Bill Gross rose to fame in the tech world in the 1990s when he came up with a novel way for search engines to make money from advertising. Under his pricing model, advertisers paid each time a user clicked on their ad. Now the “pay-per-click” man has founded a startup called ProRata with a bold, almost fanciful business model: AI pay-per-use.
Gross, the Pasadena, Calif., company’s CEO, speaks bluntly about the generative AI industry. “It’s theft,” he says. “They’re shoplifting the world’s knowledge and laundering it for their own profit.”
AI companies often argue that they need huge amounts of data to create their cutting-edge generative tools, and that they’re legally allowed to scrape it from the internet: website text, YouTube videos and subtitles, books stolen from pirated libraries, etc. Gross doesn’t buy that argument. “I think it’s bullshit,” he says.
Many media executives, artists, writers, musicians, and other rights holders are also fighting back, struggling to keep up with the flurry of copyright lawsuits filed against AI companies for the ways they operate that amount to theft.
But Gross believes ProRata offers a better solution than a legal battle. “To make it fair, that’s what I’m trying to do,” he said. “I don’t think this should be resolved through litigation.”
His company aims to strike revenue-sharing agreements so publishers and individuals can get compensated when AI companies use their work. Gross explains: “We can break down the output of generative AI — text, images, music, movies — into its components, figure out where they came from, and attribute a percentage to each copyright holder and pay them accordingly.” ProRata has filed a patent for the algorithm it created to assign attribution and make appropriate payments.
The company, which raised $25 million this week, is launching with a number of big-name partners, including Universal Music Group, the Financial Times, The Atlantic and media company Axel Springer, and has also signed up some of the most well-known authors, including Tony Robbins, Neil Postman and Scott Galloway. (It’s also partnered with former White House communications director Anthony Scaramucci.)
Journalism professor Jeff Jarvis, who believes scraping the web to train AI is fair use, also supports the proposal. Jarvis told WIRED that it’s smart for people in the news industry to band together to give AI companies access to “trusted, up-to-date information” to include in their output. “My hope is that ProRata will start a conversation about what could be an API[application programming interface]for different content,” Jarvis said.
After the company’s initial announcement, Gross said he was inundated with messages from other companies pleading for deals, including a text from Time Inc. CEO Jessica Sibley. Prorata has inked a deal with Time Inc., the publisher confirmed to WIRED. He plans to pursue deals with well-known YouTubers and other online stars.
The key word here is “plans.” The company is still in its infancy, but Gross is making bold statements. As a proof of concept, ProRata plans to release its own subscription chatbot-style search engine in October. Unlike other AI search products, ProRata’s search tool uses only licensed data; nothing is scraped using web crawlers. “Nothing is coming from Reddit,” Gross says.
