Yahoo Signs as First Licensee of Collective AI Content Licensing Model

By James Calloway

Yahoo has become the first licensee of a collective AI content licensing model run by RSL, an organization being renamed The Internet Licensing Collective (ILC). Over 3,000 publishers have already joined, and the deal means publishers of all sizes can license content for Yahoo's AI-powered search engine Scout and get paid based on how that content is used.

The move breaks from the one-off deals that have dominated AI licensing between publishers and tech companies. ILC co-founder Doug Leeds likened the collective to a streaming model, with a twist.

"It's kind of like Spotify, but also a song is a song is a song, and content is very different. And so we had to come up with these rules that made sense specifically for digital content," Leeds said.

Yahoo declined to be interviewed for this story.

How big could this market get?

A report out today from publishing analytics firm Mather Economics estimated that collective licensing for AI could generate publisher compensation equal to 15% to 35% of AI company revenue. In three years, that potential market could surpass the U.S. display advertising market. The analysis drew on current annual revenue from the two biggest frontier models, OpenAI and Anthropic, plus an economic model built on AI training-data scaling laws.

The economics are built to scale with the licensee. Leeds declined to say how much Yahoo pays, but the blanket fee is tied to "demand-side revenue."

"It allows businesses that are making a lot of money off of the content to keep that content in place and sustainable. But it also allows for entrants," Leeds said. "As the revenue scales, the percentage scales. So more money comes out. But that also means that entrants can come in, and there can be new use cases and new players and new products, and all of that's important to the evolution of what we're doing to the market."

The takeaway: the more an AI licensee earns from content, the more publishers get paid.

How does the money reach publishers?

ILC separates licensing revenue into what Leeds called a "segmented royalty pool" — one pool per AI company, not a single fund shared by everyone. Publishers only receive a share of revenue from the AI products that actually use their content.

That structure protects specialist publishers from dilution. A healthcare AI product might use a small amount of content from a handful of medical publishers, but that content could be worth considerably more to the healthcare company than generic search content.

"An AI vertical in health might be very low volume, but much higher specific value. So if your content gets used in that, you should split that high value, not get diluted by all the content that got used by Yahoo," Leeds said.

The shift fits a broader pattern. Digiday has previously reported that Google and Microsoft are testing pay-per-value models that compensate publishers when their content meaningfully contributes to AI-generated responses, rather than paying on usage frequency — a move from flat fees to dynamic pricing.

What determines each publisher's share?

ILC uses "allocation rules" that account for how much content is used — grounding, retrieval or display in an AI response — and whether the publisher is credited or cited. Leeds gave one example: an AI product that uses content to check a fact gets a lower allocation than one that displays detailed election results and explicitly credits the Associated Press. He did not disclose the exact formula.

The rules are meant to stop AI companies from picking content because it's cheap and push them toward the highest-quality sources, Leeds said.

Publishers also keep control. Yahoo is the only licensee today, but as more sign on, publishers can use their ILC portal to choose which AI companies to license to, pull content out if they strike a separate deal, and see how their content is being used, such as RAG or training.

Why the new name?

RSL stood for Really Simple Licensing. It was both a publisher group working on collective licensing and the organization behind the RSL Protocol, a robots.txt standard that describes publishers' terms of service in machine-readable language — including pay-per-crawl or pay-per-inference fees. Leeds said "thousands" currently use the standard. He wanted a name that made clear any publisher can join the collective.

What comes after Yahoo?

ILC is in talks with "some" major AI companies, Leeds said, without naming them. His pitch is infrastructure over one-offs: "You can do a deal with a one-off, and that's fantastic. But that doesn't invest in the infrastructure of content in general."