Microsoft just scored a major content coup, signing People Inc. as the launch partner for its new AI content marketplace. The deal comes as the media giant's Google traffic plummeted from 54% to 24% in just two years, forcing publishers to find new revenue streams beyond search dependency.
People Inc., one of America's largest media publishers, just landed what could be the template for how content creators survive the AI revolution. The company announced its second major AI licensing deal during IAC's third-quarter earnings Tuesday, this time partnering with Microsoft to become the launch partner for the tech giant's new publisher content marketplace.
The timing couldn't be more critical. For the first time, People Inc. revealed the brutal reality behind AI's impact on traditional media traffic. Google Search, which drove 54% of the publisher's traffic just two years ago, has collapsed to a mere 24% in the most recent quarter. The culprit? Google's AI Overviews feature, which answers user queries directly without sending them to publisher websites.
"It's essentially a pay-per-use market where AI players directly can compensate publishers for use of their content on, sort of like an 'a la carte' basis," People Inc. CEO Neil Vogel explained during the earnings call. The marketplace represents a fundamental shift from content scraping to direct publisher compensation, with Microsoft's Copilot serving as the inaugural buyer.
This deal marks People Inc's second major AI partnership, building on its earlier agreement with OpenAI last year. But there's a key difference in monetization strategy. Where the OpenAI arrangement operates more like an "all-you-can-eat" subscription model, Microsoft's marketplace follows transaction-based pricing. "What matters to the company is that its work is 'respected and paid for,'" Vogel emphasized, though specific financial terms remain undisclosed.
The publisher's aggressive stance against unpaid AI training has been paying off literally. People Inc. deployed Cloudflare's web infrastructure technology to block AI crawlers, forcing companies to negotiate rather than simply scrape content. "Blocking AI crawlers has been 'very effective' and 'brought almost everyone to the table,'" Vogel reported, hinting that additional licensing deals are in the pipeline.
Vogel hasn't been shy about calling out tech giants for what he sees as content theft. He recently labeled Google a "bad actor" because the company uses the same crawling bot for both search indexing and AI training, making it impossible for publishers to block AI access without losing search traffic entirely. This catch-22 has created an existential crisis for content creators who built their businesses on Google's traffic.
