Generative AI is the talk of the town. Its increasing prominence and the rise in venture capital investment in the sector have made it one of the most phenomenal tech stories of recent times. But it seems that, following the advent of online advertising and social media, news publishers now have another potential existential threat to their business models.

The relationship between news publishers and AI companies is increasingly uneasy. On one hand, we have the ChatGPT owner OpenAI signing deals with media companies to licence their archives to train the large language models (LLMs) and in the process, provide support for local publishers in the US. And on the other, a coalition of major publishers is preparing to lead a lawsuit against the AI companies. News media companies have been fighting big technology companies for years to get their dues, but with generative AI now, the stakes are bigger than ever.

What is at stake – and how are news publishers reacting?

Decreased traffic, revenue and more

One of the fundamental issues that threatens news publishers with generative AI is that the chatbots launched by the likes of Google and Microsoft answer the user’s questions in a detailed manner, unlike the search engines throwing up links to particular websites. Basically, AI chatbots bring forth direct responses within their chat interfaces, bypassing the need for users to navigate to publisher websites. This big change is what threatens the existing media monetisation models and is reshaping how users interact with content as well.

The potential consequence of this new wave is reduced website traffic and diminished click-through rates (CTRs) – two of the most vital metrics for publishers that rely on user engagement. Consequently, this reduction then has an impact on ad impressions on the news websites and hence, the ad revenue. But the possible ramifications of generative AI chatbots go beyond just the advertising revenue.

With their quick and free-of-cost answers, AI chatbots are likely to undermine other revenue sources like subscriptions and even donations to independent journalism. Why pay for something you could get for free? To be sure, generative AI tools are not that good right now, so this threat is still hypothetical for most publishers – but AI services seem to be improving and becoming more widely available with every month.

To counter the AI threat, numerous top-tier media corporations across the world have already started to restrict ChatGPT web crawler GPT Bot from accessing their content. The latest publication to do so is The Guardian which just blocked OpenAI from harvesting its content earlier in September. A report in The Guardian itself said “according to Originality.ai, which detects AI-generated content, news websites now blocking the GPTBot crawler, which takes data from webpages to feed into its AI models, include CNN, Reuters, the Washington Post, Bloomberg, the New York Times and its sports site the Athletic. Other sites that have blocked GPTBot include Lonely Planet, Amazon, the job listings site Indeed, the question-and-answer site Quora, and dictionary.com.”

In that context, it is evident that the publishers are concerned. Joey Levin, CEO of IAC, has even gone on to say to Semafor that he is worried that a chatbot-based approach would turn a detailed food and wine review into a simple text recommendation of a bottle of Malbec, without attribution. Microsoft’s chatbot Bing shows how this works: to take an example offered by Wired, if you ask the chatbot about the best dog beds according to The New York Times product review site Wirecutter, it tells you the top three with a brief description for each. (The response attributes and links to Wirecutter, as seen on the screenshot and as Microsoft highlighted in a comment to Wired, but one can assume that in reality for a big chunk of users a brief summary from a chatbot would suffice, and they would not actually follow the links provided by Bing).

It’s obvious though that things might turn grave and merely blocking the web crawlers is not going to be enough for the news publishers to fight this new threat. Publishers are going to have to think strategically about safeguarding their businesses. For instance, in The Rebooting, a media business newsletter, Brian Morrissey has noted that due to the rise of AI, some leading media outlets are now exploring alternative ways to maintain engagement and revenue, such as through emails and special events. In addition to that, news publishers now have to look at building meaningful partnerships, fostering stronger connections with the audiences and offering something that AI simply can’t duplicate.

Some possible Hail Marys

Considering deals with tech giants. One move publishers are increasingly exploring is partnering with the tech companies. This not only offers a fresh income stream but also hopefully makes sure that the content isn’t used in ways the publisher doesn’t approve of. The challenge though is that tech executives are hesitant to pay publishers at this early stage of AI development, and small media organisations might not have the resources to bargain with tech giants on their own.

Building a real connection with the audiences: AI can churn out news articles, but it can’t capture human emotions or the complexities of any situation. Publishers can create a deeper bond with their readers by investing in quality storytelling. This connection also starts with being transparent about how your journalism works. Readers who trust the publisher are readers who stick around and maybe even hit the “Subscribe” button.

Offering what AI can’t: This is easier said than done, but news publishers can offer exclusive experiences, such as events and newsletters. In fact, customised newsletters can give readers exactly what they’re interested in and events provide them with unique networking opportunities and experiences.

These are all difficult and elaborate pointers. However, given the shakedown that the news industry is (once again) looking at, they can help publishers all prepare better and figure out the challenges and the outcomes of these massive technological changes.

Source of the cover photo: https://unsplash.com

Generative AI threatens to undermine news media business models. How are news publishers reacting and adapting?

Iryna Hoiuk

As generative AI gains prominence, news publishers are grappling with concerns about its potential impact on their business models. Can they devise a winning strategy to stay afloat?

Author

Iryna Hoiuk

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