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Controversies and Developments Surrounding Perplexity AI and Generative AI

GOOVER DAILY REPORT July 1, 2024
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TABLE OF CONTENTS

  1. Summary
  2. Controversies Surrounding Perplexity AI
  3. Major Product Launches and Partnerships in Generative AI
  4. Comparative Analysis of AI Tools
  5. Ethical and Legal Dimensions in Generative AI
  6. Conclusion

1. Summary

  • This report delves into the controversies and key developments in the realm of generative AI, with a particular focus on Perplexity AI. It provides a detailed examination of legal and ethical issues, such as content scraping and copyright infringement, involving AI companies like Perplexity AI and OpenAI. Key aspects explored include partnerships, major product launches, and technological comparisons of AI tools. Furthermore, the report addresses the impact on publishers, keen on ad revenue, and provides a comparative analysis of AI tools like Canva and Kittl, and highlights advancements in AI across various industries. The goal is to furnish a comprehensive overview of the current generative AI landscape backed by data-driven evidence from multiple sources to inform the target audience.

2. Controversies Surrounding Perplexity AI

  • 2-1. Content Scraping and Legal Issues

  • Perplexity AI is embroiled in significant controversies regarding content scraping. It has faced accusations of scraping content from websites that have explicitly forbidden it, in violation of AWS rules, as revealed by WIRED. Amazon's cloud division has initiated an investigation into these claims (docId: go-public-web-eng-N1939110423981990974-0-0, go-public-web-eng-4260514873305297262-0-0). Wired observed a machine tied to Perplexity scraping content from Condé Nast publications, including WIRED, despite these websites blocking

  • 2-2. Plagiarism and Accusations of Copyright Infringement

  • Perplexity AI has come under fire due to allegations of plagiarism and copyright infringement. It has been accused of reproducing content from major news outlets like Forbes without proper attribution. For instance, Perplexity's summarized news story mirrored Forbes' investigative article without citing the original source. Similar accusations have been made by The New York Times, The Guardian, and Condé Nast, who claim that Perplexity's bots have been circumventing their blocks to scrape and reuse their content (docId: go-public-web-eng-4580593612693711804-0-0, go-public-web-eng-3991361439606559074-0-0).

  • 2-3. Response and Counterclaims by Perplexity

  • In response to the allegations, Perplexity AI, represented by its CEO, Aravind Srinivas, has strongly denied any wrongdoing. Srinivas claimed that any content scraping was done by a third-party company and emphasized the improvements being made to Perplexity's processes to ensure high-quality and authoritative sources. Perplexity also claims to adhere to the Robots Exclusion Protocol and has developed internal algorithms to detect AI-generated content, which they continuously refine (docId: go-public-web-eng-2475073604088121171-0-0, go-public-web-eng-2205576055153324413-0-0).

  • 2-4. Impact on Publishers and Ad Revenue

  • The activities of Perplexity AI have raised concerns among publishers who assert that the scraping of content by Perplexity potentially cuts them out of significant ad revenue. Publications like The New York Times and The Guardian have reported lost ad revenues due to Perplexity's unauthorized use of their content. Forbes has demanded Perplexity remove infringing articles and provide compensation for the revenue it has earned (docId: go-public-web-eng-N2203081481210203283-0-0, go-public-web-eng-4260514873305297262-0-0).

3. Major Product Launches and Partnerships in Generative AI

  • 3-1. Key Product Launches

  • In June 2024, Stability AI appointed Prem Akkaraju as its new CEO and released SD3 Medium, its most advanced text-to-image generating AI model. Runway announced its latest generative video model, Gen-3. In May 2024, OpenAI collaborated with Stack Overflow to improve its generative AI models, and News Corp. and OpenAI struck a $250 million content partnership deal. Telus launched a generative AI support chatbot, and CalypsoAI enhanced generative AI chatbot moderation. In April 2024, Adobe made its Express Mobile App with Firefly AI available to everyone. March 2024 saw Adobe integrate Firefly generative AI into Substance 3D Sampler and Stager. In February 2024, Google released the AI model Gemma designed for researchers, while OpenAI completed a tender offer valuing the company at $80 billion. In January 2024, Google partnered with Mistral AI on generative language models. December 2023 witnessed Meta introduce generative AI photo editing on Instagram.

  • 3-2. Significant Partnerships

  • In June 2024, SoftBank Corp. entered a strategic partnership with Perplexity AI, providing its generative AI search services freely to mobile customers. March 2024 saw AWS, Accenture, and Anthropic partner to accelerate enterprise AI adoption. Sanofi partnered with OpenAI and Formation Bio in May 2024 to build AI-powered software for drug development. Additionally, AI startup Cohere raised $450 million from Nvidia, Salesforce, and Cisco, while Trust AI raised $17.8 million to revolutionize data protection with zero-trust architecture.

  • 3-3. Funding Rounds for AI Startups

  • Cohere raised $450 million in June 2024. In the same month, French AI startup Mistral AI secured $640 million. Other notable rounds include OpenAI's partnership with Stack Overflow and $250 million deal with News Corp. CoreWeave received $1.1 billion in Series C funding. In May 2024, xAI raised $6 billion. Additionally, CoreWeave raised $1.1 billion to drive next-gen cloud computing AI.

  • 3-4. Advancements in AI Across Industries

  • Accenture and Oracle have partnered to deliver generative AI solutions for finance teams. Adobe has integrated Firefly generative AI capabilities into Substance 3D. In the healthcare sector, Sanofi has established partnerships for AI-powered drug development. Cohere and Microsoft are integrating generative AI for enhanced platform capabilities. Meanwhile, Telus and CalypsoAI launched generative AI support chatbot and moderated security scanners, respectively, showcasing the application of AI in customer support and cybersecurity.

4. Comparative Analysis of AI Tools

  • 4-1. Comparison Between Canva and Kittl

  • Canva and Kittl are two prominent AI-powered design tools with distinct features. Canva, an established platform, provides a wide range of features and integrations such as 610,000 pre-designed templates, versatile design tools, photo editing capabilities, and collaboration tools. On the other hand, Kittl, a newer player, excels with high-quality design elements and specific features for print-on-demand creators including AI vector generation, customizable templates, text effects, and texture features. Canva is user-friendly with a straightforward drag-and-drop system, while Kittl offers advanced customization, making it more suitable for professional designers. Canva offers three pricing plans: Free, Pro ($119.99 annually), and Teams ($149.9 annually), whereas Kittl provides Free, Pro ($120 annually), Expert ($288 annually), and Business plans. The choice between the two depends on the user’s needs - Canva for simplicity and speed, and Kittl for advanced, high-quality design capabilities.

  • 4-2. Local vs. Online AI Chatbots

  • AI chatbots that have internet access are becoming increasingly important due to their ability to provide real-time data and insights. This report highlights three top chatbots: ChatGPT with browsing capabilities, Perplexity AI, and ChatLabs. ChatGPT, as part of its Plus plan, can fetch real-time data, thus offering up-to-date information for research and customer support. Perplexity AI stands out by using advanced algorithms that transform user interactions with the internet, offering accurate and contextually aligned responses. ChatLabs integrates multiple AI models, supporting multilingual and unrestricted models, and it offers a user-friendly interface for a variety of tasks including writing and research. The key benefits of these AI chatbots include enhanced research capabilities, improved decision making, and increased efficiency by automating information retrieval.

  • 4-3. Overview of Generative AI Tools

  • Generative AI tools are advancing rapidly, providing various functionalities from text and image generation to real-time data retrieval. Canva incorporates AI features such as Magic Write for generating content, Magic Design for quick stunning designs, Beat Sync for syncing video with music, and Magic Erase for removing unwanted objects from images. Kittl boasts of AI tools like AI Art Generator for creating logos and images from text prompts and real-time text transformation. Perplexity AI focuses on delivering accurate, contextually relevant information using natural language processing and machine learning, positioning itself as a new kind of online encyclopedia. ChatLabs combines several AI models to provide comprehensive support in research, writing, and creation, making it accessible and efficient for diverse tasks. These developments signify the dynamic growth and increasing application of AI tools in various domains.

5. Ethical and Legal Dimensions in Generative AI

  • 5-1. Ethical Considerations and Controversies

  • One of the main ethical controversies surrounding generative AI concerns the practice of content scraping. AI companies such as Perplexity AI, OpenAI, and others have been accused of using copyrighted material from various sources to train their AI models without proper permission. Mustafa Suleyman of Microsoft stated that AI models could use any content on the internet freely unless explicitly prohibited by the content owners. This practice has raised significant ethical questions regarding intellectual property and the fair use of online content. Additionally, Perplexity AI has been criticized for generating inaccurate and misleading summaries of articles, which further questions the ethical use of AI in content creation.

  • 5-2. Legal Repercussions and Lawsuits

  • The legal repercussions for AI companies involved in content scraping have been substantial. Notably, several organizations and publications, including Forbes, the New York Times, and the Recording Industry Association of America, have filed lawsuits against Perplexity AI, OpenAI, and others. These lawsuits claim that the AI companies used their content without permission to train their models. For instance, WIRED conducted an investigation revealing that Perplexity AI engaged in surreptitious scraping of content, despite efforts by content owners to block such activities through the Robots Exclusion Protocol. Amazon also launched a review following allegations that Perplexity AI improperly scraped content using Amazon Web Services.

  • 5-3. Industry Response to AI Misconduct

  • In response to allegations and investigations, industry players like Amazon have started scrutinizing the practices of AI companies. Amazon confirmed that Perplexity AI's actions are under review to determine whether they violated Amazon's terms of service. Perplexity AI responded by asserting that their services do not violate these terms, and CEO Aravind Srinivas stated that their company does not train models on others' content, instead, it aggregates outputs from other AI systems. Additionally, Perplexity has started to highlight sources more prominently following criticism from Forbes and other publications regarding inadequate citation of original sources.

6. Conclusion

  • The detailed examination of Perplexity AI and the broader generative AI landscape reveals significant ethical and legal challenges in the industry. The controversies surrounding content scraping and copyright infringement highlight the need for stringent regulations and transparent practices. Perplexity AI, in particular, has faced severe scrutiny due to allegations of unethical content scraping and plagiarism which has raised concerns about intellectual property rights and the economic impact on publishers. Despite these challenges, the sector has witnessed rapid advancements with major product launches and strategic partnerships, signifying dynamic growth. However, issues related to information accuracy and the ethical deployment of AI remain imperative to address. It is essential to balance innovation with responsible practices to ensure sustainable growth in the AI industry. Future efforts should focus on developing robust legal frameworks and ethical guidelines to mitigate risks while leveraging the potential of generative AI technology for practical applications.

7. Glossary

  • 7-1. Perplexity AI [Company]

  • An AI-powered search engine that has faced several allegations regarding content scraping and plagiarism. Supported by prominent investors like Jeff Bezos, Perplexity claims to innovate online information access but has been criticized for ethical and legal misconduct.

  • 7-2. Content Scraping [Issue]

  • The unauthorized extraction of data from websites, leading to legal battles and ethical concerns. In the context of Perplexity AI, it involves allegations from major publishers about scraping without consent, resulting in potential ad revenue loss.

  • 7-3. Generative AI [Technology]

  • A branch of artificial intelligence focused on generating new content based on existing data. It includes AI tools and models used for creating text, images, and other digital content. Recent advancements include major product launches and new partnerships across industries.

  • 7-4. Microsoft [Company]

  • A leading tech company involved in AI research and development, including the controversial use of web content for training AI models without explicit permission from content creators.

  • 7-5. OpenAI [Company]

  • An AI research organization known for creating the ChatGPT model. OpenAI has been both praised for its innovations and criticized for its handling of copyright and voice imitation issues.

  • 7-6. Copyright Infringement [Legal Issue]

  • The unauthorized use of protected content, often central to lawsuits involving AI companies like Perplexity and OpenAI. Legal battles emphasize the need for clearer guidelines on AI’s use of existing content.

  • 7-7. AI Chatbots [Technology]

  • Interactive platforms using AI to engage in real-time conversations and information retrieval. Key players include ChatGPT and Perplexity, noted for their applications in customer support and real-time data access.

8. Source Documents