Unlocking AI Royalties for Small and Midsize Publishers

The rise of enterprise LLMs is creating new opportunities for small and midsize publishers to monetize their content through AI royalties.

TL;DR
• AI royalties are now available for small and midsize publishers through collective licensing.
• Enterprise LLMs are driving demand for high-quality, vetted content.
• Publishers can tap into this demand through aggregators or vertical partnerships.

Summary
The landscape of AI revenue generation is evolving, with small and midsize publishers now able to earn royalties through collective licensing. Dow Jones' Factiva has been expanding its licensing agreements for generative AI usage, with around 5,000 publishers from its 30,000-strong network opted in. Factiva's general manager, Emma O'Brian, emphasizes the importance of upfront conversations with enterprise clients to ensure proper usage and mitigate risks. The company uses a usage API to track and attribute usage, allowing publishers to be paid accurately on a per-usage basis.

Key actionable insights include:
• Enterprise appetite for vetted, quality content to feed private LLMs is opening doors to new AI licensing opportunities for publishers.
• Collective licensing bodies are carving out a promising new stream of revenue for the long tail of publishers.
• The rise of small language models specializing in specific industries and topics is creating demand for quality specialist content.
• Publishers can tap into this demand through aggregators or vertical partnerships, while larger groups can strike direct, data-rich deals.

The Economist and The Financial Times are among those exploring licensing content to enterprise clients' private LLMs. Factiva is uniquely positioned to act as a collective licensor, aggregating rights at scale to negotiate B2C deals with major LLM platforms. This could turn scattered archives into royalty streams for publishers who would struggle to negotiate solo. As more companies use AI for research, data analysis, and admin work, ensuring properly licensed and used content is crucial. The Copyright Clearance Center (CCC) has adapted its copyright licensing agreements to include AI usage, and PLS handles copying licenses and returns money to publishers. With thousands of publishers and hundreds more for AI rights, the royalties publishers receive will be determined based on usage, which the CCC calculates by collecting usage samples and pays out every six months.

As the AI licensing market continues to evolve, small and midsize publishers must adapt to capitalize on new revenue streams and stay ahead of the competition.