Economic Impact of Generative AI Study: “AI has the power to cause great damage to human creators”
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What will the economic impact of generative AI be? A new report finds that generative AI poses a massive risk to music producers, with revenue losses hitting 24% within the next few years.
Economic Impact of Generative AI
A new study released by CISAC (the International Confederation of Societies of Authors and Composers) shows that generative AI poses a huge risk to musicians and producers. The global study, the first of its kind, has found that while generative AI will enrich tech companies, it will have a detrimental effect on us, “substantially jeopardizing the income of human creators in the next five years.”
Economic Impact of Generative AI: Revenue at Risk
According to the study, creators working with music are posed to see a 24% drop in revenue by 2028. To put a monetary value on that, the CISAC sees this hitting €10 billion in losses in the next five years.
This will be due to an exponential increase in the market for Gen AI audio content. When combined with audio/visual Gen AI content, the AI market is likely to grow from €3 billion now to €64 billion in 2028.
Not coincidentally, this will see a comparable rise in the revenue of Gen AI providers to €4 billion in music, up from €0.1 billion in 2023.
The study has identified the streaming and library sectors as the ones hardest hit by Gen AI, with Gen AI music projected “to account for approximately 20% of traditional music streaming platforms’ revenues, and around 60% of music libraries’ revenues.”
Economic Impact of Generative AI: Protective Measures Urged
The key takeaway from the study is twofold, in that creators will suffer losses in two ways: replacement of revenue due to the competition of Gen AI content, and the loss of revenue due to the unauthorized use of copyrighted works by Gen AI models.
“For creators of all kinds, from songwriters to film directors, screenwriters to film composers, AI has the power to unlock new and exciting opportunities,” said CISAC President Björn Ulvaeus (of ABBA fame), “but we have to accept that, if badly regulated, generative AI also has the power to cause great damage to human creators, to their careers and livelihoods.”
Björn goes on to urge policy makers to enact legislation that will protect creators from runaway AI: “Which of these two scenarios will be the outcome? This will be determined in large part by the choices made policy makers, in legislative reviews that are going on across the world right now. It’s critical that we get these regulations right, protect creators’ rights and help develop an AI environment that safeguards human creativity and culture.”
Economic Impact of Generative AI: What Do You Think?
AI has the power to be an incredible tool for humanity, across many different sectors. But as the meme goes, we’d like AI to do the dishes and laundry so we can do art, not for AI to do art so we can do the laundry and dishes.
What do you think about the possible economic impact of generative AI? Are you worried about generative AI taking away your music revenue? Or do you think it’s a storm in a teacup? Let us know in the comments.
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3 responses to “Economic Impact of Generative AI Study: “AI has the power to cause great damage to human creators””
It was already not that rosy for the musician artists in terms of revenue with streaming platform redefining the game, now this.
Thinking that AI will be regulated in its use of original content online or that a fair compensation would be paid for the creator when AI use their work is like thinking the sun is made of ice.
Tech giant like Spot and Met jubilate at the prospect of having all this music generated automatically at no cost to them (royalties). But we can guess that at some point this AI crap will choke on its own content once people have enough and stop putting tracks online.
As AI music will become more and more irrelevant and muddy, it will tire people that will move to something else. One can only hope.
If legislators are the only thing that will save us from AI, we’re screwed. Tech companies pump millions of dollars into legislators’ pockets, musicians contribute next to nothing.
Expecting legislators to bite the hand that feeds them is naive at best.
Time to concentrate on playing live… no AI is capable of that!
Don’t worry it’s just a bubble. These things will never be profitable or good. Tech companies have no idea how to turn a profit… and this is before considering paying royalties to who they steal from.
They are doing a lot of damage right now when it’s (fasly) free and widely available, but this won’t last long.