Google Refrains From Selling Facial Recognition Technology

Alphabet Inc. (NASDAQ:GOOGL) recently announced that the company will refrain from selling facial recognition technology over privacy abuse concerns.

Facial recognition technology has its own set of pros and cons. The use of the technology is almost infinite, for instance, unlocking screens, identifying and uniting family members, receiving suggestions for tagging a person on a picture and locating criminals among others.

However, this technology does pose a threat to privacy and human rights. To start off, approval of the people in question is often not considered. Without the knowledge and permission of an individual, the government may be aware about their whereabouts or it can be used by businesses to target customers among others.

Unlike other companies that have offered this technology without taking into consideration its ill-effects, Google has taken a very strong stance. Its CEO, Sundar Pichai was noted stating that artificial intelligence could prove “far more dangerous than nukes.”

Coming to price performance, Alphabet’s shares have lost 0.9% on a year-to-date basis compared with the industry’s decline of 25.1%.

Companies and Their Stance on Privacy and Racial Bias

Microsoft (NASDAQ:MSFT) made a major breakthrough with its Face API, with the company being able to recognize men and women with darker skin with more accuracy. IBM (NYSE:IBM) too addressed the issue by issuing a new API, which recognized darker females with reduction in error to 3.5%.

Notably, this stride was made at a point when major facial recognition companies failed in precisely identifying people with a darker skin tone.

However, Microsoft was the first tech firm to voice its concern over this facial recognition technology. The company remains highly concerned about this violation of a fundamental right, which has been going on for quite a while.

The company’s president also provided suggestions to safeguard the platform by increasing transparency, identifying location and time of the technology’s implementation, garnering user review and third-party testing.

Alphabet Inc. Price and Consensus

Growing Trend for Facial Recognition

Per Allied Market Research, the facial recognition market is expected to hit $9.6 billion by 2022, reflecting a compounded annual growth rate (CAGR) of 21.3%. Google is poised to gain traction in this market.

At present, United States offers the largest market for face recognition technology. China too is in the reckoning with an aim of developing a video surveillance network countrywide. Per reports from Gemalto (AS:GTO), total surveillance cameras in China reached 176 million in 2017 and is expected to reach 626 million by 2020.

The major tech juggernauts that have adopted facial recognition are Facebook (NASDAQ:FB), Amazon (NASDAQ:AMZN) and Apple (NASDAQ:AAPL) among others.

Facebook is using this software to tag individuals in a picture automatically, while Amazon is using it to develop an app where users can click a selfie and make payment for their purchases. Additionally, Apple is using it to analyze moods and emotions and help people suffering from emotional distress.

Currently, Alphabet carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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