Learn how artificial intelligence (AI) impacts personal data protection and how to comply with GDPR and CCPA regulations while using AI. Discover key insights on privacy, risks, and essential compliance steps
Artificial intelligence (AI) is here to stay. AI tools have become easily accessible to everyone with an internet connection these days.
You likely love to use AI, but if you don't live under a rock, you must have heard about the risks of AI to personal data privacy. Some don't care at all, and others see AI as doomsday.
We want to take a rational and pragmatic approach to online data privacy, and that's how this article will explain how AI affects data protection and how data protection affects AI.
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At its core, AI is a branch of computer science dedicated to creating machines capable of mimicking human intelligence. Unlike traditional software that follows explicit instructions, AI systems learn from data, refining their operations over time.
The heart of many AI systems is a neural network inspired by the human brain's structure. These networks process vast amounts of data, identifying patterns and making decisions. For instance, when you upload a photo to a social media platform and it automatically recognizes and tags your friends, that's AI in action.
Machine learning, a subset of AI, allows systems to learn from data without being explicitly programmed. By feeding these systems vast amounts of data, they "learn" and improve their performance. Deep learning, a further subset, uses large neural networks to analyze even more complex data sets.
In essence, AI operates by continuously learning from data, adapting its responses, and offering solutions that were once considered the exclusive domain of human cognition.
But sometimes that data is personal data. And with AI tools becoming mainstream and accessible to everyone, we cannot help but consider the risks.
The use of AI processing tools is nothing new. For years, big tech companies like Google and Meta have harnessed the power of AI to refine their advertising tools, ensuring that users receive ads tailored to their unique preferences and behaviors. This personalization is achieved by analyzing vast amounts of personal data to deliver the most relevant content.
YouTube's recommendation algorithm amazes with its ability to suggest videos that align with a user's interests. It wouldn't have been possible without its sophisticated AI mechanisms.
But the data collection and use of personal information with AI technologies were not limited to the world's most popular social networks and entertainment sites.
Insurance companies, financial companies, and HR companies have been leveraging AI in their work in ways that significantly impact the lives of individuals whose personal data is being processed.
Insurance companies use AI to generate precise insurance quotes. Recruitment agencies employ AI tools to sift through resumes and applications. Financial institutions process personal data to decide who is eligible for loans.
Even fitness applications now come equipped with AI features that provide insights into an individual's health metrics, offering personalized workout and diet recommendations.
Chances are, whether you're aware of it or not, you've interacted with or benefited from these AI data processors in your daily life.
Yet, the AI landscape witnessed a significant shift with the introduction of models by OpenAI. This marked a turning point where AI transitioned from being a tool used by tech giants to something more mainstream. It became more accessible to businesses of all sizes overnight. This accessibility, combined with increased robustness, has enabled businesses to process and analyze personal data on an unprecedented scale. The development and deployment of AI tools have become a breeze for many entrepreneurs.
However, as with all technological advancements, this comes with its own set of challenges. The primary concern is the potential risks associated with AI. And that's where data protection laws come into play.
The General Data Protection Regulation of the European Union protects personal data. The California Consumer Privacy Act protects consumer privacy.
As soon as the use of AI involves the use of personal data, GDPR is triggered and applies to such AI processing. The amount of data doesn't matter. You can't say it was just a little bit of AI data processing. The GDPR applies to such processing as long as the controller, the person whose data is processed, or the AI system are from the EU.
When the CCPA applies to a business, they are obliged to respect individuals' data privacy in the processing of personal data with AI. The CCPA is not as strict as the GDPR and relies only on the opt-out principle, yet businesses must be careful with its implementation.
Having said that, we have to clarify the following: the GDPR, CCPA, and other privacy regulations apply only when personal data is processed. AI is related to many other risks that do not involve personal information, but they are not subject to this article. Our focus here is on data privacy issues only.
The most common risks of personal data processed by AI include:
Also important to note: if you use generative AI without using personal data, such as to write articles or social media posts, the data privacy laws do not affect you.
Now you may want a quick checklist of what to do to use AI without violating the data protection laws. Here are a few tips:
If you use personal data to train your own AI models, the rules applying to you could be completely different. You must think about all these recommendations from the moment you start building the product.
Implementing privacy by design is essential for AI product builders. It all starts with processing as little personal data as possible, keeping it as secure as possible, and processing it where there is a real need for it, particularly sensitive data. Otherwise, it is likely that the product will violate the GDPR and maybe the CCPA by itself.
(Significant Data Fiduciary obligations under India's DPDP Act.)
AI is useful, but companies collecting and processing personal data with it must be careful with what they do. AI raises serious concerns about privacy for a good reason, and you have to address them.
AI has the potential to change our lives in ways that we may not be able to envision. However, it may also lead to harms that are hard to envision so far. Artificial intelligence evolves too fast for regulations to follow properly, but you should not think that many uses are not covered by the laws.
Some ways of using artificial intelligence systems are covered by data protection laws; others are covered by copyright; and others are covered by anti-discrimination laws and criminal laws.
Take advantage of the use of AI technology, but do not forget to implement proper safeguards to protect personal information. This technology can bring good only if used without doing harm to others. And you have to act responsibly.
