People Inc forges AI licensing deal with Microsoft as Google traffic drops

People Inc., one of the largest media publishers in the United States, has signed an AI licensing agreement with Microsoft. The media giant (formerly known as DotDash Meredith) announced Tuesday a portion of parent company IAC’s third-quarter earnings.

Under the agreement, People Inc. Microsoft’s publisher will become a launch partner in the content marketplace. This is the company’s second AI deal after its earlier one contract Last year with OpenAI.

People Inc. CEO Neil Vogel described the new marketplace as “essentially a pay-per-use marketplace where AI players can directly compensate publishers for the use of their content, such as on an ‘a la carte’ basis.”

He praised Microsoft for committing to paying for content to support its AI efforts, adding that Microsoft’s Copilot would be the first buyer for the marketplace.

“Being in the room with them is a very strong endorsement of us and a very strong endorsement of the publishing market and the value of the content to create AI that is high value,” Vogel said.

The Microsoft deal announcement was shared during IAC’s earnings call, alongside news that Google Search’s AI overview is hurting the publisher’s traffic. For the first time, People Inc. shared data with investors showing how Google search, which accounted for 54% of its traffic two years ago, fell to 24% of its traffic last quarter.

The deal differs from the OpenAI deal, which Vogel characterized as an “all-you-can-eat” model, but said People Inc. Happy with both models. What matters to the company is that its work is “respected and paid for,” he said. However, the company did not share the specific terms of the deal.

People Inc. has taken issue with the way AI companies have taken media without paying to fuel their AI products and train their models. Recently, Vogel criticized Google, Calling the tech giant a “bad actor”. Because it uses the same bot to crawl websites for its Google search engine and its AI features Publishers cannot block the bot, as Google search still accounts for a large percentage of their traffic

However, People Inc. Uses technology from web infrastructure providers Cloudflare to block other AI crawlersThe AI ​​prompts players to approach it with content deals. In September, Vogel imposed The decision to leverage CloudFlare’s technology as a way to push AI companies to the negotiating table said its progress on the deal was “far ahead” after adopting the solution.

He reiterated those comments in today’s earnings call with investors, saying that blocking AI crawlers was “very effective” and “brought almost everyone to the table.” Vogel suggested that more deals would be announced in time.

IAC reported that People Inc. Its digital revenue rose 9% to $269 million in the quarter, driven by performance marketing and licensing, which grew 38% and 24%, respectively. It also noted the acquisition of a food-focused media publisher and influencer network feed feed.