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AI “plagiarism engines” like Perplexity cannot be the future of the web

We can still have the internet we want — but we have to try new business models.

Casey Newton
6/21/24 6:52AM

I.

For a while now, I’ve been gloomy about the state of the web. Plagiarism engines like Perplexity and Arc Search have attracted millions of users by ripping off other people’s work, depriving publishers of the traffic and advertising revenue that once sustained them. The results have been successful enough that Google is following them.

Today, I want to talk about a more positive vision for the future of the internet — one where AI companies and creators work hand in hand to grow the web again, sharing the wealth they create with one another.

Before I get there, though, it’s worth taking a moment to reflect on how bad the status quo has gotten.

Earlier this month, Forbes noticed that Perplexity had been stealing its journalism. The AI startup had taken a scoop about Eric Schmidt’s new drone project and repurposed it for its new “pages” product, which creates automated book-report style web pages based on user prompts. Perplexity had apparently decided to take Forbes’ reporting to show off what its plagiarism can do.

Here’s Randall Lane, Forbes’ chief content officer, in a blog post.

“Not just summarizing (lots of people do that), but with eerily similar wording, some entirely lifted fragments — and even an illustration from one of Forbes’ previous stories on Schmidt,” noted “More egregiously, the post, which looked and read like a piece of journalism, didn’t mention Forbes at all, other than a line at the bottom of every few paragraphs that mentioned “sources,” and a very small icon that looked to be the “F” from the Forbes logo – if you squinted. [...]

Perplexity then sent this knockoff story to its subscribers via a mobile push notification. It created an AI-generated podcast using the same (Forbes) reporting — without any credit to Forbes, and that became a YouTube video that outranks all Forbes content on this topic within Google search. 

Any reporter who did what Perplexity did would be drummed out of the journalism business.

Any reporter who did what Perplexity did would be drummed out of the journalism business. But CEO Aravind Srinivas attributed the problem here to “rough edges” on a newly released product, and promised attribution would improve over time. “We agree with the feedback you've shared that it should be a lot easier to find the contributing sources and highlight them more prominently,” he wrote in an X post.

In person, Srivinas can come across as earnest and a bit naive, as I learned when he came on Hard Fork in February. But any notion that Perplexity’s problems stem from a simple misunderstanding was dashed this week when Wired published an investigation into how the company sources answers for users’ queries. In short, Wired found compelling evidence that Perplexity is ignoring the Robots Exclusion Protocol, which publishers and other websites use to grant or deny permissions to automated crawlers and scrapers. 

Here are Dhruv Mehrotra and Tim Marchman:

Until earlier this week, Perplexity published in its documentation a link to a list of the IP addresses its crawlers use—an apparent effort to be transparent. However, in some cases, as both Wired and Knight were able to demonstrate, it appears to be accessing and scraping websites from which coders have attempted to block its crawler, called Perplexity Bot, using at least one unpublicized IP address. The company has since removed references to its public IP pool from its documentation. [...]

Wired verified that the IP address in question is almost certainly linked to Perplexity by creating a new website and monitoring its server logs. Immediately after a Wired reporter prompted the Perplexity chatbot to summarize the website's content, the server logged that the IP address visited the site. This same IP address was first observed by Knight during a similar test.

Forbes sent Perplexity a cease-and-desist letter, and I imagine it won’t be the last publisher to do so. There are open legal questions about whether copyrighted material can be used to train large language models or answer chatbot queries, but I see no legal way Perplexity can get away with one of its other core techniques for building pages: using copyrighted images from Getty, the Wall Street Journal, Forbes and others. You simply are not allowed to re-publish other people’s copyrighted photos and illustrations without permission, even if your plagiarism engine is new and has “rough edges.”

Perhaps Perplexity will clean up its act; once it came under fire, the company ran to Semafor to promise that it is “working on” deals with publishers. In the meantime, though, I’ve come to think of it as the Clearview AI of generative artificial intelligence companies: scraping billions of pieces of data without permission and daring courts to stop it. 

Like Clearview, Perplexity’s core innovation is ethical rather than technical. In the recent past, it would have been considered bad form to steal and repurpose journalism at scale. Perplexity is making a bet that the advent of generative AI has somehow changed the moral calculus to its benefit. 

“I think we need to work together to build all these things, rather than trying to see it as, hey, like you’re taking my stuff and using it,” Srinivas told us in February. 

But then he just kept taking everyone’s stuff and using it. The working together part, I guess, is meant to come later.

II.

One path forward for the web, as I shared on a recent episode of Search Engine, is the Fediverse. Decentralized, federated apps; portable identities and follower graphs; permissionless innovation on open protocols: this is a way journalists can once again begin to build audiences — stable ones! — rather than simply courting traffic. This is a years-long project, and I can only barely see the outlines of it taking shape. But it’s an appealing alternative to a world where all content is subsumed into a large language model and accessed by an opaque and proprietary set of algorithms. 

But this is a long-term solution, and a partial one. And it carries with it the embedded assumption that today’s AI systems cannot be reshaped in ways that actually grow the web, and pay for the labor of the people who make it. The Fediverse is about giving up on the consumer internet as we know it today — the big walled gardens, the metastasizing LLMs — and trying to build something different.

Tim O’Reilly is thinking differently. As a publisher, investor, and open source advocate, O’Reilly sits at the intersection of many of the business problems and opportunities presented by AI. On Tuesday, he offered his solution to parasitic companies like Perplexity: developing new business models for AI companies that pay creators based on the amount of material that the companies use.

O’Reilly is starting with his own publishing business, sharing a portion of subscription revenue with (or paying a fixed fee to) authors when it uses AI to generate summaries, test questions, translations, or other derivative works based on their writing. 

He concludes:

When someone reads a book, watches a video, or attends a live training, the copyright holder gets paid. Why should derivative content generated with the assistance of AI be any different? Accordingly, we have built tools to integrate AI-generated products directly into our payment system. This approach enables us to properly attribute usage, citations, and revenue to content and ensures our continued recognition of the value of our authors’ and teachers’ work.

And if we can do it, we know that others can too.

To O’Reilly, this view of AI is a natural extension of the modern web, which is built on what he calls an “architecture of participation.” The earlier web consisted of giant walled gardens like AOL and MSN, which sought to keep as much activity within their own borders as possible. In this view, companies like Google, OpenAI, and Perplexity are all competing to become the next AOL. It is a vision in which most of the benefits of AI are reaped by a very small number of companies.

“Only the most short-term of business advantage can be found by drying up the river AI companies drink from.”

But this would be a mistake, he writes, if only because the current AI business models are ultimately self-defeating. “If the long-term health of AI requires the ongoing production of carefully written and edited content — as the currency of AI knowledge certainly does — only the most short-term of business advantage can be found by drying up the river AI companies drink from,” O’Reilly writes. “Facts are not copyrightable, but AI model developers standing on the letter of the law will find cold comfort in that if news and other sources of curated content are driven out of business.”

We know that AI companies are running out of data to train their frontier models on. Given that fact, it seems ludicrous that companies like Perplexity are building systems that all but ensure they will have less data to train on in the future.

O’Reilly is taking the opposite approach. And while it remains to be seen whether the average writer on his platform benefits meaningfully from AI royalties, if nothing else he has gotten the incentive structure right. Pay people to create high-quality writing and other content; use that content with permission to train powerful AI systems; and share the wealth that those systems create to fund and incentivize the production of further high-quality writing.

If Srinivas meant it when he said he “we need to work together to build all these things,” he can now look to O’Reilly for a powerful example of what working together actually looks like.


Casey Newton writes Platformer, a daily guide to understanding social networks and their relationships with the world. This piece was originally published on Platformer.

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Report: Microsoft adds Anthropic alongside OpenAI in Office 365, citing better performance

In a move that could test its fraught $13 billion partnership, Microsoft is moving away from relying solely on OpenAI to power its AI features in Office 365 and will now also include Anthropic’s Claude Sonnet 4 model, according to a report from The Information.

The move is a tectonic shift that boosts Anthropic’s standing, heightens risks for OpenAI, and has huge ramifications for the balance of power in the fast-moving AI field.

Per the report, Microsoft executives found that Anthropic’s AI outperformed OpenAI’s on tasks involving spreadsheets and generating PowerPoint slide decks, both crucial parts of Microsoft’s Office 365 productivity suite.

Microsoft will have to pay the competition to provide the services —Amazon Web Services currently hosts Anthropic’s models while Microsoft’s Azure cloud service does not, The Information reported.

OpenAI is also reportedly working on its own productivity suite of apps.

The move is a tectonic shift that boosts Anthropic’s standing, heightens risks for OpenAI, and has huge ramifications for the balance of power in the fast-moving AI field.

Per the report, Microsoft executives found that Anthropic’s AI outperformed OpenAI’s on tasks involving spreadsheets and generating PowerPoint slide decks, both crucial parts of Microsoft’s Office 365 productivity suite.

Microsoft will have to pay the competition to provide the services —Amazon Web Services currently hosts Anthropic’s models while Microsoft’s Azure cloud service does not, The Information reported.

OpenAI is also reportedly working on its own productivity suite of apps.

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Apple announces extra slim iPhone Air, iPhone Pro with longer battery life, updated AirPods Pro 3 with live language translation, and refreshed Apple Watch line

At todays Awe Dropping Apple event, the company announced its yearly refresh of the iPhone lineup. The new iPhone 17, iPhone 17 Pro, and iPhone 17 Pro Max were joined by a brand-new addition: the iPhone Air, a superthin model with tougher glass and faster processors.

Apple shares dipped on news of the product releases and are down about 1.4% on the day in afternoon trading.

The company also announced an updated Apple Watch line — Series 11, SE3, and Ultra 3 — with new features like 5G, high blood pressure detection, 24-hour battery life, and satellite communication. 

Apple iPhone 17
Apple’s iPhone 17 (Photo: Apple)

Here’s a breakdown of the new products Apple announced:

  • The ultrathin iPhone Air was described by Apple as “a paradox you have to hold to believe.” The sleek 5.6-millimeter-thin iPhone features a crack- and scratch-resistant front and back and “Macbook Pro levels of compute,” which you can pair with a weird $59 cross-body strap. It starts at $999.

  • The iPhone 17 has a faster A19 chip, an improved smart selfie camera, and a higher-resolution screen. It starts at $799.

  • The iPhone 17 Pro has a new design, ever-faster A19 Pro chip, a tougher ceramic shield on the front and back, better cameras, and a bigger battery that gets an extra 10 hours of video playback compared to its predecessor. It costs $100 more than the previous generation, but the minimum storage has doubled to 256 gigabytes. It starts at $1,099.

  • The iPhone 17 Pro Max starts at $1,199.

  • The AirPods Pro 3 have AI-powered live translation, a new heart rate sensor, eight hours of battery life, and improved active noise cancellation. The new AirPods can also track workouts, and Apple says they are built to fit more people’s ears with a new design and foam ear tips. They start at $249.

  • The Apple Watch Series 11 has 5G, a new high blood pressure detection feature, improved sleep tracking, a more scratch-resistant face, and 24 hours of battery life.

  • The entry-level Apple Watch SE 3 gets 5G, new health-tracking features, and an always-on display. It starts at $249.

  • The chunky Apple Watch Ultra 3 has an impressive 42-hour battery life, satellite communications for emergencies, and a brighter and bigger display. It starts at $799.

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Nebius soars after signing a 5-year deal with Microsoft to supply nearly $20 billion worth of AI computing power

Artificial intelligence infrastructure group Nebius jumped more than 50% in early trading on Tuesday after the company announced after the close on Monday a major deal to supply computing power for Microsoft’s AI operations.

Under the agreement, Nebius — which rose from the ashes of Russian tech giant Yandex — will provide Microsoft “access to dedicated GPU infrastructure capacity in tranches at its new data center in Vineland, New Jersey over a five-year term.” The New Jersey data center has a capacity of 300 megawatts. The total contract value through 2031 is $17.4 billion, though, if further capacity is required, the contract value could rise to $19.4 billion.

The deal represents a sizable portion of Microsofts proposed annual capital expenditure on AI, which is expected to reach $120 billion by the end of fiscal 2026.

Nebius and competitor CoreWeave are both on the short list of startups that Nvidia has invested in. Nvidia’s small stake in the former is now worth about $120 million.

Under the agreement, Nebius — which rose from the ashes of Russian tech giant Yandex — will provide Microsoft “access to dedicated GPU infrastructure capacity in tranches at its new data center in Vineland, New Jersey over a five-year term.” The New Jersey data center has a capacity of 300 megawatts. The total contract value through 2031 is $17.4 billion, though, if further capacity is required, the contract value could rise to $19.4 billion.

The deal represents a sizable portion of Microsofts proposed annual capital expenditure on AI, which is expected to reach $120 billion by the end of fiscal 2026.

Nebius and competitor CoreWeave are both on the short list of startups that Nvidia has invested in. Nvidia’s small stake in the former is now worth about $120 million.

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