Speaking at the recent White House AI Summit, US President Donald Trump slammed the intellectual property demands targeting AI companies as “unworkable.” Trump said “You can’t be expected to have a successful AI program when every single article, book or whatever you’ve studied, you’re expected to pay for,” Trump said. “We appreciate that, but you just can’t do that because it’s not do-able.” He urged “common-sense artificial and intellectual property rules” that won’t constraint AI development. The media business empires and online news portals probably felt the tremors of Trump statement. In a single stroke, Trump delegitimized the rights of journalists and book publishers by framing it as an impractical demand that constrains competitiveness of American tech sector. AI Chatbots like Grok and Perplexity have already positioned itself as a key source of instant news updates. Search engine giants like Google has responded to Chatbot search by creating an AI Overview feature that replicates Chatbot replies. Media organizations like The New York Times are in court against OpenAI over copyright violation claims. Meanwhile, AI Chatbots continue to utilize training datasets from copyright-protected sources as online portals struggle to prevent unauthorized use.
The devastating impact of AI summaries
Its not AI chatbots alone that are causing consternation. New websites are finding their traditional business models collapsing as AI summaries replace comprehensive news content in user preference. As per a new study, AI summaries have already caused 80% fewer click-through rates in websites. Media owners are concerned about Google AI reviews. AI overviews can be an existential threat that can result in dwindling of search traffic and lower advertising revenues. Despite paywalls and subscription options, media outlets haven’t been successful in generating enough revenue as news essentially remains free. Apart from free AI summaries, media companies also compete with social media platforms where information is available real-time.
As per an analysis by Authoritas analytics company, a site previously ranked first in a search result could lose about 79% of its traffic if query results were delivered in an AI overview format. Apart from news portals Big Tech giants like Google may also face collapse of revenue if the trend of AI summary persists. As per a month long survey of a round 69000 Google searches run by the Pew Research users only clicked a link under an AI summary once every 100 times. If news website experience a steep drop in click through rates on their desktop site and mobiles, it will be unsustainable to have news reporters on the ground and journalist on the desk.
AI deal with news publishers
If AI-powered news isn’t sustainable, it’s in the interest of news outlets and book publishers to arrive at an amicable settlement. News media companies shutting off their content completely will be a setback to AI companies dependent on quality content. The AI giants realized it as global publishers joined hands to sue and block AI web crawlers by default. Backed by an initiative from Cloudflare, global news organisations like Associated Press, The Atlantic, Sky News, Time, Buzzfeed, Conde Nast, and DMGT are part of efforts to protect original journalism from unauthorised AI exploitation. Google has opened negotiations on revenue sharing with nearly 20 national news publishers. Companies like OpenAI and Perplexity AI have already begun licensing content. If the initiative of Google succeeds, it could be a fresh revenue stream for news outlets hit hard by declining ad revenue and dwindling reader engagement.
Conclusion
As there is a growing realization of revenue potential and risks, the future of content is ‘pay-per-crawl’ model letting publishers charge AI firms directly when bots access their websites. AI summaries will dominate web search making website clicks lower. The source from where summary is generated will get paid directly by the search engine. The grey area of rankings will likely persist with no easy answers making big tech’s retain their dominance in the sector. Say, a query is the number of goals scored by Christiano Ronaldo in 2024. With multiple sports news portal hosting the same data, the edge will be with media company preferred by big tech. AI may not destroy media outlets completely. It may just change the business model.
