Sometimes AI seems pretty impressive — at least in its ability to whip up several images of a cat playing a banjo in a matter of seconds.
But is it always? SEC Chair Gary Gensler recently brought up the concept of “AI washing” in a pop culture-laden speech, comparing it to The Music Man, a musical about a big-talking con man.
AI washing is when companies create false buzz and manipulate investors by:
Everyone wants to be part of the hot new thing. Goldman Sachs found that a record 36% of S&P 500 companies talked about AI in their Q4 earnings reports, per Business Insider.
But many companies are nebulous at best about what AI can do and how it will integrate into existing operations, while others are hyping a future that may never occur.
Example: I received a press release about an AI girlfriend who doesn’t nag you to do the dishes. She also doesn’t really exist, and unless she’s a WiFi-enabled dishwasher, you’ll eventually still have to do your own dishes.
Yes. Hype too hard, and the SEC will come for you. It charged two companies earlier this month.
While AI does have great potential, companies should also be realistic about what it can do.
One company found its customer support agents were 14% more productive when integrating AI, though its higher-skilled agents saw little benefit.
And companies that have attempted to use AI to fully create articles, art, or other creative work have had mixed results. May we never forget that Glasgow Wonka experience.