Considering AI licensing deals? Make sure you have your rights people in the room!
This is a call to anyone in the publishing industry discussing artificial intelligence and the licensing or selling of any of your content. Clare Hodder discusses the many considerations, as well as the importance of getting your rights team involved to support the discussions, negotiations and implications of the terms.
Read on for a helpful guide, as well as a range of questions to consider.
AI and the implications for rights and licensing
At a recent meeting of the Publishers’ Licensing Services (PLS) Rights Group, we had an excellent session with Mary Elliott from Fox Williams, on artificial intelligence (AI).
Mary patiently answered our many questions about the implications for rights and licensing.
One of the questions asked was about how to ensure that rights professionals were able to add their valuable expertise to internal discussions about entering into licensing deals for AI training models. This was raised as a particular concern when we aren’t always being included in the conversation.
The lack of a “rights voice” is echoed in many blog posts, webinars and conference sessions about AI and licensing. Yet, there is a huge wealth of expertise available from individuals with decades of experience in negotiating licensing agreements.
Mary’s advice was that we should make sure that colleagues are aware of our specific experience. To shout louder about some of the things a rights professional will be able to contribute that no one else in the business will be thinking about.
So, in this post, I’m taking up that challenge and shouting loudly on behalf of my fellow rights professionals – listen up!
Why to get your Rights team involved with AI licensing deals
We’ve all seen the headlines about the money being splashed about by big tech to woo publishers. It’s a tempting proposition, the sums reportedly being offered are considerate and who is to say how long that kind of money will be on the table for. However, as with all licensing arrangements the devil is in the detail – the exact place where rights people thrive.
We view our publishing organisations through a rights specific lens. We consider ourselves custodians of authors’ and other creators’ content, ensuring it is licensed responsibly and remunerated fairly. We have an over-arching view of the IP assets of the business. This will include all of the content types, genres, imprints, over the entire history of the business – including out of print (but most definitely not out of commerce) works, all but forgotten by the rest of the business.
We are deftly able to balance commercial drivers with legal, moral and reputational responsibilities, in order to take a long-term view of a publishing companies single biggest asset – its intellectual property. Some of our skills overlap with our legal colleagues, but we bring a practical, solution-focused approach, honed from long experience of “doing” licensing. In additions, this covers the before, during and after the contract negotiations. We know how to do it all.
What to ask about any proposed AI licensing deal
So, if you are a publisher looking at entering into licensing arrangements with AI companies, here are some suggestions for questions you might find useful to discuss with your rights team, before you sign on the dotted line.
1) Do we have the rights?
As any good licensing professional will tell you, this is always the starting point.
It goes beyond what is in the author’s agreement. Consider what’s in all of the agreements that might be involved in the work being licensed. Your rights teams will be very familiar with the versions of contract your organisation has used. They will also have a good idea of the exceptions, and the works for which the rights picture is more murky. Their help in steering you through which books you can include in a licensing agreement, or not, will be invaluable!
2) Do we still have the rights?
Just because you had the rights when you published, it doesn’t mean you still have the rights now. Rights granted in some or all of the work may have been reverted, or the term for which you had the rights may have expired.
This information can be hard to piece together, but your rights team may be able to give you a head start.
3) What other contractual obligations might come into play?
Your agreements with content creators will contain various obligations that you need to meet, if you license the work covered.
There will be clauses covering approvals, acknowledgements and more that you will need to be aware of.
If you have Open Access content, you will need to be mindful of the licence under which you acquired the work and the compatibility of the terms with the proposed new licensing arrangement. Again, these are issues that your rights team are familiar with dealing with and can guide you accordingly.
4) What do we do about moral rights?
Moral rights are automatic and include the right to be identified as the creator of a work and the right to object to derogatory treatment, Be aware! Both of these could be breached under the terms of an AI license.
Creator’s can waive moral rights, but have they? Do you need to ask them to? Your rights people can help you work that out.
5) What exclusive licenses have we already granted?
Your rights team (and perhaps others) will have been actively selling rights to your content. As part of that, they will have entered into exclusive licensing agreements that may conflict with the proposed terms of any new AI agreements. It is important to be aware of these so that, if necessary, they can be carved out of any new licensing agreements.
6) What questions should we be asking the AI companies?
Your rights team will be able to help in unravelling some of the complexity of what’s going on, by asking the right kind of questions. These will be the questions they ask every day when they are contemplating new licensing arrangements. For example:
- ascertaining exactly what the proposed use is
- assessing the level of risk to the IP being licensed
- establishing how content usage will be tracked, managed and remunerated.
7) How do we assess the terms being offered? Are they ok?
Getting an experienced set of eyes on a licensing agreement will quickly reveal any potential areas of concern.
Your rights teams review licensing agreements every day. The inclusion of ‘odd’ clauses or an exclusion of standard safeguards will stick out like a sore thumb.
They will also have an eye on the practicalities of managing obligations on either side and where potential problems may arise.
8) What kind of reporting should we be asking for?
Receiving reports of usage data is invaluable. This is both to keep an eye on licence compliance and to inform future licence negotiations. It is an essential component of a licensing deal.
For more information on this, check out this article from Paul Gerbino at Content Licensing International:
However, they can be complex to manage, especially if remuneration is tied to usage and you depend upon them to allocate revenue.
Tap into your rights team’s experience of what is needed and how (and how often) you want to receive it.
9) Are we getting a good deal?
Valuing content is a difficult skill, and when AI companies are throwing so much cash about, it seems almost unimaginable to think that the amounts being offered, might not actually be enough.
Your rights team’s experience could be very useful here. For example, they can consider whether there are opportunities to secure recurring payments through the life of the agreement and to what extent entering into a licence will impact on other revenue streams in future.
10) Can we manage this arrangement practically?
There may be a lot of back-office implications as a result of entering into an AI licensing arrangement.
Your rights team will be able to help you understand what those are and the implications on systems and resources. As an example, this could include if a large scale contract review is required. Or, in considering whether the finance and royalty systems can cope with the financial model and reporting being proposed.
Getting a heads up from your rights people on where these practical issues may arise will enable you to plan accordingly.
Discussing AI licensing? Get your Rights team involved
Consider this a list of starter questions only when it comes to discussing AI licensing.
Once you get your rights team involved in the discussion, there are all sorts of things they will be able to contribute from their vast experience of content licensing whether its strategies for negotiating, advice on contract terms or just practical considerations particular to your publishing business.
With all the uncertainty around AI, surely it pays to get all of the relevant experience in the room, before you start “trading the family silver”?
If you need systems support or rights consultancy to help manage your AI licensing challenges then do contact us for a chat: email info@rightszone.co.uk
With thanks to Mary Elliot and the PLS rights group for providing the inspiration for this post!
IMAGE CREDIT: Photo by Shantanu Kumar from Pexels