Microsoft-backed OpenAI (NASDAQ:MSFT) has entered into a multi-year global content licensing deal with Axel Springer, the media giant behind names such as Business Insider, Politico, and Bild.
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The deal is a landmark moment in media companies’ fight to be compensated by technology companies who use their content to churn out sophisticated AI models and solutions. While financial details of the deal remained under wraps, OpenAI will now pay for the content it uses from Axel’s publications to generate answers in ChatGPT and train its AI models. According to the Wall Street Journal, the deal is expected to be a significant revenue generator for Axel.
Now, ChatGPT will include links to the original content sources along with its answers. The format is expected to be introduced within months, ensuring original content sources receive traffic and credit.
Importantly, the non-exclusive nature of the deal means Axel can generate additional revenue from its content. Earlier, OpenAI announced a licensing deal with Associated Press. Further, these deals could be a harbinger of the things to come as content publishers look to thrive in the age of AI and tech companies wade through backlash over allegedly unlicensed content usage.
Is Microsoft Stock Expected to Rise?
Overall, the Street has a Strong Buy consensus rating on Microsoft. Following a nearly 51% rise in the company’s share price over the past year, the average MSFT price target of $421.33 implies a modest 12.25% potential upside in the stock.
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