skift take
— Justin Dawes
Executives from companies like Airbnb and Booking Holdings have been discussing plans to implement the latest advances in artificial intelligence for more than a year.
Airbnb's CEO, in particular, mentioned several times during the company's latest earnings call that AI could fundamentally change the way the company operates, and this is something he has discussed numerous times.
When executives talk about generative AI, they tend to focus on the positives.
Companies have become more candid in their annual reports published over the past month. Although they emphasize the worst-case scenario, this is the first time so many travel companies have made such pointed statements about the risks of AI.
According to these reports, the top AI-related threats that travel giants are focused on are:
pressure from competitors
The latest advancements in AI have led major travel companies to look for ways to enhance operations, streamline business processes, and release new customer products.
Meanwhile, the topic is also influencing the birth of new travel-related startups, such as travel planners and back-office software.
Incumbent companies in the industry are aware of competition from each other and from emerging companies seeking to displace them or be acquired.
Booking Holdings: “Competitive pressures to innovate may extend to a broader range of services and technologies, including those outside of our historical core business, slowing our ability to keep pace. It's possible. Emerging startups may be able to innovate faster than we do, specifically focus on developing new products and services, or anticipate consumer needs for new services and technologies before we do. Maybe we can.”
Hyatt: “Our competitors and other third parties may incorporate AI into their services faster or better than we do, which could harm our ability to compete effectively and Our competitors may have access to greater financial and technical resources and may be unable to compete in recruiting, motivating, and retaining sought-after AI professionals. You can get the upper hand.”
TripAdvisor: “In July 2023, we announced an AI-powered travel itinerary generator that uses OpenAI’s generative artificial intelligence technology to create personalized travel itineraries…Our itinerary generator and more There is no guarantee that efforts focused on artificial intelligence will be competitive or attract more consumers than our platform.”
An uncertain regulatory future
There is significant pressure from governments, particularly in the United States and the European Union, for stricter regulation of what AI companies are allowed to do. The “Development and Use of Safe, Secure, and Trustworthy Artificial Intelligence'' is an executive order by the President of the United States that aims to create guidelines for the development and use of AI. The EU will soon implement its own regulations through artificial intelligence legislation.
AI is advancing so quickly that the law has not been able to keep up. Travel companies are aware that further changes to the law are likely in the coming years, which may impact some aspects of their business.
Airbnb: “New laws, guidelines, and decisions in this area may limit our ability to use machine learning and AI or require changes to our platform or operations, which could reduce our operational efficiency. may reduce our operating costs and/or impede our ability to improve our Services…Furthermore, intellectual property ownership and licensing rights (including copyrights) surrounding AI technology may have not been adequately addressed by courts, laws, regulations, and the use or implementation of AI technologies in our Services. We may be exposed to claims of copyright infringement or other intellectual property misappropriation. ”
Uber: “The use or management of AI by us or others, including decisions based on automated processing or profiling, inappropriate or controversial data practices, or inadequate disclosures about machine learning or algorithms, will preclude acceptance of AI solutions.” “We may be subject to litigation, regulatory investigation, or other harm, including an adverse impact on our intellectual property or brand value.”
technical limitations
There are countless examples of generative AI producing inaccurate answers. Air Canada recently received a lot of press for being ordered to refund a passenger who received bad information from a chatbot on the airline's website.
Travel companies are wary that these problems will continue.
Uber: “AI algorithms and automated processing of data may be flawed, datasets may be insufficient or contain biased information, and may produce inaccurate or discriminatory results.” There is a sex.”
TripAdvisor: “These and other failures in our artificial intelligence systems could subject us to competitive harm, regulatory action, liability, and brand and reputation damage.”
Cybersecurity and fraud
Companies can use AI for profit, but fraudsters can also use it against companies.
Expedia: “The rapid evolution and increased adoption of AI technology may increase the risk of fraudulent bookings and fraudulent supplier schemes. Any of these events could have a material negative impact on our brand value. may have an adverse effect on our financial performance.”
Choice Hotels: “Cybercriminals are increasingly demonstrating advanced capabilities, including the use of zero-day vulnerabilities (undiscovered security gaps in technology applications) and the rapid integration of new technologies such as generative artificial intelligence .”
Hilton: “Hacker efforts to gain unauthorized access to information systems have become increasingly sophisticated in recent years, and this trend is likely to continue at an accelerated pace as criminals leverage generative artificial intelligence-based technologies and services. There is a sex.”
increased cost
It will take a significant amount of effort for companies to completely overhaul their operations, as predicted to happen with AI.
It will be expensive, especially if there is no long-term reward.
Uber: “The rapid evolution of AI may require us to allocate additional resources to implement it ethically to minimize unintended or harmful impacts, and we may need to allocate additional resources to implement our own You may also need to make additional investments in developing datasets, machine learning models, etc. The system can be costly.”
Booking Holdings: “Uncertainty regarding new AI applications may require additional investment in developing proprietary datasets, machine learning models, and systems for testing accuracy, bias, and other variables “However, they are often complex and costly, and as we expand the use of AI technologies in our products, they will impact our profit margins.”
Hyatt: “AI programs can be expensive, require significant expertise to develop, be difficult to configure and manage, and require regular upgrades. There is also a risk that we may not have access to technology or qualified AI talent resources to adequately incorporate current advances into our AI initiatives, including access to property licenses.”
Photo credit: Travel companies are focusing on the risks associated with AI.
