Anthropic, the Amazon-backed artificial intelligence startup, on Monday was hit with a class-action lawsuit in California federal court over alleged copyright infringement. Three authors said in the filing that Anthropic “built a multibillion-dollar business by stealing hundreds of thousands of copyrighted books,” including their own.
Anthropic, which was founded by ex-OpenAI research executives, has backers including Google and Salesforce.
Authors Andrea Bartz, Charles Graeber and Kirk Wallace Johnson alleged in the lawsuit that “an essential component of Anthropic’s business model — and its flagship ‘Claude’ family of large language models (or ‘LLMs’)— is the largescale theft of copyrighted works,” later alleging that “Anthropic downloaded known pirated versions of Plaintiffs’ works, made copies of them, and fed these pirated copies into its models.”
The lawsuit follows Anthropic’s June debut of its most powerful AI model yet, Claude 3.5 Sonnet. Claude is one of the chatbots that, like OpenAI’s ChatGPT and Google‘s Gemini, has exploded in popularity in the past year.
“Copyright law prohibits what Anthropic has done here: downloading and copying hundreds of thousands of copyrighted books taken from pirated and illegal websites,” the lawsuit states.
Anthropic did not immediately respond to a request for comment.
This week’s case also follows another lawsuit brought against Anthropic last October, in which Universal Music sued the startup over “systematic and widespread infringement of their copyrighted song lyrics,” per a filing in a Tennessee federal court. Other music publishers, such as Concord and ABKCO, were also named as plaintiffs.
One example from Universal Music’s lawsuit: When a user asked Anthropic’s AI chatbot Claude about the lyrics to the song “Roar” by Katy Perry, it generated an “almost identical copy of those lyrics,” violating the rights of Concord, the copyright owner, per the filing. The lawsuit also named Gloria Gaynor’s “I Will Survive” as an example of Anthropic’s alleged copyright infringement, as Universal owns the rights to its lyrics.
“In the process of building and operating AI models, Anthropic unlawfully copies and disseminates vast amounts of copyrighted works,” the lawsuit stated, later adding, “Just like the developers of other technologies that have come before, from the printing press to the copy machine to the web-crawler, AI companies must follow the law.”
With the news industry broadly struggling to maintain sufficient advertising and subscription revenue to pay for its costly newsgathering operations, many news publications and media outlets are aggressively trying to protect their businesses as AI-generated content becomes more prevalent.
The Center for Investigative Reporting, the country’s oldest nonprofit newsroom, sued OpenAI and lead backer Microsoft in federal court in June for alleged copyright infringement, following similar suits from publications including The New York Times, The Chicago Tribune and The New York Daily News.
In December, The New York Times filed a suit against Microsoft and OpenAI, alleging intellectual property violations related to its journalistic content appearing in ChatGPT training data. The Times said it seeks to hold Microsoft and OpenAI accountable for “billions of dollars in statutory and actual damages” related to the “unlawful copying and use of the Times’s uniquely valuable works,” according to a filing in the U.S. District Court for the Southern District of New York. OpenAI disagreed with the Times’ characterization of events.
The Chicago Tribune, along with seven other newspapers, followed with a suit in April.
Outside of news, a group of prominent U.S. authors, including Jonathan Franzen, John Grisham, George R.R. Martin and Jodi Picoult, sued OpenAI last year, alleging copyright infringement in using their work to train ChatGPT.
But not all news organizations are gearing up for a fight, and some are instead joining forces with AI startups.
On Tuesday, OpenAI announced a partnership with Condé Nast, in which ChatGPT and SearchGPT will display content from Vogue, The New Yorker, Condé Nast Traveler, GQ, Architectural Digest, Vanity Fair, Wired, Bon Appétit and other outlets.
In July, Perplexity AI debuted a revenue-sharing model for publishers following more than a month of plagiarism accusations. Media outlets and content platforms including Fortune, Time, Entrepreneur, The Texas Tribune, Der Spiegel and WordPress.com were the first to join the company’s “Publishers Program.”
OpenAI and Time magazine announced a “multi-year content deal” in June that will allow OpenAI to access current and archived articles from more than 100 years of Time’s history. OpenAI will be able to display Time’s content within its ChatGPT chatbot in response to user questions, according to a press release, and to use Time’s content “to enhance its products,” or, likely, to train its AI models.
OpenAI announced a similar partnership in May with News Corp., allowing OpenAI to access current and archived articles from The Wall Street Journal, MarketWatch, Barron’s, the New York Post and other publications. Reddit also announced in May that it will partner with OpenAI, allowing the company to train its AI models on Reddit content.
TikTok’s grip on the short-form video market is tightening, and the world’s biggest tech platforms are racing to catch up.
Since launching globally in 2016, ByteDance-owned TikTok has amassed over 1.12 billion monthly active users worldwide, according to Backlinko. American users spend an average of 108 minutes per day on the app, according to Apptoptia.
TikTok’s success has reshaped the social media landscape, forcing competitors like Meta and Google to pivot their strategies around short-form video. But so far, experts say that none have matched TikTok’s algorithmic precision.
“It is the center of the internet for young people,” said Jasmine Enberg, vice president and principal analyst at Emarketer. “It’s where they go for entertainment, news, trends, even shopping. TikTok sets the tone for everyone else.”
Platforms like Meta‘s Instagram Reels and Google’s YouTube Shorts have expanded aggressively, launching new features, creator tools and even considering separate apps just to compete. Microsoft-owned LinkedIn, traditionally a professional networking site, is the latest to experiment with TikTok-style feeds. But with TikTok continuing to evolve, adding features like e-commerce integrations and longer videos, the question remains whether rivals can keep up.
“I’m scrolling every single day. I doom scroll all the time,” said TikTok content creator Alyssa McKay.
But there may a dark side to this growth.
As short-form content consumption soars, experts warn about shrinking attention spans and rising mental-health concerns, particularly among younger users. Researchers like Dr. Yann Poncin, associate professor at the Child Study Center at Yale University, point to disrupted sleep patterns and increased anxiety levels tied to endless scrolling habits.
“Infinite scrolling and short-form video are designed to capture your attention in short bursts,” Dr. Poncin said. “In the past, entertainment was about taking you on a journey through a show or story. Now, it’s about locking you in for just a few seconds, just enough to feed you the next thing the algorithm knows you’ll like.”
Despite sky-high engagement, monetizing short videos remains an uphill battle. Unlike long-form YouTube content, where ads can be inserted throughout, short clips offer limited space for advertisers. Creators, too, are feeling the squeeze.
“It’s never been easier to go viral,” said Enberg. “But it’s never been harder to turn that virality into a sustainable business.”
Last year, TikTok generated an estimated $23.6 billion in ad revenues, according to Oberlo, but even with this growth, many creators still make just a few dollars per million views. YouTube Shorts pays roughly four cents per 1,000 views, which is less than its long-form counterpart. Meanwhile, Instagram has leaned into brand partnerships and emerging tools like “Trial Reels,” which allow creators to experiment with content by initially sharing videos only with non-followers, giving them a low-risk way to test new formats or ideas before deciding whether to share with their full audience. But Meta told CNBC that monetizing Reels remains a work in progress.
While lawmakers scrutinize TikTok’s Chinese ownership and explore potential bans, competitors see a window of opportunity. Meta and YouTube are poised to capture up to 50% of reallocated ad dollars if TikTok faces restrictions in the U.S., according to eMarketer.
Watch the video to understand how TikTok’s rise sparked a short form video race.
The X logo appears on a phone, and the xAI logo is displayed on a laptop in Krakow, Poland, on April 1, 2025. (Photo by Klaudia Radecka/NurPhoto via Getty Images)
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Elon Musk‘s xAI Holdings is in discussions with investors to raise about $20 billion, Bloomberg News reported Friday, citing people familiar with the matter.
The funding would value the company at over $120 billion, according to the report.
Musk was looking to assign “proper value” to xAI, sources told CNBC’s David Faber earlier this month. The remarks were made during a call with xAI investors, sources familiar with the matter told Faber. The Tesla CEO at that time didn’t explicitly mention any upcoming funding round, but the sources suggested xAI was preparing for a substantial capital raise in the near future.
The funding amount could be more than $20 billion as the exact figure had not been decided, the Bloomberg report added.
Artificial intelligence startup xAI didn’t immediately respond to a CNBC request for comment outside of U.S. business hours.
The AI firm last month acquired X in an all-stock deal that valued xAI at $80 billion and the social media platform at $33 billion.
“xAI and X’s futures are intertwined. Today, we officially take the step to combine the data, models, compute, distribution and talent,” Musk said on X, announcing the deal. “This combination will unlock immense potential by blending xAI’s advanced AI capability and expertise with X’s massive reach.”
Alphabet CEO Sundar Pichai during the Google I/O developers conference in Mountain View, California, on May 10, 2023.
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Alphabet‘s stock gained 3% Friday after signaling strong growth in its search and advertising businesses amid a competitive artificial intelligence environment and uncertain macro backdrop.
“GOOGL‘s pace of GenAI product roll-out is accelerating with multiple encouraging signals,” wrote Morgan Stanley‘s Brian Nowak. “Macro uncertainty still exists but we remain [overweight] given GOOGL’s still strong relative position and improving pace of GenAI enabled product roll-out.”
The search giant posted earnings of $2.81 per share on $90.23 billion in revenues. That topped the $89.12 billion in sales and $2.01 in EPS expected by LSEG analysts. Revenues grew 12% year-over-year and ahead of the 10% anticipated by Wall Street.
Net income rose 46% to $34.54 billion, or $2.81 per share. That’s up from $23.66 billion, or $1.89 per share, in the year-ago period. Alphabet said the figure included $8 billion in unrealized gains on its nonmarketable equity securities connected to its investment in a private company.
Adjusted earnings, excluding that gain, were $2.27 per share, according to LSEG, and topped analyst expectations.
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Alphabet shares have pulled back about 16% this year as it battles volatility spurred by mounting trade war fears and worries that President Donald Trump‘s tariffs could crush the global economy. That would make it more difficult for Alphabet to potentially acquire infrastructure for data centers powering AI models as it faces off against competitors such as OpenAI and Anthropic to develop largely language models.
During Thursday’s call with investors, Alphabet suggested that it’s too soon to tally the total impact of tariffs. However, Google’s business chief Philipp Schindler said that ending the de minimis trade exemption in May, which created a loophole benefitting many Chinese e-commerce retailers, could create a “slight headwind” for the company’s ads business, specifically in the Asia-Pacific region. The loophole allows shipments under $800 to come into the U.S. duty-free.
Despite this backdrop, Alphabet showed steady growth in its advertising and search business, reporting $66.89 billion in revenues for its advertising unit. That reflected 8.5% growth from the year-ago period. The company reported $8.93 billion in advertising revenue for its YouTube business, shy of an $8.97 billion estimate from StreetAccount.
Alphabet’s “Search and other” unit rose 9.8% to $50.7 billion, up from $46.16 billion last year. The company said that its AI Overviews tool used in its Google search results page has accumulated 1.5 billion monthly users from a billion in October.
Bank of America analyst Justin Post said that Wall Street is underestimating the upside potential and “monetization ramp” from this tool and cloud demand fueled by AI.
“The strong 1Q search performance, along with constructive comments on Gemini [large language model] performance and [AI Overviews] adoption could help alleviate some investor concerns on AI competition,” Post wrote in a note.