Academic publishers are turning to AI licensing deals as a new revenue source amid fears of US research funding cuts.

Informa’s Taylor & Francis signed a US$10 million deal with Microsoft last year.

This agreement allows access to part of its library to train large language models.

Other publishers, including John Wiley & Sons and Bloomsbury Publishing, have also partnered with AI firms to monetize their academic content.

These deals significantly boosted publisher earnings, with Informa reporting US$75 million in 2024 from AI-related data access.

Licensing agreements may help offset expected losses from US federal research budget cuts that could reduce subscription revenue.

While some publishers reject licensing deals, concerns remain over author compensation, content control, and the need for stronger IP protections.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ The birth of a publisher revenue lifeline amid academic funding pressure

Academic publishers’ AI licensing deals represent a significant new revenue stream during a challenging period for traditional funding models.

Taylor & Francis’s non-recurring revenue from AI licensing reached $75 million in 2024, accelerating their growth from 3% to 15% year-over-year according to Berenberg analysis 1.

These deals provide crucial financial buffer against potential US research funding cuts, which could create a £33 million ($45 million) revenue shortfall for Taylor & Francis if the proposed 43% National Institutes of Health budget reduction materializes 1.

This trend is similar to developments in news media, where the New York Times recently secured an AI licensing agreement with Amazon, signaling a shift toward monetizing content archives through AI partnerships 2.

Publishers are positioning these deals as complementary revenue streams rather than replacements for core subscription models, enabling them to navigate the transition to an AI-influenced publishing landscape.

2️⃣ Author compensation emerges as a flashpoint in AI licensing agreements