues to evolve, this legal battle could shape how companies use copyrighted material to train their AI models.

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