Concerns Grow Regarding “AI Washing” and Likely Harms

Amazon faced some criticism following its launch of the Just Walk Out technology at different physical grocery stores across several markets. This new artificial intelligence-powered system allows consumers at different Amazon Go and Amazon Fresh shops to just pick the things they need and leave the premises, all without having to stop.

To work, this system uses many sensors to determine what a customer picks. Once this is done, the customer is then billed automatically.

What you may not be aware of is the fact that a few months ago, it had been reported that while Just Walk Out did rely on artificial intelligence (AI), the system also needed actual workers to go through almost three-quarters of these “smooth sailing” transactions.

Amazon refuted these claims, however, explaining that the workers, all from India, didn’t have to review video footage from all the company’s shops. Instead, Amazon noted, the employees were reviewing the system in an effort to improve accuracy.

This is a good example of how companies globally are making bloated claims about their use of artificial intelligence. This phenomenon has been termed as “AI washing,” in reference to green-washing claims often made with regard to the environment.

There are several types of AI washing, starting with companies that just integrated an artificial intelligence chatbot onto their current non-AI operating software. Some companies are also overstating the effectiveness of their artificial intelligence over current methods, with some going as far as to suggest that their solutions are fully operational even when they aren’t.

Additionally, other companies are claiming to use artificial intelligence when, in fact, they’re using computing that’s even less sophisticated.

An analysis recently conducted by OpenOcean determined that more than 25% of tech start-ups mentioned the use of artificial intelligence in their pitches last year. This is an increase from the 10% who did the same in 2022.

Sri Ayangar, a team member at OpenOcean, posits that a desire to appear advanced and compete for additional funding has prompted some companies to overstate their artificial intelligence capabilities. Ayangar argues that some founders hold the opinion that not including artificial intelligence in their pitch may be disadvantageous to them.

From the company’s analysis, an imbalance exists between companies that have demonstrated tangible results driven by artificial intelligence and those that claim to have these capabilities. This issue seems to have existed for some years now, according to a separate study done by MMC Ventures, a tech investment company. In its report, MMC had determined that 40% of new tech companies that defined themselves as AI start-ups used no artificial intelligence in their activities.

AI washing not only keeps companies from meeting operational objectives but also makes it harder for investors to identify organizations that are genuinely innovative. Additionally, trust in start-ups can be eroded if consumers hold false expectations from products claiming to provide advanced artificial-intelligence-driven solutions.

To help prevent this, regulators in America have begun charging companies that make misleading and/or false statements about the extent of their use of artificial intelligence.

Over in the United Kingdom, regulations that cover AI washing have already been implemented. This includes the Advertising Standards Authority’s code of conduct, which directs marketing comms to not mislead consumers.

This “AI washing” won’t dent the inroads that true AI solutions from enterprises such as Salesforce Inc. (NYSE: CRM) are making in business because, as they say, the proof of the pudding is in the eating.

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