Back to Services


What Are Some of the Key Business Risks Associated with Generative AI?

Posted June 28th, 2024 in Articles

A few months ago, we published an article highlighting some of the key business risks associated with predictive artificial intelligence (AI). This month, we’re focusing on the risks associated with generative AI. With the advent of ChatGPT, generative AI has quickly gained mainstream attention, and companies like Apple, Google and Microsoft are currently investing billions of dollars in developing new generative AI products and services.

But, while generative AI presents enormous opportunities, it also presents risks. For companies seeking to develop generative AI platforms and leverage third-party generative AI technologies, understanding and addressing these risks is essential. What are the risks your company needs to consider? Here are five critical examples:

Key Business Risk #1: Generative AI Tools Can Quickly Become Outdated

Just like we discussed with regard to predictive AI tools, generative AI tools can quickly become outdated. For most companies, one of the primary reasons for investing in generative AI will be to stay ahead of the curve. With this in mind, companies will need to work to remain up-to-date on the latest developments, and they will need to negotiate licenses that provide adequate rights to achieve a positive long-term return on investment (ROI).

Key Business Risk #2: Copyright Infringement Remains a Legitimate Concern

The current generation of generative AI platforms relies on third-party data and content to “learn.” This raises significant questions regarding copyright infringement—and, currently, these questions remain unresolved. As a result, developers and users alike must carefully assess whether they may be exposing themselves to infringement liability.

Key Business Risk #3: Customers May Not Want AI-Generated Content

While AI-generated content has proliferated, this doesn’t necessarily mean that this is what customers want. In fact, in many industries, this is not the case. If your customers value human-generated content, then investing in generative AI could be the wrong move.

Key Business Risk #4: Developers May Oversell Their Generative AI Tools’ Capabilities

We discussed this in our article on predictive AI as well—and, here too, the risks are similar. When investing in third-party generative AI platforms, companies must be sure that they have an accurate understanding of what they are (and aren’t) getting for their license fees.

Key Business Risk #5: AI-Generated Content Isn’t Necessarily Reliable

Finally, we have already seen numerous highly publicized instances of generative AI producing inaccurate, poor-quality and even salacious content. With this in mind, before publishing AI-generated content or delivering AI-generated content to customers, companies must take adequate measures to ensure effective quality control. This is a concern that companies will want to address during their license negotiations as well.

Schedule an Appointment with a Business Consultant Today

Do you have questions about how your company can (and should) be leveraging generative AI to achieve a competitive business advantage? If so, we can help, and we invite you to get in touch. To schedule an appointment with a business consultant at Mithras Investments, please call 305-517-7911 or tell us how we can help online today.

Contact Mithras Investments

For Strategic Answers

To learn more about services offered by Mithras Investments to multinational corporations across the globe, call our consulting firm at + 1-305-517-7911 or send us an email using our online system. Our existing clients can also use our convenient client login terminal.