{"id":222156,"date":"2025-01-29T20:53:10","date_gmt":"2025-01-29T20:53:10","guid":{"rendered":"https:\/\/www.musicbusinessworldwide.com\/?p=222156"},"modified":"2025-01-29T21:34:47","modified_gmt":"2025-01-29T21:34:47","slug":"openai-valued-at-157bn-and-facing-multiple-copyright-lawsuits-says-chinas-deepseek-may-have-used-its-data-without-permission","status":"publish","type":"post","link":"https:\/\/www.musicbusinessworldwide.com\/openai-valued-at-157bn-and-facing-multiple-copyright-lawsuits-says-chinas-deepseek-may-have-used-its-data-without-permission\/","title":{"rendered":"OpenAI, valued at $157bn and facing multiple copyright infringement lawsuits, says China\u2019s DeepSeek may have used its data to train rival AI model without permission"},"content":{"rendered":"

The sudden arrival of China\u2019s DeepSeek AI chatbot has thrown the US\u2019s AI industry into what Forbes<\/em> calls<\/a> a \u201cpanic.\u201d<\/p>\n

AI-related companies\u2019 stocks fell sharply on Monday, with chipmaker Nvidia<\/strong> leading the way to a 17%<\/strong><\/span> stock price drop, wiping out nearly USD $600 billion<\/strong> of the company\u2019s market cap. (A rebound on Tuesday clawed back some of those losses.)<\/p>\n

The reason for the panic? DeepSeek appears to have created a chatbot with similar capabilities to those of US-made chatbots, but using a fraction of the resources and capital needed to develop the US models. The company says it spent just $5.6 million<\/strong> developing the chatbot, compared to the more than $100 million<\/strong><\/a> that OpenAI spent developing ChatGPT-4.<\/p>\n

<\/div>
<\/div>
<\/div> <\/div> <\/span><\/p>\n

Now it appears that DeepSeek may have accomplished this through intellectual property theft. According to news reports, OpenAI<\/strong> \u2013 maker of the ChatGPT chatbot that triggered the global AI craze a few years ago \u2013 is investigating whether DeepSeek violated its intellectual property in creating its R1 artificial intelligence model.<\/p>\n

OpenAI was reportedly notified of the possible violation by its key investor, Microsoft<\/strong>, according to Bloomberg<\/em>, which first reported<\/a> on the matter. The AI company then blocked DeepSeek\u2019s access to ChatGPT, according to<\/a> the Financial Times<\/em>.<\/p>\n

For those following the growing battle between copyright owners and AI developers, this seems like a clear case of tables turning: OpenAI has been dragged into court by the likes of The New York Times<\/em>, comedian-writer Sarah Silverman<\/strong><\/a>, Game of Thrones<\/em> author George R.R. Martin<\/strong><\/a>, and German music licensing organization GEMA<\/strong><\/a>. They all accuse the company of training its AI on copyrighted content without permission.<\/p>\n

<\/div> <\/div> <\/span><\/p>\n

In an interview with Fox News, President Donald Trump<\/strong>\u2019s artificial intelligence czar, David Sacks<\/strong>, said there\u2019s \u201csubstantial evidence\u201d that DeepSeek used \u201cdistillation\u201d to develop its AI technology.<\/p>\n

Distillation<\/a> is a process in which a smaller, more efficient AI model is trained to mimic the outputs of a larger, less efficient model in order to replicate its behavior. The technique is used to create AI services that are cheaper to develop, and require less processing power and energy to run.<\/p>\n

However, in this instance, it appears DeepSeek used ChatGPT-4 to train its own, smaller model, a violation of OpenAI\u2019s terms of service, FT<\/em> reported.<\/p>\n

\u201cThe issue is when you [take it out of the platform and] are doing it to create your own model for your own purposes,\u201d an unnamed individual close to OpenAI said.<\/p>\n

<\/div> <\/div> <\/span><\/p>\n

Some experts say it could be hard to stop AI developers from using distillation to piggyback on the achievements of other AI developers, because the practice is widespread.<\/p>\n

\u201cIt is a very common practice for start-ups and academics to use outputs from human-aligned commercial LLMs, like ChatGPT, to train another model,\u201d Ritwik Gupta<\/strong>, a PhD candidate in AI at the University of California, Berkeley, told FT<\/em>.<\/p>\n

\u201cIt is not surprising to me that DeepSeek supposedly would be doing the same. If they were, stopping this practice precisely may be difficult.\u201d<\/p>\n

\u201cWe know [People\u2019s Republic of China]-based companies \u2013 and others \u2013 are constantly trying to distill the models of leading US AI companies,\u201d OpenAI said in a statement.<\/p>\n

\u201cWe engage in countermeasures to protect our IP, including a careful process for which frontier capabilities to include in released models, and believe\u2009.\u2009.\u2009. it is critically important that we are working closely with the US government to best protect the most capable models from efforts by adversaries and competitors to take US technology.\u201d<\/p>\n

\n

That marks a striking change of tone from the one OpenAI has taken when defending itself against accusations of IP theft. In response to the suit brought by Sarah Silverman and other authors, OpenAI indicated<\/a> it plans to defend itself by arguing that using copyrighted works to train AI should be considered a \u201cfair use\u201d exemption to US copyright laws.<\/p>\n

The \u201cfair use\u201d argument has been made by other AI developers, notably Anthropic<\/strong><\/a> (sued by Universal Music Group<\/strong> (UMG), Concord<\/strong>, and ABKCO<\/strong> for allegedly violating copyrights on lyrics) and Suno<\/strong> and Udio<\/strong><\/a>, two AI music-making apps, sued by the three music majors, that are banking so heavily on the fair-use argument that they all but admitted to using UMG, Warner Music<\/strong>, and Sony Music<\/strong> content without permission in developing their apps.<\/p>\n

In the wake of DeepSeek\u2019s release of R1, and the ensuing market chaos, AI developers may well be rethinking their liberal stance on intellectual property.<\/p>\n","protected":false},"excerpt":{"rendered":"

DeepSeek spent far less money on developing a chatbot than US AI companies, but it may have done so by stealing OpenAI’s IP<\/p>\n","protected":false},"author":46,"featured_media":216731,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[7],"tags":[133582,133581,130934],"class_list":["post-222156","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-david-sacks","tag-deepseek","tag-openai"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/posts\/222156","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/users\/46"}],"replies":[{"embeddable":true,"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/comments?post=222156"}],"version-history":[{"count":0,"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/posts\/222156\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/media\/216731"}],"wp:attachment":[{"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/media?parent=222156"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/categories?post=222156"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.musicbusinessworldwide.com\/wp-json\/wp\/v2\/tags?post=222156"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}