How we will enforce the rules on artificial intelligence

By | May 11, 2023

Written by Lina Khan.

Virginia Gabrielli for “The New York Times”

It is exciting and disturbing to have a realistic conversation with a computer. Thanks to the rapid advancement of generative artificial intelligence (AI), many of us have now experienced this potentially revolutionary technology that heralds massive changes in the way people live, work and communicate around the world. The full scope of AI’s potential is still up for debate, but there is no doubt that it will be hugely disruptive.

The last time we faced such pervasive social change due to technology was the dawn of a new generation of the world wide web (Web 2.0) in the mid-2000s. Innovative new companies like Facebook and Google revolutionized communications. and provided popular services. to a rapidly growing user base.

These innovative services, however, came at a high price. What were initially perceived as free services were monetized through extensive tracking of the people and companies that used them. The result has been an online economy in which access to increasingly essential services depends on the widespread collection and sale of our personal data.

These business models led companies to develop endlessly invasive ways to track us, and the Federal Trade Commission (FTC) would later find reason to believe that several of these companies had broken the law. Combined with aggressive acquisition or foreclosure strategies from companies that threatened its position, these tactics consolidated the dominance of a handful of companies. What started as a revolutionary set of technologies ended up concentrating enormous private power over critical services and entrenching business models at exorbitant costs to our privacy and security.

The path that the Web 2.0 era took was not inevitable; rather, it was shaped by a wide range of political options. And now we are faced with another moment of choice. As the use of AI becomes more widespread, government officials have a responsibility to ensure that history we learned the hard way does not repeat itself.

As companies race to develop and monetize AI, the FTC is carefully considering how we can best fulfill our dual mandate of promoting fair competition and protecting Americans from unfair or deceptive practices. As these technologies evolve, we are committed to playing our part in upholding America’s long tradition of maintaining open, fair, and competitive markets that have built both revolutionary innovations and our nation’s economic success, without tolerating business models or practices that involve the massive exploitation of its users. While these tools are innovative, they are not exempt from existing rules, and the FTC will vigorously enforce the laws we are tasked with administering, even in this new marketplace.

Although technology is advancing fast, we can already see several risks. The increasing adoption of AI risks further blocking the market dominance of existing big tech companies. A handful of powerful companies control the necessary “raw materials” that startups and other businesses rely on to develop and evolve AI tools. This includes cloud services and computing power, as well as massive data sets.

Regulators and authorities need to be vigilant. Dominant firms could use their control over these critical inputs to unfairly exclude or discriminate against their competitors, picking winners and losers in ways that further cement their dominance. Meanwhile, the artificial intelligence tools that companies use to set prices on everything from laundry detergent to bowling alley reservations can facilitate collusion to unfairly inflate prices, as well as forms of targeted unfair pricing. Authorities have a dual responsibility to be vigilant about the risks posed by new AI technologies and, at the same time, to promote the fair competition necessary to ensure that the market for these technologies develops legitimately. The FTC is well equipped with legal jurisdictions to handle the problems raised by the rapidly growing AI industry, including cases of collusion, monopolies, mergers, unfair pricing, and unfair competition.

And with artificial intelligence comes the risk of fraud taking off. It may not be ready to replace professional writers, but it can already do an incomparably better job than the average scammer at crafting a seemingly authentic message, giving scammers the ability to create content quickly and cheaply. Chatbots are already being leveraged to create deceptive emails, fake websites, and fake consumer reviews; The bots are even instructed to use words or phrases targeted at specific groups and communities. Scammers, for example, can compose highly targeted phishing messages based on individual users’ social media posts. Along with tools that create deep fake video and voice impersonations, these technologies can be used to facilitate large-scale fraud and extortion.

By enforcing the provisions of the Deceptive Practices Act, we will not only take on the scammers who use these tools, but also the companies that make them available to them.

Finally, these AI tools target massive amounts of data in ways that are largely uncontrolled. Because they could receive biased and error-ridden information, these technologies risk automating discrimination, unfairly excluding people from jobs, housing, or critical services. These tools can also target private emails, chats, and sensitive data, ultimately exposing personal information and violating user privacy. Existing laws prohibiting discrimination will apply, as will existing principles prohibiting the collection or exploitative use of personal data.

The story of the growth of tech companies two decades ago serves as a cautionary tale about how we should think about the expansion of artificial intelligence. But history also has lessons on how to manage technological upheavals for the benefit of all. Facing antitrust scrutiny in the late 1960s, the computer giant IBM separated software from hardware systems, catalyzing the rise of the US software industry, generating trillion-dollar growth. The government’s actions required AT&T to open its patent vault and similarly sparked decades of innovation and the expansion of countless new companies.

America’s longstanding national commitment to promoting free and fair competition has been an essential part of what has made this nation an economic superpower and a laboratory of innovation. Once again we find ourselves at a critical decision point. Can we continue to be the home of the world’s leading technology without accepting business models of negative competition and monopoly control that preclude higher quality products or the next big idea? Yes, if we make the right political decisions.

* Lina M. Khan is chairwoman of the Federal Trade Commission

© 2023 Available from The New York Times Licensing Group

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