Unravelling the Impact of EU's New AI Regulations: A New Game for Businesses

You might have heard the buzz about the latest AI regulation being developed by the European Parliament. It's a big step towards establishing fair and transparent rules in the realm of Artificial Intelligence. But how does this actually impact businesses???

From emotion recognition software to real-time biometric surveillance, from social scoring algorithms to creative AI, and finally recommendation algorithms, every aspect of AI is being thoroughly examined. Each of these areas carries immense implications for different business sectors.

Let's dive into the specifics and understand what this could mean for your business, the industry, and the global market.

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The grown-ups in Europe are worried about how AI can be used. Some people could use AI to do naughty things, like spying on others or lying about things. So they've decided to create some rules, just like we have in our games.

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They've said a big "Yes" to the new rules, but now they have to agree on the details. It's like deciding what the safe zones in hide and seek are. This might take a while, and they have to discuss it among three different groups, just like if you, me, and your friend have to agree on the rules of our game.

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Here are some things they want to do:

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No, using AI to guess feelings:

Do you know how sometimes you can tell if your friend is sad or happy? Well, some people think computers can do that too. But the grown-ups in Europe say this can't be done in places like schools or work, because it could lead to mistakes or unfairness.

Example- Here's an app that some teachers might use which tries to understand if a student is confused or not understanding what they're being taught. It does this by looking at the student's facial expressions. But, these rules say it's not fair to use AI like this.

Business Implications- Companies that create software for analyzing emotions, like those used in customer service to gauge customer satisfaction, might have to adjust their product offering. If they were selling this software to schools or workplaces in Europe, they would need to stop because of the new rules

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No spying in public:

AI can be used to recognize people's faces, like when your toy robot recognizes you. But the grown-ups don't want this to be used in public places to watch people without their permission.

Example- Imagine a security camera in the park that not only records what's happening but also identifies who is thereby comparing faces with a database of people. The rules aim to stop this kind of use of AI without people's permission.

Business Implications- Companies providing facial recognition technologies, especially to public institutions or police, might face challenges. They may need to adjust their technologies or change their business models. For example, a security company using real-time facial recognition in public places would need to find a different approach.

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No social scoring:

Imagine if I gave you points every time you shared your toys or did your homework, and then used those points to decide what you can do or have. That's a bit like social scoring. The grown-ups think this is not fair and should be stopped.

Example- Think about a system where you get points for being kind to others or lose points for being naughty, and these points then decide what you can do, like going to a special school or getting certain jobs. This is similar to social scoring, and the new rules want to stop it.

Business Implications- Data analysis companies that collect and use personal data to score individuals for different services, like credit ratings or insurance, may need to reconsider their methods. They might need to develop new algorithms that don't involve social behavior data.

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Rules for creative AIs:

Just like you can create beautiful drawings, some AIs can create things too, like stories or music. The grown-ups want to make sure these AIs don't copy other people's work without permission, and that people know when something was made by an AI.

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Example- For instance, imagine an AI that writes stories. But, instead of coming up with its own ideas, it copies parts of stories from different books that already exist. These rules want to make sure that doesn't happen.

Business Implications- Companies that offer AI tools for generating content, like AI writing assistants, would need to ensure they are not using copyrighted material without permission. For instance, a company like OpenAI would need to be sure its language model, GPT-4, is not trained on copyrighted books or articles.

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Check on suggestions on the Internet:

You know how when we watch cartoons on the internet and it suggests more cartoons to watch? That's because of an AI. The grown-ups want to make sure that these suggestions are good for us and don't lead us to watch things that are bad.

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Example- Consider when you're on a website like YouTube. After you watch a video about making a toy castle, it might suggest more videos about toy castles. This is done by AI. But, the rules want to make sure that these suggestions are good and don't lead us to watch things that might be harmful.

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Business Implications- Social media companies, and other companies with platforms that use recommendation algorithms, like YouTube or Netflix, would have to be more transparent about how their algorithms work. They might need to provide clearer explanations about why certain content is being recommended, and potentially be held responsible for the impacts of the recommended content.

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They are making these rules because they want to make sure AI is used in good ways. Just like we want our games to be fun and fair, they want the use of AI to be safe and fair for everyone. They're worried that if we don't have these rules, people might start to not trust each other or get scared of the world around them.

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In each of these scenarios, the businesses would need to adjust to stay in line with the new rules, and to ensure their products or services are fair, transparent, and respectful of people's rights and freedoms. This could involve changes in technology, business models, or strategies. The companies that can adapt best to these new rules will have an advantage in the marketplace.

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Remember, it's important to always follow the rules in games, and in life. And that's what the grown-ups are trying to do with AI!