Here’s a delicious AI irony.

For years, tech giants have argued that if information is available on the Internet, it can be used for the development and output of AI models. They call it fair use. Content owners have tried to avoid it, without success.

Now Anthropic, OpenAI, and Google are discovering what the rest of the Internet has already learned through painful experience: once you put something online, people will find ways to use it in ways you don’t like and they won’t be able to stop.

The last critical point is something called “distillation,” which uses the results of one AI model to improve another. Anthropic says competitors are harvesting their products at scale, turning billions of dollars in research into a shortcut for rivals. OpenAI and Google have recently issued similar warnings.

The fear is obvious. Why spend billions building the best AI models if someone else can recreate much of this intelligence for a fraction of the cost?

That’s a legitimate business concern. But here’s the awkward part.

Symmetry

From 30,000 feet, the distillation looks an awful lot like what AI companies have been doing with the rest of the Internet. Extract web content for free and without permission. Turn it into a product you sell. Argue that it is fair use. I hope the lawyers work out the details later.

Anthropic says its rivals are extracting intelligence from its best models. Website owners have spent the last three years saying that Anthropic extracted intelligence from them. Both parties argue that this is against their terms of service. Symmetry is hard to ignore.

And despite presenting itself as the most ethical AI company, Anthropic is by far the worst performer here. Its data-sucking robots crawl web pages thousands of times for every referral the company sends to the web.

Bots on both sides

Anthropic, OpenAI, and especially Google, frame this as a cybersecurity problem, noting that swarms of robots “attack” their models to extract intelligence. But they’ve been doing the same thing to many websites, bombarding them with so much bot crawling activity that site owners have seen their operating costs skyrocket. Some websites not only use your content without permission, but also pay more for the privilege.

AI researchers say distillation is different from web scraping. But the AI ​​industry can’t even decide whether distillation is okay or not, or where to draw the line.

There is the original, benign form of distillation, in which laboratories use the results of their own models to create different, often smaller models. Then there’s what Anthropic calls “distillation attacks,” where rivals use other people’s AI results to develop or improve their own offerings.

Even here, however, the lines are blurring, and some AI researchers now fear that Anthropic’s aggressive stance will hurt all types of distillation. Open source AI expert Nathan Lambert calls this “distillation panic.”

So let me summarize this, from the perspective of the AI ​​giants: They can extract intelligence from the web for free and without permission. That’s different than distillation, which is fine. Ah, but not when distillation involves using their content in ways they don’t like.

“A game of cat and mouse”

This twisted argument is being demolished by the brutal realities of the modern Internet. Anthropic has spent months restricting access to its best models to prevent competitors from learning too much. Those efforts have either backfired or are simply leading to more elaborate solutions.

Once the information is online, smart people will figure out how to collect it, mix it, and profit from it. This is true for blogs, photographs, software code, videos and, yes, the beautiful model results of the AI ​​giants.

“It’s always kind of a cat-and-mouse game,” Zilan Qian, a researcher at the Oxford China Policy Lab, told Business Insider. As long as AI model results are available in the world, “people will probably find a way to access them.”

In fact, distilling another company’s AI model may even be fair use. These legal arguments can cut both ways.

Welcome to the new Internet, Anthropic, OpenAI and Google. Get used to it.

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