People Inc., a prominent U.S. media publisher and subsidiary of IAC, has finalized an AI content licensing agreement with Microsoft. The announcement was made Tuesday during parent company IAC's third-quarter earnings call. Under the deal, People Inc. will participate as a launch partner in Microsoft's new publisher content marketplace, marking the company's second major AI licensing agreement following a previous deal with OpenAI.
People Inc. CEO Neil Vogel described Microsoft's forthcoming marketplace as 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." Vogel affirmed Microsoft's commitment to remunerating publishers for content utilized in its AI initiatives, identifying Microsoft Copilot as the inaugural buyer within the new marketplace. He characterized the partnership as a "very strong endorsement" for People Inc. and for the inherent value of publisher content in developing high-quality AI.
The announcement coincided with reports from IAC's earnings indicating a notable decrease in traffic from Google Search for People Inc. The company presented data showing Google Search's contribution to its traffic declined from 54% two years ago to 24% during the past quarter, attributed to the impact of Google Search's AI Overviews. While specific financial terms of the Microsoft agreement were not disclosed, Vogel stated that People Inc. found both the new "pay-per-use" model and the "all-you-can-eat" model of its OpenAI deal acceptable, provided its content is "respected and paid for."
People Inc. has previously voiced concerns regarding AI companies ingesting media content without compensation. Vogel has previously criticized Google, labeling the tech giant a "bad actor" for using a singular bot for both search engine crawling and AI feature content acquisition, a practice that prevents publishers from selectively blocking AI access while maintaining search visibility. In response, People Inc. has leveraged web infrastructure provider Cloudflare to block other AI crawlers, a strategy Vogel credited with prompting AI companies to engage in content licensing negotiations. He reiterated during the earnings call that blocking AI crawlers has been "very effective" in bringing potential partners to the negotiating table.
For the quarter, IAC reported that People Inc. saw its digital revenue grow by 9% to $269 million, driven by performance marketing and licensing, which experienced 38% and 24% growth, respectively. IAC also noted People Inc.'s acquisition of the food-focused media publisher and influencer network, Feedfeed, during the period.
