ProRata.ai: Pioneering Ethical AI with $130M Valuation and UK Media Partnerships

Start-up ProRata.ai valued at $130mn after signing up UK publishers

ProRata.ai, a US artificial intelligence start-up aiming to bring greater fairness in how media groups are paid for content, has agreed licensing deals with publishers including Daily Mail-owner DMG Media, the Guardian, the Telegraph and Sky News. As part of the deal, which is set to be announced on Wednesday, DMG Media will acquire a stake in ProRata in a funding round that people familiar with the situation said would value the group, which was founded in January, at about $130mn. Nicholas Thompson, chief executive of The Atlantic magazine, another partner to ProRata, will also join the board of directors of the LA-based start-up. ProRata, which is launching its AI-powered search engine next month, is offering a unique model to media companies in publishing, music and video that aims to pay fairly for the usage of their content. It has developed technology that pays publishers per use of their content in generating AI answers and searches. The group will share half the revenue from subscriptions to its platform with its licensing partners, which already include Universal Music, Axel Springer, Financial Times, The Atlantic and Fortune. The model aims to address the concerns in the media industry over AI start-ups stealing their content to train and provide up-to-date responses to users. This has led to deep divisions between the media and tech industries: Rupert Murdoch's Dow Jones and the New York Post are suing Perplexity AI over an alleged "brazen scheme" to rip off their journalism, while the New York Times has filed a similar lawsuit against OpenAI. Some AI start-ups have sought to sign commercial partnerships and licensing agreements with publishers, including News Corp and the FT, which typically include an upfront amount and a licence fee every year. Bill Gross, founder of ProRata and chair of tech start-up incubator Idealab Studio, said there were revenue sharing agreements with creators across platforms such as Spotify, YouTube and Apple News. But for "generative AI", he said, "there is no revenue share right now because it's not as easy of a thing to measure. We think that's unfair. That's not sustainable for publishing, for creativity, to be able to just shoplift content and use it." Gross has been credited as the inventor of pay-per-click keyword internet advertising, which has been the foundation of the multibillion dollar digital advertising industry. He compares the behaviour of rival AI companies to how Napster was ripping off music two decades ago. "What the AI companies are doing today is crawling the web, using it and not sharing any revenue. We feel this is the future, and we're trying to both invent it, protect it, and scale it." ProRata wants to license the technology behind its search engine to other generative AI companies. "If you adopt this business model, this will end your lawsuits, because now you'll be sharing revenue properly." Rich Caccappolo, vice-chair of DMG Media, said that it was the first UK news publisher to take an equity stake in ProRata, which he described as "a vital first step towards advancing accurate and fair attribution and promoting transparency". Sky News executive chair David Rhodes said: "ProRata's solution helps advance high-quality, impartial journalism across AI platforms and publishers." ProRata's technology analyses AI output, measures the value of contributing content and calculates proportional compensation. ProRata has submitted patents for its tech that are awaiting approval. Other investors include Mayfield Fund, Revolution Ventures, Prime Movers Lab and Idealab Studio.

U.K. Media Groups, Including Sky News, Guardian, Partner With "Ethical AI" firm ProRata.ai

Camerimage: How Did They Shoot That 'Emilia Pérez' Final Scene? U.K. media firms Sky News, the Guardian Media Group, the Financial Times, and dmg media, publisher of the Daily Mail, have signed a strategic partnership with L.A.-based tech company ProRata.ai, an "ethical AI" firm whose technology is designed to compensate creators and publishers for the use of their work by generative Artificial Intelligence systems. ProRata signed similar partnerships with The Atlantic, Fortune, Time, Universal Music Group (UMG) and German publishing giant Axel Springer, earlier this year, as well as with several authors. "Our AI technology is the only one that credits and compensates creators while providing consumers with highly accurate search results," said company CEO Bill Gross. "Stealing and scraping content is not a sustainable path forward." The company's tech is designed to be combined with generative AI platforms like ChatGTP or Sora to allow the platforms to identify the use of copyright-protected content and compensate rights holders on a pre-use basis. The company argues the technology will also help prevent un-attributed, unreliable content from compromising AI results. "Global audiences trust Sky News to give them the full story, first. ProRata's solution helps advance that high-quality, impartial journalism across AI platforms and publishers," said David Rhodes, Executive Chairman, Sky News, in a statement. "With all our partners today we're securing our company's massive investment in fair and accurate news reporting - now, and well into the future." Added Anna Bateson, CEO of the Guardian Media Group: "The trusted, quality journalism for which The Guardian is world-renowned must be fairly credited and valued when used by AI platforms. ProRata respects and promotes these fundamental principles, and we are pleased to be partnering with them." ProRata is one of several companies that see a business opportunity in finding tech solutions to the scrape-and-steal model of most generative AI systems, which are trained on copyright-protected material but do not compensate the original creators. UMG has signed deals with AI music company Klay Vision and sound wellness group Endel to create commercial, and ethical, AI models that compensate artists for their use of their work. Stock images giant Getty Images recently did a deal with AI giant Nvidia to create AI text-to-image and text-to-video services with a generative model trained on Getty's copyright-protected library of stock images.