How AI copyright lawsuits could make the whole industry go extinct

Our new Thursday episodes of Decoder are all about deep dives into big topics in the news, and for the next few weeks, we’re going to stay focused on one of the biggest topics of all: generative AI.

There’s a lot going on in the world of generative AI, but maybe the biggest is the increasing number of copyright lawsuits being filed against AI companies like OpenAI and Stability AI. So for this episode, we brought on Verge features editor Sarah Jeong, who’s a former lawyer just like me, and we’re going to talk about those cases and the main defense the AI companies are relying on in those copyright cases: an idea called fair use.

All the big generative AI models from every company are tried on huge swaths of data that are scraped from the entire internet. And big media companies, like The New York Times and Getty Images, have filed lawsuits against those AI companies, saying, basically, that the AI companies are stealing their work and profiting from it — claims that amount to straightforward copyright infringement.

Copyright law is still very much rooted in the idea of making copies and regulating which copies are legal and which aren’t. Since computers can’t do anything at all without making copies, copyright law shows up again and again in the history of the internet, which allows anyone to make and distribute perfect copies faster than ever before.

But there’s a check on all that control that copyright law provides: fair use. Fair use is written right into the Copyright Act, and it says that certain kinds of copies are okay. Since the law can’t predict what everyone might want to do, it has a four-factor test written into it that courts can use to determine if a copy is fair use.

But the legal system is not deterministic or predictable. Any court gets to run that test any way they want, and one court’s fair use determination isn’t actually precedent for the next court.

That means fair use is a very vibes-based situation, and it’s anyone’s guess how a lot of copyright lawsuits are going to go. Many of them feel like a coin flip, and when you add in the amount of hype, uncertainty, and money that comes with AI, it gets even more complicated.

The stakes are very high. As you’ll hear us say in the episode, this is a potential extinction-level event for the modern AI industry on the level of what Napster and fellow file sharing sites were facing in the early 2000s. And as we know from history, the copyright rulings from the file sharing age made entire companies disappear, and copyright was changed forever.