216 | 🤗 🥰 Is Hugging Yourself Creepy?

In today’s Brainyacts:

1. AI is forcing you to pay higher prices

2. Is OpenAI reigniting the Search Wars?

3. End of hallucinations soon? and other AI model news

4. An Innovation Officer lateral, does it matter? and more news you can use

   👋 to all subscribers!

To read previous editions, click here.

Lead Memo

💸 🤑 AI Is Forcing You to Pay More for Things You Buy

While this isn't directly about generative AI, I aim to share information that equips you to know and do more—even if it’s about protecting yourself when needed. Ever wondered why prices seem to shift mysteriously based on your online behavior? Welcome to the world of surveillance pricing, where companies use AI to figure out exactly how much you’re willing to pay for that cat food, just because you once Googled "luxury pet spas."

What's the Deal with Surveillance Pricing?

Surveillance pricing is all about using AI and algorithms to monitor and analyze your online activities—browsing history, searches, social media, and more—to tailor prices just for you. It’s like having a personal shopper, but instead of finding you deals, it's figuring out how to get you to pay more.

How It Works

1. Data Collection: Every click, search, and social media ‘like’ is tracked to build a detailed profile of you.

2. Behavior Analysis: AI crunches this data to understand your spending habits and price sensitivity.

3. Dynamic Pricing: Prices are adjusted in real-time based on what the AI thinks you’ll pay.

4. Personalized Offers: You get special offers and prices that seem too good (or too high) to be true, because they’re made just for you.

Why Do Companies Love It?

• Boosts Profits: Charging more to those who can afford it increases revenue.

• Targets Better: Personalized prices and offers can make customers feel understood and valued.

• Competitive Edge: Advanced pricing strategies can leave less tech-savvy competitors in the dust.

The Dark Side

• Privacy Concerns: The sheer amount of data being collected is staggering and often done without clear consent.

• Fairness Issues: Knowing you're paying more than others for the same product can feel unfair and discriminatory.

• Lack of Transparency: Companies rarely disclose how they determine these prices, leading to mistrust.

• Regulatory Scrutiny: The ethical and legal implications are starting to catch the eye of regulators.

FTC Steps In

On July 23, 2024, the FTC announced it’s taking a hard look at surveillance pricing. They issued orders to eight companies, including heavyweights like Mastercard, JPMorgan Chase, and Accenture, demanding transparency about their pricing practices. FTC Chair Lina M. Khan emphasized that consumers have the right to know how their data is being used to set prices.

This inquiry aims to lift the veil on this opaque practice and ensure that pricing strategies don’t exploit consumers unfairly. The FTC’s investigation will explore everything from data collection methods to the impact of these practices on consumers.

Protecting Yourself from Surveillance Pricing

To avoid falling prey to surveillance pricing, consider these tips:

• Use Privacy-Focused Browsers: Browsers like Firefox or DuckDuckGo offer better privacy protections than mainstream ones.

• Install Ad Blockers: These tools can prevent tracking scripts from running on websites.

• Enable Do Not Track: Turn on the “Do Not Track” setting in your browser, though not all websites honor this request.

• Use VPNs: A Virtual Private Network (VPN) can hide your IP address and encrypt your internet traffic, making it harder for companies to track you. FYI always use VPNs when on public wifi.

• Clear Cookies Regularly: Deleting cookies can prevent websites from storing and using your data over long periods.

• Opt-Out of Data Collection: Whenever possible, opt-out of data collection services and adjust privacy settings on your devices and accounts.

• Shop in Incognito Mode: Incognito or private browsing modes can prevent your search history from being tracked.

Spotlight

🧑‍🏭 🔎 The New ‘Search” Wars Begin: OpenAI Tests New SearchGPT

OpenAI is testing SearchGPT, a temporary prototype of an AI-powered search engine that give you fast and timely answers with clear and relevant sources.

• It is initially available to 10,000 test users, aiming to refine search results with brief descriptions and relevant links.

• Users can ask follow-up questions or access more related links easily with a sidebar, plus there's a mysterious "visual answers" feature.

• OpenAI is working with news organizations and external partners to ensure accurate and controlled content, as SearchGPT is tested for a broader launch.

Might this be the entry point for OpenAI to monetize through targeted content (ad-based revenue)?

More coverage HERE

AI Model Notables

► Research shows how to reduce hallucinations in a significant way that doesn’t require re-training AI models. This is a research paper out of folks at IBM. I am sharing it because the topic of hallucinations causes a lot of stress and fear in the legal realm. The method outlined in this paper is a promising approach. Basically, they found a way to “fine-tune” the output of a model before it shares its actual output with us. This is different from fine-tuning the entire AI model itself. We are getting closer to mitigating hallucinations.

► AI-powered legal-tech startups cut the hype, gain more traction.

► Google is upgrading its Gemini chatbot experience with the Gemini 1.5 Flash model, which will be available on the web and mobile, and will allow users to upload files and ask Gemini about them.

► Mistral, the French AI model company, just released Large 2. It boasts impressive performance but not quite GPT-4o. Regardless with Meta releasing its latest Llama earlier this week and now Mistral – pressure continues to grow for the likes of Google, Anthropic, and OpenAI. Updates keep coming but the performance gains are leveling out.

► The new Bing AI search feature is currently available to a limited number of users. It integrates AI-generated answers directly on the search page.

► Google had a massive quarter thanks to Search and AI making almost $85 billion over the past few months — a 14 percent increase from the same time last year.

► IBM's AI business is on fire, with bookings for AI consulting and software surpassing $2 billion since mid-2023 - doubling their previous report.

► Amazon racing to develop AI chips cheaper, faster than Nvidia's, executives say.

► Is OpenAI’s new voice AI assistant finally getting released?

News You Can Use:

➭ Cooley hires first Chief Innovation Officer in Wilson Sonsini’s David Wang. Why is this noteworthy? A couple of reasons:

• David was helping lead Wilson’s AI efforts and recently made a bold statement when the firm announced the AI-driven redlining tool: “If it is cannibalizing our own work—if that statement is true—then that is because it is better than the work we provide now.” Interesting take.

• Are capable AI business leaders going to be hot in the lateral market in the coming years?

➭ The AI boyfriend business is booming

➭ Tesla’s profit margin is getting hammered by EV discounts and hefty AI spending

➭ Tech giant Capgemini just issued a report that evaluated the impending mass implementation of “multiple-agent AI systems” expected to impact businesses worldwide

Who is the author, Josh Kubicki?

Some of you know me. Others do not. Here is a short intro. I am a lawyer, entrepreneur, and teacher. I have transformed legal practices and built multi-million dollar businesses. Not a theorist, I am an applied researcher and former Chief Strategy Officer, recognized by Fast Company and Bloomberg Law for my unique work. Through this newsletter, I offer you pragmatic insights into leveraging AI to inform and improve your daily life in legal services.