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FTC warns companies over unsubstantiated AI claims

Commission reminds businesses in all industries it will be monitoring baseless or exaggerated marketing around AI

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The Federal Trade Commission has published a warning to companies about overselling claims around the use of artificial intelligence in their products.

In a post on its website, the Commission emphasised that AI is an "ambiguous term with many possible definitions," and that while it can refer to tools for predictions, recommendations and decisions, computers cannot completely recreate or predict human behaviour.

As such, the FTC views it predominantly as a marketing term.

"And one thing we know about hot marketing terms is that some advertisers won't be able to stop themselves from overusing and abusing them," the government body wrote.

The Commission posted a series of questions that businesses should ask themselves before pitching or marketing a product in order to ensure there are no unsubstantiated claims around their use of AI.

  • Are you exaggerating what your AI product can do, or claiming it can do something beyond the current capability of such technology?
  • Are you promising that your AI product does something better than a non-AI product?
  • Are you aware of the risks if it fails or yields biased results?
  • Does the product actually use AI at all?

On this last point, the FTC stressed that it has access to experts who can analyse products and technology and compare with others, and added that "using an AI tool in the development process is not the same as a product having AI in it."

The FTC has previously warned businesses not to use automated tools that have "biased or discriminator impacts."

While the warning was general – with the FTC noting that AI is being touted in everything from chatbots to toys and cars – it's worth bearing in mind within the games industry given the rise of AI experimentation in development.

We recently spoke to a range of developers and analysts about the potentials and perils of generative AI, which some argue will help with conception and accelerate some of the 'drudgery' in games development, but are no substitute for human creativity.

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James Batchelor avatar
James Batchelor: James is Editor-in-Chief at, and has been a B2B journalist since 2006. He is author of The Best Non-Violent Video Games
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