{"id":125,"date":"2023-07-13T16:34:17","date_gmt":"2023-07-13T20:34:17","guid":{"rendered":"https:\/\/blogs.duanemorris.com\/artificialintelligence\/?p=125"},"modified":"2023-07-27T11:40:15","modified_gmt":"2023-07-27T15:40:15","slug":"the-ai-update-july-13-2023","status":"publish","type":"post","link":"https:\/\/blogs.duanemorris.com\/artificialintelligence\/2023\/07\/13\/the-ai-update-july-13-2023\/","title":{"rendered":"The AI Update | July 13, 2023"},"content":{"rendered":"

\"\"#HelloWorld. Pushback and disruption are the themes of this edition as we look at objections to proposed regulation in Europe, an FTC investigation, the growing movement in support of uncensored chatbots, and how AI is disrupting online advertising. Let\u2019s stay smart together. (<\/em>Subscribe to the mailing list<\/em><\/a> to receive future issues.)<\/em><\/p>\n

Pushback against AI regulation.<\/strong> The AI Update has followed closely the progress of the European Union\u2019s proposed AI Act. Today we report on pushback in the form of an open letter<\/a> from representatives of companies that operate in Europe expressing \u201cserious concerns\u201d that the AI Act would \u201cjeopardise Europe\u2019s competitiveness and technological sovereignty without effectively tackling the challenges we are and will be facing.\u201d The letter takes aim in particular at the proposed \u201chigh risk<\/a>\u201d treatment of generative AI models, worrying that \u201cdisproportionate compliance costs and disproportionate liability risks\u201d will push companies out of Europe and harm the ability of the EU to be at the forefront of AI development. The ask from the signatories is that European legislation \u201cconfine itself to stating broad principles in a risk-based approach.\u201d As we have explained, there is a long road and many negotiations ahead before any version of the AI Act becomes the law in Europe. So it remains to be seen whether any further revisions reflect these concerns.<\/p>\n

FTC flexes its muscle. <\/strong>Putting aside future AI-specific regulations, the Federal Trade Commission reminded us this week that existing regulatory rules will apply to AI as well. The FTC sent a 20-page Civil Investigative Demand<\/a>\u2014in essence the FTC\u2019s version of a subpoena\u2014to OpenAI. The stated purpose? To obtain information for an investigation into whether OpenAI\u2019s use of LLMs has \u201cengaged in unfair or deceptive privacy or data security practices\u201d or has \u201cengaged in unfair or deceptive practices relating to risks of harm to consumers, including reputational harm,\u201d with the latter justification seeming to be an oblique reference to the potential for LLMs to engage in \u201challucinations\u201d in which they generate text responses that sound like facts, but are actually untrue. In the near-term, the FTC\u2019s action will require OpenAI to deal with the FTC\u2019s request for significant amounts of information about OpenAI\u2019s practices, data security and privacy policies, model development and training, its \u201cfine-tuning\u201d practices, and its efforts to mitigate the risk of its products, among other categories. In the long term, the FTC\u2019s investigation may prove to be an early data point on how regulators will go about addressing AI while we await AI-specific legislation.<\/p>\n

Off the rails. <\/strong>As we\u2019ve covered in prior issues, policy makers and the biggest mainstream players debating best practices<\/a> for how to develop AI models responsibly largely agree that chatbots should be carefully designed not<\/em><\/strong> to output misleading, deceptive, offensive, or harmful information. But, there is a growing faction of smaller developers now arguing that chatbots should be uncensored<\/a>, and the responsibility for how their output is used should be entirely on users. Users frustrated with mainstream offerings seem to agree<\/a>. We don\u2019t need an uncensored chatbot\u2019s help to generate the parade of horribles<\/a> for why this is a dangerous idea\u2014we\u2019ll just assume everyone has learned a lesson from how social media handles misinformation and hope for the best!<\/p>\n

What we\u2019re reading: <\/strong>With all the vague menace of AI eating the world lately, it was only a matter of time until it came for the Internet\u2019s golden goose:\u00a0 advertising.\u00a0 According to a NewsGuard report<\/a>, analysts found that at least 140 brands (including major banks, luxury department stores, sports apparel retailers, appliance manufacturers, consumer technology companies, and streaming services) were spending programmatic advertising budget on low-quality AI-generated news sites that operate with minimal (or zero) human supervision.\u00a0 Given the volume of content that is being generated for these widely proliferating sites (an average of more than 1,200 articles per day per site), the struggle to place programmatic advertising effectively is hard and only getting harder<\/a>.<\/p>\n

What should <\/em>we be following?<\/strong> Have suggestions for legal topics to cover in future editions? Please send them to AI-Update@duanemorris.com<\/a>. We\u2019d love to hear from you and continue the conversation.<\/p>\n

Editor-in-Chief<\/em><\/strong>: <\/strong>Alex Goranin<\/a><\/p>\n

Deputy Editors<\/em><\/strong>:<\/strong> Matt Mousley<\/a> and Tyler Marandola<\/a><\/p>\n

Subscribe to the mailing list<\/em><\/a> to receive future issues.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

#HelloWorld. Pushback and disruption are the themes of this edition as we look at objections to proposed regulation in Europe, an FTC investigation, the growing movement in support of uncensored chatbots, and how AI is disrupting online advertising. Let\u2019s stay smart together. (Subscribe to the mailing list to receive future issues.) Pushback against AI regulation. … <\/p>\n

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