News Corp is suing Perplexity for scraping its articles

The AI landscape is many things, and one of them is a war zone with shots being fired between AI companies and publishers. For example, The New York Times is suing OpenAI. Well, according to a new report, News Corp is now suing Perplexity for allegedly scraping content from some of its news companies.

In case you don’t know, News Corp is a massive news publishing company that owns about a dozen other smaller news sites. “Smaller” is a relative term because it owns some journalistic heavy hitters such as The New York Post and the Wall Street Journal. It’s a multi-billion-dollar company, so it’s no small player on the field. Since it owns so many news companies, it needs to be that much more vigilant about AI companies scraping data from its sub-brands.

News Corp is suing Perplexity for scraping data from its sites

In case you don’t know, Perplexity is an AI-powered search engine. It’s what Google strives to be with its AI Overviews. When you search using it, you’ll see an AI-generated overview of the top you searched, and it will also surface the links for the sites it got its information from. This company has been making some gains in the market and has even started paying some publishers to use their content.

Well, there are other publishers out there that aren’t too happy about this company. News Corp filed a lawsuit on October 21st, and it alleges that the company scraped data from sites such as the New York Post and the Wall Street Journal among other sources. The plaintiffs in the lawsuit are Dow Jones & Company, Inc. (“Dow Jones”) and NYP Holdings, Inc. (“NYP Holdings”), and the defendant is Perplexity.

The lawsuit claims that Perplexity engages “in a massive amount of illegal copying of publishers’ copyrighted works and diverting customers and critical revenues away from those copyright holders.” This is a common complaint that many news companies have about AI tools in general. Another key point that the lawsuit hits on is the fact that Perplexity allows people to bypass reading information on websites much like what Google’s AI Overviews does.

What makes this worse is that, if News Corp is correct, Perplexity is reproducing sections of articles verbatim, which is a major no-no in copyright law. Along with that, News Corp claims that Perplexity also hallucinates on details and generates false information. It then attributes that false information to the sources. These are all pretty hefty allegations, and if they’re true, then Perplexity could be in some trouble.

This isn’t the first time that these two companies butted heads

While this lawsuit was officially filed in the Fall, News Corp made its anger known back in the Summer. It reached out to Perplexity back in July and urged the company to stop scraping data from its sites. What did Perplexity do in response to this? Nothing.

The company simply disregarded the letter and continued scraping the data. It was probably then that News Corp started getting this lawsuit together.

Perplexity’s response

Perplexity’s rebuttal to the lawsuit echoes the same notion that we’ve seen in the New York Times vs. OpenAI lawsuit. News Corp says that Perplexity is scraping its copyrighted material. However, Perplexity responded by saying that its practices fall within fair use. Information within the articles is paywalled and copyright protected. However, if Perplexity is able to use the scraped information and produce its own original content from it, then it should fall under fair use. This is pretty much the same thing that OpenAI/Microsoft said in the New York Times lawsuit.

Whether this falls under fair use or not depends on how Perplexity presents the content. If the company is indeed reproducing sections of paywalled content for people to access freely, then it might be liable.

News Corp isn’t the only one unhappy with Perplexity

Perplexity is proving to be pretty unpopular on the playground, as other companies are clashing with it for much the same reason. These other companies including the aforementioned New York Times, Forbes, and Wired, have been vocal about their disdain for Perplexity’s practices. Just last week, The New York Times sent a cease and desist letter to Perplexity urging it to stop what it’s doing.

Neither of these companies has filed a lawsuit against the AI startup, but there’s no telling if they will eventually. If they do, then Perplexity could be in some trouble.

If News Corp wins

There’s no telling how long this lawsuit will drag on for. The New York Times vs. OpenAI lawsuit has been going on since December of last year. In any case, if Perplexity loses this lawsuit, then it could be forced to stop scraping content from its sites. Not only that but the startup would be forced to delete any database of content it scraped from News Corp’s sites.

Depending on how much data it scraped from News Corp, it could punch a hole in Perplexity’s content. There’s no telling how long we’re going to have to wait for the resolution to this case.

This is hypocritical on News Corp’s part

The words written in News Corp’s lawsuit were all uttered by a silver tongue, but we can’t overlook a pretty glaring detail. Just a few months ago, the very same News Corp signed a deal with OpenAI to license the content from its many news sites. For a sizable $250 million (over the next five years), OpenAI will have access to the human-created content that News Corp’s sites write.

Sure, in a legal sense, this isn’t bad. OpenAI has the legal right to access News Corp’s content. It’s just a bit shady on News Corp’s part to accuse Perplexity of taking human-made content when it’s feeding OpenAI its content on a silver platter. In the lawsuit, the plaintiff says that Perplexity’s answers are “machine-generated reproductions of human-created content arranged by LLMs and other tools that summarize and paraphrase original, human-generated content…” Does that sound familiar? ChatGPT does the same thing, and this is one of the reasons it’s being sued by The New York Times.

Let’s not forget about the money

Not only that, but the lawsuit also spoke about Perplexity’s effect on the revenue of news sites. It accuses Perplexity of “diverting customers and critical revenues away from those copyright holders.” Well, OpenAI is going to launch its own search engine that will do much of the same thing that Perplexity is doing. It will deliver overviews of the topic you searched and show a scant number of source links. The only that makes things different is that News Corp is receiving money directly from OpenAI. What about the other websites that didn’t? SearchGPT is going to have the same effect on other companies, and News Corp is fueling the company’s database.

It’s tough to take this lawsuit seriously considering that News Corp sold out to a company that’s been doing the same thing that it’s accusing Perplexity of. Its lawsuit speaks about journalists, their contributions to the spread of information, the revenue to their sites, and other aspects, but at the end of the day, what seems more important is the company signing the check. We’re sure that, if the table was flipped, and it was Perplexity that gave News Corp $250 million, then it would be suing OpenAI for the same thing. We can’t overlook News Corp’s little deal.