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My argument is that the LLM is just a tool. It's up to the person that used that tool to check for copyright infringement. Not the maker of the tool.
Big company LLMs were trained on hundreds of millions of books. They're using an algorithm that's built on that training. To say that their output is somehow a derivative of hundreds of millions of works is true! However, how do you decide the amount you have to pay each author for that output? Because they don't have to pay for the input; only the distribution matters.
My argument is that is far too diluted to matter. Far too many books were used to train it.
If you train an AI with Stephen King's works and nothing else then yeah: Maybe you have a copyright argument to make when you distribute the output of that LLM. But even then, probably not because it's not going to be that identical. It'll just be similar. You can't copyright a style.
Having said that, with the right prompt it would be easy to use that Stephen King LLM to violate his copyright. The point I'm making is that until someone actually does use such a prompt no copyright violation has occurred. Even then, until it is distributed publicly it really isn't anything of consequence.
I run local models. The other day I was writing some code and needed to implement simplex noise, and LLMs are great for writing all the boilerplate stuff. I asked it to do it, and it did alright although I had to modify it to make it actually work because it hallucinated some stuff. I decided to look it up online, and it was practically an exact copy of this, down to identical comments and everything.
It is not too diluted to matter. You just don't have the knowledge to recognize what it copies.
Build an inkjet printer exclusively out of stolen parts from HP, Brother, and Epson and marketed as being so good that experts can't differentiate what they print from legal currency (except sometimes it adds cartoonish moustaches). Start selling it in retail stores alongside them. They would battery be announced, much less stocked on the shelves before C&D letters and/or arrest warrants arrived.