Publisher execs talk AI licensing deals, new applications for AI in latest earnings calls

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Things are heating up between publicly-traded media companies and generative AI tech companies, resulting in more than one new AI licensing deal.

Of the half dozen or so publishers’ earnings that Digiday tracks, two of them have announced deals with tech companies since their Q4 earnings calls in February. IAC’s Dotdash Meredith struck a three-part deal with generative AI tech company OpenAI on May 7 and The Wall Street Journal’s parent company News Corp recently signed an agreement with Google that pays the news publisher to develop new AI-related content and products.

Meanwhile, publishers like BuzzFeed, Gannett and The New York Times are finding internal applications for the technology, from developing products to synthetic audio, which was addressed — in some cases ad nauseam — during their respective earnings calls.

Despite the latest movement in this space, Doug Arthur, managing director at media research and advisory firm Huber Research Partners, said it still remains to be seen how the technology is contributing to publishers’ businesses.

“It’s still vague to me exactly how AI pushes the envelope with consumer engagement,” Arthur said in an email. While a lot of these initiatives sound good in theory, he said he was “not sure exactly what it means other than an enhancement tool.”

Talking deals

IAC CEO Joey Levin didn’t share how much Dotdash Meredith was getting paid for its multi-year content licensing and large language model training deal with OpenAI during the company’s Q1 earnings call on May 8.

News Corp CEO Robert Thomson was also mum on the amount of money changing hands as a result of the deal with Google, though The Information reported News Corp is getting paid between $5 million and $6 million a year by Google.

During News Corp’s May 8 earnings call, an analyst asked if the renewal agreement with Google — this time, focused on developing AI-related content and products — was one of the “nine-figure deals” with large tech companies mentioned by Thomson in previous earnings calls.

“I can’t comment on the financial details of the deal other than to say that this is a renewal of the existing deal. It has nothing to do with a payment for AI, gen AI use of our content, servicing of that content, training of that content or grounding of the content. So any negotiations for that particular use of our content will come later,” Thomson responded.

News Corp CFO Susan Panuccio added during the call that the renewal deal is “broadly consistent with the financials of the previous deal.”

IAC’s Levin told shareholders that the OpenAI deal could “hopefully” help drive traffic from ChatGPT to the publisher’s sites (declines in referral traffic was one of the many concerns publishers initially had about the arrival of ChatGPT).

Levin also said the OpenAI deal is “not exclusive,” suggesting the company has the opportunity to engage in talks with other LLMs. “Hopefully that agreement is just the beginning of other opportunities for us in that AI ecosystem,” he said during IAC’s earnings call.

AI for improved contextual ad targeting

IAC’s agreement with OpenAI allows Dotdash Meredith to use the tech company’s LLM to improve its first-party contextual targeting solution D/Cipher by mapping intent signals across “a much bigger portion of the internet.” Dotdash Meredith can then sell those signals to advertisers, said Levin, who noted that this was especially important in a post-third-party cookie digital ecosystem.

“Accessing significantly more scale inventory with good data for intent-based targeting — if we can pull that off, we think that that’s potentially a real accelerant to the business. It’s already working well so far,” he said.

When an analyst asked BuzzFeed’s CEO Jonah Peretti if Google delaying its third-party cookie deprecation had affected conversations with advertisers, he said he saw notable opportunities in this space with generative AI.

“Our ad product roadmap includes product enhancements and contextual positioning and using LLMs to understand contextual audiences even better,” Peretti said, adding that AI technology could scour BuzzFeed’s content to suggest ad placements. “I think a lot of the advancements in that space are going to offset or more than offset some of the cookie depreciation,” he added.

AI as an internal tool

The New York Times Company’s executives didn’t say much about generative AI. CEO Meredith Kopit Levien did not mention the lawsuit filed in December against Microsoft and OpenAI, though The Times’ Q1 2024 earnings released on May 8 stated that the company had spent $1 million on the lawsuit.

Kopit Levien did briefly mention that the company was “experimenting more ambitiously with audio by introducing the ability to listen to much of our report by an AI-powered automated voice.”

Meanwhile, Gannett’s president of digital marketing solutions Chris Cho reiterated in an earnings call on May 2 that the company is using AI technology to develop business products for clients. “As discussed in our previous earnings call, we are expanding our product portfolio with AI powered solutions that we believe will increase our total addressable market and core platform revenues,” he said. Cho went on to describe the launch of Gannett’s first AI-powered CRM tool, currently in a beta test with 30 customers.

“Over time, our plan is to monetize the software solution and make it commercially available more broadly,” Cho said.

And BuzzFeed’s Peretti said new AI-powered features and formats have driven “deeper engagement among our most loyal audience” and led to “the number of page views per web visitor growing for four consecutive months since December.” Those new features and formats include AI-powered image filters, content generators, chatbots and games.

Peretti said he expects to improve engagement, loyalty and time spent per user by plugging generative AI models into existing BuzzFeed products and experiences “without having to invest more in their development.”

BuzzFeed’s commerce business is another area of “tremendous potential” for generative AI application, Peretti said. The technology could help develop personalized shopping experiences for audiences, dynamically insert recommended products and curate products from retailer partners, he added.

Peretti also said AI technology was powering a new, interactive BuzzFeed homepage design that began rolling out at the beginning of this month.

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