Scoop: Microsoft looks to build AI marketplace for publishers
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Microsoft is in talks with select U.S. publishers about a pilot program to help launch a two-sided marketplace that would compensate publishers for their content used by AI products, starting with its Copilot assistant.
Why it matters: Microsoft would become the first major tech company to build an AI marketplace for publishers, a milestone in building a sustainable business model for content companies in the AI era.
Driving the news: The new Publisher Content Marketplace (PCM), as Microsoft is calling it, will launch as a pilot program with a limited set of publishers, according to publishing executives briefed on the matter.
- The company eventually hopes to expand the pilot to more partners over time, working in tandem with them to build out the tools, policies and pricing models that could work for PCM.
- Microsoft's Copilot assistant will serve as the first AI buyer within the marketplace for publishers to sell their content. The tech giant is looking to grow the marketplace's demand-side offering to include other AI products.
- Microsoft discussed the pilot program last week at its invite-only Partner Summit in Monaco.
- One of Microsoft's slides that caught attendees' attention for its candor, and stood in contrast to other tech companies' policies, read, "You deserve to be paid on the quality of your IP."
- Microsoft did not share concrete timing for the pilot's launch.
The big picture: The media industry is desperate for a tech company to get into the marketplace business. Without Big Tech's participation, a two-sided marketplace cannot function.
- While smaller startups like ProRata.ai and TollBit have started to build marketplaces, they don't yet have enough inventory to meaningfully compensate publishers. (ProRata.ai launched its own AI search engine to try to address that problem.)
State of play: Most major AI companies have focused on brokering licensing deals that pay publishers upfront for access to content, not on a per-use basis.
- Google — the biggest search company in the world by far — has hardly brokered any AI deals with publishers. It has not shown interest in participating in any AI marketplaces.
- Microsoft has dabbled in other publisher deals for Copilot. In 2024, it launched Copilot Daily, an audio summarization of news and weather sourced from partners like Reuters, Axel Springer, Hearst Magazines, USA Today Network and the Financial Times.
- Meta has ramped up discussions with publishing partners about AI deals in recent months.
Between the lines: The PCM news suggests Microsoft is looking to deepen its relationship with publishers as it expands its AI capabilities and restructures its relationship with OpenAI.
- Until now, OpenAI — which counts Microsoft as its largest minority investor — has taken the lead on brokering AI deals with publishers.
- Despite that effort, Microsoft has still faced legal challenges. It has been sued by the New York Times and other major publishers for copyright infringement, alongside OpenAI.
Reality check: Copilot's monthly traffic from desktop and mobile visits pales in comparison to ChatGPT and other AI chatbots, according to data from Similarweb.
- Yes, but: While Copilot might not have as much consumer-facing traffic as Google and OpenAI, Microsoft has the scale and built-in audiences with enterprise clients who rely on Microsoft 365 and Azure.
What to watch: Microsoft's moves could entice Google to act.
