Altman launched OpenAI in 2015 with a mission to develop AI that “benefits all of humanity.” Fast forward nine years later, humanity be damned — Altman and his ego needed a “Her” moment when OpenAI launched its latest version, ChatGPT-4o. Problem is, Scarlett Johansson was having none of it. Neither is much of the creative community, which is finally beginning to understand its collective power and is rising up to say, “Stop the madness!” 

That “madness” is the arrogant taking of not just creative works — which is the subject of an ever-growing number of infringement cases in the courts – but now also the taking of creators’ personas themselves. Exposed were Altman’s true colors when he asked Johansson for permission to use her voice, she declined, then he asked again just two days before OpenAI’s big ChatGPT-4o launch, and went forward anyway when he didn’t hear back.  

Altman and his apologists want us to believe that there is no harm, no foul here because OpenAI reportedly used a faux Johansson voice, not her actual one. But that doesn’t diminish Altman’s theft, both ethically and legally. We know what Altman was really doing, and a wide body of established NIL (name, image and likeness) law protects celebrities from companies using “sound-alikes” for commercial purposes. 

Singers Tom Waits and Bette Midler faced similar fact patterns decades ago. Just like Johansson, both singers declined to license their voices for major ad campaigns (by Frito-Lay and Ford Motors, respectively). But the big brands went ahead anyway using voices that mimicked the real thing. Although those NIL cases reflect the current state-by-state NIL patchwork, national legislation is now being considered in Congress to put an end to this theft of the economic value of artist personas known as their right of publicity.

Altman’s humiliating gaffe at the hands of Johansson may end up being a watershed moment in Big Tech’s relentless quest to add the next trillions of dollars to its market capitalizations. Her public pushback shines Hollywood’s bright spotlight on what’s really going on here – and it certainly ain’t Big Tech concerns for trust and safety. If there were any doubt about that, the recent departures of OpenAI’s two top executives on that front – and the dissolution of their entire “risk mitigation” team — erased it. Not a good couple weeks for Sam. 

This Altman episode, of course, followed fast on the heels of almighty Apple’s own humiliating gaffe with its now infamous iPad “Crush” video ad that literally crushes all of humanity’s creativity with a giant press for the sake of Apple’ “next big thing” — its slimmer iPad. Apple’s gaffe, and what it represents, are even more telling. If Apple – which trumpets itself as being the trusted home to creators – can be so tone deaf, then can it be sincerely doubted that an undercurrent of Silicon Valley indifference to creators’ interests is to blame?

Hugh Grant and Justine Bateman took up the cause in sounding the alarm against the Apple ad, observing that the tech giant was crushing the entire creative community into one thin piece of technology. Enough was enough already. “The destruction of the human experience. Courtesy of Silicon Valley,” Hugh Grant wrote on X.

The Altman-Apple one-two generative AI gut punch reveals what we have known all along. Big Tech sees creators and their content as being just ingredients it needs to fuel its voracious and rapacious appetite. In Silicon Valley’s view, tech titans know what’s best for all of us and there’s no time to question how or why they do things. It’s all in the name of progress, right? Besides, as virtually all Big Tech CEOs have said, even if they slow down their own generative AI development, the “other guys” won’t – and they have shareholders to please. Damn the torpedoes! It’s time to get biggerer and biggerer, just like the Lorax in Dr. Seuss. 

We’ve seen how this has all played out before. Big Tech’s relentless thirst for dollars in the name of progress created the ad-driven social media ecosystem that has divided our country and decimated so many young lives. Do we have any doubt that Big Tech’s unchecked DNA could lead to similar harms, perhaps at an even greater disruptive level?

So – good for Johansson because she single-handedly hit the panic button and caused Altman to blink and reveal who he really is. Altman famously said this in a The New Yorker interview in 2016: “When I realized that intelligence can be simulated, I let the idea of our uniqueness go, and it wasn’t as traumatic as I thought.” In other words, sentience is sentience, regardless of whether it is human or artificial. It’s all the same in his book. I assume he would say the same thing about human and AI “creativity” as well.

Now it’s time for “Big Media” – the major studios, streamers, record labels, game companies, publishers – to follow Johansson’s lead and magnify the issue of Big Tech’s wholesale theft. Unified collective action can best lead to both a more equitable sharing of the generative AI pie going forward and significant payments for Big Tech’s past misdeeds of scraping copyrighted works without consent or compensation. We see signs of progress in the wake of Johansson’s fight. President Tino Gagliardi of the American Federation of Musicians called on all creatives to understand what’s at stake. “[I]f someone can try and do this to one of the most famous actresses in the world, they can absolutely do it to anyone.”

And rather than fight or dismiss the creative community at every turn, Big Tech should welcome it. It’s in Silicon Valley’s best interests to listen to the creative community’s concerns early when transformational technology is born rather than wait for blowback and resistance. That friction only slows down the progress that they so desperately seek. Inclusion and recognition of value – rather than entitlement and taking – will lead to a generative AI world that works for all.

And creators, one more thing. The licensing deals Big Tech is offering today – like OpenAI’s reported $250 million five-year licensing deal with News Corp – may sound like big numbers today. But my bet is that those numbers will seem like trifles to the overall value generated by Big Tech with your IP over that period of time. Remember, Google bought YouTube – which built its initial value largely by enabling infringement of copyrighted works — for $1.65 billion in 2006. Now Google is valued at nearly $2.2 trillion. Assuming YouTube represents only 20% of Google’s overall value, that’s still $440 billion.

That’s the power of content. 

Reach out to Peter at peter@creativemedia.biz. For those of you interested in learning more, sign up to his “the brAIn” newsletter, visit his firm Creative Media at creativemedia.biz, and follow him on Threads @pcsathy.

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Live sports, of course, are essentially traditional media’s last stand against Big Tech streaming’s winner-take-all attitude. Live news’ numbers pale in comparison to sports. That played out yet again in spectacular fashion with the Super Bowl, which became the most watched television event in U.S. history with an astounding 123 million viewers. Sure, Taylor Swift had something to do with it (okay, she had a lot to do with it, haters be damned!). But the big game is just the pinnacle of what it represents — shared experience stuff you just gotta see live, as it’s happening, because you don’t want your Bleacher Report buddy ruining the ending. 

Live sports pay the bills and are just about traditional media’s only kryptonite against Big Tech’s full Hollywood takeover. So, Hollywood can’t afford (both literally and figuratively) to lose them. But we know the game here. The numbers to acquire those coveted exclusive television rights are “Evermore” mind boggling (see what I did there, Taylor?) and moving only one direction — vertically, just like Patrick Mahomes’ salary. 

Just take a look at the live sports cash scoreboard. NBC, CBS, ABC and Fox each pay more than $2 billion just for the NFL. Warner Bros. Discovery paid more than $1 billion for the NBA, and collectively traditional studios paid nearly $2 billion for Major League Baseball, and we’re not even talking yet about the billions for college football and soccer. Layer on top of that the fact that the Big Tech streamers want in on the live streaming game because they too have discovered its fervent fan magic. That hyper-competition now dials up those prices to 11, even as traditional media’s pockets get tighter.

Meanwhile, Big Tech’s pockets get brighter. Boasting multi-trillion dollar market caps — much of which was built on the backs of traditional media players (as I wrote last week in the context of TikTok and UMG’s ongoing dispute) — these ‘roided out Silicon Valley-programmed behemoths act like the Kansas City Chiefs playing one of the new United Football League teams (games of which will be telecast on traditional media’s outlets, by the way). The plays may be similar, but the ability to execute is entirely different. 

That’s why Amazon could pay $1 billion for just one night of football each season (Thursday Night Football). YouTube paid $2.5 billion to steal NFL Sunday Ticket away from DirecTV, and Apple paid the same $2.5 billion for 10 years of exclusive live MLS soccer. Netflix is also testing the lives sports waters to expand its sports programming lineup, and these tech-fueled media goliaths ain’t done yet.

This very uneven live sports playing field demands a new kind of coaching. It’s kind of like the great gridiron movie “Rudy.” No one gave Rudy (traditional media) a chance against the Goliath forces he faced (Big Tech) in that story. So, what did our underdog do? “Rudy” (Disney, WBD, and Fox in our story) teamed up to create their live sports streaming joint venture. Think of it this way. It’s an entirely new kind of one-stop streaming stadium to host all of their collective live sports in the hopes of creating newly dedicated fans. In the immortal words of Shoeless Joe Jackson (yes, I know that’s a baseball reference), “if you build it, they will come.” 

The question is whether fans of the new joint venture will stay though. It’s kind of like when my always-the-underdog Minnesota Vikings built their spectacular U.S. Bank stadium a few years back to ensure that the team’s fans would stay put in Minneapolis (there were rumblings at the time that the team would move elsewhere). The stadium is now widely considered to be the best of the best, easily beating out the venues of NFL royalty like the Kansas City Chiefs, and fans continue to flock, so far. But stadiums, no matter how shiny,  must host a winning programming team. That hasn’t looked too great of late for the Vikings, but hey, one can only hope! 

Of course, games are nothing without a referee, and we certainly have one here — the feds. Disney’s joint venture streaming trick play likely isn’t going over too well by live sports-focused streamer Fubo and other television focused primarily on live sports. The anti-trust referee will be asked to scrutinize the deal — analyzing it over and over on replay — and then make a decision that will be wildly applauded by some, but boisterously booed by others. Even if QB Iger called the right play, it’s up to the entire joint venture team to convince the ref that they followed all the rules here. 

Hollywood’s new live sports joint venture is a surprisingly bold move designed to beat Big Tech at its own game. Now it’s time to really go big. The JV should staff its new streamer with the real pros who could take it to the promised land — young tech-savvy “money-ballers” who can develop entirely new fan experiences for the expensive live sports content it controls. Motivate them to come up with their own new trick plays. Here’s one: Put some generative AI tools in the hands of the audience at home to give them the ability, in real-time, to make their own personalized highlight reels. 

That’s the kind of coach I’d bring in to run the new team.

The post Streaming’s Super Bowl: Inside the Epic Showdown for Live Sports appeared first on TheWrap.

The move didn’t just mean that UMG artists went silent. Because UMG’s publishing arm (Universal Music Publishing Group or UMPG) helped yank that chord, and it represents four million songs itself, the action effectively mutes the videos of recording artists on other labels if UMPG songwriters helped write their underlying songs. Remember, music carries two copyrights – one for the master recording and one for the composition itself. 

That fundamental legal reality has been mostly lost amidst the breathless news coverage, but it is absolutely critical to understanding the magnitude of UMG’s decision. Consider Adele, who is just one major artist caught in this complex music licensing web. She records for Sony Music, but her publishing is with UMPG. That means her videos are off limits to TikTok. 

And it gets much stickier even than that. Consider songs written by multiple songwriters with multiple publishing houses, only one of which is UMPG — a situation not so unusual in hip-hop and dance music. If a UMPG writer contributed just 1% of the songwriting credits to a recording, it, too, would need to come off TikTok, as leading industry publication Music Business Worldwide pointed out. A shell-shocked senior executive from a rival publishing company told MBW that “up to 80% of all relevant music content” on TikTok and other platforms likely has at least some link to UMPG.

That’s what makes UMG’s move the kind of massive shot across the bow unlike anything before it. Its potential impact is breathtaking, as are the understandable mixed emotions of the music industry that flow from it.

TikTok has played an increasingly critical role in artists’ lives, especially to emerging artists. Take UMG recording artist Cody Fry, for example. His song “Things You Said” started to go viral just before it went dark. So while he supports UMG’s hardline stand, he told Rolling Stone that he feels like he is “just at the mercy of machinations of these multi-billion dollar corporations.” 

A 2% music payout

TikTok is also increasingly dominant in our online lives, of course, much to the chagrin of some in Congress who now seek to restrict the China-based company for national security reasons. They have raised concerns that the Chinese government is using TikTok as a way to indoctrinate and gather personal data from digital natives who can now barely cope with the stress of it all. UMG’s decision is more mud to sling at TikTok’s CEO Shou Zi Chew, who just recently was in the Senate Judiciary Committee hearing hot seat. 

The battle of two power brokers — one with the largest music pipeline and the other with the largest social distribution — was triggered even before they were unable to reach agreement on terms to extend their contract past its Jan. 31, 2024 expiration date. In a scathing open letter before taking its drastic step, UMG accused TikTok of “trying to build a music-based business, without paying fair value for the music.” It further chastised the social media behemoth for allowing it “to be flooded with AI-generated recordings” and other moves that are “nothing short of sponsoring artist replacement by AI.” 

UMG made a legitimate point here, as painful as it is to all involved. TikTok has been almost unstoppable, and UMG — which boasts 32% of global recorded music market share and 23% of global publishing — correctly points out that the Big Tech social media giant is open about its music ambitions. In its letter, UMG underscored that TikTok’s senior executives “proudly state publicly that ‘music is at the heart of the TikTok experience’” yet, as UMG further pointed out, TikTok accounts for “only about 1% of [UMG’s] total revenue.”

Since UMG finished 2022 at about $11 billion in revenue (full 2023 numbers aren’t in yet), that means that TikTok pays UMG only about $110 million annually  — and the entire music industry $400 million annually — despite the fact that the platform was expected to close out 2023 with $18 billion in “net global advertising revenues.” If those numbers are right, that’s a payout to the entire music industry of just over 2%, regardless of the central role music plays in its success.

Battling the Big Tech playbook

Sure, some may cry foul at a major label’s protestations, especially young people who have grown up in an era where many have been trained to believe that music is free. But many in the entertainment industry understandably feel that Big Tech’s playbook has been to essentially steamroll over them in negotiations through sheer mass and gale force industry headwinds of the Internet, social media and now generative AI.

As I’ve pointed out repeatedly, Big Tech for the past few decades has largely built its massive user bases and resulting multi-trillion dollar valuations on the backs of the artist community. Let’s not forget that technology pipes without the content to fill them are ultimately just useless pipes.

The music industry, for example, looked to Big Tech to help save it after the original “bad” Napster wreaked havoc almost overnight on the system it had built up over decades. That’s when Apple co-founder Steve Jobs played the part of white knight by cutting albums into individual song pieces, creating the world of 99-cent downloads and then taking 30% of every song slice. There was no magic to those two numbers, but once Jobs conjured and negotiated them, they entered the wild and became industry religion.

The rest, as they say, is history. Apple has used content — and the “sexy” marketing and engagement that flow from it — as its foundation to build the most valuable company on the planet until Microsoft topped them due to their stronghold in generative AI.

Less than a decade after Napster’s great IP train robbery, YouTube entered the void and built a massive user base by enabling the unbridled uploading of millions of copyrighted videos, many of which were music videos. Still reeling from the pain of their music industry compatriots, the studios barely knew what had hit them.

Viacom ultimately sued YouTube for mass infringement, and the two companies eventually settled after 800-pound Big Tech gorilla Google bought YouTube for $1.65 billion and bankrolled its mass infringement litigation in the steal of the century. Now, about 20 years later, YouTube’s ad-first economics still rule the day, helping to drive up  Alphabet/Google’s market valuation to about $1.8 trillion while UMG’s hovers at roughly $50 billion.

TikTok picked up YouTube’s ad-supported playbook and took it to the next level with algorithms and virality that transformed social media, got us all hooked and forced the entire music industry to recalibrate. It’s the same kind of pattern and song Big Tech has played on repeat for decades. 

It’s quite likely that TikTok never really believed that UMG would pull the plug. Hours after UMG made its TikTok announcement on Thursday, Ole Obermann, the platform’s global head of music business development and IP rights, “nervously gripped the podium” at Variety’s TikTok Grammys party as he tried to sway the room and convince attendees that TikTok actively supports the artist community, according to one music industry vet in attendance. “And it was not working,” the brand partnerships professional said.

So who will blink first?

UMG needs to convince its major label and publishing partners — not to mention the entire artist community — that its battle is a noble cause that benefits all. That won’t be easy if, as TikTok wrote in its own salvo back to UMG, it has already reached agreements “with every other label and publisher.”

In its statement, TikTok also emphasized that its agreements are “artist-first.” Must be true … right?

Alexei Barrionuevo contributed to this column.

The post Tech vs Content: Behind the TikTok Fight With UMG Over Music Rights appeared first on TheWrap.

Case in point: The New York Times’ multi-dimensional case against Microsoft and OpenAI for both unlawful scraping of its journalistic content and infringing competition, which it filed just before the ball dropped in Times Square. That suit, together with others before and after it, will define the basic rules of copyright that will transform the media and entertainment business. They will define what can and cannot be done without consent and compensation both on the AI “input” and “output” sides of the equation. 

Most people with whom I’ve spoken believe that the U.S. Supreme Court will ultimately decide the issue, and many believe the Justices will rule in favor of Big Tech and find “fair use” consistent with what is commonly referred to as the landmark “Google Books” case. But that case wasn’t decided by the Supreme Court. It was decided by the 2^ndCircuit Court of Appeals in 2015, which ruled in Google’s favor against authors who had claimed mass infringement by Google’s “Book Search Project” — in which the behemoth vacuumed the entirety of text from the libraries of the world to make it all searchable. The Supreme Court refused to review the 2nd Circuit’s decision when it denied certiorari. That means that “Google Books” is not precedent it must follow. 

Today’s Supreme Court is also fundamentally different today than it was in 2015. Three new Justices, all Trump appointees, have joined since then, and the Court has also directly ruled on pivotal copyright cases since that time. Two particularly relevant cases are Google v. Oracle decided in 2021 (yes, Google again in the infringer hot seat) and last year’s surprising Andy Warhol-Prince ruling. 

In the first, in a 6-2 decision (there was an open seat at the time), the Justices ruled that Google’s direct copying of 11,500 lines of Oracle software code — copying Google had conceded — was a fair use. In the Warhol case, the Court went the other way in a 7-2 decision, rejecting Warhol’s fair use defense based on a new kind of economic “harm to creator” element it defined for the first time. Interestingly, two of the most liberal Justices — Sonia Sotomayor and Elena Kagan — split on that decision with strongly worded rebukes of each other’s reasoning. 

So what do these rulings portend for how the Justices will decide between infringement and fair use in the realm of generative AI when there is mass non-consensual “training” on the input side and frequently direct adverse market impact to creators on the output side? Well, let’s first look to the lower federal courts and where they seem to be heading. 

So far, as I’ve written previously, the few federal judges who have ruled on those issues have concluded “fair use” when confronted with Big Tech’s mass scraping of copyrighted works. Those judges — including in the high-profile Sarah Silverman case — rationalized that the eventual AI outputs bore no direct relation to any specific creative work that had been hoovered into the AI’s training vortex. In other words, Silverman and others could prove no adverse market impact. At first blush, that reaction seems to make sense and is consistent with “Google Books,” a case which the Silverman court cited.

But let’s step back a bit, as the The New York Times case presents a master class in pleading and litigation. Unlike other media-related AI infringement cases before it, The New York Times goes further and makes the case for direct market harm, seeking “billions of dollars in statutory and actual damages.” The Times contends that Big Tech’s AI-focused efforts serve no “Google Books”-like service to its journalists and brand. 

In “Google Books,” the 2^nd Circuit found fair use because Google ultimately displayed only snippets of the scraped books rather than the whole enchilada. So, the 2^nd Circuit reasoned, Google’s “revelations do not provide a significant market substitute for the protected aspects of the originals.” Instead, the Court concluded that Google directly benefited authors by shining more light on their writings.

The Times points out that Big Tech’s mass copying in the AI context is entirely different. Here, Microsoft and its rambunctious nephew OpenAI are directly copying tens of thousands of its articles precisely to offer a market substitute and compete with it. In essence, Big Tech is looking to build trillions of dollars of future value, once again, on the backs of the creative community by using its AI algorithms to do what it could not do itself — create the content that fuels its synthetic output-spitting machine.

The Times has a point here — a massive one — and the U.S. Supreme Court may be quite open to hearing it. First, as noted above, the Court never ruled on the specific “Google Books” case, so it is not a precedent it must follow. Second, its 2021 Google vs. Oracle case dealt with purported infringement of computer code, not creative works, a distinction that the Court itself noted. And finally, in Warhol, the freshest ruling of the bunch,  the Court defined a new “economic harm to creator” test when rejecting Warhol’s fair-use defense. Seven of the nine Justices were on board with that ruling, including both the most conservative and most liberal of Justices, in a rare moment of bench-wide solidarity.

In The New York Times case and others before it (including Getty Images, which also focuses on AI market substitution), it’s hard to challenge the contention that real economic harm results directly from the non-consensual and non-compensated direct wholesale copying of copyrighted works. Subjective creative works are entirely different than objective computer code. 

Further, AI outputs ultimately can — and in many cases are intended to — serve as direct market substitutes for the works that have been scraped, even if those outputs don’t bear any direct relation to the works at hand. Make no mistake — Big Tech ultimately wants us to use its AI as our source of news, instead of The Times. Unlike in “Google Books,” that shines no light on The Times that draws us in. Instead, it casts a glare that pushes us away.

For all these reasons, I strongly suspect that the Supreme Court ultimately will be sympathetic to The Times and the creative community in general and rely most on its recent Andy Warhol ruling.

Big Tech AI faces a significant crisis due to this very real potential outcome, and its best bet is to stop The Times’ and other litigation dead in their tracks. Microsoft and OpenAI should settle with The Times and proactively work with creators to define both compensation schemes and some real guardrails that benefit them so that Big Tech can deliver on the promise of its AI in the world of media and entertainment, fairly. Such negotiations are, in fact, happening now, even as Big Tech litigates onward.  

One way or another, creators and their works must be respected, protected and compensated. Perhaps that compensation will be in the form of a YouTube-like Content ID system. Google has already developed something called SynthID that identifies creative works scraped by its AI. Perhaps that compensation will come from Spotify-like royalties to artists. Perhaps it will be akin to Adobe Firefly’s scheme that pays participating “opt in” artists based on the amount of their visual works included in the AI’s training data set. 

But there should be no free lunch. Human creativity must be respected, so long as we humans still rule the day.

For those of you interested in learning more, visit Peter’s firm Creative Media at creativemedia.biz and follow him on Threads @pcsathy.

The post What the Supreme Court Will Do With the NYT AI Case and What It Means for Media and Entertainment appeared first on TheWrap.

That’s why you, the original friendly mouse, will now star in a just-announced slasher film “Mickey’s Mouse Trap” coming later this year. And you’re not alone. You’re following your animated pal Winnie the Pooh into the public domain’s wild west, because Pooh too just went dark. His horror film, “Winnie the Pooh: Blood and Honey,” was released last year.

None of this is new of course. It’s a tale as old as time. Copyright only conveys exclusive ownership and commercialization for a limited period of time, after which that creative work is available to us all. Entire creative kingdoms have been built this way, magic kingdoms in fact. It was the great Walt Disney himself who first perfected the art of creative copyright when he took the classic, yet very public domain, early 19^th century Grimm fairy tale “Snow White” and made it his own, wrapping it in a new fresh blanket of copyright protection. Fast forward almost 90 years and Disney is now today’s leading traditional media company, now valued at nearly $170 billion. 

AI used with public domain creative work generates an entirely new and potentially highly lucrative kind of creative “unlock” for enterprising young creators (and their financiers). AI is the new creative alchemist – the new Walt DisnAI so to speak – and public domain creative works represent a new treasure trove of material on which to train. 

Generative AI’s fundamental promise in the world of media and entertainment is to take a single prompt – as augmented by any number of additional prompts – and tirelessly “create” endless iterations. So just imagine an AI-supercharged Mickey Mouse. The sheer number of possible “re-imagined” works is mind boggling and dwarfs Uncle Walt’s quaint little “Snow White” public domain opportunity. It’s also the ease to create them, together with the  (and minimal resources) necessary to do socreate them, especially as generative AI improves. 

Right now, AI can produce songs and write entire movie scripts literally in seconds based on simple prompts. We already see short films being produced the same way. Full feature films are next at a tiny fraction of the time and cost historically necessary to create them. Just imagine the time, love and care it took for Walt Disney to draw each frame for the animated “Steamboat Willie” in 1928. AI ain’t that.

The Beatles resurrect the past with AI

AI, of course, also boasts other transformational chops. It can fine-tune creative works of the past in order to make them presentable for the first time. Case in point: the recent “The Beatles: Get Back” documentary on Apple TV+ which highlighted how AI repurposed priceless, but deeply damaged, videos of the Fab Four in the recording studio, much of which had never before seen the light of day. The Beatles shocked the world again this past November when they used AI to finish the song “Now And Then”, their first new track in decades. AI made this possible by “fixing” the sound quality on a long-forgotten demo track that John Lennon recorded shortly before he was killed. AI even recently completed Beethoven’s previously unfinished “Tenth Symphony,” and now can breathlessly write new ones based directly on the master’s works thanks to the public domain.

Let’s also not forget that today’s AI-infused public domain is fundamentally different from the ghosts of public domain’s past in terms of commercial possibilities. Disney’s massive investment in building the Mickey Mouse character over time, together with the massive global goodwill and commercial value that resulted from it, significantly increases the odds for new public domain-driven creative works to find a global audience willing to pay at a scale never-before-possible. In other words, the new Mickey “The Slasher” Mouse directly benefits from Disney’s massive investment. Its producers will deny any explicit endorsement of course. But come on, we, the audience, know that Walt is there, lurking in the halls of the upcoming horror film. 

All of this builds to the exciting final act of this fAIry tAIl. Big Tech’s generative AI currently faces an existential creative crisis that is now being litigated in the courts – the fundamental question of whether AI’s training on copyrighted works at scale constitutes mass infringement. The creative community’s latest shot across Big Tech’s AI bow is the recently filed The New York Times lawsuit against Microsoft and its rambunctious cousin OpenAI, in which the Times seeks massive damages for both AI’s scraping of its copyrighted works and content-generation of competing works. 

OpenAI, of course, will claim “fair use” – and the case likely will settle – but the creative community understandably will not go gentle into that good night (to quote Dylan Thomas, whose works also just crossed the public domain rubicon as of January 1st). Creators, most likely, will ultimately benefit from some kind of system that tracks and pays them, much like Google’s current Content ID system tracks and pays for copyrighted works that find their way onto YouTube. That means that Big Tech’s AI “creative” engine will look for new more cost-effective sources of inspiration to fuel its voracious appetite – and voila, “Here’s Mickey!”

Walt’s original “Steamboat Willie” mouse will welcome Big Tech and those who use its AI tools to the brave new public domain world. Now each of us can even create our very own Mickey Mouse chatbot in minutes without needing to worry about Disney’s legal machine raining down on us. Just this week, OpenAI is expected to opens its doors to its new App Store where anyone can create their own customized ChatGPT bot.

And so it goes. Those who live by the sword, also die by it. Disney – the original great alchemist of public domain creative works – now finds itself on the losing end of the stick. All Disney’s teams of lawyers can do now is watch the new upcoming slashing “Evil Mickey” closely and make sure that he sticks closely to the original “Steamboat Willie” script. 

For those of you interested in learning more, visit Peter’s firm Creative Media at creativemedia.biz and follow him on Threads @pcsathy.

The post Mickey Mouse Puts the ‘AI’ in Public Dom‘AI’n appeared first on TheWrap.

Prediction #1: AI is the headline story, and nothing else comes close

Talk of AI will continue to dominate, as it should given the immense transformation we will see AI take in our industry from this point forward. AI is poised to disrupt lives across the creative community – which means disruption to the meaning of art itself. 

Expect a sobering breakthrough on the path to artificial general intelligence (AGI). There’s a reason why OpenAI’s cautious board members ousted CEO Sam Altman, only to have him returned by the company’s “no holds barred” VC investors. And once AGI gets real, it will upend our entire media and creative ecosystem, not to mention all of our systems period.

Until then, artists and creators will begin to experiment with generative AI in earnest. So will the major studios and streamers, and you can bet that SAG-AFTRA and the WGA will be watching. Few traditional motion picture and television industry jobs will be lost at the artificial hands of AI in 2024, but that will begin to change in the years ahead, even as new AI-born jobs arise.

Look to media-focused companies like Flawless to begin enabling AI-dubbing, which will mitigate the need for subtitling to reach global audiences. At the same time, AI-enabled pre-visualization will become a “thing” in its early stages. And 2024 will be the first full year we will see how consumers respond to AI-infused creative works both their dollars and emotions. Will those works “connect” at a human level?

Big Tech companies, meanwhile, will do their best to skirt any limitations on their AI development and AI’s power. Alphabet (the company formerly known as Google) will promote its new “nice” sounding SynthID system and claim to be a “white knight” for enabling automatic detection of copyrighted works used to train AI systems. But, at the same time, Google and others will look to invest in companies like Character.AI which enables users to create chatbots that impersonate humans like musician Billie Eilish, with or without either license or consent (the company indicates it is up to users to do what is needed).

AI-powered music will increasingly flood our streaming world. Skeptical of Google and other Big Tech players, expect the major labels to turn to new “forensic AI” companies to both track AI fingerprints and enable new ways to pay the artists whose works and identities have been stolen.

Prediction #2: AI regulation is coming to the U.S. (it’s already in the EU)

Congress and regulators will do their best to control AI’s otherwise unbridled rise by developing guardrails to promote transparency, identify content provenance, and protect against the theft of names, images, voices and likenesses for profit, some of which will be necessary and sensible – but several that may not be. Once again, as in the case of social media, they will follow the EU, which just recently passed sweeping groundbreaking measures to regulate AI. The push for a national “right of publicity” will gain steam. 

Ultimately, dollars will decide how this all plays out, since no copyright and content exclusivity (the ability to monetize) come from AI-only generated works, and no one knows how consumers will react to creative works that are increasingly “synthetic.” Copyright remains the most powerful guardrail bar none. Dollars matter and the profit motive is strong, young Skywalker.

As I wrote in my last column, expect the courts to flesh out this fundamental copyright guardrail with critical AI-focused rulings on the issue of what constitutes copyright infringement both on the “input” training and “output” sides of the equation. We can already read the tea leaves of where it’s all heading based on early decisions. Judges have ruled that even full-scale copying of massive numbers of copyrighted works can be acceptable transformative “fair uses.” 

Prediction #3: TikTok encroaches on Netflix’s turf, as streamers continue content belt-tightening

Our collective obsession with TikTok will only deepen, even as Congress continues to threaten to pull the plug. The courts will strike down Montana-like “shut-it-all-down” laws, and younger voters will rebel against any serious “teeth.” The social media platform’s increasing dominance of our attention, not to mention its increasing focus on longer form content, will also begin to eat into our “Netflix and chill” time, and the streaming giant will begin to feel the pain.

Meanwhile, streaming content budgets will continue to fall back to Earth due to basic business realities of costs outpacing revenues. Expect all major streamers including Netflix to do more with less content. Gone are the days of continuous billion-dollar content budget increases. 

Call it the “Barbie Effect,” as all major streamers smartly focus more on evergreen, ever-reprogrammable franchise content. Disney is the gold standard here with its Marvel, Pixar, Star Wars and Disney Princesses brands. But tech-first streamers like Netflix will also begin to quietly experiment with AI to further cut costs and generate new content with better economics.

So-called FAST channels (free ad supported television) will continue their surprising assault on paid subscriptions, especially internationally — critical territories for U.S. SVOD expansion. Remember, 40% of the world’s 8 billion population is still offline, most of whom are economically challenged mobile-first eyeballs to capture.

Prediction #4: Social media’s influence and Musk’s madness accelerate

Speaking of TikTok’s and social media’s increasing hold on our attention, Elon Musk will continue to drive X/Twitter’s downward spiral as advertisers continue their mass exodus and billions are shed from the company’s valuation. Musk will turn to his far out, far-right friends to fill his emotional and financial void and excoriate detractors in the name of “free speech.” Unfortunately, we won’t be able to escape how his basest instincts play out, especially in this election year. 

That will be no laughing matter, as the world begins to realize how much power one brilliant, yet increasingly off-kilter man, holds over all of us on this planet, including in the world of global defense communications where Musk can decide when and where to turn on and off his Starlink satellite system.

Prediction #5: A “deep-fake” election year where cable news relevance continues to wane

AI-supercharged social media will fuel divisive flames at a level never before seen. Watch for “deep fakes” and serious danger to democracy around every corner. Being a Presidential election year, 2024 means that politicians will preen, posture and play to their respective bases as pundits pontificate. That means there will be a never-ending stream of it all by a less-disciplined media that is pressed for profits as we watch more TikTok and less cable for our news. 

The resulting mud that is slung will be increasingly dirty, and generative AI will be the shiny new toy used by the most ruthless and unhinged conspiracy fueled campaigns and influencers. 

Prediction #6: The M&A fuse will be lit and spark more consolidation

Not all change in 2024 will be divisive, of course. After a relative pause in 2023, and due to continuing tech-driven headwinds, Hollywood pairing via M&A will reignite in 2024. Disney has openly teased its dealmaking appetite during this past year. Now real deals dipped in cheese will follow as the magic kingdom tries to reclaim its spot as the happiest place on Wall Street amongst other major traditional media companies. Disney will buy out Comcast’s remaining 33% stake in Hulu for more than $8 billion and pay that bill by spinning out its linear channels. Meanwhile, former CNN topper Jeff Zucker will resurface to buy and reimagine the U.K.’s right-leaning The Telegraph.

For their part, Big Tech behemoths will continue to eye increasingly vulnerable traditional media players a la Amazon buying MGM. Paramount, Warner Bros. Discovery and Comcast’s NBCUniversal are all in their lines of sight. Those storied studios give these Silicon Valley-infused streamers the franchise content they covet to capture and retain our attention to drive sales of their underlying core products. Content becomes marketing first and foremost.

Prediction #7: Zuckerberg trades his metaverse dreams for AI

Mark Zuckerberg, Big Tech’s “Dr. Evil” before Musk, continues his rehabilitation tour both for himself and his company Meta by continuing to jettison the billions he previously spent on his metaverse dreams and redeploy them on AI (notice a theme here?). And for the most part, we all let him off the hook because our focus is now on other more pressing matters.

In fact, talk of the metaverse — which dominated Big Tech discussions just one year ago pre-ChatGPT — now finds itself constrained to the smallest conference rooms across the entertainment industry. As a result, Apple’s VR headset, launched earlier this year, will continue to serve as a niche product asterisk in 2024. That doesn’t mean it doesn’t have power. It simply means that a mass-market appetite doesn’t yet exist and won’t for quite some time.

Prediction #8: Live “immersive” experiences will grow in numbers and importance

Although immersive tech in the form of VR headsets finds itself largely relegated to the back burner for now, that doesn’t mean that immersive tech and experiences are not powerful. In fact, tech-enhanced live, experiential entertainment in all of its forms — concerts, festivals, sporting events — will continue to both expand and attract. In fact, such experiences will be increasingly important to escape the surrounding “noise” and connect with our families and friends in the real world to create shared, joyful, lasting experiences and memories.

Just look at what Taylor Swift and the MSG Sphere in Las Vegas did this year. Taylor’s tour generated more money than the economies of several countries (it’s the first to gross over $1 billion), while the Sphere re-imagined what out-of-home entertainment can look, sound and feel like. Bob Iger and Disney’s plans to dramatically increase investment in their theme parks are a smart and savvy sign of the times.

Prediction #9: Gaming will outpace other entertainment, as music keeps growing

Through it all, the nearly $300 billion gaming industry — which is expected to more than double to $650 billion by 2030 — will continue to obsess us as it massively outpaces the rest of the media and entertainment industry. The appellate courts will uphold Google’s game-changing loss in court to Epic Games regarding the excessive toll it takes for purchases in its Play Store (the equivalent to Apple’s App Store). Google will be forced to significantly cut its “take,” and game developers will cheer the significant extra money in their pockets. Ultimately, Apple will follow suit (one way or another).

For its part, the music industry will continue to lift our spirits no matter what the world throws at us. That means TikTok first and foremost, of course (see above). It also means that Spotify will both continue its impressive growth and its search for elusive profitability. Hence its recent mega-layoffs. Music catalog sales will soar despite the current Hipgnosis meltdown (a cautionary tale) since we listen to music in good times and in bad, as reflected in Goldman Sachs’s most recent music industry report which, once again, revised its global music industry numbers upward to about $50 billion by 2030.

Prediction #10: Web3 will be down but not completely out

Web3 in all of its forms – including so-called digital tokens or digital tickets – will continue to hold promise for creating direct lines of communication, shared value and monetization between creators and their audiences. These are worthy goals for a younger generation intent on creating new opportunities and new rules of the game.

But that promise will be lost for now amidst the rest of the industry noise, not to mention continuing skepticism by the older crowd of blockchain-based tech in general. FTX CEO Sam Bankman-Fried’s conviction for wire fraud, conspiracy and money laundering  is still too fresh and Web3 is guilty by association, even if digital tokens have no real relation to him and crypto-currency in the first place.

Daunting forces await in 2024, but so do transformational and exciting new opportunities. It’s the unanticipated and unexpected twists and turns that frequently change our lives more than anything else. Case in point: the launch of ChatGPT just over one year ago. No one anticipated generative AI’s commercial launch and cataclysmic global impact prior to Nov. 30, 2022 — and look at us now. 

The trick is to be stoic about it all and take fearless action to control what you can as we usher in the new year — all with a sense of hope, possibility and a willingness to pass a meaningful part of the torch to fresh young talent with constructive and creative new ideas and ideals.

Cheers to 2024 — and to a bold, inspired, kind, generous, joyful and positive new year! 

For those of you interested in learning more, visit Peter’s firm Creative Media at creativemedia.biz and follow him on Twitter @pcsathy.

The post 10 Predictions for Media, Entertainment and Tech in 2024 appeared first on TheWrap.

Players across media and entertainment — no matter what role they play — don’t know what to make of it all, which is understandable when even the company behind ChatGPT can’t seem to figure out what it all means. We’ve all witnessed the drama these past two weeks in Silicon Valley’s version of “Game of Thrones” as OpenAI’s board first fired CEO Sam Altman, then nearly hired him back (but didn’t), then enabled Microsoft to hire him (but couldn’t), and then returned him to his CEO role. The drama — reportedly sparked by a significant company AI breakthrough that jolted certain board members — surpassed virtually anything we could find on Netflix.

No one, of course, can predict generative AI’s evolution in its second year. But we certainly can anticipate several major developments in 2024 that directly impact the media and entertainment business and how creative works are both developed and monetized. Here are some of them.

Battles in the courts

First, the courts will flesh out initial basic AI guardrails set by U.S. copyright law and the WGA and SAG in their negotiations, balancing the need to accept tech-forward realities with the rights of creators and art itself. Right now, the U.S. Copyright Office grants no protection to AI-only generated works, while recent strike settlements address several key issues but leave at least one gaping hole for “Synthetic Performers” to enter stage left. 

Early returns are already in on the media-related litigation front that point the way to where this will all land. Take comedian Sarah Silverman’s copyright infringement lawsuits against OpenAI and Meta, where she and others challenge Big Tech’s AI “training” on the backs of theirs and an Internet’s worth of copyrighted creative works. The federal judge in the Meta case, and at least one more federal judge in a similar case, have thrown out those infringement claims, concluding that even literal line by line “scraping” of copyrighted works (in other words, direct copying) is not enough to find infringement. These courts instead ruled that Big Tech’s mass copying is “fair use” because its AI-generated “outputs” couldn’t be traced back to the specific creative work “inputs” at issue. 

Silverman’s case, together with numerous other similar cases pending in the U.S. court system, will certainly wind their way up to the appellate courts in 2024, and those courts are likely to uphold the core reasoning of those decisions. Ultimately, one of those cases is sure to find its way inside the hallowed halls of the U.S. Supreme Court. That won’t happen in 2024. But soon after, a majority of Justices will likely use it to craft a legal test that is seemingly objective, but instead reflects rampant subjectivity that will only invite more endless AI-related media and entertainment litigation. 

The Supreme Court’s ultimate AI test will likely balance two of its recent key copyright infringement rulings. First, the Court will point to 2021’s Google v. Oracle where it ruled that Google’s literal copying of 11,500 lines of Oracle code — a fact that Google conceded — was a fair use. Google created something entirely new based on that copied code, a majority of the Justices reasoned — with a kind of logic that directly applies in this AI context. 

The Court will seek to soften that blow when applying its test to creative works versus the software code at issue in Google v. Oracle (a distinction the Court itself noted in that case). It will use its early 2023 ruling in the Andy Warhol/Prince case, which defined a new economic “harm to creator” component that narrowed fair use, to create a kind of entirely unworkable “you know it when you see it” test when deciding whether AI has taken too much of a creator’s work to be acceptable.

New legislation

Congress will jump on the bandwagon in the coming year and pass significant AI legislation that directly impacts the media and entertainment industry. President Joe Biden’s recent Executive Order points the way. Congress will demand that the Big Tech companies behind generative AI give some basic level of transparency about the material on which their large language models are trained. Regulators will also try to get ahead of the game — a stark contrast to when they were largely absent when social media rose in popularity and importance (and caused significant harm). 

Expect the creative community to do its best to keep AI companies honest by implementing so-called forensic AI tech like watermarking to identify whether relevant creative works were “scraped” or not. That, in turn, will promote “opt in” solutions for AI training like the approaches taken by Lore Machine, an entertainment-tech company that enables creators to share in AI-generated output monetization. 

Creatives vs Big Tech

Big Tech AI players like Alphabet (the company formerly known as Google) will, as usual, try to have it both ways. Desperate to keep up with OpenAI (and Microsoft, the company largely supporting it), Alphabet will relentlessly march on with its AI development while trotting out its new SynthID watermarking solution to quell the creative masses. SynthID sounds a lot like its infringing content “take down” Content ID system for unlicensed copyrighted works that find their way on to YouTube. Alphabet throws these bones to the creative community, while its stock price rockets upward and the entertainment industry struggles to monetize amidst its continuing transfer of wealth to the Big Tech players that disrupt it.

Faced with these realities, and as it should, the creative community will do its best to harness the power of AI to its advantage. AI-fueled dubbing of film and television by companies like Flawless will begin to roll out their technology to expand global audiences (a boon for creators), and artists will increasingly experiment with AI to create exciting new creative works. Artists like Mark Mothersbaugh of Devo — who recently spoke at TheWrap’s annual Grill event — are excited by those possibilities. But others certainly are not. Many understandably feel insecure about their place in a creative universe that is increasingly overwhelmed by synths which, of course, was a large part of what the recent strikes were all about.

The major studios that finance much of that Hollywood talent and art — faced with mounting Wall Street pressure to transform their business models in a new tech-driven media world order — will begin to focus on generative AI to increase output and cut costs. Early experiments will include hyperautomation in visualization and initial uses of “Synthetic Performers.” Silicon Valley-based streamers like Netflix, with Big Tech DNA coursing through their veins, will lead the way.

So we largely know how the courts, regulators, major studios and streamers, and artists themselves will act in 2024 in a new world order of generative AI. Less known is how we consumers will react to — and support — art that kind of feels like the real thing, but that is somehow misses the mark of authentic human connection.

For those of you interested in learning more, visit Peter’s firm Creative Media at creativemedia.biz and follow him on Twitter/X @pcsathy.

The post ChatGPT Turns One — Here’s How AI Will Impact Media & Entertainment in 2024 appeared first on TheWrap.

For the most part, the contract’s AI protections are meaningful, setting critical guardrails on issues like replicating actor images, likenesses and voices without consent before the AI genie generates itself completely out of the bottle. 

But a gaping AI loophole exists in the settlement’s section about “Generative Artificial Intelligence” — a hole that is sure to be exploited by motion picture and television producers and, therefore, presents a real ongoing risk to the creative community, not to mention how we create art itself. 

Specifically, there appear to be no real guardrails to prevent producers from replacing human performers with AI-generated “Synthetic Performers” — a digitally created assets that appear to be “natural performer[s]” but are “not recognizable as any identifiable natural performer.” According to SAG-AFTRA’s post-settlement “Summary of Tentative Agreement” (the full 128-page agreement has yet to be made public), the producers’ only relevant obligation is to give notice to the union “and an opportunity to bargain in good faith over appropriate consideration, if any, if a Synthetic Performer is used in place of a performer who would have been engaged under this Agreement in a human role.” 

In other words, SAG-AFTRA’s membership is relying upon producers acting in good faith when considering casting us instead of synthetic humans that look and act exactly like us.

But let’s keep it real. “Synthetic” performers, unlike the real thing, require no negotiations, no contract, no fees, no perks, no care and feeding of any kind. Not even sleep! Many producers across film and television — certainly those that are budget constrained (which means essentially all of them) — will be tempted to take that AI plunge. And once they do, all bets are off.

Sure, the strike-settlement summary expressly acknowledges “the importance of human performance in motion pictures and the potential impact on employment.” But that provision has no real teeth, other than a loose agreement “to meet regularly to discuss remuneration, if any,” for use of guild member personas to train the AI that may generate their replacements (note the words “if any” in that provision). So the settlement’s feel-good “good faith” edict most certainly anticipates a new Hollywood version 2.0 in which productions can run 24/7 and AI-generated synthetic performers star in movies and series at the expense of human performers — on a meaningful scale. 

Of course, we’re not quite yet in a place where the synthetic performer technology is strong and convincing enough to replace the real thing (one recent 12-minute film, “The Frost,” illustrates the current state of play for AI-generated film). But make no mistake, the time it will take to significantly narrow that gap is shorter than you think. If there is any doubt, just check out the hundreds of 100% synthetic Influencers that already boast massive numbers on social media. 

Take the very human-looking synth “Miquela,” who has more than 3.5 million followers on TikTok and 2.7 million on Instagram. “She” describes herself on Instagram as being “a 19-year-old Robot living in LA.” Miquela is not just some CGI or animated character to which we have grown accustomed in Hollywood movies. “Her” (a la the movie “Her”) goal is to double as a real human influencer, and so her profile highlights very human traits. It also showcases her starring roles in high-end, real world BMW commercials and Prada ads that generate piles of very real cash for her human software coders – roles that otherwise would have gone to her humanoid friends (with whom “she snaps” pictures all the time). 

Miquela is not alone of course in “her” motivations and photorealism. Check out Lu do Magalu “from Brazil” (6.6 million followers on Instagram), Imma “from Japan” (395,000 followers), and Shudu “from South Africa” who calls herself “The World’s First Digital Supermodel” (fun fact: Tyra Banks praised Shudu, thinking “she” was the real thing). 

All of these “synths” work with leading luxury brands. Yes, all still carry that “uncanny” air about them (much like “The Frost” short film mentioned above). But the rapid pace of technology certainly will do its best to close that gap. So expect any one of them to star in a major film or television production near you in the not-too-distant future. Their fictional friend “Barbie” points the way.

SAG-AFTRA’s negotiators certainly did their best to draw some lines to keep humans from being overrun by the synths. But generative AI’s continuing threats to Hollywood talent are meaningful, and they are real. Ultimately, U.S. copyright law serves as Hollywood’s essential AI guardrail, since producers know that the Copyright Office gives no protection to fully AI-generated works (at least not yet). 

But we humans ourselves are the most effective guardrail to not only demand our spot at the top of the creative food chain, but to cherish and nourish the notion that humanity is uniquely capable of creating an almost divine connection that can never be fully and authentically replicated.

For those of you interested in learning more, visit Peter’s firm Creative Media at creativemedia.biz and follow him on Twitter/X @pcsathy.

The post ‘Synthetic Performers’ Win Big in SAG-AFTRA Agreement With Studios appeared first on TheWrap.

Biden’s Order is deceptively sweeping and certainly provides fodder to support many of the positions taken by the creative community – including those related to content provenance, copyright infringement, content “safety” and industry job security.

The Order’s first principle is that “artificial intelligence must be safe and secure.” A primary goal is to protect consumers from AI-enabled content deception and reduce “the risks posed by synthetic content.” It calls for the development of new standards and best practices to “help develop effective labeling and content provenance mechanisms, so that Americans are able to determine when content is generated using AI and when it is not.” 

One specific example is the labeling of AI-generated “synthetic” content with new “watermarking” technology. The most obvious goal here is to address the daunting new reality of “deep fakes” — like the now-infamous “fake Drake” song “Heart on My Sleeve,” which was created with generative AI — that not only can change the course of elections and potentially even topple governments, but also threaten creative works — and the names, images, likenesses, voices and styles of the creators who created them. 

This burgeoning new industry of watermarking and other “AI forensics” can also be used to identify copyrighted works that have been used for AI “training” purposes, and the Executive Order expressly gives notice that the President may step in again to specifically address the issue of “the treatment of copyrighted works in AI training.” 

I recently wrote about ongoing major copyright litigation that is beginning to answer fundamental questions about how much “scraping” of copyrighted works will be enough for courts to find infringement (even as every bit of it technically creates a copy). Biden’s Executive Order brings forensic AI tech to the fore, and the “My Art My Choice” initiative supported by Intel Labs is one that focuses on watermarking in what its authors calls “adversarial protection against unruly AI.” (Intel Labs also backs the related “My Face My Choice”initiative.)

But Biden’s Executive Order goes beyond the realm of copyright and ways of supporting claims of infringement. It goes directly to the heart of other fundamental issues that we face in the media and entertainment industry. Notably, the potential harm of content generated by AI is akin to the well-documented harm that has been caused to young people by social media. The Executive Order calls on Congress to establish new privacy legislation “to protect all Americans, especially kids,” as well as testing and safeguards against “unsafe” content. Examples include “independent evaluation of [company] claims concerning both the effectiveness and risk mitigation of their AI offerings.” 

On that issue, the Executive Order requires that developers of “the most powerful AI systems” share their safety results with the U.S. government. And while it uses the concept of “safety” primarily in the context of national defense, the Executive Order’s accompanying “Fact Sheet” requires all companies that develop “any foundation model that poses a serious risk to … national public health and safety” to notify the government when training its model. Those companies also “must share the results of all red-team safety tests” (i.e., tests that generate problematic outputs) before those foundational models are unleashed to an unsuspecting public. 

Consumer advocates should demand that AI-generated content follow this lead, rather than fall prey to social media’s sordid history of impacting the mental and physical health of kids and young people. So Big Tech take note: The Feds are far more on top of things this time with AI, especially in light of Big Tech’s AI arms race as reflected in the headlines of virtually all recent quarterly earnings calls.

Finally, President Biden’s Executive Order is also directly relevant to the current SAG-AFTRA strike and now-settled WGA strike. In its section titled “Supporting Workers,” it calls out both AI’s power and promise to improve worker productivity, but also the dangers of AI “job displacement.” 

One of the President’s guiding principles is to give workers “a seat at the table, including through collective bargaining, to ensure that they benefit from these [AI] opportunities.” That seat is especially top of mind in Hollywood right now as SAG-AFTRA just responded yesterday to the studios’ “best, last and final” offer and highlighted AI as being “an essential item” on which “we still do not have an agreement.”

Biden directs his Secretary of Labor to “develop and publish principles and best practices for employers that could be used to mitigate AI’s potential harm to employees’ well-being and maximize its potential benefits.” No mandatory edict is given about the current strikes, but the overall zeitgeist supports creators of all stripes. 

Much of the Executive Order’s direct impact on the media and entertainment industry – and the overall creative economy in general – is implicit rather than directly explicit. But the clues and cues are there for creators to use it to add further support of the need to develop basic guardrails in our industry to protect both the “inputs” of copyrighted works into AI’s black box, as well as the “outputs” that those black boxes create. That alone should be applauded.

And that is precisely what the Human Artistry Campaign did after Biden issued his Executive Order. That coalition – which represents the interests of over 170 members of the creative and tech communities – calls it an “effort to craft a responsible, ethical AI policy that will promote innovation and allow both AI and human creativity to strengthen each other and thrive.” 

That kind of focus, advocacy and overall commitment to humanity is exactly what this AI “moment” needs. That and the U.S. Copyright Office’s continued refusal to grant copyright protection for AI-only generated works.

For those of you interested in learning more, visit Peter’s firm Creative Media at creativemedia.biz and follow him on Twitter/X @pcsathy.

The post How President Biden’s AI Executive Order Impacts Media and Entertainment appeared first on TheWrap.

It’s a tale as old as time. An endless sequel of game-changing technology drives tech-tonic shifts in the media landscape that ultimately also drive major Hollywood/Silicon Valley litigation. Universal Music’s lawyers played a leading role in key litigation during tech’s earlier streaming revolution, so maybe we can use those lessons to anticipate what happens next for all sectors of media.

Let’s take our litigation time machine and go back a little less than 20 years ago to a simpler age largely devoid of video streaming and social media. That’s when a then little known startup called YouTube rocked and roiled the entertainment industry seemingly out of nowhere, much like generative AI did less than one year ago. 

YouTube, of course, breathlessly deployed technology that enabled anyone to “broadcast yourself” across the Internet. The problem was that the exuberant young upstart also enabled anyone to upload copyrighted works, such as clips of SNL’s iconic “Lazy Sunday” video that first sounded the alarm to Hollywood in late 2005 that we had entered an entirely new kind of tech driven media world order. 

Most people forget that at that same time, YouTube faced real competition from Veoh, a company backed by Disney CEO Michael Eisner that scaled massively itself. In fact, there is reason to believe that Veoh actually developed the ground-breaking concept and technology first (I was there at the time and have personal knowledge about it, but that’s another story). Universal Music took Veoh to court for enabling mass-scale copyright infringement, while Viacom took YouTube to court for its “brazen” actions. And those two pioneering (yet equally guardrail-less) tech-fueled Hollywood disruptors suffered entirely different fates. 

Universal Music sued Veoh into oblivion, whereas YouTube … well YouTube. It  withstood Viacom’s legal onslaught because, in the tech deal of the century, Google bought it for a mere $1.65 billion, financed YouTube’s defense, and bailed it out. The rest, as they say, is history. Alphabet’s market cap now stands at about $1.73 trillion and YouTube’s contribution to the company’s overall revenues exceeds 10%. That means that a good case can be made that YouTube’s stand-alone valuation would be about $200 billion. 

Due to the pressure and bad optics of litigation, Google was, shall we say, “incentivized” to develop and deploy new technology to rein in its otherwise unbridled copyright-agnostic YouTube technology (it’s amazing what pressure, new priorities, and focused resourcing can do). That magical elixir is its “Content ID” system, first launched in 2007, which automatically detects whether uploaded content contains copyrighted material (i.e., music, television, film). If it does, and depending on the copyright owner’s wishes, YouTube either takes down the infringing content, or instead pays the rights holder). It’s certainly far from perfect. But hey, it’s something.

Now let’s take this little tech-shocked entertainment industry history lesson back to the present day with Universal Music’s fresh lawsuit against Anthropic AI. Anthropic feels a lot more like YouTube than Veoh in this new scenario, since Amazon intends to fuel the company with its endless billions much like Google did with YouTube. That means that Anthropic’s coffers are rich enough to fight Universal and other big media players in the courts. 

And if Anthropic is more like YouTube than Veoh, then we can anticipate a similar fate here. Anthropic will cop to its past “misdeeds” and settle by paying an undisclosed sum of money that will appear to be massive to “insiders” at the time, but will be seen as being a trifle in the long-run. 

Universal Music’s litigation, together with the mountains of other related industry lawsuits in the courts right now, also will ultimately force Anthropic’s hand. The company will need to either develop new tech that enables copyright holders to “opt in” to having their content scraped, or new forensic AI tech a la Content ID that leads to some new — but ultimately unsatisfying — royalty scheme for creators and copyright owners (Intel Labs for one is creating some AI forensic tech with its “My Art My Choice” initiative). Neither path mitigates Anthropic’s unlicensed, non-consensual scraping of copyrighted creative works to date, of course.

And through it all, Anthropic will make dire “fair use” pronouncements that cause the courts to draw some erratic and ambiguous lines about how much “scraping” of the works in question is too little to find infringement. But ultimately, Anthropic and the other major tech gorillAIs will have no choice. 

And if YouTube’s Content ID past is AI’s prologue, Silicon Valley’s giants will use their largely uncontrolled, copyrighted content-trained generative AI tech to generate accelerating billions (and ultimately likely trillions) to their bottom lines and overall market caps largely on the backs of creators. The end result, as we used to say in law school, is Q.E.D. – i.e., Latin for something akin to “the thing speaks for itself.” AI copyright litigation just becomes another cost of doing business for these tech behemoths. 

So how do artists, creators and copyright owners who now unwittingly train the AI tech in the first place make out? Sure, many will learn to use generative AI as a tool to create cool new works (just like they learned to use YouTube). But let’s keep it real and look at today’s transformed industry economics and media company valuations for clues about who really wins. The WGA was essentially forced to punt the training issue down the road to end writer pain — the studios reserved their rights to “train” AI on pre-existing material — and actors continue to be on strike to set some basic guardrails. Meanwhile, mighty Disney, the fairest traditional media company of them all, sits at a nine-year low $150 billion market cap, while tech giant Google/YouTube’s is nearly $2 trillion and Apple’s is nearly $3 trillion. 

You do the math. Big tech is the big winner here once again. And I’m no anti-tech guy; I’ve led several tech-forward media companies. This is no mere “Lazy Sunday” take-down situation where copyrighted works are easily identifiable. Here we have endless “Fake Drake” songs and deep fake videos, each capable of auto-spawning endless AI iterations, coming to a screen near you. And generative AI itself offers up few precise clues as to how it actually artificially creates. 

Just ask the CEOs of Google, Microsoft, and Chat GPT unleasher OpenAI, who concede they are equally puzzled by how exactly their generative AI black boxes work, but have no intention of slowing down their collective gravy trAIn. And as for Anthropic, which markets itself as being the white knight amongst the others for creating “moral” and “ethical’ AI, oh yes, Google is an investor there, too.

For those of you who push back and argue that humans “train” on pre-existing copyrighted works all the time when they create works inspired by (or “in the style of”) of others, let’s be clear. They typically aren’t plagiarizing or making actual copies. Big tech’s generative AI, on the other hand, most certainly is when it “scrapes” each and every word.

[NOTE: I’ll be hosting a free “AI & Entertainment” webinar tomorrow, October 25th, at 9 am Pacific (12 noon Eastern). Register here via this link.]

For those of you interested in learning more, visit Peter’s firm Creative Media at creativemedia.biz and follow him on Twitter/X @pcsathy.

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