Kate Knibbs
Wired.com
Originally posted 8 AUG 24
Bill Gross made his name in the tech world in the 1990s, when he came up with a novel way for search engines to make money on advertising. Under his pricing scheme, advertisers would pay when people clicked on their ads. Now, the “pay-per-click” guy has founded a startup called ProRata, which has an audacious, possibly pie-in-the-sky business model: “AI pay-per-use.”
Gross, who is CEO of the Pasadena, California, company, doesn’t mince words about the generative AI industry. “It’s stealing,” he says. “They’re shoplifting and laundering the world’s knowledge to their benefit.”
AI companies often argue that they need vast troves of data to create cutting-edge generative tools and that scraping data from the internet, whether it’s text from websites, video or captions from YouTube, or books pilfered from pirate libraries, is legally allowed. Gross doesn’t buy that argument. “I think it’s bullshit,” he says.
Here are some thoughts:
Bill Gross, founder of ProRata, is revolutionizing the generative AI industry with a novel "AI pay-per-use" business model. Gross criticizes the industry for stealing and laundering knowledge without fair compensation. ProRata aims to address this issue by arranging revenue-sharing deals between AI companies and content creators, ensuring fair payment for used work.
ProRata's approach involves using algorithms to break down AI output into components, identifying sources, and attributing percentages to copyright holders for payment. The company has already secured partnerships with prominent companies like Universal Music Group, Financial Times, and The Atlantic. Additionally, ProRata is launching a subscription chatbot-style search engine in October, which will use exclusively licensed data, setting a new standard for the industry.
The company's model offers a solution to the ongoing copyright lawsuits against AI companies, providing a fair and transparent way to compensate content creators. ProRata's emergence is part of a larger trend, with other startups and nonprofits, like TollBit and Dataset Providers Alliance, also entering the training-data licensing space. Gross plans to license ProRata's attribution and payment technologies to other companies, including major AI players, with the goal of making the system affordable and widely adopted, similar to a Visa or Mastercard fee.
Overall, ProRata's innovative approach addresses the pressing issue of fair compensation in the generative AI industry. With its impressive partnerships and promising technology, ProRata is poised to make a significant impact and potentially transform the industry's practices.
