AI startup Perplexity wants to upend search business. News outlet Forbes says it’s ripping them off (2024)

MATT O'BRIEN and SARAH PARVINI Associated Press

The artificial intelligence startup Perplexity AI has raised tens of millions of dollars from the likes of Jeff Bezos and other prominent tech investors for its mission to rival Google in the business of searching for information.

But its AI-driven search chatbot is already facing challenges as some news media companies object to its business practices. It is also competing against tech giants Google, and now Apple, which are increasingly fusing similar AI features into their core products.

Perplexity CEO Aravind Srinivas spent much of last week defending the company after it published a summarized news story with information and similar wording to a Forbes investigative story but without citing the media outlet or asking for its permission. Forbes said it later found similar “knock-off” stories lifted from other publications.

The Associated Press separately found another Perplexity product feature inventing fake quotes from real people, including a former elected town official from Martha’s Vineyard falsely quoted to say he didn’t want the Massachusetts island to become a destination for marijuana.

“I never said that,” said Bill Rossi, a former member of the island town of Chilmark’s select board.

Srinivas said his company is trying to build positive relationships with news publishers that ensure their news content “reaches more people.”

“We can definitely coexist and help each other,” he said.

Asked about Forbes, he said his product “never ripped off content from anybody. Our engine is not training on anyone else’s content,” in part because the company is simply aggregating what other companies’ AI systems generate.

“We are actually more of an aggregator of information and providing it to the people with the right attribution,” Srinivas said. But, he added, “It was accurately pointed out by Forbes that they preferred a more prominent highlighting of the source. We took that feedback immediately and updated changes that day itself. And now the sources are more prominently highlighted.”

Perplexity also revealed this week that it has been seeking revenue-sharing partnerships that would pay news publishers a portion of Perplexity’s advertising revenue each time an outlet’s news content is referenced as a source.

Randall Lane, chief content officer of Forbes Media, called the dispute an “inflection point” in the conversation about AI.

“It’s a case study in where we’re heading,” Lane said. “If the people who are leading the charge don’t have a fundamental respect for the hard work of doing proprietary reporting, and keeping people informed with value-added content, we’ve got a big problem.”

A self-described “AI bull” who believes that the technology could help make many news organizations more efficient, Lane said the dispute between Perplexity and Forbes is important because it is a “metaphor for what can happen if the people controlling the AI don’t respect the people doing the work.”

Perplexity bills itself as a search engine while “acting like a media company and publishing a story” that only Forbes had reported, Lane said.

“The whole thing was very disingenuous. And what we didn’t hear was, ‘Oops, yeah we messed that one up and we need to do better,’” he said. “Instead, it was just putting out more content, little tweaks to the model and treating journalism like it’s just a commodity to be manufactured.”

Srinivas, a computer scientist and former AI researcher at OpenAI and Google, co-founded Perplexity in the summer of 2022, not long before the AI image-generator Stable Diffusion and OpenAI’s ChatGPT began sparking the public's fascination with the possibilities of generative AI.

Inspired, in part, by his childhood love of Wikipedia, he described Perplexity as “like a marriage of Wikipedia and ChatGPT” that can instantly answer a person’s questions without the “huge cluttered mess” of Google’s conventional search results.

The company sells a subscription for premium features and is planning to start an advertising-based service as it grows its user base.

Perplexity relies on existing AI large language models such as those built by OpenAI, Anthropic and Meta Platforms, the parent company of Facebook; and then “post-trains” them.

“We shape them to be really good summarizers,” he said.

It’s not always clear where the summarized information is coming from. One Perplexity feature called Writing — which enables a user to “generate text or chat without searching the web” — produces lengthy and unsourced commentary, often in the style of a news article. Tests of the feature by an AP reporter led it to produce a 465-word document that resembled a news article and included fabricated quotations.

“There is no doubt that generative AI is upending journalism, content creation, and search,” said Sarah Kreps, director of Cornell University’s Tech Policy Institute.

The debate demonstrates the “uncertain and challenging times” for online content creators in general and journalism in particular because aggregators only work if publications such as Forbes exist, said Stephen Lind, an associate professor at the University of Southern California’s Marshall School of Business.

Using AI as a synthesizing tool works for widespread dissemination of information until “you run out of originals,” he said.