GenAI builders may have to pay creators

India is crafting a policy outline on how architects of artificial intelligence (AI) can use copyrighted material, a development that promises to impact AI giants and startups digesting vast amounts of data to spit out everything from quirky images to medical analyses.

- Dhirendra Kumar & Shouvik Das

Royalties to be paid through a collecting body.

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Companies building commercial AI models must pay a fee to the source of copyrighted content, a government committee recommended on Tuesday. The Department for Promotion of Industry and Internal Trade (DPIIT) panel floated a mandatory licensing model for AI developers, with compulsory access to all "lawfully accessed copyrighted content" for model training without seeking individual permission from the creators; In turn, the developers must pay royalties through a single, government-designated collecting body managed by rights holders.

Proposal says India needs regulations that encourage innovation in AI while ensuring creators are fairly compensated.

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“The entity will function as a centralized body for licensing and royalty distribution under the compulsory blanket licensing model,” it said.

The proposal also suggested that companies may be charged fees retroactively.

The paper said the new model would lower compliance costs for startups, reduce litigation risk, and create a level playing field between large and small players, besides opening revenue stream for creators.