New Delhi: Regulators worldwide should adopt a risk-based approach when it comes to technology, focusing on harmful behaviours rather than broadly regulating innovations, experts say. This, they believe, will enable regulators to not unnecessarily regulate areas that don’t pose significant risks. This, in turn, will facilitate innovation, and simultaneously make it possible to focus on targeting harmful actions more effectively.
At an event Wednesday conducted by Delhi-based advisory firm Koan Advisory on the Indo-US collaboration in consumer technology, Jason Oxman, president and CEO of the Washington-based Information Technology Industry Council (ITI), the global trade association for the technology sector, stressed that regulators should not target technology and not look at it as requiring new set of rules, but instead focus on behaviours and regulate those similar to what is done in the offline world.
“The job of the government is to protect citizens, but I think there is a tendency in technology regulation to view technology as a unique area that has to be regulated separately. That is certainly true in consumer technology,” Oxman said.
“The government (should be) focused on behaviour as opposed to technology… So, things that would be illegal or harm consumers in the offline world, could also be illegal or harm consumers in the online world. It’s not the technology tool that is necessitating that regulation. It’s the behaviour or the misuse.”
Citing an example, Oxman said that currently, there are a lot of discussions taking place around how artificial intelligence (AI) will take away jobs and enable companies to discriminate against their applicants. He added that discrimination in hiring, whether done “using a pencil and a piece of paper” or with the use of AI, is illegal. Hence, it is the behaviour that needs to be targeted.
“So, that’s our essential message to regulators about these advances in technology. And AI is not going to take your job but somebody who knows how to use AI may take your job. So, we need to focus on reskilling the workforce for the next generation of job opportunities,” he added.
S. Gopalakrishnan, who has previously served as joint secretary at MeitY and as additional secretary at the Prime Minister’s Office, concurred, adding that there are some areas that do not need to be regulated.
He explained that the mandates of the regulators need to be very clear whether it is to protect the consumer from harm or to promote domestic industries. “In fact doing nothing well may be the best regulatory output in many sectors. Regulators do not need to show existence that we did this etc…we just don’t need to regulate technology, we need to regulate sectors.”
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What experts say about risk-based regulatory approach
Explaining the concept of risk-based approach to regulation, Oxman said it means to focus on areas which may cause actual harm to consumers. For instance, a music streaming service like Spotify that uses AI to recommend songs and artists, does not need to be regulated because there is no risk involved to the consumer if they are recommended a wrong song.
However, in cases where AI is being used to assist doctors in making a medical diagnosis, high risk is involved, which should be regulated. Gopalakrishnan added that such an instance should be dealt with under “health regulations” rather than a separate AI regulation.
He pointed out that one of the dangers with the regulation of emerging technologies is that the humans may end up stifling innovation and lose a good opportunity in the process. “So, we got to be more risk taking in terms of letting things happen, we got to be more clear about focusing on harms which are actually harmful, rather than trying to be very defensive like something may go wrong, so let me be very harsh. The only way out of this is consultative.”
At the event, Koan Advisory released a study which said that commercial restrictions—including those on tying, bundling and self-preferencing in the digital ecosystem proposed in the draft Digital Competition Bill (DCB), 2024—are likely to disrupt existing commercial bundles in the smartphone market, impacting consumer welfare and cybersecurity negatively.
The study, which analysed the responses of 5,117 Indian users on preferences and behaviour within the smartphone ecosystem, found that over 85 percent of respondents believe that the smartphone’s operating system, along with its software, hardware, and external peripherals, is an essential value addition to the device.
The study added that consumers place considerable trust in their smartphone bundles, with 93 percent saying that they are highly satisfied with their operating system because it helps maintain user security and privacy, and tends to be easy to navigate. Meanwhile, 86.9 percent exercise a high-degree of agency in selecting applications, finding it easy to download their preferred choices from app stores.
“More than 50 percent of the survey respondents use direct web downloads and multiple app stores to download apps, which is a potential cybersecurity concern because apps downloaded from external sources are not necessarily subjected to the same security standards as in the case of preinstalled app stores,” it said.
“Any changes to bundling regulations should be backed by thorough empirical evaluation and impact assessment to ensure they effectively address the issues without unintended consequences,” Vivan Sharan, partner at Koan Advisory, said at the event.
(Edited by Radifah Kabir)
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