Microsoft sued; AI agent projects at risk of being scrapped

A group of high-profile authors has dragged Microsoft (NASDAQ: MSFT) to court for using pirated versions of books to train an artificial intelligence (AI) model.

The authors alleged that the Big Tech firm illegally used 200,000 pirated books to train its AI model, infringing on their copyrights. The filing named Kai Bird, Daniel Okrent, Jia Tolentino, and a list of top authors as plaintiffs in the case, seeking compensation for breach of their intellectual property (IP) rights.

The plaintiffs are requesting $150,000 for each work misused by Microsoft and a permanent injunction to stop the tech giant from using pirated works to train their AI models.

Generative AI models rely on a vast pool of training data obtained from diverse sources. Top large language models (LLMs) derive their training data from publicly available texts, licensed data from books, and human-curated and synthetic data.

However, licensed data like published books has triggered the loudest uproar from authors over claims of copyright infringement. OpenAI and Microsoft have previously come under fire for training their models with copyrighted material without seeking authors’ consent.

“Microsoft created a computer model that is not only built on the work of thousands of creators and authors but also built to generate a wide range of expression that mimics the syntax, voice, and themes of the copyrighted works on which it was trained,” read the latest filing.

At press time, a spokesperson for Microsoft declined to comment on the complaint against the company. However, the filing came a day after a California court ruled that although Anthropic made fair use of copyrighted material in training its model, there is the possibility of liability stemming from pirated materials.

Similarly, another court ruling favored Meta (NASDAQ: META) on the issue of using copyrighted materials to train AI models. However, the judge noted that his verdict hinged on the weakness of the plaintiff’s argument rather than Meta’s defense.

Since OpenAI’s 2023 debut, several corporations have sued technology giants over perceived copyright violations. The New York Times (NASDAQ: NYT), Getty Images (NASDAQ: GETY), Disney (NASDAQ: DIS), and NBC Universal have instituted lawsuits against LLM and text-to-video creators for misuse of copyrighted materials.

Amid the flurry of lawsuits, technology giants are pinning their defense on the fair use doctrine and “no substantial similarity” argument. In its case against a group of American authors, Meta urged the court to throw out the lawsuit, leaning on the fair use defense.

In other news, while AI agents are gathering significant attention, a new report claims that up to 40% of projects tied to this technology will be abandoned before the end of 2027.

United States-based business research firm Gartner stated that as many as two scores of agentic AI projects will be shuttered over the next two years, citing soaring costs and unclear business value as primary reasons for their cancellations.

AI agents are systems that act autonomously and make independent decisions to achieve a set goal. Widely considered a step up from basic AI chatbots, AI agents are recording significant interest from enterprises, eyeing a productivity and efficiency boost.

Technology giants Salesforce (NASDAQ: CRM) and Oracle (NASDAQ: ORCL) are sinking significant resources into integrating AI agents into their operations. Many early adopters are targeting a spike in the profit margins while optimizing expenses via the wholesale adoption of AI agents.

“Most agentic AI projects right now are early-stage experiments or proofs of concept that are mostly driven by hype and are often misapplied,” said Gartner Senior Director Analyst Anushree Verma.

Despite the potential upsides, Gartner analysts argued that most agentic AI projects are powered by hype without real-world capability. The report notes that only 130 out of the thousands of agentic AI vendors are authentic, with the rest merely rebranding chatbots without any actual agentic functionalities.

Furthermore, analysts at Gartner revealed that agentic AI projects have an unclear value proposition and a hazy path toward a return on investment. They also noted that even the highest models cannot achieve their goals without a measure of human interference, indicating an inability to follow nuanced instructions.

However, the agentic AI market is still expected to grow, making up 15% of day-to-day work decisions by 2028. Furthermore, 33% of all enterprise software applications will contain agentic AI functionalities, recording a compound annual growth rate (CAGR) of 220%.

AI tools are set to change the landscape for work in the coming years, with companies pursuing frantic adoption strategies. A report has revealed that 93% of Saudi firms have robust AI adoption strategies, underscoring the pace of transformation.

Amid the push, fears of job losses have spiked with multiple reports predicting widespread entry-level job replacements by AI models. While AI is leading the push, other companies are still keen on integrating blockchain and the Internet of Things (IoT) technologies into their internal operations.

In order for artificial intelligence (AI) to work right within the law and thrive in the face of growing challenges, it needs to integrate an enterprise blockchain system that ensures data input quality and ownership—allowing it to keep data safe while also guaranteeing the immutability of data. Check out CoinGeek’s coverage on this emerging tech to learn more why Enterprise blockchain will be the backbone of AI.

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