In a bold move, News Corp has filed a lawsuit against the AI search engine Perplexity. The complaint, lodged on Monday, accuses Perplexity of infringing upon copyrighted content by copying news articles, analyses, and opinions “on a massive scale”.
Perplexity, an AI startup known for its innovative search models, aggregates content from across the web to deliver concise summaries in response to user queries. However, News Corp contends that this practice undermines the very foundations of journalism by allowing users to “skip the links” to original articles. The lawsuit claims this not only diverts customers but also erodes critical revenue for copyright holders.
The legal document outlines serious allegations, including Perplexity’s practice of reproducing content “verbatim.” News Corp further asserts that the AI engine has misattributed facts and analyses, occasionally citing incorrect sources and, at times, fabricating news stories altogether. According to the lawsuit, News Corp attempted to address these issues with Perplexity in July by sending a letter suggesting a potential licensing agreement, but the publishing giant received no response.
In its lawsuit, News Corp seeks a court order to compel Perplexity to cease using its content without permission and to destroy any databases containing its works.
“Perplexity perpetrates an abuse of intellectual property that harms journalists, writers, publishers, and News Corp. The perplexing Perplexity has willfully copied copious amounts of copyrighted material without compensation and shamelessly presents repurposed material as a direct substitute for the original source,” said Robert Thomson, chief executive of News Corp, in a statement.“Perplexity proudly states that users can ‘skip the links’—apparently, Perplexity wants to skip the check,” he added.
Thomson went on to commend “principled” companies like OpenAI, which has established agreements with various outlets, including News Corp, to utilise their work for training AI. “We have made clear that we would rather woo than sue, but, for the sake of our journalists, our writers, and our company, we must challenge the content kleptocracy.”
The content-licensing agreement between News Corp and OpenAI, valued at an estimated $250 million over five years, allows OpenAI access to its extensive library of articles and archives. In doing so, News Corp has acknowledged the demand for premium journalism while also seeking to adapt to a digital landscape dominated by tech companies. This partnership not only serves as a potential revenue stream for News Corp but also offers a glimpse into a future where AI technologies can enhance the quality and credibility of information provided to users.
As Thomson noted at the time the deal was penned, “the digital age has been characterised by the dominance of distributors, often at the expense of creators”.
However, the implications for the advertising industry are significant, as this deal could shift the focus from traditional click-based metrics to more direct compensation models for content creators. As AI platforms like OpenAI and Perplexity transform how information is accessed, publishers may find themselves grappling with the challenge of maintaining traffic to their sites while navigating a landscape where AI-generated responses can provide immediate answers without the need to visit original sources.
Adam Krass, chief digital and data technology officer at UM Australia, told B&T back in May that while such partnerships can offer financial relief to struggling media organisations, they may also inadvertently disadvantage smaller, independent content creators who rely on traditional ad revenue.
“The move by News Corp could serve as a model for other publishers, pointing towards a future where the value of digital content is recognised through direct compensation, aligning monetisation strategies more closely with the evolving capabilities and roles of AI in digital consumption and search. However, we, as consumers, should have concerns about the smaller independent content creators and publishers. There’s a risk that their ability to deliver diverse and meaningful ideas could be compromised in a landscape dominated by major players. This underscores the need for careful consideration of how such models affect the broader ecosystem of content creation.”
This underscores the need for careful consideration of how these evolving models can impact the diversity and richness of the media landscape as larger players dominate the narrative and shape the future of journalism.
This lawsuit is not the first instance of controversy surrounding Perplexity. Over recent months, various news outlets, including Wired and Forbes, have accused the company of scraping content without permission and circumventing paywalls. Just last week, The New York Times, which is concurrently suing OpenAI, issued a cease and desist letter to Perplexity, demanding an end to its unauthorised content use. In response to mounting pressure, Perplexity has begun compensating some publishers, including Time and Fortune, for their content.
As the case unfolds, it underscores the growing tensions between traditional media and the rapidly evolving landscape of AI-driven content aggregation. News Corp’s action represents a broader struggle within the industry to safeguard intellectual property rights in the face of advancing technology and the fight to find a new way to secure revenue when traditional click formats may no longer work.
