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Textbooks giant Pearson takes legal action over use of its content to train AI [standard.co.uk]:

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extbooks giant Pearson [standard.co.uk] is currently taking legal action [standard.co.uk] over the use of its intellectual property [standard.co.uk] to train AI [standard.co.uk] models, chief executive Andy Bird [standard.co.uk] revealed today as the firm laid out its plans for its own artificial intelligence [standard.co.uk]-powered products.

The firm laid out its plans on how it would use AI a week after its share price [standard.co.uk] tumbled by 15% as American rival Chegg said its own business [standard.co.uk] had been hurt by the rise of ChatGPT.

Those plans would include AI-powered summaries of Pearson educational videos, to be rolled out this month for Pearson+ members, as well as AI-generated multiple choice questions for areas where a student [standard.co.uk] might need more help [standard.co.uk].

Bird said Pearson had an advantage as its AI products would use Pearson content for training, which he said would make it more reliable.

However, he also added that the business was also monitoring the situation regarding other businesses using Pearson content to train its AI. He said Pearson had already sent out a cease-and-desist letter, though did not say who it was addressed to.

“We’re committed to protecting that IP and we’re following developments in fields such as music and photography with great interest,” he said.

“We take great efforts, and will continue to do, to protect our IP. We are in litigation with a company and have sent a cease-and-desist letter, but I won’t go into any further specifics.

“We’ve also been approached to license our IP and at the time decided not to go down that route. But there may be benefits of licensing our IP at certain circumstances.”

Bird also said it was usually easy to tell what a large language model such as ChatGPT has been trained on, because “you can ask it”.

Bird also sought to point out a difference between Pearson and Chegg, which focuses more on homework assistance.

“They are in a very different business to us,” he said. “We see a great differentiator between what Chegg are offering and what Pearson+ are offering.

“We’re in the business of helping you learn and improve your skills, not in the business of answering.”

He added that - as Pearson was in the business of learning - its products would be hard to replace.

“If all we had to do was read a set of facts in order to learn, there’d be no need for schools, colleges and teachers.”

Pearson shares are up 13.3p to 831.6p today. They are currently 3.8% below where they opened this time last week, before the steep slide sparked by Chegg’s warning.

Pearson shares are up 13.3p to 831.6p today. They are currently 3.8% below where they opened this time last week, before the steep slide sparked by Chegg’s warning.

Pearson shares are up 13.3p to 831.6p today. They are currently 3.8% below where they opened this time last week, before the steep slide sparked by Chegg’s warning.

Pearson shares are up 13.3p to 831.6p today. They are currently 3.8% below where they opened this time last week, before the steep slide sparked by Chegg’s warning.

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extbooks giant Pearson [standard.co.uk] is currently taking legal action [standard.co.uk] over the use of its intellectual property [standard.co.uk] to train AI [standard.co.uk] models, chief executive Andy Bird [standard.co.uk] revealed today as the firm laid out its plans for its own artificial intelligence [standard.co.uk]-powered products.

The firm laid out its plans on how it would use AI a week after its share price [standard.co.uk] tumbled by 15% as American rival Chegg said its own business [standard.co.uk] had been hurt by the rise of ChatGPT.

Those plans would include AI-powered summaries of Pearson educational videos, to be rolled out this month for Pearson+ members, as well as AI-generated multiple choice questions for areas where a student [standard.co.uk] might need more help [standard.co.uk].

Bird said Pearson had an advantage as its AI products would use Pearson content for training, which he said would make it more reliable.

However, he also added that the business was also monitoring the situation regarding other businesses using Pearson content to train its AI. He said Pearson had already sent out a cease-and-desist letter, though did not say who it was addressed to.

“We’re committed to protecting that IP and we’re following developments in fields such as music and photography with great interest,” he said.

“We take great efforts, and will continue to do, to protect our IP. We are in litigation with a company and have sent a cease-and-desist letter, but I won’t go into any further specifics.

“We’ve also been approached to license our IP and at the time decided not to go down that route. But there may be benefits of licensing our IP at certain circumstances.”

Bird also said it was usually easy to tell what a large language model such as ChatGPT has been trained on, because “you can ask it”.

Bird also sought to point out a difference between Pearson and Chegg, which focuses more on homework assistance.

“They are in a very different business to us,” he said. “We see a great differentiator between what Chegg are offering and what Pearson+ are offering.

“We’re in the business of helping you learn and improve your skills, not in the business of answering.”

He added that - as Pearson was in the business of learning - its products would be hard to replace.

“If all we had to do was read a set of facts in order to learn, there’d be no need for schools, colleges and teachers.”

Pearson shares are up 13.3p to 831.6p today. They are currently 3.8% below where they opened this time last week, before the steep slide sparked by Chegg’s warning.

Pearson shares are up 13.3p to 831.6p today. They are currently 3.8% below where they opened this time last week, before the steep slide sparked by Chegg’s warning.

Pearson shares are up 13.3p to 831.6p today. They are currently 3.8% below where they opened this time last week, before the steep slide sparked by Chegg’s warning.

Pearson shares are up 13.3p to 831.6p today. They are currently 3.8% below where they opened this time last week, before the steep slide sparked by Chegg’s warning.

don't-learn-from-our-textbooks dept.

Pearson shares fall after US digital learning rival says AI hurting its business [theguardian.com]:

Digital learning companies are leaning in on generative AI. Photograph: Michael Dwyer/APDigital learning companies are leaning in on generative AI. Photograph: Michael Dwyer/APPearson shares fall after US digital learning rival says AI hurting its business

Company’s shares fall 15% after Chegg says ChatGPT is affecting subscriber numbers

Almost £1bn has been wiped off the stock market value of the digital learning company Pearson after a US rival admitted that the rise of artificial intelligence chatbot ChatGPT [theguardian.com] is hurting its business.

Jittery investors sent Pearson’s shares down more than 15%, making it the biggest faller among London-listed companies on Tuesday, after the California-based online learning service Chegg reported a 5% drop in subscribers and pulled its full-year guidance.

“Since March we have seen a significant spike in student interest in ChatGPT,” said Chegg chief executive, Dan Rosensweig, whose company saw its share price almost halve after publication of its first quarter results. “We now believe it’s having an impact on our new customer growth rate.”

Pearson, which last week published first quarter results that beat its own forecasts, said that its business is much more ChatGPT-proof than Chegg, which offers on-demand answers to college course questions for $19.95 a month.

“Chegg is a fundamentally different company with a different business model,” said a spokesperson for Pearson. “We are a highly diversified company, with 80% of our profits coming from businesses outside higher education.”

The company also said its subscription service, Pearson+, continues to grow, with user numbers up threefold since last spring.

“While ChatGPT could be seen as an alternative for students seeking answers to their homework we do not see it as an alternative to Pearson’s text books, courseware, and learning platforms that provide trusted programmes that are adopted by colleges, and have to be followed and consumed by students for about 70% of higher education courses,” said analysts at JP Morgan. “The difference is that Pearson provides the content and sets the questions whereas Chegg and ChatGPT provide answers to those questions.”

Chegg has previously clashed with colleges in the US over accusations that its technology enables students to submit answers that are not their own.

Last month, the company launched a service built with ChatGPT-4, called CheggMate. “[We are] embracing [generative AI] aggressively and prioritising our investments to meet this opportunity,” said Rosensweig.

“Investors will inevitably worry about the readacross to Pearson as another supplier to the US Higher Ed market,” said Thomas Singlehurst, an analyst at Citi. “Generative AI is a great tool for ‘cheating’ [but] less good (for now) for content creation/assessment. Net/net, though, it seems likely it will weigh on sentiment for the broader educational services space in the short term.”

Shares in Pearson closed down 133p to 754p, to value it at £5.4bn.

Topics

• Pearson [theguardian.com]

• ChatGPT [theguardian.com]
• Artificial intelligence (AI) [theguardian.com]
• Stock markets [theguardian.com]
• news [theguardian.com]

Reuse this content [theguardian.com]

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