Hollywood and Bollywood groups are lobbying an Indian panel for stricter copyright protection that will prevent artificial intelligence firms from using their intellectual property to train AI models, letters show.

AI companies remain at loggerheads with content owners globally and governments are fast developing regulations that lay down rules for the new technology. While Japan gives broad exemptions to AI firms in using copyrighted content, the European Union has stricter rules that allow content owners to opt-out of such use.

The movie industry is particularly concerned that AI tools could scrape their copyrighted videos, images and clips online - like trailers and promos - and more critically ingest pirated content onto their platforms.

India's current copyright law does not account for use by AI. The government formed a panel this year consisting of lawyers, government officials and industry executives to review if existing copyright law is sufficient to tackle AI-related disputes, and make recommendations.

Worried film studios lobbying hard

Motion Picture Association (MPA), which represents Warner Bros, Paramount and Netflix, and the Producers Guild of India have argued India should not tinker with its copyright law and instead promote a licencing regime.

In response to the panel's private inquiry on why India should not allow blanket training exceptions to bolster AI innovation, MPA India Managing Director Uday Singh said in an August 2 letter the move could "undermine the incentive to create new works and erode copyright protection in India."

The Indian guild's CEO Nitin Tej Ahuja told the panel in his letter "licensing copyrighted works is essential for creators' revenue and business sustainability."

MPA declined to comment, while the guild did not respond to Reuters queries on the letters, which are not public.

India's commerce ministry official Himani Pande, who chairs the panel, did not respond to Reuters queries. The panel is finalising its recommendations which it will present to senior officials in coming weeks, a source with direct knowledge said.

India's vibrant movie market

India has one of the world's most vibrant film industries. A Deloitte-MPA study in May said India's film, TV and online content industry generated $13.1 billion in revenues last year, growing 18% each year since 2019.

The deliberations come just when a Bollywood couple has gone to court to challenge YouTube's AI policies after their manipulated videos started spreading online.

The film studios' position is in contrast to the Business Software Alliance, which represents AI firms like OpenAI, and which argued in public submissions in July that New Delhi should ensure exceptions to permit lawful AI use.

MPA members however remain concerned.

The association has said India should not consider allowing use of content in AI models with an opt-out system as it will put the burden of responsibility on the movie studios, a move that could force them to individually track and block sharing of their work on scores of AI platforms.

Such exceptions "would hinder future investments, development of high-quality local content," MPA India said.

In September, Warner sued AI service Midjourney in Los Angeles by saying it brazenly stole the studio's works to generate images and videos of Batman, Superman, Bugs Bunny and other copyrighted characters.

Midjourney maintains the way it trains its AI model amounts to fair use.