GILCHRIST, Ms Kate, Head, Content and Legal, Australian Broadcasting Corporation SUTTON, Mr David, Senior Executive, Policy and Regulatory Affairs, Australian Broadcasting Corporation Committee met at 0 9 : 3 0 CHAIR ( Ms Briskey ): I declare open this hearing of the Joint Select Committee on Artificial Intelligence. I begin by acknowledging the traditional custodians of the land on which we are meeting this morning, and I pay my respects to elders past and present. I extend that respect to any Aboriginal and Torres Strait Islander peoples here with us today. The committee will be conducting today's hearing both in person and via videoconference. I remind all witnesses that, in giving evidence to the committee, they are protected by parliamentary privilege. It is unlawful for anyone to threaten or disadvantage a witness on account of evidence given to a committee, and such action may be treated by the Senate as contempt. It is also a contempt to give false or misleading evidence. If a witness objects to answering a question, they should state the ground upon which the objection is made, and the committee will determine whether it will insist on an answer, having regard to the ground which is claimed. If the committee determines to insist on an answer, a witness may request that an answer be given in camera. I remind senators and members of their obligation under the Behaviour Code for Australian Parliamentarians to treat witnesses with dignity, courtesy, fairness and respect. I now call on representatives of the Australian Broadcasting Corporation. I understand information on parliamentary privilege and the protection of witnesses giving evidence to inquiries has been provided to you. The Senate has resolved that an officer of a department of the Commonwealth or a state shall not be asked to give opinions on matters of policy and shall be given reasonable opportunity to refer questions asked of the officer to superior officers or to a minister. This resolution does not preclude questions asking for explanations of policies or factual questions about when and how policies are adopted. I am confirming that we do have media in the room with us today. I now invite you to make a short opening statement. At the conclusion of those remarks, I'll invite members of the committee to ask their questions. Ms Gilchrist : Thank you for the opportunity to make submissions to this inquiry. As a media organisation, the ABC participates in three different industries in Australia: the news industry, the screen industry and the audio industry. The ABC acquires, produces and publishes news, screen and audio content for the benefit of Australians. The ABC's services are available to Australians for free. That is a key tenet of public service media. The ABC recognises that Australia needs to harness the benefits of AI while managing and mitigating the downside risks through proper regulation and safeguards. I refer you to the ABC's submission, No. 304, and the joint submission with other rights holders, No. 329. In summary, in relation to the inquiry's question about copyright, the ABC says Australia has a fit-for-purpose copyright framework which provides AI organisations with access to high-quality material via voluntary negotiated licensing arrangements. The current framework, where copyright users pay for the content they use, provides creators and rights holders with real incentives to invest in and create Australian content. To the question about adequacy of Australia's existing laws and regulatory frameworks, the ABC submits that AI services which act as a publisher of news and information must be subject to the same regulatory framework as Australian media. The values of independence, integrity, accuracy and impartiality in journalism and in the publication of news and information are critical in any consideration of AI. These values are the cornerstones of the media as the fourth estate in a Western democracy like Australia. Indeed, they are baked into the ABC's own act of parliament. AI search services are already having the effect of driving down referrals to news platforms. The ABC has no control over how its content is being used by AI in order to control the integrity, accuracy and impartiality of the content and the independence of the ABC. It is important that the same regulatory requirements that apply to media organisations like the ABC are applied to the use of our material by AI services to maintain trust and regulate against misinformation and disinformation. The regulatory framework must underpin the sovereignty of Australian news and the viability of the news industry in Australia. Regulation would make AI models more reliable, accurate, safe and appropriate for relevant age groups as well as reduce bias and the risk of bad actors operating through AI. An AI regulatory framework must guarantee that AI search and summary services provide prominence and proper attribution to Australian news organisations. Media laws must equally apply to AI organisations acting as publishers of information rather than providing them with safe harbours. To provide the Australian news and creative industries with a level playing field to negotiate with major international AI organisations, the ABC submits that steps need to be taken to address the imbalance of negotiation power. The ABC submits that AI organisations should bear a level of risk and should invest in a regulatory and licensing framework to ensure the ongoing viability of Australian news and creative industries and to ensure a virtuous circle rather than the cannibalisation of Australian culture. CHAIR: In that opening statement and in your submission you said AI services can and do act as publishers and should follow the same rules that apply to both the ABC and others. How would a regulator decide when an AI service counts as a publisher? Ms Gilchrist : It would follow the same test of publication in media laws—when an AI organisation publishes material to a third party, that becomes a publication. I think it's about the definition of publication for the purposes of disseminating news and information. CHAIR: You also suggest major AI developers should be named as accountable executives, like it is in the rules for our financial services. You describe this in principle, but could you explain a bit further for the committee what you'd want this to look like. What should those executives answer for? Ms Gilchrist : At this point in time, it does feel like we are trying to predict the future. But I think there is a well-established framework for Australian media organisations, to ensure that they are given a level of power and trust and are regulated—through ensuring that those organisations are run by fit and proper people—to have that level of trust. CHAIR: Senator Dolega. Senator DOLEGA: How does the ABC use AI within the organisation, and how do you see it changing over time? Mr Sutton : I'll take that. The ABC uses AI technologies in a range of ways but probably the overriding description would be that we seek to use it carefully and responsibly. We've established a set of overriding principles that govern the way in which our staff overall use AI tools. At this stage, we actively do not allow AI produced content to go directly to the public. We essentially say to our staff that they may use it as a tool to assist with things like research or the development of content but anything that goes out publicly has to be overseen by a human. We insist on human oversight of outputs because that's fundamentally what I think the public expects of the ABC. In terms of tools, we do use Anthropic's Claude as a recently introduced corporation-wide productivity tool. We use a range of tools which have AI capabilities baked into them in production. We have our own system, ABC Assist, which is essentially a RAG model for searching past ABC content that our content makers use. If you want to track down what the ABC has covered around a particular issue in the past, it will take you directly to those sources. That's something we built up ourselves internally and as part of the process attempted to internalise ABC editorial values into the structure of the software. It's very much a tool for that purpose. It's very assistive and, essentially, we seek to use it responsibly in that way. Senator DOLEGA: And into the future? Mr Sutton : As Kate said, it's difficult to predict the future and to see where this goes. That's why we're stepping cautiously with this. It's not clear to us exactly how the technology will develop out over time. There are a range of predictions about where this may end up, some of which are very, very optimistic and others which are much more pessimistic. We're taking a path of essentially moving slowly and carefully with the technology so that we engage with it. But we are not rushing forward or over engaging, if that makes sense. Senator DOLEGA: That's good to hear. You don't anticipate or you haven't looked at any work in which AI would replace a human to, for example, read the news on the radio? The ABC still supports workers and has no intention to replace presenters—journalists—with artificial intelligence to read the news, whether it's a podcast or a 30-second clip? Is it always going to be humans? The ABC has built the brand and trust over many, many years through the humans that contribute. The ABC has no plans to replace humans at all? Mr Sutton : No plans to replace humans, Senator. To be very clear, the guidance that we give to our editorial staff makes very, very clear that they are not to create replicas of people, of their voices, without very, very careful consideration. I can envisage particular contexts in program making where that might be necessary, but fundamentally there's no plan to create AI newsreaders or anything like that. Senator DOLEGA: How has your consultation with your staff and the unions over the introduction of AI in the workplace been? Has there been any feedback or any pushback against the use of AI, or has there been positive feedback that it's actually creating a more productive workplace? And are you using artificial intelligence for any type of surveillance on workers? Mr Sutton : Let's take those in pieces. First of all, in terms of the introduction of AI within the workplace, there are absolutely productive discussions going on with unions about that. We've had union members as part of the pilot processes. For example, when we rolled out Claude within the organisation, we explicitly had union representatives able to participate so that they could see what was going on. We've answered a range of questions that they've put to the organisation as part of that process. In terms of the way that people have reacted to it, I think there's a spectrum of views within the ABC. There are people who are very sceptical about the technology. There are people who are embracing it wholeheartedly and would probably like us to go faster and give them more tools to play with. We're taking a very careful, measured approach there, and I would point out that fundamentally we're not requiring anybody to use these tools. If they don't feel comfortable, if they don't think it enhances their productivity and if they don't think that they get a benefit from it, they don't have to. What was the last part of that question? Senator DOLEGA: I think you've covered it in that answer. CHAIR: Senator Pocock, Senator DAVID POCOCK: Thank you very much for your time here this morning. I understand you've previously negotiated paid content arrangements with the likes of Meta and Google. In your view, does the argument from big AI companies that it's essentially too hard to negotiate deals stack up? Ms Gilchrist : No. I think, if you are in the content creation business, your business model inherently has a component which is about negotiating deals with rights holders, with creatives and with journalists. It's an inherent part of your business. Senator DAVID POCOCK: Do you have a sense of why some of the biggest companies in the world are saying that they can't and that it's too hard? What is actually at the heart of that argument? Ms Gilchrist : I do not understand why they are saying that. Senator DAVID POCOCK: The government is proposing this opt-out model, and SBS has said that the opt-out proposal from Anthropic and the government, and the use of these robots.txt files are routinely ignored by scrapers. What's the ABC's experience been? Ms Gilchrist : I do not think that we have conclusive evidence that we have been scraped, but I expect, like every other content creator in Australia, there is a likely possibility that we have been. My understanding about technological protection measures is that they're not failsafe. They may not work sufficiently to protect the interests of your intellectual property. What was the other component of that question? Senator DAVID POCOCK: That was it—the experience of the ABC and whether you're aware of that. What would be a better solve to this problem? How should parliament be thinking about dealing with it? Ms Gilchrist : Our suggestion is that the copyright system is completely adequate to manage the business of AI. AI can engage in negotiations with rights holders for the relevant licences that they need. We do not support the opt-out scheme, because that places the burden on rights holders. It imposes a cost and an ongoing surveillance requirement to see whether or not your copyright is being used. Voluntary licensing is capable of managing rights at scale. Senator DAVID POCOCK: OpenAI said in their submission that they need certainty. What is uncertain about our current copyright laws that have existed for decades? Ms Gilchrist : Nothing. Senator DAVID POCOCK: To your point about the opt-out, in documents released in the New York Times lawsuit against OpenAI and Microsoft, Greg Brockman, the co-founder and president of OpenAI, responded, 'Ah, nice,' when informed by an employee about a workaround to bypass the New York Times paywall, and Nick Turley, the head of ChatGPT, stated that publishers face an existential threat because AI products are largely substitutive. What is at stake here when it comes to media in this country and big US AI companies? Ms Gilchrist : I expect a lot is at stake. Media organisations, I think, need three things. We want our content to meet our audience. Our audience may come to the ABC's platform. But the audience may also be on third-party platforms, so sometimes we need to seek them out on those third-party platforms. But we need to ensure that our audience understands that that is the ABC's content, so it's about reach. It's about audience and fulfilling our functions under our act. The second component is ensuring that we have appropriate guardrails around the ABC's content to ensure that the trust in the ABC's content continues, and that goes to the principles of impartiality, accuracy, integrity and independence. Finally, we would like a financial return on the content that public moneys have been invested in to create so that the media organisations can continue to create and to invest in the creation of that content. Senator DAVID POCOCK: Have you done any work to quantify that? The government seems to be proposing what companies have been proposing, which is to pay into some sort of fund and then find a way to slice up the pie. I don't know how they're going to do it, with international rights holders, Australian rights holders and media organisations. Have you had a look at what that might look like? Ms Gilchrist : No. We've thought about it, to the extent that a fund inadequately values individual pieces of copyright material. A fund assumes a fixed value for content, and that's simply not the dynamics of the copyright marketplace. Senator DAVID POCOCK: Finally, can you explain to Australians what is happening with, say, Google, when you type in 'ABC content guidelines'. In the past, the first result would likely have been your ABC editorial policies link to your website. Now you get this AI overview, with a whole bunch of dot points and some links. Have you looked at what that's meant for your traffic and at how many users are simply reading that and then moving on or how many are actually going straight to you? What does it mean for your business model and for actually being able to reach Australians? Mr Sutton : We don't have hard numbers that we can offer you, but we have definitely seen a decline in traffic there. Moreover, when we look around the world, we're seeing, when there are quantitative studies, a trend in those studies of people being satisfied with the description they see and of them not following through and clicking to the substantive story behind it. So, effectively, they get what they need from the summary at the top in many, many cases. But we have no hard numbers. Ms Gilchrist : And that is the basis of our submission around prominence and attribution. We need to make sure that the audience understand, if they stop there and don't refer back to our platform, that it's trusted content that's been subject to all our editorial policies and frameworks. Mr Sutton : There's a related issue with that, which is that, inasmuch as this is essentially a description that's been generated by a probabilistic system, there may well be inaccuracies. So, even when there is a link back to the ABC, if somebody only goes that far and there are inaccuracies that they don't check by following through, that effectively has a reputational impact on us—'The ABC said X,' which the ABC people did not say. Senator DAVID POCOCK: Yes. CHAIR: Senator Cadell, did you have any? Senator CADELL: Yes. I might just ask a couple of questions. Wouldn't the opt-out model that has been floated—where you can opt out and do your own deal and use the bar—suit organisations like yours that have a developed sense for working with copyright? Wouldn't that work for you? My understanding is that, for the learning models, a lot of the learning is code and mathematics. It doesn't have established rights procedures. Ms Gilchrist : No, the opt-out model does not work for ABC content. It proceeds on the assumption that everything that the ABC publishes is owned by the ABC and controlled by the ABC. That is simply not the case. What you see on ABC News or what you receive through our broadcasts is a combination of many different rights holders across the spectrum, and we do not have the relevant AI rights to opt in, necessarily. But, if we were to then opt out, to preserve our position, our content is found everywhere else on the internet. Either we've licensed it, it's being used on a promotional basis or it's being used under fair dealing. We cannot scour the internet and ensure that we are opting out on all of those different sites of publication. It simply does not work. Senator CADELL: There's been a lot of focus on this and the changes for the learning models. I'm concerned about section 43B, as it currently exists in the Copyright Act, with inference—which is already there—and the storing of data. Have you got legal advice or looked into whether 43B covers AI institutions for what they're currently doing with inference as opposed to learning? Ms Gilchrist : I would prefer not to provide legal advice. Senator CADELL: I don't want the legal advice. Have you got it? Ms Gilchrist : But what I would say is that, if you look at the history of the introduction of that legislation, it is a temporary copy for the purpose of communication. It is not for the purpose of training AI models. Senator CADELL: I don't want your legal advice, but have you sought legal advice on 43B and its inference? Ms Gilchrist : No. Senator CADELL: Okay. That's all I wanted to know. You're not giving legal advice, but your opinion then was that 43B is not fit for purpose on inference models. Is that correct? Ms Gilchrist : I doubt that it is, but I would need to go and look at it more carefully. Senator CADELL: What current protections do you have under the US fair use policy on copyright? What protections, if any, do you have now? Ms Gilchrist : That would govern publications in the US. Our focus is really on publications in Australia, where there is no fair use model. Senator CADELL: I understand, but what we're looking at here are learning models. For these learning models based in the US, what protections do you have under fair use policy now? Can they scrape your websites without a problem? Ms Gilchrist : What I would say is that that question is still being contested in enormous amounts of litigation across America. Senator CADELL: Okay. I'm happy with that. Thank you. CHAIR: Senator Sheldon. Senator SHELDON: Thanks for joining us this morning. I want to tease out an answer you gave earlier on the use of AI now within the ABC. Can you give us a flavour of how AI use, if harnessed correctly, could improve the journalism that the ABC provides? Mr Sutton : There are a range of possible ways that it could be used, but, in particular, it's very useful in helping with certain types of research. We've done a number of stories in recent months, where there's been the analysis of very large collections of documents as a way of surfacing things for journalists to then look at more closely. So, in a sense, it provides an enhanced search capability with large document sets. The classic example, and one that probably proved to be almost too expensive to go with, was when the Epstein files were released. There was an enormous trove of documents. I think half the world turned around and threw AI engines at that, much in the same way that I think they wish they could have done with the Panama Papers. There's that kind of research capability that exists. I think that has the potential to enhance journalism considerably. It doesn't replace the work of the journalist by any stretch of the imagination, but it makes the research task a lot more manageable and makes it easier to find the needles in haystacks that that kind of work requires. Senator SHELDON: That leads me to another question. The ABC is obviously required to comply with editorial standards, complaints processes, classification requirements, defamation law, privacy obligations and a range of other publishing rules. AI companies are increasingly performing many of the same publishing functions without being subject to those obligations. Can you explain how that creates an uneven playing field and what impact it's having on the sustainability of Australian journalism? Ms Gilchrist : The processes and teams that are used to resource prepublication advice for legal risk, classification, editorial policy advice—the ABC invests significantly in those functions to ensure that the news content is impartial and accurate and that it maintains integrity and independence. It is not clear whether AI organisations, when they publish—whether it's ABC news summaries or something else—are also required to meet those same standards. To the extent that the ABC's audiences may be diminishing through the lack of referrals back to the news platforms of the ABC, we're investing that cost in all of these frameworks. AI organisations are taking that content without those frameworks but then not having to meet those tests on classification or whatever it may be. There is cost and process that I think creates that unlevel playing field. Senator SHELDON: There are two groups. There are the news bargaining laws which are in place. Nine has come up with an AI licensing agreement with Microsoft regarding Microsoft Copilot. You've touched on this in your previous answers, but you might want to expand. There are some compensation packages happening, but, at the moment, is there the desperate need for a clearer frame to get those negotiations settled? Where are we at on the basis of the evidence you've given so far? Mr Sutton : The ABC has sought to negotiate arrangements with the frontier AI companies, so far to no avail. Some assistance in making that happen would be wonderful, frankly. As I understand it, it's not that there's entire disinterest, but there's been no success in bringing that to fruition. Senator SHELDON: It is concerning. We're seeing people pirating information—some getting part of the booty paid back. It's clear that the rules that apply to those pirates are different to what applies to those that are sailing by the Royal Navy. CHAIR: We really appreciate you both coming before us today and answering our questions. If you've taken any questions on notice or have any information to come back to committee, we ask that you provide those to the secretariat within the next two weeks. Thanks very much..