As Sports Illustrated is finding, the repercussions of disguising generative artificial intelligence content can range from acute, measurable declines in revenue to more intangible loss of brand value.
Since news of the gen-AI content snafu surfaced Tuesday, the share price of the publicly traded Arena Group has dropped 20%, wiping out millions of dollars in value, according to public filings. Sports Illustrated’s brand is owned by Authentic Brands Group but operated by The Arena Group.
“The overarching point is that there needs to be transparency,” said Eunice Shin, partner at digital strategy firm Prophet. “This is absolutely on the minds of advertisers and agencies. Nobody wants to be duped.”
Technology publisher Futurism reported this week that Sports Illustrated, working with vendor AdVon Commerce, created fake profiles of staff writers, and then used gen AI to create and publish buying guides monetized by affiliate links under the imaginary authors’ bylines.
Representatives for Sports Illustrated, Reviewed and CNET denied any wrongdoing. AdVon did not respond to a request for comment.
While publishers—increasingly challenged by distribution gatekeepers and a soft ad market—should experiment with the technology, readers deserve to know the provenance of the content they are consuming, said Shin. In misleading readers, publishers risk further worsening the declining level of trust consumers have in the media.
Being duped can tarnish these publishers’ brands, leaving them at risk of incurring both commercial and reputational blowback, according to brand consultant Ben Dietz. Advertising relies on trust and brand equity, and opaque business practices directly undermine those tenets.
Commercial and reputational risk
But in a highly saturated media ecosystem, publishers also rely heavily on the cachet of their brand to attract readers and secure advertisers, according to Max Willens, a senior analyst at Insider Intelligence.
“Unless you are one of the few publishers whose content attracts a critical mass of valuable audience, all publishers have left is their brand,” Willens said. “Anything you do to jeopardize that is a mistake, and you have to consider whether any short-term benefit is worth that risk.”