As artificial intelligence continues to be a hot topic, some companies have been accused of “AI washing” by exaggerating the capabilities of their AI technology.
BBC News Reports In recent years, the phenomenon of “AI washing” has come into the spotlight as more companies claim to use AI in their products and services. A play on “greenwashing,” the term refers to companies making exaggerated claims about their use of AI. This can take many forms, including claiming to use AI when they use less advanced computing, exaggerating the effectiveness of AI over existing technologies, or suggesting an AI solution is fully functional when it isn’t.
One high-profile example is Amazon’s “Just Walk Out” technology, which claims to use AI to allow customers to simply pick their items and walk away in many Amazon Fresh and Amazon Go stores. The AI uses sensors to determine what customers choose and automatically charges them. However, reports earlier this year questioned the extent of AI’s role in the system, suggesting that around 1,000 workers in India were required to manually review almost three-quarters of transactions. Amazon denied these reports, saying its workers in India were simply reviewing the system.
The rise in AI-washing can be attributed to several factors, including competition for funding and a desire to be on the cutting edge. According to OpenOcean, a UK- and Finland-based investment fund for emerging technology companies, only 10% of tech startups mentioned the use of AI in their pitches in 2022, but that number is expected to rise to more than a quarter in 2023 and exceed a third this year. However, Sri Ayangar, a team member at OpenOcean, points out that “there is a big gap between companies claiming AI capabilities and those showing tangible AI-driven results.”
The lack of a consistent definition of AI exacerbates the problem. Douglas Dick, UK emerging technology risk lead at KPMG, explains: “If you ask people what the definition of AI is, everyone will give you a different answer. The term AI is used very broadly and loosely, with no clear standards. This vagueness allows AI-washing to emerge.”
AI-washing can have worrying implications for companies, as they overpay for technology and services or fail to achieve the business goals that AI was expected to help them achieve. For investors, it can make it harder to identify truly innovative companies. And for consumers, unmet expectations from products that claim to offer advanced AI-driven solutions can erode trust in startups doing truly groundbreaking work.
Regulators, especially in the US, are starting to take notice: the SEC recently charged two investment advisory firms with making false and misleading statements about the extent of their use of AI. The UK already has rules and laws in place to regulate AI-washing, including the Advertising Standards Authority’s (ASA) code of practice, which states that marketing communications must not be materially misleading or likely to mislead.
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Lucas Nolan is a reporter for Breitbart News covering free speech and online censorship.
