Saturday 8 July 2023

Big Tech Companies Seek AI Regulation on their Own Conditions

**OpenAI CEO Sam Altman Advocates for Regulation of Artificial Intelligence**

OpenAI CEO Sam Altman has recently voiced his concerns about the dangers associated with artificial intelligence (AI) and called for government regulation to mitigate these risks. Altman’s surprising statement comes at a time when tech companies are increasingly acknowledging the need for responsible AI development. However, while some companies are pushing for regulation, they are also fighting against certain measures that they believe will overly restrict the growth of the AI sector.

The landscape of AI development is rapidly evolving, with the sector securing over $1 billion in venture capital funding in the first four months of this year alone. AI systems are already being used in various industries, from toothbrushes to drones. The future trajectory of AI development, however, will largely depend on government intervention.

In the United States, tech giants like Google, Microsoft, IBM, and OpenAI have called on lawmakers to oversee AI development to ensure safety and competition with China. On the other hand, in the European Union (EU), where draft legislation aimed at regulating generative AI has recently been approved, these same companies are lobbying against measures they feel will unnecessarily restrict the growth of the AI sector. This stark difference in approaches to regulating AI between the US and the EU reflects the varying regulatory environments in each region.

The EU has been at the forefront of data protection laws for over five years and is now implementing stringent guidelines for competition and content moderation. In contrast, the US has had minimal regulation in place for the past two decades. Big Tech companies understand the significance of the EU’s influence, as the region’s social media and data protection rules have become global standards. The EU’s AI Act, expected to be enacted in the next two to three years, will mark the first attempt by a Western government to regulate AI and will come with significant penalties for non-compliance.

Under the AI Act, companies found to be in violation could face fines of up to 6% of their annual turnover, as well as potential bans on operating within the EU. Given that the EU represents 20% to 25% of the global AI market, valued at over $1.3 trillion within the next decade, these penalties hold significant implications for the AI sector. Should the legislation come into effect, major AI providers will need to adopt more transparent practices and enhance their risk assessment and deployment strategies.

While the tech industry strives to maintain control over AI regulation, the legislative process moves at a relatively slow pace. The European Commission’s initial draft of the AI Act took a risk-based approach, banning extreme cases of AI use while allowing the majority of AI systems to operate with minimal oversight. The draft focused on high-risk cases, such as AI systems used for crime prediction or job application sorting, which would require strict adherence to quality data and risk assessment protocols. Additionally, it proposed transparency measures for deepfakes and chatbots to ensure users are aware when they are interacting with AI systems.

Notably, the draft did not explicitly mention generative AI, which encompasses machine learning algorithms capable of creating new images, videos, text, and code. Tech companies embraced this approach but also sought to refine the regulations further. Many companies argued that AI should be considered a tool that reflects its user’s intent and that users should share liability for how AI systems are utilized.

IBM and Microsoft, among others, pushed for exclusions or customer-handled regulatory checks for “general-purpose AI,” which encompasses a broad range of AI applications. Critics, however, raised concerns about the lack of oversight for powerful AI systems and called for more comprehensive regulation. Nonprofit organization Future of Life, initially supported by Elon Musk, argued that future AI systems would be even more advanced than existing models and therefore required explicit regulation.

Following concerns raised by politicians in 2022, EU member states, led by France, began considering regulation of all general-purpose AI, irrespective of use cases. OpenAI, which had previously stayed out of the European legislative process, became involved and expressed concerns that proposed regulations could inadvertently capture all their general-purpose AI systems. In response, EU countries included requirements for general-purpose AI to comply with certain high-risk regulations, such as risk assessments.

The future of AI regulation and development relies heavily on how governments strike a balance between oversight and enabling innovation. It remains to be seen how the EU’s AI Act will evolve and whether the potential penalties will effectively regulate the AI sector without stifling its growth. As AI continues to advance, responsible and comprehensive regulation will be crucial to ensure its ethical and safe implementation.

## Editor Notes

This article highlights the ongoing discussions surrounding the regulation of artificial intelligence. OpenAI CEO Sam Altman’s call for government oversight underscores the need for responsible AI development. However, striking a balance between regulation and fostering innovation poses challenges for tech companies. While the EU is leading the way with proposed legislation, the US lags behind, with minimal regulation in place. It is crucial for governments to implement robust regulations to harness the full potential of AI while safeguarding against risks. For more AI-related news and updates, visit GPT News Room.

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