Copyright Wars

By subSPAC

EXECUTIVE SUMMARY

• AI has been the talk of the town in 2023, and two products in particular, ChatGPT and Dall-E 2, have been making waves with their massive popularity and usage.
• ChatGPT hit the incredible milestone of 100 million users in just two months, so it’s no wonder investors and creators are excited about the productivity boosts and potential outcomes that AI can bring in the near future.
• Even mainstream media and tech leaders are heralding AI as the next big thing after the iPhone.

DETAIL

AI has been the talk of the town in 2023, and two products in particular, ChatGPT and Dall-E 2, have been making waves with their massive popularity and usage. ChatGPT hit the incredible milestone of 100 million users in just two months, so it’s no wonder investors and creators are excited about the productivity boosts and potential outcomes that AI can bring in the near future. Even mainstream media and tech leaders are heralding AI as the next big thing after the iPhone. But there’s one group that’s not happy with the rise of AI – content owners. They’re feeling left out and short-changed. Getty Images, the leading visual media company and supplier of stock photography, recently took legal action against open-source AI art generator Stability AI. This lawsuit has serious implications for the future of content ownership and could be a defining moment for AI So, who will come out on top, and what does the future hold for the industry?

Content Owners vs. AI Creators

Getty Images has escalated its legal battle against Stability AI, the creators of open-source AI art generator Stable Diffusion, by filing a lawsuit in the US. The stock photography company alleges that Stability AI had engaged in a brazen infringement of the company’s intellectual property on a staggering scale. Specifically, the lawsuit claims that Stability AI copied more than 12 million images from Getty Images database without permission or compensation to build a competing business and, in the process, infringed on the company’s copyright and trademark protections.

Last month, Getty announced that it had initiated legal proceedings against Stability AI in the High Court of Justice in London. However, the claim has not been served yet, and Getty has not disclosed whether it plans to pursue legal action in the US as well. Meanwhile, a group of artists has filed a class action lawsuit against Stability AI and another AI art startup, Midjourney, in the US.

The ongoing legal feud between AI companies and content owners for recognition, revenue, and the creative industries’ future direction has intensified with the latest lawsuit. AI art tools such as Stable Diffusion require human-generated images for their training data, which firms often extract from the internet without the creators’ awareness or consent. While AI firms contend that this falls under laws like the US fair use doctrine, numerous rights holders disagree and consider it copyright infringement.

Although legal experts are split on the matter, they acknowledge that the courts will have to determine such contentious issues. So far, things look favorable in the US for AI startups. In the legal battle bought by LinkedIn against Hiq Labs, the company tried to sue the defendant that it scraped its data to analyze employee attrition. However, LinkedIn lost the legal challenge when the US Ninth Circuit of Appeals reaffirmed its original decision that scraping publicly accessible data on the internet is not a violation of the Computer Fraud and Abuse Act (CFAA), which governs computer hacking under US law (essentially suggesting that what AI companies are doing with data scraping is fine). 

The Dark Side of Data Scraping 

While AI startups that have scraped the web for data have had their wins in recent years, there have been instances where it has been taken too far, leading to serious privacy and security concerns. For instance, Clearview AI was an app that could be used to upload a photo of someone and then identify them by matching with its database (the app was used by hundreds of public law enforcement agencies despite being in a legal grey area). Similarly, Voyager Labs, which specializes in investigative software and services intended to help law enforcement and companies obtain information about suspects, created over 60,000 Facebook and Instagram Accounts and pages to scrape data.

Voyager, for its part, was sued by Meta earlier this year for a breach of Terms of Service. In Clearview AI’s case, the outcome was more severe. In addition to being fined and ostracised by most tech companies (with legal battles ongoing), the firm was fined $30 million collectively by the UK and Australian privacy watchdogs. With its lawsuit, Getty wants to set a precedent of preventing companies from accessing its content without permission and isn’t looking for damages. 

Cease, Desist, Repeat

However, despite the company’s “noble intentions,” Getty has previously been embroidered in several copyright battles, with many cases being controversial. Getty usually avoids sending “cease and desist” notices and instead sends demand letters that assert significant monetary damages against website owners suspected of infringing on their photographers’ copyrights. They often try to intimidate website owners by dispatching collection agents, even though a demand letter does not establish a debt.

For instance, a church in Lichfield, Staffordshire, was billed £6,000 by Getty for pictures on its website, apparently uploaded by a volunteer. Getty Images has also faced criticism for claiming copyright and selling public domain images, including ones related to The Holocaust and created by NASA. They have also attempted to collect fees from photographers for using their own images previously in the public domain. Getty’s controversial copyright policies could lead to a more lenient judge reducing the severity of fines or dismissing the lawsuit altogether. 

If the company ends up losing the lawsuit, it could be a big blow to the owner of the roughly 477 million assets. Generative art and photos could completely upend the company’s business since it is infinitely cheaper to generate alternate photos rather than license them by paying high royalties. Time will tell who will eventually win, Getty, which enforces copyrights aggressively, or the AI companies that “supposedly” stole its images. 

Bottom Line 

The rise of AI has brought about significant changes in various industries, including the creative industry. While AI tools like ChatGPT and Dall-E 2 have been widely embraced for their productivity-boosting potential, there has been growing tension between AI companies and content owners over copyright infringement. Getty Images’ lawsuit against Stability AI, which allegedly copied over 12 million images from the company’s database, has serious implications for the future of content ownership and could be a defining moment for AI. However, Getty’s controversial copyright policies and history of aggressive enforcement could potentially lead to a more lenient judgment. The future of the industry remains uncertain, and only time will tell who will eventually win the battle between content owners and AI companies.

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Originally Posted March 5, 2023 –Copyright Wars