In a recent court filing from the lawsuit Kadrey v. Meta, it was revealed that Meta generates revenue from its openly available Llama AI models through revenue-sharing agreements with hosting partners. This contradicts CEO Mark Zuckerberg’s July 2023 statement that “selling access” to Llama isn’t Meta’s business model. The filing shows Meta receives a percentage of revenue from companies hosting Llama models, though it doesn’t specify which partners pay. Known Llama hosts include AWS, Nvidia, Google Cloud, Azure, and others.
While developers can download and run Llama models independently, many opt for hosting partners due to added services and tooling. Zuckerberg hinted at monetizing Llama during an April 2024 earnings call, mentioning licensing deals with tech giants like Microsoft and Amazon, as well as potential revenue from business messaging and ads in AI interactions.
Meta’s primary focus with Llama, however, is on improving its products through contributions from the AI research community. Llama powers Meta’s AI assistant and other services, with Zuckerberg emphasizing the benefits of open development for industry standardization.
The Kadrey v. Meta lawsuit alleges Meta trained Llama on pirated e-books, using torrenting methods that inadvertently shared these works with others. Plaintiffs claim Meta facilitated infringement by uploading and distributing the pirated content.
To support its AI ambitions, Meta plans to double its capital expenditures in 2025, spending 60billion−60billion−80 billion on data centers and AI development. Additionally, Meta is reportedly considering a subscription service for its Meta AI assistant to offset costs.
Key Takeaways:
- Revenue Sharing: Meta earns revenue from Llama through agreements with hosting partners like AWS and Google Cloud.
- Legal Challenges: Meta faces allegations of using pirated e-books to train Llama and facilitating infringement.
- AI Investments: Meta is doubling down on AI, with plans to significantly increase CapEx in 2025.
- Subscription Service: Meta may launch a paid tier for its Meta AI assistant to generate additional revenue.