Rapid growth of AI spurs the need for greater regulation

today’s top news

• The US Federal Reserve will announce its decision on interest rates today at 2pm ET / 7pm London time. See here for details and reactions.

• An FT investigation reports how Russian spy networks acquired classified technology from EU firms, even after the US-led crackdown on secret smuggling ring. A Russian warship was spotted near the Nord Stream pipeline last year, days before the gas link between Russia and Europe was blown up.

• Russia has accused Ukraine of trying to assassinate Vladimir Putin in a drone strike on the Kremlin. Both sides stepped up airstrikes ahead of the expected Kiev counterattack.

For the latest news updates, live blog

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Good evening.

The “singularity” (the hypothetical moment when artificial intelligence becomes parity with humans) may be some time away, but it will bring new opportunities for big tech and give new urgency to the regulatory debate. and there are increasing signs that it could disrupt the business world.

U.S. education company Chegg yesterday became one of the first to acknowledge financial damage as a direct result of generative AI. An example of this would be the use of the chatbot ChatGPT. The announcement sent chills across the sector, sending Chegg shares and those of its rivals plummeting.

Other sectors, such as advertising, are more obscure. WPP, the world’s largest advertising group, argues that AI is an opportunity, not a threat, while other agencies say technology companies such as Meta can create as well as manage personalized ads for their clients. Because we are building a system that does this, we are concerned about being excluded from the advertising process. .

What is beyond doubt is the desire of technology companies to take advantage of rapidly evolving science. They want a new wave of generative AI. The latest announcement is a new AI chatbot called Pi by the co-founders of Google DeepMind and LinkedIn, which joins similar products launched this year by OpenAI (the company behind ChatGPT), Google, Snap and others. .

Debates over regulation are also heating up.

As Lex’s column points out, AI taps into many existing concerns around privacy, data use, copyright, misinformation, and disinformation. The head of Norway’s sovereign wealth fund, the world’s largest, said last week that the government needs to speed up the development of regulations, announcing it will set guidelines on how companies in which it invests can use AI “ethically.” bottom.

The EU, backed by the European Parliament, is drafting the toughest rules yet on AI, which could result in fines of up to €30 million or 6% of annual global turnover.

Ethical issues are also the subject of today’s Moral Money newsletter (for premium subscribers). This newsletter addresses the question of whether fears about generative AI may prompt a broader rethink of whether technology companies really count as ethical investments.

Meanwhile, there are growing warnings about what AI can go unchecked. Elon Musk joined more than 1,000 researchers and executives last month to oppose a “dangerous” arms race in which he called for a six-month “pause” of development.

But the most serious warning came yesterday from Geoffrey Hinton, widely regarded as the godfather of modern AI. Hinton resigned from his role at Google, warning about misinformation flooding the public his domain and AI taking more human jobs than predicted.

Hinton said he fears the race between Google and Microsoft to launch AI-driven products before proper guardrails are put in place, saying the moment AI surpasses human intelligence is coming sooner than expected. said it does.

“I don’t think they should expand this further until they understand if they can control it,” he said.

Listen to the latest in our Night School podcast series for discussions about . Biggest tech story of the year So far, it includes AI, the US-China tech race, and the future of blockchain.

What You Need to Know: The UK and European Economy

Official data confirm the extent of food price hikes in the UK.the price of cheese, milk and egg To-go burgers and fish and chips have grown nearly 20%, with an increase of over 30% in the last 12 months.

euro zone inflation It rose for the first time in six months to 7% from 6.9% in April, complicating the situation for tomorrow’s European Central Bank interest rate decision. Core inflation, which excludes volatile energy and food prices, fell to 5.6% from 5.7%. Other data show that demand for loans has fallen sharply since the 2008 financial crisis. Eurozone unemployment It fell to a record low of 6.5% in March.

European and Latin American police crack down on Italian mafia groups Ndranghetahotels, restaurants, car wash companies, and grocery chains are suspected of laundering drug money.

What You Need to Know: The Global Economy

Sultan Al Jaber Nominated for President COP28 And the head of the Abu Dhabi National Oil Company said it would “supercharge” global climate finance, complete a $100 billion fund to help poor countries deal with climate change, and invest in “low-carbon” technologies. We promised to lead a new push.Reducing Oil Production Means gulf countries The IMF said it faced a significant slowdown in growth.

U.S. Treasury Secretary Janet Yellen The government warned on June 1 that it was at risk of running out of funds as the long-standing debate over the debt ceiling resurfaced.

What does our latest big lead look like Tunisia, The country that emerged as a beacon of democracy in the Arab world a decade ago is returning to dictatorship.

What You Need to Know: Business

US investment china stocks It has taken a beating as political tensions escalate between Washington and Beijing. Foreign consultants working in China “Men in blackmaking due diligence on the country’s businesses even more difficult.

EU and US warn Malaysia On the risks to national security and foreign investment by allowing China’s Huawei to bid for a role in its 5G network.

Despite the economic impact of U.S. restrictions on classified technology, Huawei, It has had some success building its own resources to evade sanctions, with Beijing’s backing.

european investment Chinese car marketMeanwhile, companies trying to reclaim market share from China’s dominant electric car makers hit a record €6.2 billion last year despite the worsening political environment. Demand for luxury cars Boosted profitability for Porsche and Aston Martin.

Chilean The move to state control over lithium projects to develop vast resources of components for electric vehicle batteries has been attacked by businesses who claim it erodes the country’s investment potential.

blood pressure reported a better-than-expected first-quarter profit of $5 billion, albeit down from record levels in 2022, and said it will slow its share buyback program. Shell, BP and Total Energies made more profits last year than the four largest private energy traders in buying and selling oil, gas and power, highlighting the growing importance of these activities to profits. I’m here.

China Dominating the global market for initial public offerings as the US and Europe continue to disappoint, buoyed by the Shanghai and Shenzhen Stock Exchange’s new streamlined listing regimes.

world of work

Alumni whose education was disrupted by the lockdown had weaker teamwork and communication skills than their previous cohort, according to the study. Deloitte and PwC, offers special coaching to its youngest UK staff. New hires lack confidence in performing basic tasks such as giving presentations and speaking at meetings, they said.

if you want to move out of your technical job But I’m worried about selling your transferable skills.

some good news

sweden is the world first electronic highway, permanently electrified roads that allow vehicles to be charged while driving. We want to build another 3,000km of electric roads by 2045.