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Column: OpenAI just scored a huge victory in a copyright case … or did it?

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Column: OpenAI just scored a huge victory in a copyright case … or did it?

The snap judgment among legal experts was that a federal judge’s dismissal on Nov. 7 of a copyright infringement lawsuit against OpenAI, the leader in advanced chatbots, will short-circuit an ever-growing effort by artists and writers to keep AI firms from stealing their content.

There’s no question that the ruling handed down Thursday by Judge Colleen McMahon in New York landed with a thud among lawyers trying to bring such cases.

McMahon went beyond merely dismissing the lawsuit brought against OpenAI by Raw Story Media, the owner of progressive news websites. She undermined the basic argument that content creators have made against AI firms: that the process of feeding their AI models data indiscriminately “scraped” from the internet inevitably involves using copyrighted content without permission.

I don’t put a lot of stock in anyone who tells you how these cases are going to turn out.

— Copyright expert Aaron Moss

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McMahon’s ruling, based on a Supreme Court decision in an unrelated case, “could leave AI copyright claims on shaky ground,” wrote Los Angeles intellectual property lawyer Aaron Moss on his website. The judge not only dismissed Raw Story’s case; she implied that no copyright holder might be able to show enough harm from AI scraping to win an infringement case.

That’s because the amount of content fed to AI bots such as OpenAI’s ChatGPT to “train” them is so immense that it’s almost impossible to pinpoint any particular content that has been infringed when the bot spits out an answer to a user’s query.

“Given the quantity of information,” McMahon asserted, “the likelihood that ChatGPT would output plagiarized content from one of [Raw Story’s] articles seems remote.”

McMahon’s ruling may also undermine what has been a growing trend toward the licensing of copyrighted content by AI developers — in part to forestall copyright infringement claims. Dow Jones, the parent of the Wall Street Journal, reached a licensing deal with OpenAI in May that could be worth more than $250 million over five years. That followed multimillion-dollar licensing deals OpenAI reached with the Axel Springer, the owner of Business Insider and Politico; the Financial Times; and the Associated Press.

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“This court is allowing this thriving, lucrative market for licensed content for AI training to be taken away from Raw Story Media,” Peter Csathy, chairman of Creative Media, a Los Angeles entertainment and media marketing and consulting firm, told me.

That may have happened because Raw Story didn’t make much of that market’s potential in its lawsuit. In its complaint it mentioned the licensing deals OpenAI reached with the Associated Press and Axel Springer, but noted only that the AI firm has “offered no compensation” to Raw Story.

For all that, the full import of McMahon’s decision is anything but clear. That’s because the case brings together two muddy legal regimes: copyright law, which is renowned for its craziness and confusion; and AI law, which may be years away from coalescing into coherence.

At least 12 lawsuits against AI developers alleging copyright violations are currently wending their way through the federal courts — with plaintiffs including the publishers of Mother Jones, the Wall Street Journal and the New York Times; the music recording industry; and writers Michael Chabon and Sarah Silverman.

Intermediate court rulings in these cases contradict each other and raise issues that haven’t been seen before even in high-tech intellectual property law.

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Judges have struggled even to define how copyright infringement principles apply to technology that doesn’t output exact copies of copyrighted works but “mimics” them — rather like how the beverage machine in Douglas Adams’ “Hitchhiker’s Guide to the Galaxy” delivered “a cupful of liquid that was almost, but not quite, entirely unlike tea.”

All those cases are still in their early stages. “I don’t put a lot of stock in anyone who tells you how these cases are going to turn out,” Moss says.

Before wading into the legal morass these lawsuits are attempting to navigate, let’s take a quick look at how the technology is developed and why copyright has become an issue.

The models that are in the forefront of artificial intelligence research and development just now don’t think for themselves. They’re repositories of billions of articles, software lines and music or art made by humans. When asked a question, they ply through their database and try to synthesize from it the most probable answer. Often they get it right; often they get it wrong.

Sometimes they’re confused enough to output obvious errors, as Apple researchers found when asking the models to solve math problems written in plain English. Sometimes they show that they don’t know what they don’t know, and fill in the blanks in their knowledge with fabrications — or as AI developers call them, “hallucinations.”

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As McMahon observed, the sheer volume of materials the bots draw from and the synthesizing process make it unlikely that any answer will replicate any specific content exactly.

That has been an obstacle for some of the plaintiffs in the copyright cases. Most of those claiming their written content has been infringed assert chiefly that the databases known to have been fed to some AI models are known to include their books or other writing. (At least one of the content repositories used by some AI developers includes three of my own books, but I’m not a party to any of the lawsuits.)

In its lawsuit, the New York Times cites text output by OpenAI’s ChatGPT-4 that reproduces portions of its articles verbatim, without credit or permission. (Microsoft, named as a defendant as an investor in OpenAI and a user of its technology, replied that the New York Times had effectively “coaxed” the chatbot to reproduce its texts by artfully framing its queries to elicit infringing answers.)

That brings us back to Raw Story Media’s lawsuit. The company, which operates the Raw Story and AlterNet news sites, didn’t fashion its claim as a copyright infringement complaint. Instead, it asserted that OpenAI had deliberately removed author, title and copyright labels — collectively known as copyright management information, or CMI — from the articles it imported to train its bots.

Raw Story argued that this process facilitated future infringement by leaving users unaware that they were receiving, and possibly distributing, copyrighted material without permission.

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Deliberately removing CMI with the intention of fostering copyright violations is a direct violation of the 1998 Digital Millennium Copyright Act, which governs intellectual property rights of producers of digital content. Raw Story sought damages for OpenAI’s violation of the law and an injunction requiring the AI company to remove from its database all Raw Story content from which the CMI had been removed.

That’s where Raw Story ran into a roadblock erected by the Supreme Court. In a 5-4 decision involving the credit bureau TransUnion in 2021, the court declared that it is not enough for a plaintiff to sue over a defendant’s violation of a federal statute. To have the standing to bring a federal case, the court ruled, a plaintiff must show that they have suffered a “concrete harm” stemming from the violation.

Raw Story couldn’t show that because it couldn’t produce evidence that any of its content had been copied in answers to user queries and therefore that it had suffered “concrete harm.” As a result, McMahon dismissed the lawsuit on grounds that Raw Story didn’t have standing to bring it.

Indeed, McMahon seemed irked at the thought that Raw Story was trying to pull a fast one. “Let’s be clear about what’s really at stake here,” she wrote. The supposed injury for which Raw Story was seeking relief, she wrote, “is not the exclusion of CMI” from OpenAI’s database, but the “use of Plaintiffs’ articles to develop Chat GPT without compensation for Plaintiffs.”

McMahon gave Raw Story the opportunity to refile its lawsuit to show that it was damaged by OpenAI’s acts. She didn’t sound sanguine, calling herself “skeptical” that the company will be able to allege a “cognizable injury.”

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But Csathy contends that McMahon overlooked the possibility that her ruling might undermine the licensing market — if AI developers can remove CMI from training data with impunity, they might not feel any need to license copyrighted material in the future. “There’s some real substantial money there,” he says.

Raw Story may well cite the loss of licensing income as a “cognizable injury” if and when it files an amended complaint. That would be a new wrinkle in a field that at this point is virtually nothing but wrinkles.

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How 'CoComelon' became a mass media juggernaut for preschoolers

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How 'CoComelon' became a mass media juggernaut for preschoolers

Fifty-five years ago, preschoolers were captivated by the TV performance of a fuzzy blue monster, two striped shirt-wearing best friends and a big yellow bird.

Today, in the now-crowded field of children’s media, one big-headed, animated toddler named JJ is running to the top.

Born from YouTube, JJ and his friends in the animated kids’ franchise “CoComelon” represent a new wave of children’s programming. Focused on songs, bright colors and a world with no sharp edges, “CoComelon” has become a children’s media juggernaut, spawning spin-offs, video games, toys, a live tour and a story-time podcast. Although its multimedia approach to kids’ content has helped expand its audience, it has also raised questions about screen time and what kind of content — if any — very young children should be watching.

Reflecting on the brand’s growth, CoComelon General Manager Patrick Reese said the company is thoughtful about the needs of its young audience and its own legacy in children’s media.

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“We very much stand on the shoulders of giants in this space, like ‘Mr. Rogers’ and ‘Sesame Street,’” he said. “If you learn to be kind and open in those early years, if you learn that growth mindset way of thinking, that becomes your behavior for the rest of your life. And if we can create an environment and create these various shows and these various different streams of content that just make the world 1% kinder, 5% kinder, 10% kinder … we’re going to seize that opportunity.”

“CoComelon” has indeed taken the lucrative kids media market by storm.

In 2023, “CoComelon” ranked fifth on Nielsen’s list of top 10 overall streaming programs, bested only by the legal drama “Suits,” the Australian animated series “Bluey,” the long-running procedural “NCIS” and the medical drama “Grey’s Anatomy.” Beyond its presence on Netflix, the brand also commands massive engagement on its native YouTube.

“CoComelon” producer Moonbug Entertainment declined to share financial results for the franchise, but parent company Candle Media said Moonbug was the biggest and most profitable piece of its business, which also includes actor Reese Witherspoon’s Hello Sunshine production company.

The market for kids entertainment is “massive,” said Brandon Katz, senior entertainment industry strategist at Parrot Analytics. “It boasts probably the best re-watchability rates of anything in the market. What that represents is an incredibly long tail of engagement for whatever that one project cost.”

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The genesis of “CoComelon” dates back to 2006, when commercial director Jay Jeon and his wife, a children’s book author, posted their first video to YouTube of a short cartoon played to music — alphabet-related animations that stemmed from videos they made to entertain their own sons.

By 2017, the videos had started to center on a toddler named JJ with a single blond curl. By 2020, “CoComelon” was the most-watched YouTube channel in the world, with more than 3.5 billion average monthly views, and had attracted potential suitors.

That year, it was acquired by the London-based Moonbug Entertainment, which also bought fellow YouTube children’s program “Blippi.” A year later, Moonbug was acquired by Candle Media, led by ex-Disney executives Kevin Mayer and Tom Staggs, for a reported $3 billion.

For “CoComelon‘s” Reese, who has worked on the franchise since 2018 and saw the dealmaking frenzy, the effect of the acquisitions has been stark.

There is now “CoComelon Lane,” a streaming series on Netflix that follows the adventures of JJ and his friends. In September, Moonbug released a live-action YouTube spin-off called “CoComelon Classroom,” which stars National Teacher of the Year awardee Juliana Urtubey as Ms. Appleberry. In the video series, Urtubey teaches lessons about letters, sings songs and interacts with an animated JJ.

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Much of the creative team works at Moonbug’s office near the Grove in Los Angeles’ Fairfax district. A wall with three shelves’ worth of “Blippi” and “CoComelon” toys greet visitors.

“We’ve been able to grow so much faster,” Reese said. “We probably would not have been able to create all of these different shows, create all the different franchise moments that we’ve created, expanded consumer products and goods in the same way.”

But the franchise faces stiff competition in the preschool entertainment space from “Bluey,” which has generated 587 million hours of viewing through July, compared to 218 million hours for “CoComelon” and 45 million hours for “CoComelon Lane,” according to Nielsen data.

That disparity could be due to the difference in how “CoComelon” and “Bluey” are perceived, particularly by parents. Adults will readily admit watching “Bluey” with their kids, noting how the family dynamics feel real and relatable.

But “CoComelon” does have about a 50% co-watching rate with adults, said Staggs of Candle Media. Mayer said he and Staggs have been thanked by parents for their work on “CoComelon,” which provides relief and emotional stability for their kids during times of stress.

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“It’s heartwarming, it’s easy to digest,” said Nancy Jennings, a professor at the University of Cincinnati and director of its Children’s Entertainment and Education Research Lab. “There’s not a lot of dialogue that you have to follow, and with the songs too, a lot of the characteristics of the show are attractive to kids in general.”

But even kids’ media is not immune to Hollywood’s recent struggles. Last year’s dual Hollywood strikes and the upheaval in the industry has touched nearly every company in the industry, including Candle Media, which is backed by Blackstone.

“Candle Media has come through a very difficult time, as the rest of the industry has … but as a whole, we’re profitable,” Mayer said. “And Moonbug is the main driver of that, and is, in and of, itself, very profitable too.”

The company must also grapple with concerns about children’s screen time.

The American Academy of Pediatrics recommends that families avoid screen media, other than video-chatting, for children younger than 18 months, and that children ages 2 to 5 should get only an hour of screen time a day. The primary audience for “CoComelon” is kids ages 0 to 4.

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Research, though largely correlational, has shown that heavy exposure to screens at early ages is associated with inattention and impulsive behaviors, said Drew Cingel, an associate professor in UC Davis’ communication department who directs the university’s human development and media lab. Programs with bright colors, repetition and songs grab hold of children’s attention, he said.

“There are 24 hours in a day, and when you’re a developing child, there’s a lot of things you need to do in those 24 hours in order to get you the inputs you need to develop normally and healthfully,” he said. “Anything that takes up a sizable portion of those 24 hours can displace the time that could be spent practicing these developmental capabilities.”

Reese said that the company works with educational consultants and that there are ways for families and children to interact with “CoComelon” beyond screen time, such as through books and live tours. The company says it takes seriously its responsibility of teaching and entertaining children for the amount of time they spend with “CoComelon” content.

“It’s for every family to decide for themselves what their level of comfort is with any activity,” Reese said. “We want to create the best environment and the best tools, and the most entertaining, enriching content that we possibly can. And use us how it makes you happy.”

Every episode must incorporate music and life skills, said Rich Hickey, chief creative officer. A so-called story trust meets weekly to discuss ideas, and themes revolve around milestones and lessons that families experience on a regular basis.

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“You really want to meet kids and families where they’re at,” said Hannah Kole, senior development executive. “We really want to make sure that those are relatable experiences that we know kids are going through.”

That can include bath time, eating vegetables or experiencing something new for the first time.

“Every day, we’re reminding ourselves that we’ve got a responsibility to a huge audience, globally,” Hickey said. “We’re trying to make a meaningful connection, that parents and caregivers will trust us that we’re going to make content that’s enriching and warm and safe for their children.”

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Hollywood intimacy coordinators unanimously vote to unionize under SAG-AFTRA

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Hollywood intimacy coordinators unanimously vote to unionize under SAG-AFTRA

Intimacy coordinators have unanimously elected to unionize under the Screen Actors Guild-American Federation of Television and Radio Artists.

Members of the bargaining unit voted 100% in favor of unionization in an official election overseen by the National Labor Relations board, the union announced Tuesday.

Intimacy coordinators are the professionals who help actors navigate scenes involving nudity, simulated sex and other sensitive scenarios on set.

“In these sobering times with looming threats to environmental protections and women’s equality, it is refreshing to see the entertainment industry’s recognition of intimacy coordinators and their important contribution to productions and to performers in intimate scenes,” SAG-AFTRA President Fran Drescher said in a statement.

“We at SAG-AFTRA are proud to include this esteemed group of trained professionals as the newest to join our member body. May this continue to carve the path of elevated consideration for the feelings of safety for people and planet.”

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SAG-AFTRA formally requested a union election for intimacy coordinators in September, about four years after the labor organization established rules regarding the presence of intimacy coordinators on set. On the heels of the #MeToo movement, the guidelines were introduced as part of a larger effort to reduce sexual misconduct in the entertainment industry.

The use of intimacy coordinators has generated significant media attention and become increasingly commonplace in the film and TV business over the past several years.

“Working in scenes involving nudity or physical intimacy is some of the most vulnerable work an actor can do,” Drescher said in a statement in September.

“Intimacy coordinators not only provide assistance in navigating these scenes but they also create a safety net for performers ensuring consent and protection throughout the entire process. Shifting the power imbalance that has been ingrained over a century is challenging but important work. Work that can be done even more effectively with the backing of a union.”

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Netflix says ad-supported plan now has 70 million monthly active users

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Netflix says ad-supported plan now has 70 million monthly active users

Netflix said Tuesday that it had reached 70 million monthly active users on its ad-supported plan, two years after launching its cheaper subscription tier that includes commercials.

That’s up from May, when the company reported having 40 million monthly users on the ad version.

The Los Gatos, Calif., streamer has also been diversifying its content, including increasing its streams of live events, in order to boost its nascent advertising business.

Netflix said it had sold out of the in-game inventory for its live NFL Christmas Day games this year, with sponsors that include sports betting company FanDuel and Verizon. The streamer has partnered with Nielsen to provide live ratings for the games.

Netflix also said it had sold ads across its scripted programs, including the anticipated second season of the Korean drama “Squid Game.”

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The company said that more than half of new sign-ups in countries where Netflix offers ads are for the cheaper ad-subscription tier.

“There has been continuous momentum over the last two years, but we’re just getting started and can’t wait to see what’s to come,” Amy Reinhard, president of advertising, said in a blog post.

Netflix began offering a cheaper ad subscription plan in November 2022 after the streamer saw its subscriber growth in decline earlier that year. In the U.S., Netflix with ads cost $6.99 a month, compared to ad-free options that start at $15.49 a month.

At first, Netflix’s ad-supported tier was powered by Microsoft’s technology through a partnership, but the streamer is transitioning to using its own in-house ad technology which will make it function independently from third parties.

The ad-supported tier was part of a broader push to diversify Netflix’s offerings and boost revenue. In addition to commercials, Netflix has started streaming live events, cracking down on password-sharing and promoting games on its platform.

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This week, Netflix will up its live sports ambitions with a boxing match between former heavyweight champion Mike Tyson and influencer-turned-fighter Jake Paul.

Netflix in the third quarter added 5 million subscribers, bringing its total to about 283 million globally.

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