AI

AI stands for Artificial Intelligence. It refers to the development of computer systems which perform tasks that typically require human intelligence. These tasks include problem-solving, learning, speech recognition, perception, and decision-making. AI aims to create machines that can mimic cognitive functions such as reasoning, problem-solving, learning from experience, and understanding natural language.

We come across AI in our day to day lives through smart speakers - which use AI to understand natural language and perform tasks based on voice commands. We also see AI in social media platforms as they use AI algorithms to analyse your preferences, interactions, and content engagement. This information is then used to suggest relevant content, friends, or ads in your feed. Many companies employ AI-powered chatbots on their websites to provide instant customer support. These bots can answer frequently asked questions, guide users through processes, and even resolve certain issues without human intervention. We also see the use of AI in navigation apps to analyse real-time data, historical traffic patterns, and user inputs to predict and provide the fastest route to a destination. They can also offer alternative routes based on current traffic conditions.

What do you need to consider as an AI developer or service provider?

When entering into contracts with customers or users as an AI service provider, it's crucial to explicitly address several key aspects to ensure clarity, transparency, and legal compliance. A key consideration should be to outline how user data will be handled, stored, and protected. This will likely involve specifying security measures in place to safeguard sensitive information.  You will also want to state any limitations of your liability and define circumstances under which each party is responsible for indemnifying the other. Clarify the extent of financial responsibility in case of data breaches, system failures, or other issues. Your contracts should also specify the ownership and usage rights of intellectual property, including any pre-existing technology or proprietary algorithms. Clarify whether the customer retains any rights over the data generated through the use of the AI service.

What do you need to consider when engaging an AI provider?

When incorporating AI into your own product as a business customer, it's essential to address various contractual considerations to protect your interests, ensure clarity, and establish a strong partnership with the AI service provider. Make sure that your contract with the provider clearly defines the scope of AI services being provided. Ensure that the scope aligns with your business requirements and objectives and specify the features, functionalities, and deliverables to be included in the product. The contract should include provisions for confidentiality to protect sensitive information exchanged during the collaboration, and ensure that the AI service provider commits to compliance with relevant laws, regulations, and industry standards. Specify any specific regulatory requirements applicable to your industry or jurisdiction.

You should also look to address the ownership and licensing of intellectual property, including any customisations or enhancements made to the AI service. Clarify whether the AI service provider retains any rights over proprietary algorithms or technologies.

How can we help?

Engaging legal professionals experienced in technology and AI contracts is advisable to ensure that the contract accurately reflects your business needs and protects your interests in the dynamic field of AI technology. We can help you clear your path to success.

In need of support from commercial or technology contract lawyers in the UK? Get in touch with our team.

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