As the hype about generative artificial intelligence (AI) has grown, the Federal Trade Commission (FTC) has made clear that it intends to be at the forefront of federal agencies working to ensure the responsible use of AI. In just the last few months, it has spoken repeatedly about AI, issuing multiple warnings about the risks of AI technology. In many respects, this is not new terrain for the FTC. Since at least 2016, the FTC has cautioned about the potential for machine learning and AI algorithms to lead to discrimination against protected classes. The FTC recently reiterated those concerns and cautioned businesses about the use of generative AI to spread manipulative, fraudulent, or unsubstantiated content.
European Regulators Advance Artificial Intelligence Initiatives
Recent weeks have seen action from various European regulators regarding artificial intelligence/machine learning (AI/ML) and algorithms.
Opening of the European Centre for Algorithmic Transparency
The European Centre for Algorithmic Transparency (ECAT) was officially inaugurated on April 17, 2023, by the European Commission’s Joint Research Centre in Seville, Spain. The ECAT plans to leverage an interdisciplinary team of data scientists, AI experts, social scientists, and legal experts to perform technical analyses and evaluations of algorithms used by Very Large Online Platforms (VLOPs) and Very Large Online Search Engines (VLOSEs) governed by the Digital Services Act (DSA). The ECAT believes that doing so will help encourage transparency and risk-mitigation, particularly for systemic issues identified by the DSA, including possible amplification of illegal content and disinformation, impacts on freedom of expression or media freedom, gender-based violence, protection of minors online, and their mental health. Researchers at the ECAT will also study the long-term societal impact of algorithms.
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FTC Requests Comments on Cloud Computing Business Practices With Potential Data Security Impacts
The Federal Trade Commission (FTC) issued a press release and a request for information on March 22, 2023, soliciting comments from the public on cloud computing business practices, including issues related to market power, competition, and potential data security risks.
Regarding data security, the request for information seeks to gain insight on cloud computing against the backdrop of FTC guidance to businesses on steps to secure and protect data stored in the cloud. This request comes amid recent FTC enforcement matters (such as against education technology provider Chegg) alleging failure to adequately secure data stored on third-party cloud computing services.
FTC Claims Sharing User Health Data With Advertising Platforms Is a “Security Breach”
For the first time, the Federal Trade Commission has brought an enforcement action under its 2009 Health Breach Notification Rule (HBNR). The case was brought against a digital health company, GoodRx Holdings, Inc., for sharing users’ health information with third-party advertising platforms without the authorization of the users whose data was being shared.