AI Deception: How Tech Companies Are Fooling Us

this video is brought to you by Aura hi welcome to another episode of Cold Fusion in 1770 Hungarian author and inventor wolf Gan Von kemplin built and unveiled a self-operating chess playing machine called The Mechanical Turk in demonstrations around Europe his chess playing invention won most of its games against actual human chess players and it's even said that it went on to beat players like Napoleon and Benjamin Franklin naturally The Invention was extremely popular a Marvel of its day however it was actually just some guy under the table secretly operating the machine in other words

it was a hoax some 250 years later in 2016 Amazon pulled a similar stunt their checkout system called just walk out allowed customers to Simply grab items from the store and leave under this system customers didn't have to manually scan their items at the checkout the transactions and Logistics were automatically taken care of behind the scenes by AI An Elegant combination of Compu Vision sense of fusion and deep learning or was it just like the Mechanical Turk all was not as it seemed Amazon's so-called AI technology was actually powered by a thousand people in India

watching and labeling videos to ensure accurate checkouts now humans labeling data is often how AI models are first trained and that's fine but the point is the advertising was misleading even by 2022 these 1,000 people were still manually reviewing 70% of of transactions in 20 Amazon go stores 40 Amazon fresh grocery stores and two Whole Food stores although some saw it as dystopian Amazon promoted their just walkout technology as a utopian magical solution powered by Ai and here in lies the problem companies often leave out critical information in the fine print it wasn't until 2023

that Amazon mention the use of the a thousand people in India and it gets worse according to a report by the information other companies were swindled too quote 30 stores operated by other companies in the US sports stadiums 12 airports and one University all used Amazon's walk out technology and this is where things become murky when companies promis revolutionary technology but don't follow up on them it creates distrust but it can even spoil it for those who are doing legitimate work in the field with the AI Revolution that we've seen over the past couple of

years there needs to be a more critical look at what's happening with AI in this episode we'll see the reasons for the AI hype and its consequences we'll look at if there is indeed an AI bubble and what real world impact that might be having this includes companies releasing half-baked AI products but also simultaneously replacing actual humans with AI it's a dichotomy of the industry so sit back and relax as we make sense of it all you are watching C Fusion TV one use of AI technology that absolutely nobody is thrilled about is the fact

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trial offer only available in the United States okay so let's continue no it's not just you the term AI is really being thrown around everywhere for older cold fusion viewers you'd know that I've been covering AI for the good part of a decade now before 2022 the word artificial intelligence was limited to Industry verbage in obscure research papers the general public didn't know or care and even as late as 21 when I covered gpt3 there was a lot of people that thought I was just making it up how could a computer possibly talk like that

well as you all know after 2022 especially following the launch of chat GPT it was a different story from your smartphone to LinkedIn to your local government site a lot of organizations today will boast the term powered by AI while in a lot of cases it makes sense the overuse of the term and it being thrown around so casually is a symptom of something called AI washing AI washing simply put is when companies create a fake buzz and mislead investors by providing manipulative information about the capabilities limitations or risks of their AI products or simply

wholesale lie about how and when they're using AI according to Goldman Sachs a record 36% of S&P 500 companies mentioned AI in their Q4 earnings reports if the biggest companies in the world are hyping it up there's no doubt that small companies are following suit and some without tangible results backing up their claims and the Investments are there to match too from 2015 to 20122 Global corporate AI Investments have increased seven times a lot of companies have seen tremendous growth in the recent AI hype and this puts pressure on other companies to integrate AI into

their business model or their products in order to compete and that's even if it's not really AI Monkey C Monkey Do For example the Canadian investment firm Delia claimed that that had built an AI to predict upcoming companies and Industry Trends despite not having any such capabilities the SEC caught wind of the scam and has since ordered them to pay $225,000 and this was for false advertising and misleading statements about the use of AI and I have a feeling that this is just the start I previously talked about the wire card fraud where CEO Marcus

Brawn boasted about having Advanced proprietary AI throughout their fintech products and services in reality it was just spreadsheets in the end there was $2 billion missing from the books but that was a story for a different day you might have also heard about the npu or neural Processing Unit it's a dedicated processor specifically designed for AI tasks among other things they're becoming increasingly common in the world of PCS and laptops and Microsoft has even claimed that we're now in the age of the AI PC but recent reviews of the current crop of these products have

left consumers with a bad taste in their mouth let's talk a bit more about AI yes the Snapdragon processors dominate here but AI is still very nent many people either won't use these tasks all that much or these tasks themselves just don't work that well yet for example they demo generating images of animals and they highlighted how fast the processes were versus Intel but when I look closely at the images generated they were all garbage the AI dogs all had very lopsided eyes so who cares if one of these processors is faster than the other

if they are both generating garbage right now I just wouldn't advise anyone buy a laptop based on its AI capabilities a news analyst from computer world has mentioned that these AI PCS aren't quote all they cracked out to be and if you're expecting something transformative when you buy one from the start of 2024 you're going to be disappointed they might one day deliver a lot of cool features just not yet end quote but are there consequences of such misplaced promises other than distrust from customers companies that Miss The Mark with AI product launches are constantly

trying to save face even the most popular companies in the world are not immune to mistakes perhaps the biggest consequence of AI washing is a certain b word that might be lurking around the corner almost as soon as AI started going Uber mainstream from late 2022 a lot of people immediately liken the phenomenon to the dotom bubble or even the crypto Fiasco in fact some people still do today even when we talk about the.com Bubble it's not the worldwide web that was the problem because of course you're using a right now instead it was mostly

the e-commerce side of things which over promised reeling in investors but underd delivered leading to a crash when everyone realized that the companies that they invested in weren't making any money with AI there's no doubt that we'll see some more investment in the space and Monumental growth too according to Oppenheimer no not the one you're thinking of who's a chief Global Equity strategist at Goldman Sachs research quote we believe we are in the relatively early stages of a new technology cycle that is likely to lead to further outperformance end quote Nvidia who designs the chips

that are powering big Tech's AI Revolution is tentative proof of this their stock is up 80% this year alone perhaps excessive but it's indicative of what the market thinks of AI Mark Cuban who made his fortune during the era also doesn't see AI as a bubble in a recent interview with Lex fredman he expressed that the biggest sign that we're not in a bubble is the lack of IPOs in the AI sector also the absence of companies with no intrinsic value going public and the lack of quote funky AI companies is a key indicator he

noted that the current market doesn't exhibit such characteristics and I think that I largely agree with that there's obviously some bad players in the industry who are just trying to make a quick Buck but there might be more to it and here's what I mean there's a known pattern for emerging Technologies called the Gartner hype cycle it describes how humans tend to be overzealous about a new revolutionary technology we overestimate and overshoot its impact hype it up until the market crashes and after the crash the real companies with the real value come through and spearhead

the development of the new technology until it's mature if we look at the Gardner hype cycle for AI it seems like we're at the closing stages of the peak of inflated expectations and are slowly entering the trough of disillusionment this interpretation of the current market means that there's going to be a lot of disappointment ahead the real applications of AI will come after the hype and fatigue Fades but but this time could be a little bit different because at its core AI has the ability to mimic cognitive labor a change that no previous technology has

been able to do without intrinsic human intervention whereas as pointed out in a previous podcast episode during the dot bubble there were a lot of people simply making a random website and going public and investors would throw money at anything with a do at the end of its name there's been a lot of organizations that have been ring to launch AI products or replace humans with AI altogether but the ones who are hastily adding the ever popular quote powered by AI gimmick are failing badly and there have been some spectacular AI failures for example a

parcel delivery firm called dpd enabled an AI online chat for answering questions for One customer it was not only useless at answering relevant questions regarding his order but instead when asked it provided him with a poem and swore at him this amazing poem came forth about a dpd chatot who who wasn't able to do anything it was quite amazing it appeared to even disregard its own rules and started swearing and even started dissing its own employer adding dpd is the worst delivery firm in the world I would never recommend them to anyone in Australia a

group of academics used AI generated material as part of their complaint submission to the Australian parliament against four of Australia's biggest banks of course the AI made up a whole bunch of information including SC scandals that never existed and implicating deoe when they had nothing to do with the original complaint someone on the team didn't read the entire submission before it went to the Australian government so it was a huge embarrassment and the academics were forced to apologize this is just one of many examples and I'm going to include a website that keeps a running

tab of these AI blunders but on the other hand there are companies who are integrating AI successfully and this is where we come to the other kind of broken promise when it comes to AI it's not CEO's over promising ai's usefulness but under promising instead in other words we were told that AI would be our assistant and create new jobs not replace us but what if that's just not true not about replacing the human in the loop in fact it's about empowering the human like it's an assistant it's an assistant this clip from SAA is

a bit hard to believe now even though later he did mention the flip side yes I'm sure a lot of us use chat GPT to help get work done on personal projects but AI eventually creating more jobs than it would replace maybe not so fast you may have noticed that since 2022 there's been a lot of tech related layoffs The Narrative is that this is happening due to the over hiring during the pandemic times and that would make sense for 2022 and even 2023 but in 2024 we're still seeing Mass layoffs now if companies were

just struggling to make a profit the explanation would be as simple as the common business cycle but strangely some of the biggest companies in the world are seeing record profits they're almost cyclically shedding workers according to reports tech companies fired 165,000 people in 2022 260,000 in 2023 and so far the projection is 270,000 in 2024 so if companies are doing fine why are workers being kicked out the door well marketing professor and author Scott Galloway thinks quote there's something else going on end quote in his recent blog post dissecting the impact of AI on corporations

he mentions quote AI is playing a larger role in layoffs than CEOs are willing to admit end quot the normal way we think about Job Replacements caused by AI is that Joe blogs is working at his computer analyzing company figures or something like that and then suddenly the next day he's replaced by an AI but the truth is it's a bit more nuanced than that as companies slowly get better at understanding how AI can Aid in their operations they'll create better teams and structure with higher outcomes basically instead of three people doing the work of

three you'll have one person doing the work of five with AI the problem is that none of these companies are being sincere about it because if you're a CEO and you've been hyping up AI as the single greatest thing to happen to the industry and then you follow it up with a memo that you've laid off 30% of your staff because of AI the hypocrisy becomes clear but in 2024 it seems like the truth is slowly coming out and there's hints everywhere IBM made headlines when CEO arvind chrish mentioned that they're planning to pause hiring

roles that could be replaced with AI same with UPS where recently their CEO Carol Tom acknowledged that AI is playing a part in employee layoffs and this came after UPS had the largest layoff in its 116e history 12,000 workers in both cases spokes people later clarified saying quote AI is not replacing workers end quote which is basically PR talk to save face in fact a Shopify employee broke their non-disclosure agreement to expose that the company has been secretly firing employees because of AI the shift is even having an impact far outside the tech industry TV

and media producer Tyler Perry was building an $800 million Studio expansion but paused its construction after he saw the results of open aiora an AI video generator he made the remark quote I am very very concerned that in the near future a lot of jobs are going to be lost end quote in the last couple of years you probably would have heard this phrase a bit AI will not replace humans but humans who utilize AI replace humans who don't there's definitely some truth to it but some jobs will be at risk regardless we don't have

to imagine this it is already happening Mega caps like meta and alphabet they are shrinking their workforces and and shrinking their hiring it's this idea that senior AI researchers or data analysts they can do more with Gen than an army of Junior Engineers who code a recent report from Mackenzie found that around 12 million us workers may need to switch jobs by 2030 lower wage workers are 14 times more likely to be impacted stem Healthcare Builders and professional Fields will continue to add jobs but generative AI could change work significantly for occupations like customer service

and sales and office support there's been repeated reports of how AI will be adding hundreds of millions of jobs in the next decade and how it's going to positively impact GDP while by some miracle this could happen right now as has been the case in many times in history the train will leave the station without telling us whether we're aware to jump on board or not is the question so wrapping this all up I do have to mention that in no way am I saying that all forms of AI and all of these giant corporations

are elaborate hoaxes in fact on this channel I've been making videos about AI progress for the better part of a decade now and I've seen exponential progress right in front of my eyes and so will many of you we may have hit a temporary bottleneck when it comes to compute but all it takes is a breakthrough in model efficiency and the curve continues upwards but I just think that it's important to still have a cautious approach when it comes to looking at all sides of a story I'm also working on a video that's all about

the positive real life impacts of AI so hopefully that's going to balance things out a bit so far it seems like the promises of AI are yet to be fully realized whether that's creating and not taking jobs solving Global issues or even providing us with a Dependable AI customer service spot that doesn't swear at us with such big and bold promises from these companies over the years it's important for all of us to ask ourselves do we have technological gold a trojan horse or a chess master hiding under a table anyways that's about it from

me my name is toogo and You' been watching cold fusion if you did like that episode feel free to subscribe there's plenty of other interesting stuff on the Channel all right so I'll catch you again soon cheers guys have a good one a better future Heaven Help Us make a better [Music] future cold fusion it's new