Canva earmarks $200 million in royalty payments for new AI platform

Australian design platform Canva is seeking to address the fundamental concerns of the creator economy in the wake of the Hollywood writers strike by offering an artificial intelligence (AI) royalty program over the next three years as part of its new product release, AI design tool Magic Studio.

Cofounder and CEO Melanie Perkins said the business will earmark US$200 million (A$316m) in a royalties fund for creators who let Canva use their work for AI training, pledging to only use their work if they opt into the program.

The move by Canva’s billionaire owners comes after news last month that Booker Prize-winning novelist Richard Flanagan was among hundreds of Australian writers whose works were in the dataset reportedly used to train Meta’s open source AI model.

Flanagan labelled it “the biggest act of copyright theft in history”.

The Creator Compensation Program will act in a similar fashion to Australian Copyright Agency payments for writers and artists, and pay who Canva creators who consent to having their content used to train the company’s proprietary AI models. Creators who opt into training AI models on their existing content will receive an initial payment followed by monthly payment for continued use.

The US$200 million over three years represents around 3.9% of Canva’s current annualised revenue of US$1.7 billion (A$2.7bn). The business, worth A$39 billion, and profitable for seven years, says it now has 16 million paying subscribers and more than 150 million monthly users after adding 65 million users in the last 12 months.

Canva head of AI Danny Wu said: “Creators are at the heart of our community, so we fully embrace our responsibility to ensure that we’re offering them AI-powered tools that are firmly grounded in transparency, as well as ethical and fair practices every step of the way.”

The design app has also moved to protect companies from falling foul of copyright laws when using the work of others via AI by indemnifying them as part of a new trust and safety product called Canva Shield, which offers enterprise-grade security, privacy and indemnification.

Canva has embraced AI as the future of its design platform over the last 12 months, including new AI and marketer tools at Create in March. Already the company’s early set of AI-powered design products have been used more than 3 billion times.

Perkins hailed Magic Studio is the world’s most comprehensive AI-design platform.

“With a focus on making complex things simple, Magic Studio has been built for the 99% of the world without complex design training,” she said.

“This launch marks the start of an exciting new chapter as we double down on empowering over 150 million individuals and thousands of businesses to unlock their creativity and achieve their goals.”

Magic Studio allows users to generate marketing content in video, audio, image and text form from prompts.

The announcement comes in the same week that Facebook’s parent company, Meta, introduced its first generative AI-powered features for advertising creatives in Meta’s Ads Manager.