Bill Gross made its name in the tech world in the 1990s when it invented a new way for search engines to make money from advertising. Under its pricing scheme, advertisers will pay when people click on their ads. Now the pay-per-click guy has founded a startup called ProRata, which has a bold, possibly amazing business model: “AI pay-per-use.”
Gross, who is CEO of the Pasadena, Calif.-based company, doesn’t mince words about the generative AI industry. “It’s stealing,” he says. “They are stealing and laundering the world’s knowledge for their own benefit.”
Artificial intelligence companies often claim that they need vast amounts 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 stolen from pirated libraries is legally allowed. Gross does not accept this argument. “I think it’s bullshit,” he says.
So do many media executives, artists, writers, musicians and other rights holders who are pushing back – it’s hard to keep up with the steady stream of copyright lawsuits filed against AI companies, claiming that the way that work is theft.
But Gross thinks ProRata offers a solution that beats the legal battles. “To make it fair — that’s what I’m trying to do,” he says. “I don’t think this should be decided by lawsuits.”
His company aims to arrange revenue-sharing deals so that publishers and individuals get paid when AI companies use their work. Gross explains it this way: “We can take the output of generative AI, whether it’s text, image, music or film, and break it down into components to understand where they came from, and then give a percentage attribution to each copyright holder and then pay them accordingly.” ProRata has filed for patents on the algorithms it has created for assigning authorship and making corresponding payments.
This week the company, which raised $25 million, launched with a number of big-name partners, including Universal Music Group, the Financial Times, The Atlantic and media company Axel Springer. He has also signed deals with authors with large followings including Tony Robbins, Neil Postman and Scott Galloway. (Also partnered with former White House communications director Anthony Scaramucci.)
