Children’s online safety is at risk. Smart toys with AI algorithms are a threat

  • Smart toys are rapidly proliferating across the world, presenting new risks and opportunities for the younger generation.

  • Several emerging regulations establish minimum requirements for smart toy manufacturers in areas such as cybersecurity and online safety.

  • Where regulations may have limits, initiatives such as the Smart Toy Awards actively encourage smart toy developers to make children’s well-being and developmental needs their top priority in interaction design.

Exposure to online security risks with smart toys

The non-transparent ways in which some smart toys exchange data for algorithmic analysis with other AI-enabled devices, such as via a Bluetooth connection, show how weak cybersecurity features can violate children’s privacy and compromise security. Smart toys can exacerbate children’s exposure to online security riskssuch as “‘contents’ risks (for example, exposure to harmful or age-inappropriate material); ‘Contact’ risks (eg exposure to unsolicited adult contact); ‘conduct’ risks (e.g. cyberbullying); and ‘Contract’ risks (e.g. data collection, commercial pressure and inducements to play)” as defined by the 5Rights Foundation.

International legal mechanisms govern the proliferation of AI-powered toys and the mitigation of these risks. The EU Cybersecurity Law imposes minimum requirements on developers of smart toys, who must design toys with strong cybersecurity features when the products are marketed in the EU. The European AI Law, which is expected to come into effect in 2024, introduces a four-tier risk framework for assessing AI technologies and also requires smart toy innovators to assess the impact of their AI systems against “misuse reasonably foreseeable”. AI-enabled smart toys that exploit children are outright banned by regulations. EU Digital Services Act also protects young people by prohibiting AI-enabled targeted advertising through child profiling. A US federal law, the Children’s Online Privacy Protection Act (COPPA), sets age-appropriate criteria for access and exchange of content on websites as a requirement. The FTC also recently introduced a cybersecurity labeling program to protect consumers from AI system breaches.

Protect the interests of children and young people

Beyond laws, standards and policy frameworks are also effective in positively influencing smart toy developers. The IEEE Standard for an Age-appropriate Digital Services Framework serves as a strong international means for smart toy companies to comply. UNICEF Policy Guidance on AI for Children offers recommendations for the development of AI policies and systems that respect children’s rights. The World Economic Forum AI toolkit for kids is another way to encourage companies to innovate responsible toys powered by AI by better protecting the interests of children and young people. Although there are laws and policies that govern the spread of smart toys, these may not incentivize product innovation focused on child development.

UNICEF provided several case studies on smart toys that display current best practices. Mattel has, for example, worked with ToyTalk to release guidance that addresses parents’ privacy concerns. Parents are allowed to access all data stored in ToyTalk’s cloud account while being able to delete all information. ToyTalk also participates in the FTC KidSafe Seal Programwhich is a compliance program for online services targeting children.

Various AI-enabled toy innovations have, to date, also demonstrated how AI systems can positively impact child development. NAO, a school robot, is an example of a smart toy that teaches children by allowing them to spot and correct mistakes in their interactions and forms of learning. Play Shifuan Indian startup has grown since its inception in 2016 to become a global company of diverse interactive smart toys that align with educational research, child development and parenting needs. ROBI-Robot is a smart companion that introduces children to technology, math, science and languages ​​such as English, Mandarin and Spanish.

smart toy prices

smart toy pricesco-organized in 2022 by the World Economic Forum and the Dubai Future Foundation, illustrates an active way to engage smart toy developers to prioritize the developmental needs of children when designing AI-enabled toys around the world. The Smart Toy Awards give winners a unique competitive advantage by showing how smart toy makers can go beyond legal compliance and provide safe, rewarding and playful experiences for children and parents.

Beyond the applicable regulations, the evaluation criteria of the Smart Toy Awards are also based on the FIRST principles of the AI toolkit for kids. The toolkit encourages companies to demonstrate how their toys display fair, inclusive, accountable, safe and transparent featuresand it offers practical advice for businesses, parents and leaders to better understand the benefits and risks of AI-enabled toys.

In addition to child rights impact assessments, the use of the FIRST Principles as a requirement for companies to enter the competition, the Smart Toy Awards show how the competition can trigger various innovations in smart toys suitable for children. Winners of the Smart Toy Awards receive an honorary badge that can be used on their products, which can help parents better understand what it takes for a toy to exhibit responsible AI behavior when interacting with children.

The article originally appeared in the World Economic Forum.


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Sharon D. Cole