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Why tech companies want governments to regulate AI

It’s been almost a year since the release of ChatGPT, which sparked a market-changing AI boom.

And while reality and other unfavorable factors may dampen the hype, Alphabet (GOOG, GOOGL) CEO Sundar Pichai, Microsoft (MSFT) President Brad Smith, and OpenAI Business leaders such as Sam Altman support AI regulation. This has traditionally been one of the biggest headwinds for new technologies.

So why do AI leaders support regulation? There are actually several reasons. At its core, a carefully thought-out set of rules ensures that AI companies can invest in products they know won’t go unregulated in the future.

Regulation also means companies have a uniform set of rules, rather than a patchwork of different AI laws across different states.

“The worst-case scenario for companies is that there are 50 different rules at the state level. It would be expensive to come up with different software in Idaho as opposed to Illinois,” says the Brookings Institution. Darrell West, a senior researcher at the Center for Technology Innovation, explained.

OpenAI CEO Sam Altman testifies during the Senate Judiciary Privacy, Technology, and Law Subcommittee hearing OpenAI CEO Sam Altman testifies during the Senate Judiciary Privacy, Technology, and Law Subcommittee hearing

OpenAI CEO Sam Altman will testify in May 2023 at a Senate Judiciary Privacy, Technology, and Law Subcommittee hearing entitled “Surveillance of AI: The Rules of Artificial Intelligence.” (Image: Reuters/Elizabeth Franz) (Elizabeth Franz/Reuters)

And, of course, seeking regulation could give companies more power in shaping future AI rules. But passing any legislation in the near term could be a tall order for Washington.

“They definitely want to help shape it so that it makes sense and is cost-effective from their perspective,” explained Avivah Litan, distinguished vice president and analyst at Gartner. did. “They want to prevent heavy mandatory regulations that would cost them huge amounts of money to maintain compliance.”

How regulation helps businesses and consumers

It may seem counterintuitive for technology companies to seek regulation of AI, but for companies investing millions or even billions of dollars in new technologies, specific legislation could Investments will not be made illegal in the future.

“You may not like the regulations, but at least you know exactly what to expect and how to optimize your processes to comply with them,” said Regina Barzilay, Distinguished Professor of Engineering at MIT School of Engineering. explains.

Wednesday, September 13, 2023, at the U.S. Capitol in Washington after a closed-door meeting of major technology CEOs to discuss the priorities and risks surrounding artificial intelligence and how it should be regulated. Alphabet/Google CEO Sundar Pichai (center) departing.  (AP Photo/Jacqueline Martin)Wednesday, September 13, 2023, at the U.S. Capitol in Washington after a closed-door meeting of major technology CEOs to discuss priorities and risks surrounding artificial intelligence and how it should be regulated. Alphabet/Google CEO Sundar Pichai (center) departing.  (AP Photo/Jacqueline Martin)

Wednesday, September 13, 2023, at the U.S. Capitol in Washington after a closed-door meeting of major technology CEOs to discuss the priorities and risks surrounding artificial intelligence and how it should be regulated. Alphabet/Google CEO Sundar Pichai (center) departing. (AP Photo/Jacqueline Martin) (Related news)

Regulation will not only give companies a clearer understanding of how to invest in AI, but it will also give customers greater peace of mind that their products are safe to use. Without regulation, AI customers will operate more or less without knowing that the technology they are using is safe based on the guarantees of the companies they buy from.

On the consumer side, AI regulation will help crack down on AI-based phone fraud, prevent AI-based discrimination in financial services, and eliminate the risk of AI bias in everything from the justice system to the housing market. There is a possibility.

“There are accuracy risks, intellectual property risks, bias and discrimination risks, consumer protection risks, sustainability risks, and no one can control them except the companies that create these models. ” said Leetan. “And if it’s not regulated, there’s often no incentive to do this because it doesn’t necessarily improve the bottom line.”

Overseas precedent

AI regulation is not an impossible task. Outside of the US, the European Union is already well on its way to enacting AI legislation. The economic bloc initially proposed AI rules in April 2021, focusing on different levels of risk associated with the technology. The greater the risks involved, the more regulation AI will be subject to.

The EU’s proposed rules would outlaw various forms of AI, including those used to classify people based on characteristics such as race, gender, and religion. Predictive Policing. A system that retrieves images of people from the web and subtitled TV.

High-risk applications require regulatory evaluation before going to market. This includes applications that may impact human health and safety, as well as applications used to recommend content on social media platforms with more than 45 million users. The underlying models that power generative AI systems must also be registered in the EU database. Other forms of AI must meet transparency requirements to allow users to understand their capabilities.

China has also introduced its own AI regulations. In August, the country finalized guidelines requiring Chinese AI platform companies to submit their algorithms to appropriate government agencies for review. However, platforms designed for use outside China are not required to follow the same rules.

Lawmakers in Washington and the Biden administration have begun meeting with major AI companies. Biden is also expected to issue an executive order on AI in the coming days.

But if we want to keep up with the pace of innovation, we will need to move faster.

daniel howley I’m the technology editor at Yahoo Finance. He has been covering the technology industry since his 2011. You can follow him on Twitter. @Daniel Howley.

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