Rights management in the age of AI

OpenAI has been busy, and it's only halfway through the year. Credit: Mashable Composite / Ian Moore; Images / Financial Times / Associated Press / VoxMedia / News Corp / Axel Springer / The Atlantic / DotDash Meredith / Open AI / cocodava / istock / Getty

 

By Nathan MAY, Data Scientist at MovieChainer

Introduction

Artificial Intelligence (AI) is moving at a fast pace and players in the creativity industry need to understand the new realities of intellectual property. While the new technology is lauded for enhancing efficiency and boosting the creative process, it has also led to the rise of new approaches to rights management: 

 

In this Article:

  • Rising Collaborations Between Content Creators and AI Companies
  • New Licensing Model to Compensate Rights Holders
  • The Complexities of Selling Rights to AI Companies
  • Key Considerations for Successful Collaboration and Licensing
  • Benefits of Effective Rights Management to IP Holders

 

Rising Collaborations Between Content Creators and AI Companies 

Content creators are increasingly collaborating with AI companies, with more right holders licensing their IP to train AIs. As this technology becomes a norm in the film industry, it is reshaping the way we produce, distribute, and consume content. Since AI models are now being advanced to generate original works that can rival human-created content, the collaboration of content creators, AI developers, and rights holders is needed to protect intellectual property rights. 
The use of AI in content creation provides a unique opportunity to enhance entertainment. However, it also raises the question of how original creators can be compensated fairly when their work is used to train the AI models. Through proper collaboration and new approaches to licensing, property management systems provide a solution that addresses the needs of each party. 

 

New Licensing Model to Compensate Rights Holders

For many years, traditional intellectual property rights like copyrights and trademarks have been used to protect creative works and inventions. However, these traditional models are not as effective when it comes to AI applications. Most AI systems use vast datasets and algorithms as an inspiration for creating content.  This makes it difficult to ascertain ownership and license the underlying compensation.
To address these challenges, new licensing models are being explored to find the balance between fair compensation for the right holders and recognizing the cost incurred by AI developers. Content creators, now have new types of rights when selling their creations to AI companies. While training and maintaining AI models require a substantial amount of investment, their output may not be as effective as expected without the contributions of the original content creators.

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Source: Variety Insights

 

Hybrid Vs. Flat Fee Licensing Model 

One of the approaches used to address this concern is the hybrid licensing model. Under this model, upfront fees are combined with revenue sharing to ensure fairness for both parties. On one hand, right holders receive immediate compensation for their creativity. On the other hand, AI-powered products and services receive support for long-term success. 
Another approach is the flat fee licensing model although its applicability is limited. In particular, this approach fails to recognize the specific contributions that each party plays. With the revenue share model, the interests of both parties are addressed, ensuring long-term collaboration and high-quality output.

 

The Complexities of Selling Rights to AI Companies

While AI-related rights offer a unique opportunity for content creators to be recognized for their efforts, there are several difficulties associated with this landscape. In its simplest form, intellectual property is a fundamental aspect of the society that protects and rewards unique human capabilities such as creativity, intellect, and inventiveness. Since these qualities are so crucial in the society, the law grants us property rights for ownership and controlling what happens to our creation. 
One of the primary difficulties associated with AI-generated content is defining and qualifying the value of IP rights. Unlike traditional IP such as copyright, AI-related rights usually involve intangible assets, which are difficult to assess. Factors such as the quality of the content, the sophistication of the AI algorithm, and the market value of the AI application can influence the value of these rights. In addition, ethical issues in AI systems development may perpetuate biases in the data used to train them. Without a balanced approach, rights management may end up overlooking either of the parties. 
Issues pertinent to the use of AI products and services may potentially cause disputes over the ownership and rights to AI-generated content. The primary concern is whether the IP of AI-created works belongs to the creator of the data used to train it or a combination of the creator and the AI developer. To resolve such disputes, collaborations between content creators and AI companies have proven to be more effective. 

 

Key Considerations for Successful Collaboration and Licensing

Licensing and collaboration are essential to maximize the value of IP assets. They also help to resolve potential disputes, ensuring both the content creator and AI developer are acknowledged for their efforts. However, the following considerations are necessary for successful collaborations:  

  1. Clear Licensing Terms 
    Any collaboration must have clear licensing terms to avoid misunderstanding potential legal disputes. This includes specifying the purpose of the content, how it should be used, and for how long. A music publisher may license a catalog of 1,000 songs to an AI model developer for five years. With such an agreement in place, the AI developer can use the songs to train new models without directly reproducing or distributing the licensed songs. 

    The purpose of having clear terms of licensing is to make sure that both parties understand their roles. This clarity prevents misunderstandings and disputes that may arise from ambiguities of the licensing terms. It also sets clear boundaries, specifically on the use of intellectual property.  By clearly outlining the specific rights of individual parties and the limitations imposed, the terms set a solid foundation for the relationship between the parties.

  2. Transparent Attribution Mechanisms
    Even in the age of AI-generated content, proper attribution is crucial in maintaining the integrity of intellectual property and enabling creators to build their reputation. For instance, an AI image generation company can develop a system that automatically provides a breakdown of the visual elements that influence every new image generated. When a user views the image, they can find information about the artist or photographer who inspired the creation. In so doing, AI model generators can credit original creators while providing users with insights into the AI’s creative process.

  3. Fair Compensation Mode
    While compensation models may differ significantly, hybrid models that combine upfront fees with revenue sharing are more effective. The model ensures that rights holder receive their compensation immediately and they also benefit from the long-term success of AI-powered products.
    If a publishing house licenses its book catalog to an AI writing assistant, this model would ensure compensation is fairly distributed. The deal may include an upfront fee of $1 million, plus a 5% revenue share on subsequent subscriptions to the AI writing tool. With such an approach, the publisher receives immediate value for their product and long-term interests that provide a perfect balance between the AI developer’s cost and fair compensation for the rights holders. 

  4. Open and Ongoing Communication 
    Every collaboration requires clear and ongoing communication. The rights holders and AI developers need to exchange information and updates regularly to help refine AI models and ensure that the collaboration is mutually beneficial.

    If a film studio licenses its content to an AI video editing company, it would require quarterly or semi-annually reports detailing the use of licensed content in training the AI model. These reports provide an opportunity for the AI company to share data on the studio’s content with the most influence in the creation process. This ongoing sharing of information and data will not only enhance the creation process but help keep the parties in harmony. 

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Benefits of Effective Rights Management to IP Holders 


Rights management systems such as MovieChainer facilitate collaborations between content creators, AI developers, and rights holders. By providing the necessary tools and insights into the changing landscape, they help the parties navigate complex licensing agreements. 

Centralized systems for monitoring all agreements: IP holders can monitor all their agreements in the same system that is regularly updated to match the increasing complexity of AI collaborations.

Proper crediting and usage tracking: Rights management systems ensure that IP holders get clear licensing terms with attribution mechanisms for their creation.

Efficient integration of new licensing models: Since the AI landscape is so dynamic, new flexible licensing models are being introduced for fair revenue sharing. While it can be difficult for IP holders to keep up with the changes, the rights management system accommodates these complex arrangements to ensure you are getting fair deals.

Stay abreast with regulations: The legal landscape surrounding intellectual property in AI is evolving as more knowledge emerges. With a proactive rights management system, you can easily navigate these changes to remain compliant. 

 


The Bottom Line


The AI revolution has greatly impacted the creation, distribution, and consumption of content. As rights holders adapt to the new reality and find ways to benefit from these new developments, rights management systems like MovieChainer offer ready solutions to thrive in this new landscape. They help you understand your rights as a content creator and the impact of Intellectual Property rights on AI content developers. 

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