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Innovation at Stake: How White House AI Regulation Favors Tech Giants


Innovation at Stake: How White House AI Regulation Favors Tech Giants
Innovation at Stake: How White House AI Regulation Favors Tech Giants

The White House issued an executive order yesterday on AI regulation, ushering in a new era of oversight in the fast-evolving AI landscape. One of the key provisions of this order mandates that companies developing AI models exceeding a certain computational threshold must notify the federal government during the training process and share the results of safety tests under the Defense Production Act. While this regulation aims to enhance national security and public safety, it raises concerns about its potential impact on competition and innovation.


Stifling Innovation and Favoring Established Giants


The executive order's threshold for notification and safety testing is set at a level where all major AI models with potential risks to national security and public safety are likely to fall under its purview. While this may enhance oversight, it also presents a conundrum. Established tech giants with significant resources may navigate these regulatory waters more easily, while startups and smaller companies could face barriers to entry. This echoes past experiences with financial regulations like the Dodd-Frank bill, which stifled competition in the financial sector. Will AI regulation yield a similar outcome?


Keeping Pace with AI Innovation


The AI industry moves at breakneck speed, with costs for training AI models plummeting in recent years. For example, DALL·E 2, an AI model that once cost over $2 million to train, can now be trained for a mere $26,000, as demonstrated by PixArt's recent research. This highlights a fundamental challenge: how can the government establish a fixed threshold in an industry that evolves at lightning speed while the regulatory process moves at a snail's pace? Is there a way to strike a balance between safety and innovation in the AI domain?


A Step in the Right Direction


It's worth noting that while the AI regulation may raise concerns, it represents a proactive step by the government to address AI's rapid development and potential risks. In a climate where congressional action has been at a standstill, this executive order demonstrates a commitment to safeguarding national interests. The balance between fostering innovation and ensuring public safety remains a challenge, but at least the government is taking strides to grapple with this complex issue.

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Do you or your organization have questions, need guidance, or seek advice on AI? I'll be available for a FREE 15 min consultation to see if I can help, check out DavidBorish.com/AIConsulting to learn more.

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