AI Royalties -- an IP Framework to Compensate Artists & IP Holders for AI-Generated Content

This article investigates how AI-generated content can disrupt central revenue streams of the creative industries, in particular the collection of dividends from intellectual property (IP) rights. It reviews the IP and copyright questions related to the input and output of generative AI systems. A systematic method is proposed to assess whether AI-generated outputs, especially images, infringe previous copyrights, using a similarity metric (CLIP) between images against historical copyright rulings. An examination (economic and technical feasibility) of previously proposed compensation frameworks reveals their financial implications for creatives and IP holders. Lastly, we propose a novel IP framework for compensation of artists and IP holders based on their published "licensed AIs" as a new medium and asset from which to collect AI royalties.