Marketplace - What Anthropic's copyright settlement means

Episode Date: July 21, 2026

Anthropic settled a copyright case Monday, agreeing to pay out $1.5 billion to authors whose material had been scraped to train its AI chatbot. It comes out to roughly $3,000 per work used after legal fees and other costs. But the outcome isn’t as decisive as it seems. In this episode, what Anthropic’s decision to settle means for future AI copyright cases. Plus: What we lose when we rely on digital downloads, why Jersey Mike’s is soaring while Subway slumps, and how small business owners are handling higher trucking costs. Every story has an economic angle. Want some in your inbox? Subscribe to our daily or weekly newsletter.Marketplace is more than a radio show. Check out our original reporting and financial literacy content at marketplace.org — and consider making an investment in our future.Read the stories in today’s episode:How business owners are grappling with higher trucking costsJersey Mike's filed to go public. What advantages does it have over other sandwich chains?A GM vehicle will set you back around $52,000. Here's why that's higher than average.In the digital era, what media do we still own?Anthropic pays $1.5 billion to settle a copyright caseBreckenridge's dark night skies are dreamy — but they come at a cost

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In Los Angeles, I'm Kyle Rizzo. It is Tuesday Day, July 21. Good as always to have you along, everybody. Our starting point today is the loading dock at the warehouse that supplies your local grocery store or maybe your neighborhood hardware store. More specifically, the semi-truck that's backed up to that loading dock. And even more specifically, the two huge fuel tanks that truck has, maybe 300 gallons capacity, give or take. And with diesel at $5.14. cents a gallon today, so says AAA. I mean, you do the math. The per barrel price of oil gets most of the headlines. Yes, present company included Mayaculp. But the reality is that the

straight up cost of driving goods around the country is a huge part of what is driving up costs overall. Last month, trucking rates were up almost 30% over the same time a year ago. That's according to the DAT freight and analytics. And consumers are getting squeezed. Yes, we know that. But as Marketplace's Justin Ho reports today to get us going, small businesses are getting squeezed too. Ever since oil prices spiked earlier this year, Randy George has been paying more to truck and ingredients for the bakery he runs in Middlesex, Vermont, called Red Hen baking company.

What we normally see when we see these kinds of spikes is the fuel surcharge. George says that's affecting the cost of butter, nuts, olives, and flour. A trailer truck can hold 26 tons of flour. I know that because we buy it by the truckload. 26 tons, that's a lot of fuel every mile. Fuel isn't the only thing that's making transportation more expensive. Businesses are still having to pay tariff surcharges. Even just the overall rate that these companies are charging, we see that going up all the time.

That's Kyle LaFond, the founder of Natural Contract Manufacturing, a company in Madison, Wisconsin that makes deodorant, skin creams, and other men's grooming products. He says the company's been doing what it can to buy more supplies from domestic companies to help bring down his tariff costs. If I can find a domestic manufacturer of an ingredient that we've been sourcing overseas, that's obviously a win. But LaFawn says he can't rely on domestic manufacturers for everything. And either way, he still has to truck those products in. So to help the company deal with the higher cost of trucking? We're developing a plan to basically transfer those costs to our clients, to have our own fuel, transportation, shipping, surcharge of some sort.

Not every business is passing on these higher costs. Pat Whalen is president of Zahadi Fine Foods, a grocery store in Brooklyn that specializes in selling products from the Mediterranean in the Middle East. He says his trucking costs have gone up around 10 to 12 percent in recent months. But for now, he's just going to eat that cost. If you're going to react to every two or three or four or eight or 12 percent move, you would spend your entire day adjusting.

Waylon says he is importing more products right now, including spices and olive oil, in case fuel costs rise even more, or if tariffs go up again. But he says he's not overdoing it. I'm probably at 20% more. Not 50, not 80, not 200, maybe 20% more, maybe a little bit. Capital is still expensive. Interest rates are still relatively high. Storage rates are still relatively high.

And after going through the pandemic, and the president's rapidly changing tariff policies, Waylon says he knows not to overreact to any one supply chain challenge. You learn not to get caught up in the big bomb that blew up in front of you that day. There may be another one tomorrow and there may be another one after that, and I'm just going to take it day by day. Meanwhile, Randy George, who runs the bakery in Vermont, has been building out a warehouse that the business will start using later this year.

That will let him store more flour on site. And George says it'll let him buy more flour from local mills. As long as the volume that we purchase is high enough, it allows us to work directly with the mill. And being able to rely more on local mills will let them rely less on flower distributors farther away. When it comes from 150 miles away, that's far less fuel than it would be if it came from 2,000 miles away. In other words, shorter supply chains can be cheaper too. I'm Justin Howe for Marketplace. crude oil today just to close the loop here up another couple percent.

Brent North Sea is at almost 92 a barrel as the president's war in the Middle East spreads. On Wall Street, AI is back in Traders' Good Graces, I suppose. We will have the details when we do the numbers. A sub at Jersey Mike's, a sandwich chain, we're on you 10 or 12 bucks. you're out the door for less than 20, probably, with chips and a drink. Or you could save your money and try to get in on Mike's initial public offering, in which it is trying to raise more than a billion dollars. Mike's got backing from Blackstone in 2025 and is going to the capital markets at kind of an interesting time.

First of all, this is a very technology-friendly IPO moment looking at you, SpaceX and Anthropic and Open AI. But also, consumers are a bit touch and go right now with their discretionary spend. Marending. Marketplace's Kristen Schwab looks at the sandwich economy. John Gordon visits Jersey Mikes now and then, partly because it's his job as a restaurant analyst and consultant, partly because he likes it. I always order the honey mustard chicken item. I really like chicken, and I like kind of the spicy sauces. He also likes that the shop has a grill. Subway has ovens. What's also different about Jersey Mikes? It doesn't run many discounts. In particular Subway does just a gross amount of discounting. Gross is in horrible, okay?

Gordon says discounts cheapen the brand. And unlike Subway, Jersey Mikes doesn't only have franchises. It also has company-owned stores. You have to run restaurants to know what's going on. I know we're focusing a lot on Subway in a story about Jersey Mikes, but honestly, a lot of Jersey Mikes's growth has to do with its rivals down. says Kevin Schimp, Director of Restaurant Industry Research at Technomic. Subway is still the biggest sandwich chain in the U.S. But they've closed thousands of locations, and them closing so many

locations has really opened up this space for Jersey mics to grow into. And grow it has. Slow and steady, says Schimp, averaging double-digit location expansion each year for the past 15 or so years. That's the way to do it. I mean, that is really the way to do it. The sandwich company will probably use the money to continue expanding, including internationally. Schimpf says not many chains have been going public lately. The last food and drink operator to join the market was Black Rock coffee bar last fall. It is a little bit risky, I would say.

You know, restaurant chains just by themselves can be kind of volatile and fickle in the consumer space. The SNPs restaurant index is down about 3% this year. I'm Kristen Schwab for Marketplace. The corporate story of the day comes out of Detroit, Michigan General Motors, to be specific, which reported quarterly profits this morning. Strong is a fair characterization, and the company raised its full-year earnings outlook as well. Consumers, GM says, and GM is far from the first company to save. this. Consumers are, despite all the pressure on them, resilient and still interested in buying

trucks and SUVs averaging $52,000 a pop. And as Marketplace of Samantha Fields reports, therein lie some economic indicators. Big trucks and SUVs are the most profitable cars out there, and GM sells a lot of them. Trucks and SUVs actually make up over 95% of what they sell versus the 78% industry-wide. Aaron Keating at Cox Automotives. says because GM has basically stopped making smaller regular cars, the average price of what they're selling is naturally going to be higher. When your lineup skews that hard towards $16,000 to $90,000 trucks and SUVs, the average price just goes up. GM has also benefited from the fact that Ford has been dealing with supply chain issues and hasn't been able to make as many of its popular F-series

pickups lately, according to Sam Fiorani at Auto Forecast Solutions. These very profitable vehicles are now even more profitable because dealers aren't negotiating for lower prices. When consumers have fewer options, companies with something to offer have the upper hand. Fiorani says buying any new car is also just a lot of money these days, almost no matter what kind you're looking at. The national average is heading in the same direction that GM is. So $52,000 is not that far from where the national average is today. The market is moving up and vehicles are just getting more expensive.

largely because most car makers have stopped making smaller, cheaper models, and nearly all new cars today have more technology and safety features than they used to. Stephanie Brinley at Mobility Global says at this point the roughly $50,000 new car has just kind of become the new normal. Used car prices ever remained relatively high as well, so going used isn't always the right answer. And there's a bit of just, I have to make it work. She says the other thing working to car company's advantage is that it's not just about have to.

A lot of people want a nice new SUV and they're willing to pay for it. I'm Samantha Fields for Marketplace. Hey, anybody remember actual physical media like a newspaper or a movie at home maybe on a DVD? The digitization of almost everything means more of our media, whether we've bought it or not, lives online. And a lot of companies are just doing away with hard copies for good. Sony, for instance, says it's going to stop producing physical discs for its. Playstations. Sharon Harding wrote about that the other day in Ars TechDicah.

Thanks for coming on the program. Thanks for having me. What is Sony saying about this decision to ditch its discs, if you will? Yeah, so Sony recently announced that as of January 2028, it will not be producing physical discs for new PlayStation games. So that means that in order to play any new game after that point on a PlayStation, you're going to have to digitally download it from a digital storefront like Sony's PlayStation store.

And digging into the fine print, Sony literally says, in part, you don't own this thing anymore, basically, right? Right. Yes. If you look at PlayStation's terms of service, they do say, and I quote, you can use a product in the ways described in the license, but you do not own the product. So essentially what you're buying when you buy a digital copy of a game or even a movie or show that you stream, you're not actually buying that need.

as your property. Instead, what you're buying is a license to use that product and view it and play it, what have you. And that license can go away if the company that you bought it from loses the right to distribute that content, which we've seen happen before. Yeah, that going away thing is the reason I wanted to get you on the phone, because, I mean, we've seen this. It was a number of years ago, I think Amazon was taking things out of people's libraries and all this. I mean, we don't own what we think we own anymore. Yeah, I mean, I've been there personally before. I've, even with Amazon specifically, I bought a movie maybe a couple years ago and tried to watch it again. It's not there. I could swear that I bought it. And then, you know, I look on Amazon storefront

and they may not even have it anymore. And that's why I lost the right to watch it. Sony specifically actually has a history or some history of removing content from people's libraries. Even recently, they have removed movies produced and distributed by a company called Studio Canal. So any movie from that company was removed from people's libraries in the UK, Germany, Australia. And even here in the U.S., Sony has erased people's digital copies of Funimation, DVDs, and Blu-rays that originally came with the purchases of those physical copies. And Sony owns Funimation, by the way. So I don't want to get all metaphysical on you here, but it feels like we kind of lose something

when we lose the right to actually own it, you know? Yeah, I mean, you lose. for one thing, and this is, you know, companies like this, you can't share the content, you can't share your favorite game with a friend, you can't share DVD. And the other issue is, like I said, you might wake up and you just don't have access to that game anymore or that movie. And there really isn't anything you could do about that because the product might have been labeled as a buy now or purchase now. You're really just at best renting it long term. Sony is obviously the focus of this conversation, but, you know, it's going to everybody else. It's going to Microsoft. It's going to Amazon. I mean, everybody else is going to be doing this. Yeah, especially it's getting more accepted by the consumers as well, right? Like we're moving to streaming services for entertainment. A lot of things are moving online. But there's also movement from people who are investing more in physical media than they did before. And, you know, they're collectors. And there are also people that just want to have more control over their

products because, you know, DVDs and Blu-rays, those can really last decades or even a lifetime if you take care of them properly. But that's just not the case anymore when you rely on these digital downloads. Not anymore. Indeed. Sharon Harding at Ars Technica. Sharon, thanks a lot. I appreciate your time. Thanks for having me. Coming up. You can't do this at the snap of a finger. What if you click your heels? Would work? First, though, let's do the numbers. Dow Industrials gained 385 points today, about three quarters of 1%. 52,224. The NASDAQ gained 329 points out as 1.3%. 25,837 on that particular index. The S&P 500 added 65 points,

9 tenths percent 75 and 9. GM General Motors revved up 4 and 9 10th percent today. Competitor Ford maker of the F-1-6, F-150 series. I don't know what an F-160 is. Anyway, gained 2% Stalantis, which makes ram trucks and Jeep vehicles, ticked up about a half percent. Toymaker Hasbro's second quarter earnings, speed expectations. The company credited higher revenues in part to its digital gaming division,

which includes, apparently, Magic the Gathering, in Dungeons and Dragons card games. Hasbro ascended 8.8% on the day. Bond prices went down. The yield on the 10-year T-note rose to 4.63%. You are listening to Marketplace. This is Marketplace. I'm Kai Risdahl. There is news of artificial intelligence today, news that's not about the latest version of whichever platform is your favorite or however many tens of billions more dollars are being spent on data centers and chips.

It is news of the legal variety. A federal judge has approved the class action settlement between Anthropic and authors whose books the company used to train its large language models. Total price tag, a billion and a half. half dollars. After attorney's fees and other costs, each author gets about $3,000. This is the first big settlement of its kind, but a whole lot of other lawsuits against AI companies are pending. And as Marketplace's Nova Safo reports, key legal questions about copyright and how those companies are using human-made content are still way up in the air. AI companies say they can use copyrighted works to train their models because of a legal

doctrine called fair use. Some classic examples of fair use might be commentary, criticism, parody. Ben Sobel, assistant professor of law at the University of Wisconsin, says AI companies have so far been successful with their fair use arguments. You get a sense, you know, of the way the wind is blowing. Even in the anthropic case, the presiding judge found its use of copyrighted books to train Claude was fair use. The underlying legal conclusions are ones that are relatively good for AI firms. So why settle? Because the judge also found Anthropic illegally copied and stored millions of pirated books.

It was a narrow issue. James Grimmelman is Professor of Digital and Information Law at Cornell. It was financially very dangerous to Anthropic, so they were highly incentivized to cut a large check. But Grimmelman says, appeals courts still need to weigh in on the larger question of if and how AI companies can use copyrighted works. They'll have plenty of opportunities ahead. Dozens of cases are pending against OpenAI, Google, Microsoft, Meta, and others. The lawsuits are coming from essentially every sector of human creativity.

Newspapers, recording labels, movie studios, and more. AI companies have increasingly been entering into deals to avoid court fights. I get letters from my publishers asking me to agree to let them license my books to AI companies. Columbia Law Professor Jane Ginsberg, who's edited or co-authored 16 books, mostly about copyright and intellectual property, has granted permission. It's a means of maybe getting the authors something, also having some control over how the books are used. Although she says such licensing deals could event.

eventually work against AI companies, undercutting their fair use claims. After all, she says, why would you need to cut a deal if you're certain the law is on your side? I'm Novosafo for Marketplace. If you've ever had a chance to be up in the mountains way far away from the big city or even a small city, one of the real joys is just looking up at night and seeing all the stars that you just can't make out when you're surrounded by civilization. Breckenridge, Colorado, about an hour and a half, up in the mountains outside of Denver, wants to make sure things stay that way. So the city has gotten something called Dark Sky Certification. And that has meant, in part, homes and businesses swapping out their old lighting fixtures. But as Emma Van Deny reports from KUNC, keeping the stars visible, does not

come without costs. It's mid-June. Property owner Turk Montepere stands outside his red and cream commercial building on Main Street in Breckenridge. It has several shops, an outdoor gear store, massage company and a hair salon. It's in a ski town with tall mountain peaks, but the historic trim of Montepair's building and others on the two-lane roadway makes it seem a little more quaint. Montepair points at the light fixtures

above the covered walkway. These, even though they're underneath, diffuse more than they'd want them. Many of the building's lights are non-compliant with the town's dark sky regulations. The light has to point down, and the bulb must be covered, with something like a dark shade, for example. So we're getting canisters that go straight down.

That's the plan for the ones above the covered walkway. But he's also got lights pointing at business signs on the outside of the building. Those are much harder to fix. It would cost like $2,000 per sign. So he's just going to take them out. The lighting regulations went into effect last summer. Breckenridge leaders have pushed for a dark sky for years. years to protect the night scape for wildlife and tourists.

Research shows dark skies help draw people to visit and spend money while supporting a natural habitat for wild animals. But finding the right lights and paying for them isn't that simple. Montepaire's been trying to get his electrician in while also working with the town on extending his compliance deadline. They gave me time. You know, it isn't, you can't do this at the snap of a finger. Over the last decade, more than 150 parks and communities across the country have pushed for dark sky certification.

It's given out by Dark Sky International, an independent organization. Breckenridge was already moving in this direction back in 2007 with a change to its lighting code, says Breckenridge assistant town manager, Julia Puster. The council wanted to get a handle on the light pollution that was really proliferating throughout town. Most of the town's requirements lined up with dark sky regulations. City lights can't be too bright, direct light upward, or cause glare. While the town is spending an estimated $3.6 million to upgrade the street lights, business and homeowners are responsible for their own.

Puster says that cost is worth it in the long run. It really was the goal for our community and our town council to create somewhere that people want to be, that people can look up and see the stars. You know, we're not a city. Since the dark sky designation last year, the town sent out letters, went to HOA meetings, and set up a dedicated hotline and email address to answer lighting questions.

Still, the town says there's more than 300 properties that are non-compliant. Officials are trying to work with people, but they have to have proof. If they've purchased lighting, but it hasn't come in, which is the case a lot of times, and they have shown us that they have purchased those lights.

You know, we just grant some additional leeway. Turk Montepair is one of the residents who's had trouble finding lights. If you go to Home Depot, they have like six at most dark sky lights. And then there isn't a section. If you even Google dark sky lights, not a lot comes up. And it all comes at a cost. To upgrade more than 30 lights, Monteper ended up. spending around $5,000.

He thinks his lights have made a difference in town, but he wishes he didn't have to pay thousands for them. In Breckenridge, Colorado, I'm Emma Vanda 90 for Marketplace. This final note on the way out today in which one hates to add to our mutual concerns about higher prices and what it's going to mean for the economy. Clearly, though, researchers at Deutsche Bank have no such qualms. They published a paper this week, pointing out that the really strong El Niño were expected to get this year is going to be.

and this is a, quote, a multi-dimensional supply shock. It's going to affect agriculture and shipping hydroelectric power, too, because some areas are going to get less rain. A strong El Nino, Deutschebank, writes, would be another negative supply shock when the global economy has limited room to absorb one, which is great, just great. Jordan Manjee, Zaneh, Maharaj, Janet Wynn, Olga,

Oxman, and Virginia Kay Smith are the digital team. I'm Kyle Rizzdahl. We will see you tomorrow, everybody. This is APM. Have you ever daydreamed about leaving your office job and starting life off the grid? I'm Rie McRaece, host of This Is Uncomfortable. And this week on the show, I talk with one woman whose homesteading dream became a reality and then a nightmare. You're one disaster away from losing everything.

And for us, that disaster happened really early on and we could never get on top of it. It was just this continuous cycle of poverty. Be sure to listen to This Is Uncomfortable on your favorite podcast app.