News & Insights

While the latest Mission Impossible movie: Dead Reckoning Part 1 was impressive, it’s worth mentioning that we are not yet at a stage where sentient beings can ‘think’ for themselves and control our future.

At present, generative AI can only respond to user prompts and doesn’t think for itself – so we are some way off creating truly sentient beings.

Generative AI should be viewed as a tool and not a replacement. Hammers didn’t replace builders, and nor did nail guns… Builders with nail guns replaced those builders without. Similarly, generative AI will not replace our jobs, but individuals that know how to effectively use generative AI as a tool, will replace those who don’t!

What is Artificial Intelligence?

The concept of AI is not new, it has been a part of our lives in some form or another for centuries. It wasn’t until 1947 in London that Alan Turing reshaped what we would consider to be AI when he said what we want is a machine that can learn from experience.

Artificial intelligence at its most basic level is a mathematical model of computation. That is, a logical expression, such as “if A then B”. When a series of these logical expressions, called “algorithms”, are used they form a “program”.

How can AI benefit your business and customers?

AI is now becoming more present in our lives, through:

• recruitment software that scan our resumes before being sent to HR;
• Alexa listening to us;
• robo-vacuums cleaning the floor;
• Netflix suggesting what we watch next;
• Google finishing our sentences when we enter search terms; or
• Chatbots (such as ChatGPT) assisting with task prompts.

What is generative AI?

Generative AI works on the mathematical basis of probability in conjunction with “memory”. Using generative AI is equivalent to an individual with a photographic memory, visiting every public library in the world, reading every book in each library, and being able to recall every fact it has ever read in an instant. The AI then generates an answer to the stimulus provided to it, being the user prompt.

Generative AI starts with an assessment of your user prompt and uses the training it has received to recognise the words in the prompt, including their relationship to one another, and assigns values to each word. Unless you entered a prompt directing it to copy something, generative AI doesn’t copy anything in the generation of the output.

As you can expect, the creation of the output is highly dependent on two core elements:

1. the user prompt; and
2. the accuracy, quality, and quantum of training the generative AI has received.

And this is where we open a whole can of worms!

Is AI the new wild west?

In Australia, there is currently no legislation specifically directed towards AI. Instead, there is a reliance upon multiple different sources of legislation such as Australian Consumer Law, Australian Privacy Principles, and for products using AI in medical devices there are provisions in the Therapeutic Goods Act 1989 (Cth).

In addition to legislation, there are also various industry codes (which are not binding or compulsory) that are being developed, and of course, Australia’s Artificial Intelligence Ethics Framework, which was introduced on 7 November 2019 and includes principles for the responsible stewardship of trustworthy AI. The AI Ethics Framework is a voluntary code, that consists of 8 principles to be applied in the design, development, and implementation of AI.

Most recently, the Australian Government issued a discussion paper ‘Safe and Responsible Use of AI in Australia’ which will hopefully result in specific legislation being created to address the use of AI in Australia.

However, in the meantime, AI is a complex web of legal red tape that needs to be negotiated to determine best practices, implementation, and legal limitations to the use of AI.

How can AI help your business?

AI is already having a big impact on industries such as accounting, agriculture, manufacturing and retail. There are many ways AI can be used, within the framework of its current capabilities and development stage.

Accounting and finance

AI in Accounting and Finance sectors can be used to:

• interpret and analyse extreme amounts of financial data;
• provide more accurate financial statement forecasts, to automate repetitive tasks; and/or
• analyse patterns or trends in financial data.

Agriculture

While perhaps not the first thing you think of, technology such as AI can have a meaningful impact on Agricultural and Farming sectors. It can:

• improve crop yield prediction through real-time sensor data and visual analytics data
• assist with crop planning, to minimise reliance on seasonal staff or lack thereof (and related costs)
• to improve track & traceability of supply chains.

Manufacturing

Predictably, AI developments will have an impact on manufacturing but it’s important to note that robots won’t be taking over just yet! AI can be used to:

• improve the management of inventory;
• locate and track component parts;
• redesign items to use less materials while maintaining structural integrity;
• predict when replacement parts or machinery will be required so it is on hand before the existing machinery expires; and/or
• spot and fix equipment inefficiencies as and when they develop.

Retail

We’ve all seen an increase in the capability of self check outs, but AI can also be used to:

• manage stock levels and make seasonal demand predictions;
• track (and prevent) copycat products;
• allow consumers to ‘try on’ clothing or make-up with a mere swipe of the hand.

Your mission should you choose to accept it is to embrace AI and use it effectively as a tool of your business! It’s a rapidly evolving space and understanding the legal parameters surrounding this technology will be crucial to its implementation and success.

For further information and advice about implementing the use of AI in your business, AI policy or IP and copyright on AI inputs and outputs, please contact the experts at Macpherson Kelley.

The information contained in this article is general in nature and cannot be relied on as legal advice nor does it create an engagement. Please contact one of our lawyers listed above for advice about your specific situation.