People Inc., one of the largest media publishers in the U.S., has signed an AI licensing deal with Microsoft. The media giant (formerly known as Dotdash Meredith) made the announcement Tuesday as a part of parent company IAC’s third-quarter earnings.
Under the deal, People Inc. will become a launch partner in Microsoft’s publisher content marketplace. This is the company’s second AI deal following its earlier agreement with OpenAI last year.
People Inc. CEO Neil Vogel described the new marketplace as “essentially a pay-per-use market where AI players directly can compensate publishers for use of their content on, sort of like an ‘a la carte’ basis.”
He also praised Microsoft for being committed to paying for content to support its AI efforts, adding that Microsoft’s Copilot would be the first buyer for the marketplace.
“It’s a very strong endorsement of us to be in the room with them and a very strong endorsement of the publishing marketplace and the value of content to make AI that is of high value,” Vogel said.
The announcement of the Microsoft deal was shared during IAC’s earnings, alongside the news that Google Search’s AI Overviews has been hurting the publisher’s traffic. For the first time, People Inc. shared data with investors that showed how Google Search, which accounted for 54% of its traffic two years ago, had dropped to 24% of its traffic during the past quarter.
The agreement differs from the OpenAI deal, which Vogel characterized as more of an “all-you-can-eat” model, but said People Inc. was happy with either model. What matters to the company is that its work is “respected and paid for,” he said. The company didn’t share the specific deal terms, though.
People Inc. has taken issue with the way AI companies have ingested media without paying to fuel their AI products and train their models. Recently, Vogel criticized Google, calling the tech giant a “bad actor” because it uses the same bot to crawl websites for its Google search engine and its AI features. Publishers can’t block the bot, as Google search still accounts for a large percentage of their traffic.
However, People Inc. uses the technology from web infrastructure provider Cloudflare to block other AI crawlers, prompting AI players to approach it with content deals. In September, Vogel attributed its decision to leverage Cloudflare’s tech as a way to push AI companies to the negotiating table, noting that its progress on deals was “much further along” after adopting the solution.
He reiterated those comments on today’s earnings call with investors, saying that blocking AI crawlers has been “very effective” and “brought almost everyone to the table.” Vogel suggested that more deals would be announced in time, as well.
IAC reported that People Inc. grew its digital revenue 9% to $269 million in the quarter, driven by performance marketing and licensing, which saw 38% and 24% growth, respectively. It also noted its acquisition of a food-focused media publisher and influencer network Feedfeed.
People Inc. forges AI licensing deal with Microsoft as Google traffic drops
