I hate “AI” as much as the next guy, but that seems a bit harsh. They are making a very specific point, and it seems well argued to me.

That’s not to say that infringement is necessarily okay. But it’s a distinct issue from “theft.”

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Fair use isn’t infringement. And if it is infringement, it’s not “theft.” And even if a use competes with you, competition doesn’t make it illegal. Indeed, the “effect of the use upon the potential market” is just one of four factors, and it isn’t supposed to let ordinary competition swallow the entire fair use analysis. That these employees (who are not, themselves, copyright experts) said random things does not change the actual underlying analysis of fair use. Or, at least, it shouldn’t.