They can be binding in the sense that they can govern the licensing or potentially ownership of submitted assets. So like, for example, a ToS could have a bunch of clauses that carry no legal obligation for you, but could also include a clause that grants the company licensing to use your likeness or things submitted to the server or interaction with it. The same way any ToS can license the use of your metadata for sale to 3rd parties.
That doesn’t have any particular legally binding requirements of you, but it can serve as a shield in the event of a lawsuit if, say, Facebook uses your profile photo in some advertising materials.
It can also be useful if you’re running a small project like an independent game server. Even if there’s literally no money in it, it can be helpful to clarify who owns what in the event of something like a false DMCA. If a developer who once was doing work with you suddenly decides to take their ball and go home, some sort of agreement that outlines your ownership or usage rights surrounding code submitted to your mod can protect you when they turn around and send Steam a DMCA.
But yeah, nobody’s going to get sued for using a service in a way that the ToS prohibits unless it’s already illegal, like theft.
Why does the use of AI to modify art require justification?
We seem to have this general culture of people who don’t make things coming after those who do. Every decision of design, methodology, or artistic preference treated as though the creator has an obligation to please every single person who posts their opinions on the internet.
The reality is that this simply isn’t true. Art that spends all its energy fretting about whether people will like it ends up being some bland bullshit produced by committee. Art that allows itself to be what it is doesn’t need opinions and suggestions to flourish.
If the author of that article were remotely interested in their process or what the actual practical implications of using AI on a project are, they could have had something worth reading.
Instead they went into the interview looking to push a position and badgering without listening rather than making even a passing attempt at something resembling journalism. Because ultimately they don’t care about AI, or art, or games; they care about rage clicks.