EU Probes Alphabet’s (GOOGL) AI Model Over Privacy Concerns
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EU Probes Alphabet’s (GOOGL) AI Model Over Privacy Concerns

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European Union regulators are intensifying their scrutiny of AI systems, with Ireland’s privacy watchdog starting an investigation into Google’s AI model.

European Union’s (EU) data privacy regulator, the Irish Data Protection Commission (DPC), has launched an investigation into Alphabet’s (GOOGL) subsidiary, Google. The regulator’s inquiry is focused on Google’s artificial intelligence (AI) model, Pathways Language Model 2 (PaLM 2), for privacy concerns.

It is worth mentioning that PaLM2, a large language model, is a crucial component of Google’s generative AI services.

Through this probe, the DPC seeks to find out if Google properly safeguarded EU users’ personal data before using it to train its AI model. Additionally, the regulator will examine whether Google’s data processing practices with PaLM2 pose a significant risk to the rights of individuals in the EU.

EU Tightens Grip on AI

This investigation is part of a broader effort by EU regulators to examine how AI systems handle personal data. In recent months, other tech giants like Meta Platforms (META) and Tesla (TSLA) CEO Elon Musk’s social media platform X (formerly Twitter) have also faced scrutiny over their AI practices.

Following discussions with the DPC, Meta paused its plan to utilize public content from Facebook and Instagram for training its AI model, Llama, in June 2024. This move resulted in the company limiting access to some AI products by European users.

Additionally, later in August, Musk’s X agreed to halt the processing of user data for its AI chatbot Grok after facing legal action from the Irish watchdog.

Is Google a Strong Buy?

Turning to Wall Street, GOOGL has a Strong Buy consensus rating based on 28 Buys and nine Holds assigned in the last three months. At $204.21, the average Alphabet price target implies 35.1% upside potential. Shares of the company have declined about 15% in the past three months.

See more GOOGL analyst ratings

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