Tech firms including Meta and Spotify blast EU over AI regulation stifling innovation

Tech firms, including Meta and Spotify, on Thursday warned the European Union (EU) about the risks of overregulating the AI sector, which would likely stifle innovation.

In an open letter that was also endorsed by Italian luxury fashion brand Prada, the tech firms highlighted to the EU that the region may not fully enjoy the benefits of AI tech. In July, Meta said it was holding back its most advanced AI model Llama from the European Union (EU) markets citing a tough regulatory environment in that region.

Tech firms say the EU is fast becoming uncompetitive

Now, researchers and several industry bodies joined executives of these tech firms in signing the letter to the EU explaining to the bloc that it is already fast becoming uncompetitive, mainly because of its “fragmented and inconsistent” decision-making on matters like data privacy and AI.

Due to this, the signatories maintained that the EU risked falling further behind the AI age and called for “harmonized, consistent, quick, and clear decisions” from regulators to allow European data to be “used to train AI models to benefit Europeans” among others.

The open letter took a jibe at the recent decisions taken under the general data protection regulation (GDPR).

“In recent times, regulatory decision making has become fragmented and unpredictable, while interventions by the European Data Protection Authorities have created huge uncertainty about what kinds of data can be used to train AI models.”

– The Open Letter.

This comes as social media giant Meta Platforms, parent company for Facebook, WhatsApp, and Instagram has been caught on the wrong side of the GDPR forcing it to pause plans to use data from users in Europe to train its AI models, following immense pressure from privacy regulators in the region.

Meta however recently revealed it would resume training of its AI models using data belonging to users in the UK.

Tech firms hold back their products

A European Commission spokesperson earlier indicated that all tech firms were required to abide by the region’s data privacy rules.

Meta, which spearheaded the open letter to the EU, has faced hefty fines in the region for violating data privacy laws. At one point, the social media giant was slapped with a single penalty of more than a billion dollars under the GDPR.

This also comes as the EU became one of the first regional blocs to pass laws to stop the abuse of AI technology to breach users’ privacy by using their personal data. Its AI Act came into effect earlier this year.

Tech firms, including Meta and Google, have subsequently delayed releasing their products to the EU markets, citing regulatory uncertainties. As such, the tech firms said they wanted to seek legal clarity first before releasing their products.

Apart from holding back Llama from EU markets, Meta had earlier delayed the release of its micro-blogging platform Threads by several months last year.

Search engine giant Google also held back the release of several AI tools in the EU citing the difficult laws in the region.