FTI Consulting News Bytes – 12 January 2024

FTI Consulting News Bytes

We start this week with the story that has been dominating UK headlines: the Horizon Post Office scandal which, according to Hugo Rifkind at The Times, demonstrates the need for human oversight and accountability over automation. Secondly, how do you reign in Big Tech? Poach some of their staff, according to Ofcom, who have hired senior executives from Google, Meta and Microsoft. Next, we look at talks on international standards on AI safety and misinformation that took place between US-based AI companies and Chinese state-backed institutions. From there, in a twist of irony, we turn to celebrity deepfakes. Finally, we finish with a snapshot of the eye-catching gadgets revealed at this week’s Consumer Electronics Show (CES) in Las Vegas.

But before we get into the news stories proper, FTI’s TMT team in London made its annual predictions for the year ahead, using AI to depict each prediction in art form. Please do take a look at our 2024 Forecasts: Tech Evolution & Disruptions here.

And finally… if you’re heading to Davos next week for the World Economic Forum, say hello to the FTI team: Charles Palmer, Global Head of TMT will be there. Charles is eager to network with leaders from around the world, examining critical topics – from AI to climate and energy – through the lens of “rebuilding trust”. If you are planning to attend, message Charles to find a time to meet up.

This week’s news

Another scandal on the Horizon?

The Post Office Horizon IT inquiry has dominated UK headlines this week after an ITV drama series brought renewed attention to the wrongful prosecutions of hundreds of post workers, caused by errors in the Post Office’s electronic point-of-sale (Epos) system, Horizon. Horizon is not the only system to have had such issues: Hugo Rifkind’s column in The Times references a 2023 Wired article which detailed a series of cases in which automated systems “designed to stop fraud had ended up making baseless accusations”. He raises concerns over the ethics of over-automation, arguing that the more we automate, the fewer people there will be who understand what is being automated. He concludes that it is crucial that humans remain in control and behind the scenes of automated systems so scandals like Horizon can be avoided. 

Ofcom’s Big Tech recruitment drive 

Ofcom has been recruiting staff from Big Tech companies as it prepares to enforce the Online Safety Act, the Financial Times reports. The UK media watchdog has created a team of nearly 350 people dedicated to tackling online safety, and aims to hire another 100 this year. Ofcom’s hiring spree, which includes poaching senior executives at Meta, Microsoft and Google, comes as the Online Safety Act gives the regulator powers to hold platforms responsible for any illegal material, and broader duties to protect children online. Ofcom expects that it will need to defend many of its decisions in court, where tech companies might challenge any ambiguities. Suzanne Carter, director of enforcement at Ofcom, commented “We are fully prepared to take risky cases in terms of our own legal exposure”, adding that Ofcom “will be up against some big companies; there could be a very hostile environment here”.

AI safety: US & China engage in diplomacy

US-based artificial intelligence companies have reportedly engaged in secret diplomacy with Chinese AI experts, the Financial Times reports. Scientists and policy experts from OpenAI, Anthropic and Cohere are alleged to have attended two meetings in Geneva last year alongside representatives of Chinese state-backed institutions including Tsinghua University. The talks provided an opportunity to discuss the risks from AI and encourage investment into AI safety research, amid shared concerns about how the emerging technology may spread misinformation and “threaten social cohesion”. One person who attended the talks highlighted the significance of productive communication between representatives from the US and China, commenting that there is “no way for us to set international standards around AI safety and alignment without agreement between this set of actors”. The White House, UK and Chinese government officials were aware of the meetings, which were convened by private mediation organisation Shaikh Group.

Swifties scammed by AI

‘Swifties’ across the world were duped this week when a video appeared to show Taylor Swift offering fans the chance to win free Le Creuset cookware sets. Le Creuset confirmed with The New York Times that it was not involved with the singer for any consumer giveaway. This was just the latest in a series of scams involving celebrity deepfakes. Last October, AI versions of actor Tom Hanks and journalist Gayle King offered fake dental plans and iPhone giveaways. AI is not only enabling increasingly convincing imitations of celebrities, but also creating a new breed of ‘virtual influencers’ according to the Financial Times. Lil Miquela, one of the first virtual influencers with almost 3 million followers, reportedly charges hundreds of thousands of dollars and works with brands like Burberry and Prada. While human influencers must disclose when posts are sponsored, there are currently no rules requiring virtual influencers to declare they are generated by AI.

Viva Las Vegas! CES is back

The annual Consumer Electronics Show (CES) kicked off in Las Vegas this week. It appears there is nothing that can’t be improved by AI. You would have been forgiven for thinking fridges largely deliver on their primary purpose of keeping food cold. Alas, Samsung has released the 2024 Bespoke 4-Door Flex Refrigerator with AI Family Hub+, equipped with a smart internal camera that can visualise items inside and ‘Vision AI’ technology that can identify up to 33 different fresh food items. Elsewhere, there were other gadgets on show, addressing some more pressing needs. Smart glasses have made somewhat of a comeback with EssilorLuxottica unveiling a pair of glasses with advanced hearing technology for the hard-of-hearing while Lumen showcased glasses that replicate the support provided by guide dogs for the visually impaired, according to IoT World Today.

Top Tweets of the Week

• Guy Adams, Feature Writer, Daily Mail: In plagiarism news, a Twitter personality appears to have copied out the article I wrote for yesterday’s paper and turned it into a *THREAD*… It has then gone viral and lots of people are congratulating them for writing an excellent *THREAD*…
• Gary Gensler, Chairperson, US Securities and Exchange Commission: The @SECGov twitter account was compromised, and an unauthorized tweet was posted. The SEC has not approved the listing and trading of spot bitcoin exchange-traded products.
• John Burn-Murdoch, Chief Data Reporter, Financial Times: NEW: analysis of millions of books published over centuries suggests western society is shifting away from a culture of progress, and towards one of caution, worry and risk-aversion. I think this is one of the most important challenges facing us today. 

Number of the Week

£8.01bn – The amount of net outflows from UK equity funds in 2023, according to Calastone, the largest global funds network.