Blockchain startup Story has announced that it has raised $80 million in investment funds as part of a Series B funding round.
The mentioned startup, which is based in San Francisco, released information about receiving funding on its account on the social media platform X, formerly known as Twitter, last Wednesday, August 21. The company stated that the investment will be directed to building a blockchain designed to achieve goals related to preventing the practice of unauthorized use by companies operating in the space of the artificial intelligence industry, the intellectual property of creators. The startup identifies the mentioned property category as one of the world’s largest asset classes. It is worth noting that in the era of digitalization and the actual formation of the virtual dimension of the matter of the being, the importance and significance of information materials are significantly increasing. Intellectual property is gradually becoming what, within the framework of the manner of symbolic characterization, can be called the fuel of the century, capable of speeding up, slowing down, or starting certain processes.
A message posted on the startup’s account in X notes that the definition of property of the specified category includes training data, artificial intelligence models, memes, game assets, UGC videos, character traits, and more.
Against the background of the development and scaling of machine intelligence technologies, the preciousness of intellectual property has demonstrated significant growth. It is worth noting that in the context of the current realities, this value is not highly specialized and does not belong to the category of some kind of systems that are important only in a certain industry. Artificial intelligence has the potential to become the source of a new leap in the framework of technical evolution in the context of the material development of human civilization. Against this background, the value of intellectual property is growing, which is necessary for training large language models.
The startup’s message notes that without the specified property, artificial intelligence is highly likely to hit a ceiling. The company also claims that it is shaping the configuration of a win-win future in which creators will be able to protect and expand their rights in the age of machine intelligence. In this case, intellectual property rights are implied.
The startup notes that its technology provides creators with the opportunity to carry out control over their information materials. In this case, probably the most important aspect of the solution proposed by Story is the envisaged ability of consumers to independently formulate the economic conditions of the process of using their property by companies operating in the artificial intelligence industry. Also, the protection of information materials can be carried out within the framework of adding items of appropriate purpose to smart contracts. These are self-executing agreements written on blockchains designed to run out without external approval or human involvement. At the same time, in this case, the functional process will be started only if the conditions are met.
According to media reports, according to the results of the next round of financing, the startup’s market capitalization reached $2.25 billion.
It is worth noting that at present the issue of ensuring the protection of copyrighted information materials from theft in the Internet space is very relevant. Claims and accusations of unauthorized use of intellectual property to learn large language models have been repeatedly sent to some players in the artificial intelligence industry. The mentioned models are a kind of base for the functioning of chatbots, which have recently been increasingly used as an alternative to traditional Internet search systems. In this case, huge amounts of information are needed. The corresponding need is related to the fact that chatbots should be able to generate answers to any consumer requests and at the same time provide such data sets in the form of complex semantic structures that will most accurately, most correctly, and fully convey the essence of a certain problem, fact or phenomenon. In this context, it should be noted that access to arrays of information determines the level of productivity and quality of functioning of digital products of AI companies.
Sometimes, in the process of learning large language models, arrays of data are used that are protected by copyright, but the developers do not receive permission for such actions. One of the examples that confirms the mentioned claim is that last year the New York Times hit Microsoft and OpenAI with a copyright lawsuit. In this case, a claim was made against technology companies for damages caused as a result of abuse of the intellectual property of the newspaper. The lawsuit cited examples of how OpenAI’s GPT-4 provided modified versions of information materials originally published by the New York Times as part of responses to user requests. Microsoft, which invested $13 billion in the developer of the mentioned artificial intelligence model, described the newspaper’s claims as unsubstantiated. The technology giant also stated that the lawsuit contains a false narrative of doomsday futurology. Microsoft lawyers have formed a defense position in which a kind of basic semantic element is that information materials were used exclusively for learning large language models, and this process does not involve market competition with the New York Times.
SY Lee, Story’s co-founder and chief executive officer, said during a conversation with media representatives that companies operating in the artificial intelligence industry may face the materialization of the risk of long-term losses if they do not pay adequate compensation to publishers and creators for the use of intellectual property. Also in this context, the head of the startup noted that to ensure the sustainable development of machine intelligence, great property of the mentioned category is needed. Besides, SY Lee underlined that without human-created data, artificial intelligence models will not be able to train and improve themselves.
It is worth noting that currently, few startups are developing solutions designed to protect intellectual property from theft in the Internet space by artificial intelligence. For example, one of the University of Chicago projects called Glaze offers a free app for artists. In this case, intellectual property is protected from theft committed by artificial intelligence tools. Special technology, in case of unauthorized external activity, makes subtle changes to the work of art. The implementation of this solution disrupts the ability of artificial intelligence models to read data about works of art and imitate the creative manner of the author.
Currently, the Story platform is used by more than 200 developers. This platform is designed to enable content creation by using programmable intellectual property.
A startup earns money by charging a fee for any action performed on its network. One of the companies using Story’s solutions is Ablo. This firm has developed an artificial intelligence tool that provides users with the opportunity to make their own tailored fashion items, while doing design work within the stylistic paradigm of well-known brands, including, for example, clothing company Balmain and luxury fashion house Dolce and Gabbana. It is worth noting that in this case, brands receive a fee for using their intellectual property. The corresponding procedure is provided for by the terms of various licensing agreements and revenue-sharing agreements.
SY Lee says that a huge, amazing digital renaissance is currently taking place, making everyone into a creator or studio. Also in this context, Story’s CEO noted that the lack of compensation and monetization of intellectual property rights is a suicidal action for artificial intelligence in the long term.
Christian Mammen, partner and chair of Womble Bond Dickinson’s US Intellectual Property Litigation Group, last month, during a conversation with media representatives, shared his opinion on the prospects that information materials generated by machine intelligence systems may face such a kind of barrier or legal obligation as copyright law. According to him, there are many ways to use existing doctrines regarding the mentioned advanced technology.
The still ongoing history of the modern concept of intellectual property goes back hundreds of years. At the same time, it was only at the end of the last century that the corresponding legal paradigm became part of most legal systems in the world. Against the background of the currently active development and spread of artificial intelligence, it may be necessary to make changes to the existing concepts of intellectual property and copyright. This need is likely to be associated with the adaptation of the legal paradigm for the consideration of cases regarding certain scenarios for the use of generative AI.
Christian Mammen is not sure about the expediency of implementing such a solution as a full-scale overhaul of laws only to respond to some kind of legal challenges caused by applying artificial intelligence. At the same time, he noted that, perhaps, within the framework of certain aspects of the existing legal system, there may be a need for changes.
As we have reported earlier, Contextual AI Raises $80 Million.
