By Heather Dunn Navarro, Vice President, Product and Privacy, Legal, G & A, Amplitude
The ongoing AI revolution has brought about a data explosion: 70% of businesses report at least a 25% annual increase in data generation. This means that AI-powered data processing and analysis capabilities have never been more crucial. However, generating and analysing such extensive amounts of data raises significant user consent and privacy issues, particularly when privacy laws are evolving so rapidly.
Against this backdrop, understanding the impact of AI on data privacy is a non-negotiable. By staying ahead of changing consumer attitudes and legal landscapes, organisations can harness technological advancements while safeguarding customer data and remaining compliant.
AI’s role in businesses
AI-powered technologies offer numerous benefits, like being able to process vast amounts of data at speeds far beyond human capabilities. They can automatically organise data using predefined criteria or learned patterns, accelerating data management and reducing human error. AI can also carry out sophisticated analysis, identify patterns, and forecast future trends. All of this can help organisations become more strategic in their decision making.
Additionally, companies can use AI tools to help them keep up with new regulations. For instance, companies can deploy AI to check evolving regulations and automatically share updates with stakeholders. Going further, organisations can even use AI to monitor data usage and detect anomalies that indicate a potential risk.
Navigating the landscape of privacy laws
However, there are two sides to every coin. While AI can further compliance efforts, it can also create new privacy and security challenges. This is particularly true today, amid an ongoing global effort to strengthen data privacy laws. 71% of countries have data privacy legislation, and in recent years, this has evolved to encapsulate AI. In the EU, for instance, approval has been secured from the European Parliament around a specific AI regulatory framework. This framework imposes specific obligations on providers of high-risk AI systems and could ban certain AI-powered applications.
The fact is, AI-powered technology is immensely powerful. But, it comes with complex challenges to data privacy compliance. A primary concern here relates to purpose limitation, specifically the disclosure provided to consumers regarding the purpose(s) for data processing and the consent obtained. As AI systems evolve, they may find new ways to utilise data, potentially extending beyond the scope of original disclosure and consent agreement. As such, maintaining transparency in AI operations to ensure accurate and appropriate data use disclosures is critical.
Another critical area of concern is the potential of AI bias, which could result in AI systems making unfair decisions about a particular group of people. This could have huge consequences if unaddressed, such as leaving some unable to get mortgage offers, or unable to get into their university of choice.
To prevent any of these risky scenarios from occurring, companies must pay attention and respond to new AI regulations as they emerge.
The consumer comes first
Today, consumers are far more savvy when it comes to privacy, and are more concerned about how their data is used. Frequent mainstream news coverage of high-profile data privacy cases has heightened this. There is also the challenge of addressing public concerns, with nearly two-thirds of consumers worrying about AI systems lacking human oversight. Moreover, 93% believe irresponsible AI practices damage company reputations. Organisations must confront the critical challenge of how to innovate with AI while maintaining compliance and public trust.
However, the landscape is nuanced. Many consumers are willing to exchange data for enhanced personalisation and improved experiences. Successful businesses are finding a way to balance AI innovation, customer experiences, and protecting customers’ privacy rights.
To find that balance, organisations must focus on three key areas: transparency, informed consent, and customer control. Being transparent requires communicating data practices clearly and accessibly, rather than being hidden away or presented in highly complicated language. When it comes to informed consent, it should be viewed as an ongoing process rather than a one-time checkbox, and consent should maintain pace with AI as it evolves. Finally, empowering customers with granular control over their data – including options to opt in or out, access, correct, and delete their information – is crucial. This is especially pertinent given the potential for inaccurate data to lead to erroneous AI outcomes. By addressing all of these aspects, organisations can build trust while harnessing the power of AI for business growth.
Protecting customer data privacy is complex, but essential, and should never be viewed as a deterrent from pursuing AI initiatives. By striking the right balance between innovation and compliance, organisations can harness the power of AI to drive growth and improve customer experiences, all while maintaining the trust and confidence of their stakeholders.
Heather has been practicing law for nearly 20 years. She is currently VP, Product & Privacy, Legal at Amplitude, working with teams across the company to make sure they remain compliant and continue to enable their customers’ compliance. Over the course of her legal career, she has worn many hats, always focused on helping companies manage risk.