What is ‘AI washing’ and why is it a problem? – BBC news

Amazon received critical headlines this year when reports questioned the ‘Just Walk Out’ technology installed in many of its brick-and-mortar supermarkets.

The AI-powered system allows customers at Amazon Fresh and Amazon Go stores to easily choose their items and then leave.

Accessible to people who have registered via an app, the AI ​​uses facial recognition technology and many sensors and cameras to figure out what you have chosen. You will then automatically receive an invoice.

Instead, it said that Indian workers were simply overhauling the system. Amazon added that “this is no different than any other AI system that places a high value on accuracy, where human reviewers are common.”

However, Amazon also confirmed that it would reduce the number of stores using the Just Walk Out system.

Whatever the exact details of the Amazon case, it is a high-profile example of a new and growing question: whether companies are making exaggerated claims about their use of AI. It’s a phenomenon sometimes called ‘AI washing’, referring to the ‘green washing’ of the environment.

But first, a reminder of what exactly AI means. Although there is no exact definition, AI allows computers to learn and solve problems. AI can do this after first being trained on vast amounts of information.

The specific type of AI that has been making headlines in recent years is so-called “generative AI.” This is AI that specializes in creating new content, whether it’s having text conversations or producing music or images.

Chatbots like ChatGPT, Google’s Gemini, and Microsoft’s Copilot are popular examples of generative AI.

When it comes to AI washing, there are different types. Some companies claim to use AI when in reality they use less advanced computers, while others overstate the effectiveness of their AI over existing techniques, or imply that their AI solutions are fully operational when they are not.

Meanwhile, other companies simply mount an AI chatbot on top of their existing non-AI operating software.

While only 10% of technology startups mentioned the use of AI in their pitches in 2022, this rose to more than a quarter by 2023, according to OpenOcean, a UK and Finland-based investment fund for new technology companies. They expect this figure to years will amount to more than a third.

And, says OpenOcean team member Sri Ayangar, competition for funding and the desire to stay ahead have driven some of these companies to overestimate their AI capabilities.

“Some founders seem to believe that not mentioning AI in their pitch could put them at a disadvantage, regardless of the role it plays in their solution,” says Mr Ayangar.

“And our analysis shows that there is a significant difference between companies that claim AI capabilities and those that demonstrate tangible AI-driven results.”

It’s a problem that has quietly existed for several years, according to data from another tech investment firm, MMC Ventures. A 2019 study found that 40% of new tech companies that described themselves as “AI startups” were actually not using AI at all.

“The problem is still the same, but with a different problem,” said Simon Menashy, general partner at MMC Ventures.

He explains that “cutting-edge AI capabilities” are now available for any company to purchase for the price of commodity software. But instead of building an entire AI system, he says many companies simply slap a chatbot interface on top of a non-AI product.

Dougal Dick, UK head of Emerging Technology Risk at accounting giant KPMG, says the problem of AI washing is not helped by the fact that there is no single agreed definition of AI.

“If I asked a group of people what their definition of AI is, they would all give a different answer,” he says. “The term is used very broadly and loosely, without any clear point of reference. It is this ambiguity that allows AI washing to emerge.

“AI washing can have serious consequences for businesses, from overpaying for technology and services to missing the operational goals that the AI ​​was supposed to help them achieve.”

Meanwhile, it may become more difficult for investors to identify truly innovative companies.

And, says Mr. Ayangar, “If consumers have unmet expectations from products that claim to offer cutting-edge AI-driven solutions, this could erode trust in startups that are doing truly groundbreaking work.”

Regulators, at least in the US, are starting to take notice. Earlier this year, the US Securities and Exchange Commission (SEC) said it has charged two investment advisory firms with making false and misleading statements about the extent of their use of AI.

“The SEC’s strong stance shows that there is little wiggle room when it comes to AI washing. This indicates that, at least in the US, we can expect more fines and sanctions in the future for those who break the rules ” said Nick White, partner at international law firm Charles Russell Speechlys.

In the UK, there are already rules and laws in place regarding AI washing, including the Advertising Standards Authority (ASA) code of conduct, which states that marketing communications must not, or are likely to, materially mislead.

Michael Cordeaux, associate in the regulatory team at UK law firm Walker Morris, says AI claims have become an increasingly common feature of advertisements subject to ASA investigation.

Examples of this include a paid Instagram post about an app titled ‘Enhance your photos with AI’, which the ASA said exaggerated the app’s performance and was therefore misleading.

“What is clear is that AI claims are becoming more common and are likely to be more effective at capturing consumer interest,” says Cordeaux.

“In my opinion, we are at the peak of the AI ​​hype cycle,” says Sandra Wachter, professor of technology and regulation at the University of Oxford, and a leading global expert on AI.

“However, I feel like we have forgotten to ask ourselves whether it always makes sense to use AI for all types of tasks. I remember seeing ads on the London Underground for electric toothbrushes powered by AI. Who is this for? Who does this help?”

Moreover, AI’s environmental impact is often glossed over, she says.

“AI doesn’t grow on trees… the technology already contributes more to climate change than aviation. We need to move away from this one-sided, exaggerated discussion and really think about specific tasks and sectors where AI can be useful, and not just blindly implement it into everything.”

But in the longer term, says Advika Jalan, head of research at MMC Ventures, the AI ​​washing problem may go away on its own.

“AI is becoming so ubiquitous – even if it’s just ChatGPT wrappers – that ‘AI-powered’ as a branding tool will likely cease to be a differentiator over time,” she says. “It will be a bit like saying ‘we are on the internet’.”