Technology
Danish Kapoor
Danish Kapoor

OpenAI will pay News Corp $250 million to use its news

OpenAI and News Corp, which owns The Wall Street Journal, MarketWatch, The Sun and more than a dozen publishing brands, have signed a long-term agreement to display news from those publications on ChatGPT. The deal was announced by News Corp.

OpenAI will be able to access both current and archived content from News Corp's publications and use the data to train AI models. There was no official statement regarding the terms of the agreement. But for the more than five-year deal, News Corp will receive a total of $250 million in cash and loans, according to estimates by The Wall Street Journal.

News Corp CEO Robert Thompson said: “The agreement recognizes that there is a reward for world-class journalism. The digital age has been characterized by the dominance of distributors, often at the expense of content creators, and many media companies have been swept along by an inexorable technological tide. The responsibility is now on us to make the most of this divine opportunity.”

Generative AI has surged in popularity since OpenAI launched ChatGPT at the end of 2022. However, the quality of the responses provided by AI-powered chatbots is only as good as the data used to train the models that support it. Until now, AI companies have trained their models by collecting publicly available data from the internet, often without the creators' permission. But recently, companies have been making financial deals with the news industry to ensure that AI models can be trained with up-to-date and reliable information.

OpenAI has signed a number of deals in the last few months

In the last few months alone, OpenAI has announced partnerships with Reddit, the Financial Times, Dotdash Meredith, the Associated Press, German publisher Axel Springer, owner of Politico and Business Insider in the US, Bild and Die Welt in Germany, and Spain's Prisa . Last month it was reported that News Corp had struck a $5 million to $6 million deal with Google to train AI models.

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Google and OpenAI aren't the only companies making these deals to train AI models. Hours before News Corp's announcement, Business Insider revealed that Meta, which recently deployed its own AI chatbot on Facebook, Messenger, WhatsApp and Instagram, and also sells AI-powered sunglasses, was considering striking its own deals with news publishers.

Money from artificial intelligence companies is becoming a growing source of revenue for the struggling news industry. However, some publishers are still cautious about making these deals. The New York Times sued OpenAI and Microsoft over using content to train artificial intelligence systems. NYT, BBC and The Verge blocked OpenAI from pulling content from their websites.

Danish Kapoor