By Ed Watal, Founder & Principal — Intellibus
Much like the practice of “greenwashing,” AI washing refers to companies claiming to use AI without being completely forthcoming about how — or if they even truly are in the first place.
Artificial intelligence technology has taken the world by storm, revolutionizing numerous global industries for good. Yet due to AI’s sudden boom in popularity, many are attempting to cash in on the hype cycle of the technology by claiming to harness these tools’ massive power without actually using them. In these cases, companies are receiving the popularity boost of this boom without offering their customers any of the perks.
This trend of businesses making false claims about their use and integration of artificial intelligence has come to be known as “AI washing.” By falsely representing their use of this innovative technology in their operations, businesses are deceptively marketing their offerings in a way that misleads consumers and investors alike.
Examples of AI washing
AI washing can be done in several mediums, including words, images, and even purposeful omissions of information or details. Some of the most common ways we see businesses conduct AI washing include:
- Misleading product descriptions: One of the most common forms of AI washing is creating misleading product descriptions. For example, a business could mislabel its traditional algorithms as artificial intelligence. Because of the similarities between these two technologies, some businesses may be tempted to pull a fast one on unsuspecting consumers, even though this practice is clearly deceptive and unethical.
- Exaggerating the scale of AI’s capabilities: Another example of AI washing is exaggerating the scale of a company’s AI capabilities or use, such as claiming that a product or service is “AI-powered” when the technology’s importance in the operation is minimal. Although the business is not outright lying about using artificial intelligence, it is still deceiving consumers into thinking that it uses AI more extensively.
- Claiming to use AI without substantial implementation: Worse yet, some companies may claim to be using artificial intelligence without substantial implementation of any kind. One of the most egregious examples of AI washing is when a company claims to use AI but doesn’t at all, or when its AI is still in such early stages of its development that its effects are negligible.
How AI washing causes harm to the world
While it may seem to the businesses that use AI washing to only benefit them, the practice is not victimless. It has some very severe consequences, even beyond those who are directly involved in the practice.
Of course, the most direct consequences of AI washing are against consumers. When businesses deceive their customers using false claims about AI, they are influencing their purchasing decisions. Given many consumers' expectations regarding the performance of AI products, purchasing these falsely represented products could hurt their wallets.
Companies conducting AI washing may also face serious legal consequences. As this problem becomes more prevalent, regulatory bodies are becoming more vigilant, imposing fines and sanctions on those who make false claims about their use of artificial intelligence.
The more severe consequences, though, are against businesses that are genuinely investing in the development of AI technology. AI washing has a profound effect on the market and industry as a whole, and the businesses guilty of AI washing are in direct competition with those companies that genuinely use and develop AI. Any investments that go to a company making these false statements are funds that could be used to support actual AI businesses.
However, perhaps the most damaging effect of AI washing is that it erodes the public’s trust in the technology itself. AI is still emerging and developing, and many are still reluctant to embrace this new paradigm. When companies are practicing AI washing with their products and services, they are underdelivering to consumers and stakeholders, which will make people even more hesitant to make future purchases and investments in artificial intelligence.
Fighting back against AI washing
Thankfully, those who use AI washing to try and claim an unfair advantage for their business are in the minority. Most companies that claim to use AI are genuinely exploring the technology and its benefits but could be getting a bad reputation because of the false claims from those conducting AI washing. To stop the consequences of AI washing, those participating in the practice must be held accountable.
Transparency and honesty are key qualities that will help us fight AI washing, and the industry must strive to explain artificial intelligence technology to the public more clearly and effectively. At this point, many people still do not understand how companies use artificial intelligence due to the technology’s complexity or because these companies intentionally use cryptic language to protect their intellectual property. Instead, businesses using AI should strive to clearly and understandably explain how they use AI and provide evidence when possible.
The industry itself can play a pivotal role in supporting the increase in transparency and honesty regarding artificial intelligence, such as establishing certification bodies that can assess and verify the capabilities of AI products and the validity of AI claims. By creating benchmarks by which AI technologies can be evaluated, consumers and stakeholders will have a trusted mark of authenticity they can use to make more informed purchasing and investment decisions.
Some have suggested that control of AI washing goes even further to the point of regulation. Regulatory bodies like the SEC have the opportunity to institute consequences for AI washing and other deceptive practices related to artificial intelligence. Stringent verification processes and penalties for false claims are measures that can be taken to discourage companies from engaging in this harmful practice.
However, perhaps the most powerful tool we have to thwart the wrongdoers abusing the AI boom through AI washing is education. When people are better educated about the features and benefits of genuine AI technologies, they will be more informed and prepared to identify fraudulent products and evaluate product claims.
Although artificial intelligence has the potential to make a legitimate difference for many people’s businesses, some hope to take advantage of the surge in its popularity by falsely claiming to use it. This practice of AI washing hurts everyone, from the consumers deceived by these businesses to the competitors whose reputation is damaged by association with these companies making false claims and promises. By ending this practice, we can create a landscape where artificial intelligence can thrive and genuinely help people.
— Ed Watal is the founder and principal of Intellibus, an INC 5000 Top 100 Software firm based in Reston, Virginia. He regularly serves as a board advisor to the world’s largest financial institutions. C-level executives rely on him for IT strategy & architecture due to his business acumen & deep IT knowledge. One of Ed's key projects includes BigParser (an Ethical AI Platform and an A Data Commons for the World). He has also built and sold several Tech & AI startups. Prior to becoming an entrepreneur, he worked in some of the largest global financial institutions, including RBS, Deutsche Bank, and Citigroup. He is the author of numerous articles and one of the defining books on cloud fundamentals called 'Cloud Basics.' Ed has substantial teaching experience and has served as a lecturer for universities globally, including NYU and Stanford. Ed has been featured on Fox News, Information Week, and NewsNation.
