Hollywood studios have sued over AI. Now Google is courting them to use its tools

Tech giant Google has been quietly making overtures to the major studios as it tries to find ways to entice Hollywood to use its artificial intelligence technology.

Google executives have approached representatives at Disney, Universal, Warner Bros. Discovery and other studios about licensing intellectual property to be used in AI models, according to three people familiar with the conversations who were not authorized to speak publicly about them.

Nonetheless, no agreements have been reached yet, partly because of the complexities of the issues surrounding AI, as well as sensitivities around how Hollywood talent and unions would react, the sources said.

“In order for Google’s tools and technology to be truly usable for large-scale film and TV productions, let alone cinematic exhibition, it is essential that their models be fine-tuned with highly dynamic content and metadata that only Hollywood studios have,” said an insider who was not authorized to comment because of the sensitive nature of the discussions.

The conversations underscore how much both sides have at stake. Google is facing considerable competition in AI from rivals. For their part, studios are under pressure to cut costs and find ways to use AI in film and TV production, while also preventing unauthorized use of their intellectual property.

“Google’s enlisting some of the smartest people in Hollywood to try to unpack what’s inevitable, which is Hollywood and AI are going to become reliant upon each other, and how best can we understand that without just terrifying people,” said Tom Nunan, a former studio and network executive.

Representatives of Google, Warner Bros. Discovery and Disney declined to comment.

An NBCUniversal spokesperson said the company is not in active conversations with Google regarding licensing its intellectual property for use in AI models.

Google’s outreach is a far cry from the more adversarial posture the company took a decade ago when it clashed with Hollywood over legislation intended to curb piracy. People uploaded clips on YouTube of different shows and movies without permission or payment to the studios.

Google said it was taking problematic content down, but studios believed it was not fast enough and the search engine colossus became a pariah in the industry.

Circumstances are substantially different today. Google already is doing business with many entertainment companies through its different divisions, whether selling its cloud computing services, improving AI tools through Google DeepMind or distributing content on YouTube, which is now a major force in the TV business.

In June, Google invested $75 million into A24, the studio behind Academy Award-winning films such as “Everything Everywhere All at Once” and “Moonlight,” as part of a strategic partnership to collaborate on AI tools.

“They recognize that A24, while not the biggest studio, gives them a type of credibility they’re not getting yet in Hollywood,” said Rob Rosenberg, a partner at law firm Moses & Singer and former general counsel at Showtime Networks. “They’re in this image rehabilitation, this path of trying to gain not just acceptance but appreciation for the fact that they’re trying to take the high road. They’re trying to spark a partnership between Hollywood and themselves as an AI platform.”

The Mountain View, Calif.-based company also has a partnership with director Darren Aronofsky’s venture Primordial Soup.

For Google, it’s an opportunity to get feedback from talented creatives who can help it build better AI tools for the entertainment industry.

The A24 move also better positions Google to capture any business opportunities left behind by OpenAI, which shut down its text-to-video app Sora this year.

Disney announced a major licensing deal with OpenAI last year, allowing the tech startup to use AI-generated versions of Disney characters such as Mickey Mouse on Sora, but that deal fell apart. OpenAI decided to shut down Sora to focus resources on other businesses.

Some studios including Disney have sued AI companies over copyright infringement in cases that are ongoing. Disney also sent Google a cease-and-desist letter last year accusing the tech giant of using Disney’s copyrighted material without its authorization to train Google’s AI systems.

Studios find themselves in a tough spot dealing with AI that’s similar to two decades ago when people would go to YouTube and upload unauthorized clips from popular shows and movies.

In 2007, Viacom sued Google for $1 billion, alleging copyright infringement, but it wasn’t until 2014 that the case was settled. By then, YouTube was widely adopted by consumers. Studios now use YouTube to market their programs, and Google’s Content ID technology flags videos and gives copyright holders the ability to earn ad revenue on them.

“They are remembering and mindful of what happened years ago, where in the end Google and YouTube did what it wanted and it was really a pretty unregulated environment,” said Jonathan Miller, chief executive of investment firm Integrated Media and a former News Corp. executive. “What Google did with YouTube is it let it run completely wild until it was too big to fail and everybody had to make a deal with it at some point.”

Some of the discussion now centers on how studios could use Google’s AI tools in production, while other topics involve the licensing of studio characters for AI-generated outputs.

The licensing of characters could provide another revenue stream for studios, and Google could share in any advertising revenue from AI-generated content on YouTube.

An AI company licensing character IP from a studio could pay $40 million per character on average, with a deal for 100 characters in the multiple billions, said one person familiar with these deals who declined to be named.

YouTube also has approached talent agencies and studios about using its likeness detection technology to flag AI-generated content that would infringe on copyrighted material or alter celebrity faces, with the possibility of figuring out a way to monetize the AI-generated content if rights holders or Hollywood talent decided to keep those videos up on YouTube, the sources said.

YouTube’s global head of media and sports, Justin Connolly, a former Disney executive, is involved in those discussions, they said.

But some studios are wary about participating in such technology because of the terms that Google is requesting. For example, some companies were asked to waive their right to sue Google if they were to participate in the likeness detection technology, sources said.

In Hollywood, AI has stirred deep fears among talent. Actors and writers say their work has been used to train AI models without their permission or compensation. Other Hollywood workers in areas such as visual effects worry that the technology will replace their jobs.

Studios have contracts in place with AI protections for writers, directors and actors and are mindful about the concerns. At the same time, studios do not want to be left behind from technology that could make processes faster and cheaper.

So far, no major studios have notified performers guild SAG-AFTRA of entering into any new licensing deals with an AI company, which they are required to do under their agreement with the union, said Duncan Crabtree-Ireland, the guild’s national executive director and chief negotiator.

“The companies largely are moving carefully in this area,” Crabtree-Ireland said. “They rightly recognize that there are a lot of potential pitfalls, not only relating to creative talent and their rights and performances or other types of creation. That is part of why we see dealmaking in this area moving at a pace that allows for careful consideration of the implications.”

Disney in July named AI companies to its accelerator program, including Promise and Open Art. In March, Netflix bought Ben Affleck’s AI film tech startup InterPositive for $587 million.

“We’ve moved from the moment where there was a question, ‘Will we use AI?’ and now it’s a question of ‘How are we going to use AI?’” Rosenberg said.

Times staff writer Samantha Masunaga contributed to this report.