Commercial AI use will speed up in 2024, but businesses face regulatory challenges in implementing solutions
Market Insight 23 January 2024 23 January 2024
Asia Pacific, North America, UK & Europe
Predictions 2024 - Regulatory
With jurisdictions taking varying regulatory approaches to AI, businesses looking to develop proprietary tools should consider how this divergence could impact global roll-out of solutions
The explosion of interest around commercial uses for artificial intelligence (AI), which was largely concentrated in the technology space in 2023, is expected to result in widespread deployment of generative AI for new business functions in 2024.
While companies will move at different speeds in developing proprietary AI solutions, there is likely to be a broader roll-out of integrated tools for existing enterprise solutions used by many businesses.
But with global jurisdictions approaching AI regulation in different ways and at different rates, there is also likely to be divergence in the short term in how they regulate AI tools.
Some jurisdictions are taking a wait-and-see approach to regulating AI. Others, such as the UK, will utilise existing regulations. Meanwhile, the European Union is introducing new regulations specifically aimed at managing AI development.
A major theme in the regulation of AI will be the transparency and explicability ‘explainability’ of solutions. Solutions providers will increasingly need to be able to explain to customers and regulators what AI engines are actually doing, what data they are using and how they obtained it as well as how it is being used.
The challenge for AI solutions providers is whether they can incorporate mechanisms for tracing how AI has produced relevant outputs. This could be a potential area for disputes around liability for mistakes made by the AI in producing outputs.
For example, in the UK, where AI is already being used for automated complaints processes, this could lead to escalation of complaints if the AI fails to resolve them.
Corporate businesses therefore need to develop and implement consistent frameworks and policies to explain and justify their use of AI and defend their interests.
This will also impact the insurance space, with corporates seeking specific coverage for AI-related risks, while AI is also expected to be increasingly used for automatic claims resolution and fraud detection.
With the EU having adopted a more prescriptive approach to regulation with its AI Act, multinational corporates will need to seek advice on the global rollout of AI solutions. They must ensure whether they can be deployed in more tightly regulated jurisdictions or if they need to adapt them to conform with different regimes.