Why You Care
Ever wonder if your favorite online articles will still be around, or if AI will simply absorb them without a trace? A major U.S. publisher, People Inc., just inked an AI licensing deal with Microsoft. This move comes as their traffic from Google Search’s AI Overviews has sharply declined. Why should you care? Because this story highlights a essential shift in how content creators get paid in the age of AI. Your access to quality information online directly depends on publishers finding sustainable business models.
What Actually Happened
People Inc., formerly known as Dotdash Meredith, has signed an AI licensing deal with Microsoft, according to the announcement. This media giant will become a launch partner in Microsoft’s publisher content marketplace. Neil Vogel, CEO of People Inc., described this new marketplace as “essentially a pay-per-use market where AI players directly can compensate publishers for use of their content on, sort of like an ‘a la carte’ basis.” Microsoft’s Copilot will be the first buyer in this new marketplace, the company reports. This is People Inc.’s second AI deal, following an earlier agreement with OpenAI. The OpenAI deal was characterized as an “all-you-can-eat” model, differing from the new Microsoft arrangement.
Why This Matters to You
This creation is significant for anyone who consumes digital content or creates it. Publishers are actively seeking ways to ensure their work is “respected and paid for,” as mentioned in the release. Imagine you run a popular blog; this model could mean new revenue streams for your valuable content. People Inc.’s strategy offers a potential blueprint for others.
What does this mean for the future of online publishing and AI interaction?
Key Differences in AI Content Deals:
- Microsoft Deal: Pay-per-use model for content, with Microsoft Copilot as the initial buyer.
- OpenAI Deal: An “all-you-can-eat” model, allowing broader access to content.
“It’s a very strong endorsement of us to be in the room with them and a very strong endorsement of the publishing marketplace and the value of content to make AI that is of high value,” Vogel said. This statement, according to the announcement, underscores the publisher’s belief in its content’s worth. For you, this means a greater chance that the information AI provides will be sourced from reputable, compensated publishers.
The Surprising Finding
Here’s the twist: while People Inc. is securing these deals, they’re also seeing a significant drop in traffic from Google Search. The research shows that Google Search, which accounted for 54% of its traffic two years ago, had dropped to 24% of its traffic during the past quarter. This decline is attributed to Google Search’s AI Overviews. It’s surprising because Google has historically been a primary traffic driver for publishers. The team revealed that this dramatic shift highlights the impact AI Overviews can have on established traffic sources. It challenges the assumption that traditional search engines will always remain the dominant gateway to information.
What Happens Next
People Inc. expects more deals to be announced in time, according to the announcement. Their strategy of blocking AI crawlers, using system from Cloudflare, has been “very effective,” as the team revealed. This approach has pushed AI companies to the negotiating table. For example, by blocking bots, People Inc. forced AI developers to engage in licensing discussions. This could become a standard practice for publishers in the coming months and quarters. If you’re a content creator, consider exploring similar tools to protect your intellectual property. The industry implications are clear: content licensing will become a crucial component of digital revenue, alongside performance marketing. People Inc. grew its digital revenue by 9% to $269 million in the quarter, driven by licensing and performance marketing, the company reports. This indicates a viable path forward for publishers navigating the AI landscape.