Artificial Intelligence: Considerations Around Protecting and Licensing Your Intellectual Property
As artificial intelligence advances, the risk of intellectual property (IP) infringement through unauthorized use or replication is on the rise. Whether you're a content creator or a business, it’s essential to protect your IP from AI-related exploitation. However, while protecting your IP is important, there are opportunities to license your content for AI purposes in a way that allows you to control its usage and generate revenue. This post will cover some strategies to protect your IP and some common licensing terms in agreements around AI.
Tools to Protect Your Intellectual Property from AI
Terms of Use, Contracts and Licensing Agreements - When posting content or collaborating with partners, distributors, or platforms, ensure that you understand the terms of use (TOS) you are agreeing to and if you do have contracts, make sure they explicitly define IP ownership, usage rights, and restrictions on AI use:
IP Clauses: Clearly outline what rights the third party has to your content, especially regarding the use of AI.
Restrictions on AI Use: As a creator, you may want to ensure agreements prohibit the use of your content for training AI models or generating derivative works without your explicit consent.
Copyright and Trademark Protections - Consider registering your copyrights and trademarks early, as well as additional protection measures:
Copyright Registration: The decision to register your copyright has numerous considerations, but one positive of copyright registration is that it helps establish a record of ownership.
Trademark Registration: Registering a trademark has similar benefits to copyright registration, but there are generally more reasons to register a trademark when compared to a copyright.
Technological Safeguards -There are also technical methods for safeguarding your content:
Digital Watermarking: Consider using available tools to add metadata or invisible watermarks to your content to track unauthorized use or replication by AI systems.
Anti-Scraping Measures: Use technologies that prevent unauthorized scraping of your data or media.
Encryption and DRM: Implement encryption to control how your digital content can be used, shared, or processed.
AI-Driven Monitoring Tools: Utilize AI tools to detect and flag unauthorized copies or derivatives of your work across digital platforms.
Enforcement: Take action through DMCA takedowns (or legal proceedings) to ensure unauthorized AI use is swiftly addressed.
Licensing Your Intellectual Property for AI Purposes
While protecting your IP is crucial, AI also opens up new opportunities to monetize your content and rights. Below are some key considerations for structuring a licensing agreement for AI purposes:
License vs Ownership
Licensing: You retain ownership of your IP and control its usage, with terms that limit how and for how long the content can be used. This option allows for ongoing revenue and the ability to re-license or use your content in the future.
Ownership: You transfer full rights to the buyer, giving them complete control over the content, including the right to modify or create derivatives. While this can lead to higher upfront payments, it ends your involvement and future earning potential from the content.
Exclusivity and Option Periods - As a content creator, you may want to give a company an exclusive option to purchase your IP rights, allowing them to license or use your content for AI training or development:
Exclusivity: Negotiating a certain option period where a company has the exclusive right to use your granted IP rights.
Option Period: As is the case with many agreements around rights, this type of agreement will often have a certain option period (e.g., 12 months) with the possibility of annual renewals to extend the agreement.
Granted Rights and AI Use - When licensing your IP, clearly define the rights granted for AI purposes:
Define the Scope: Clearly define how your content can be used by AI, including restrictions and allowances for derivative works.
Exclusive AI Rights: Think through whether the licensing company has the right to use your content for AI training or other related activities.
Modification and Derivative Works: The agreement should make clear whether the company has the right to modify or create derivatives of your content, including AI-generated works. If so, how are you compensated for this?
Third-Party Licensing: Does the company you are working with have the right to license your content to other businesses for AI purposes? If so, the agreement should have very specific language around what that 3rd party company can do with your right.
Retain Certain Control: Reserve specific rights to protect yourself from over-exploitation.
Compensation Structures - A key consideration in licensing your intellectual property for AI purposes is how you are compensated. The structure of payment can vary based on the type of deal you negotiate, ranging from a flat fee to more nuanced arrangements like royalties or revenue sharing. Here are a few common compensation structures:
Flat Fee: This straightforward payment model provides a one-time payment in exchange for the rights to use your content. It’s ideal when you want immediate compensation without worrying about long-term performance or usage.
Variable/Structured Flat Fee: In some agreements, you may receive a set amount based on the volume of content used.
Revenue Sharing: If your content is licensed to third parties, you may negotiate a revenue share model where you receive a percentage of the income generated from these deals. This structure allows you to benefit from the ongoing success and reach of your licensed content.
Royalties: Royalties offer recurring payments based on how frequently your content is used or how successful the AI-generated results are. This can be especially beneficial when your content is part of a long-term AI project.
Need legal assistance? By taking these key considerations into account, you’ll be better prepared to navigate the complexities of protecting and licensing your intellectual property for AI purposes while ensuring your creative rights are protected and your compensation is fair. Need further guidance? Contact Think Creative Legal today to schedule a consultation and discover how TCL’s expertise and proactive approach can benefit you and your business.
The foregoing is not legal advice and is meant for informational purposes only.
