OpenAI and Microsoft have joined forces to pump $10 million into a project aimed at helping local newsrooms integrate artificial intelligence into their operations. The initiative, managed by the Lenfest Institute, provides five U.S. metro news outlets with the resources to explore how AI can streamline editorial and business workflows, part of a broader effort to improve the sustainability of local journalism.
Funding AI Fellows in Newsrooms
Five outlets—Chicago Public Media, The Seattle Times, The Philadelphia Inquirer, Newsday, and The Minnesota Star Tribune—are set to benefit from this initiative. Each organization will receive a $500,000 grant to hire an AI fellow for two years, someone tasked with building AI solutions tailored to each newsroom’s specific needs. In addition, Microsoft and OpenAI are offering enterprise credits to help these outlets test and implement their AI tools.
In Chicago, Public Media plans to focus on transcription and translation using AI, hoping to make their content more accessible. Meanwhile, The Philadelphia Inquirer is working on creating a conversational search feature to help users navigate its massive archives.
AI’s Role in the Struggle for Local News
For local news outlets, the hope is that AI can help lighten the load. By automating time-consuming tasks like content discovery, summarization, and audience engagement, AI tools have the potential to free up journalists’ time for more critical work. The Minnesota Star Tribune, one of the participating newsrooms in the new initiative, is experimenting with AI for content analysis and discovery. This move could help journalists sift through large volumes of data faster, aiding both their work and readers’ experiences.
Meanwhile, Newsday’s AI fellow will develop tools to aggregate public data and create summaries, potentially offering new services for both readers and marketing partners.
Perplexity AI Faces Lawsuits from Publishers
While OpenAI and Microsoft are betting on cooperation, another AI company is finding itself in hot water. News Corp just filed a lawsuit against Perplexity AI, accusing the startup of illegally scraping content from outlets like The Wall Street Journal. News Corp claims this practice is costing them ad revenue by drawing traffic away from their websites. The lawsuit could set a precedent, with other media organizations likely to take similar actions against AI companies using their content without permission.
Perplexity, which rose to a $1 billion valuation earlier this year, has faced several accusations of using publishers’ content without proper compensation. Last week, The New York Times sent a cease-and-desist letter, adding more legal pressure to the startup. Despite offering revenue-sharing models to publishers, Perplexity has been unable to calm the tensions fully.
Perplexity’s Defense and Future Implications
Perplexity AI, on the other hand, has attempted to defend its approach, arguing that it aggregates publicly available data and respects copyright laws. Its CEO, Aravind Srinivas, has emphasized that Perplexity doesn’t scrape content for AI training but rather uses information to answer user queries. However, the company’s practices have drawn ire from media giants like News Corp and The New York Times, leading to growing legal scrutiny.
While Perplexity faces these legal battles, OpenAI has chosen a different route, forging partnerships with media companies. Earlier this year, OpenAI signed a $250 million licensing agreement with News Corp, allowing it to use content from outlets like The Wall Street Journal and MarketWatch. This move helped OpenAI sidestep some of the legal challenges now plaguing Perplexity.
Licensing vs. Scraping: Two Different Approaches
The contrasting paths taken by Perplexity and OpenAI highlight the growing tension between AI developers and content creators. AI platforms that rely on scraping have drawn criticism for taking content without compensating the publishers who produce it. In contrast, companies like OpenAI and Microsoft have begun signing licensing deals, ensuring that content creators are fairly paid for their contributions.
Earlier this year, OpenAI’s deal with News Corp made headlines for its sheer size—$250 million—further underscoring the financial stakes involved in these partnerships. The AI industry is now grappling with how to balance the demand for data with the need to respect intellectual property, a challenge that will likely shape the future of AI in journalism and beyond.
Apart from the deal with News Corp, OpenAI has signed other deals with many major publishers to grant them access for training their AI models.
Noteworthy collaborations include companies like The Atlantic, Axel Springer, the Financial Times and TIME. Other platforms such as Reddit and Automattic, the owner of WordPress and Tumblr, have also aligned with AI firms.
A partnership with Condé Nast allows the company to access content from Condé Nast’s prominent titles, including The New Yorker, Vogue, Vanity Fair, Bon Appétit, and WIRED. The partnership allows OpenAI to embed these publications’ material into its ChatGPT and the experimental SearchGPT.
Lawsuits against OpenAI
In a landmark case filed in December 2023, The New York Times initiated legal proceedings against OpenAI and Microsoft, alleging unauthorized use of its copyrighted content. The litigation centers on accusations that OpenAI’s ChatGPT and GPT-4 models were trained on articles from The New York Times without proper authorization, a claim bolstered by the news organization’s presentation of 100 instances in support of its argument.
Another lawsuit filed in March 2024 emerged against tech giants Microsoft and its partner, OpenAI, accusing them of violating privacy laws through their AI development practices. A group of thirteen plaintiffs, represented by Morgan and Morgan Complex Litigation Group and Clarkson Law Firm, have presented a legal challenge against the companies.
The core of the accusation lies in the alleged training of artificial intelligence models with data scraped from the web, purportedly without securing proper consent from individuals. Moreover, the lawsuit claims continuous harvesting of personal information via API integrations with product offerings.
A group of writers, including major figures like Michael Chabon and David Henry Hwang, had previously filed a lawsuit against OpenAI. They claim that the company unlawfully accesses their copyrighted works to train its AI model, ChatGPT. Chabon and the group have also brought a similar lawsuit against Meta Inc. for the same reasons.
In July 2023, a group of leading news publishers also considered suing AI companies over copyright infringement. The publishers allege that the AI firms are infringing on their intellectual property rights and undermining their business model by scraping, summarizing, or rewriting their articles and distributing them on various platforms, such as websites, apps, or social media.
Also in 2023, Sarah Silverman, Christopher Golden, and Richard Kadrey accused both OpenAI and Meta of copyright infringement. They claim technology companies obtained their books from illegal sources, such as websites that offer free downloads of pirated books.
By 2024 the lawsuit was ongoing and the authors were granted access to OpenAI’s training data. Regulated under stringent guidelines, the inspection will take place on isolated computers without internet connectivity. Participants must agree to non-disclosure terms, and the use of recording equipment is prohibited.