What Right Do You Have?
A recent lawsuit by music labels against AI companies Suno and Udio, along with the news of various media companies starting to license content for AI training purposes, highlights a long-standing dynamic within the media and creative IP industry: content creators and rightsholders often find themselves “discovering” certain rights they own retroactively. This phenomenon, driven by constant advances in technology as well as business models, has been a recurring theme for over a century.
Notable instances whereby rights were splintered off, given away accidentally, or exploited in unforeseen ways include:
1. Public Performance Rights: The landmark case of Victor Herbert v. Shanley Co in 1917 established that public performances of music in commercial venues like restaurants warranted compensation. This case highlighted how composers had not anticipated the commercial benefits others might gain from their works, leading to the legitimization of performing rights organizations and the creation of performance royalties.
2. Interactive Media Adaptations: The expansion of film and TV properties into interactive media, such as video games, represented another unanticipated avenue for content exploitation. The first major adaptation (a Star Wars-based game in 1982) required brand new frameworks for licensing.
3. Home Video Rights: The invention of the VHS in the late 20th century introduced a new revenue stream that was initially unrecognized (and feared) by film and TV producers. Home video rights became a separate category, necessitating new agreements and royalties distinct from traditional broadcasting rights.
4. eBooks and Audiobooks: Many authors and publishers initially overlooked the potential of digital formats. As eBooks and audiobooks grew in popularity in the early 2000s, these rights often became separated from traditional print rights, sometimes to the detriment of the original rightsholders.
Today, generative AI represents the latest frontier in the ongoing extension of rights management. Just a few years ago nobody discussed AI training as a distinct right, but as AI companies accelerate their use of copyrighted works to train their models, rightsholders are starting to play catchup.
This pattern serves as a powerful reminder of two key points: 1) predicting the next technological or business model shift that will impact content rights is extremely challenging; and 2) rightsholders do eventually find ways to assert their interests and secure participation in new revenue streams. Missed revenue and leaked value along the way is simply collateral damage.
