Service levels and key performance indicators

Many customers seeking to use services involving an AI model, may seek certain quality, accuracy, or other benchmarks in connection with the service. If the AI model provides inaccurate or non-beneficial data, then the AI model could be potentially useless. A customer may request a vendor to provide assurances that the AI model will perform as it is supposed to perform in the form of service levels and key performance indicators. One type of service level a customer may request is an accuracy SLA, which requires that the output data generated by an AI model is accurate X percentage of the time. For a vendor, this could be difficult since a customer could be providing poor input data to begin with. For example, if a customer provides input data that says only cows can be brown, then when the AI model sees a cow that is black and white, it could classify that cow as another animal that the AI model knows can be black and white. At the same time, a vendor should be continuously improving and training its AI model to know that cows can be assorted colors and committing that the AI model will provide accurate output data.

Termination rights

When parties terminate a relationship, there are common features in data licenses agreement that dictate the requirements to wrap up the termination or expiration such as destruction of any confidential information that was shared and continued use of data after termination. Many of these standard provisions may be difficult with respect to models, derivatives, and the like. For example, vendors may include in the contract the right to continue to use the confidential information that was part of the input data for further training. If this right is included, a provision stating deletion of confidential information could conflict with a license right regarding such confidential information that survives termination. This could also cause potential leakage of a customer’s confidential information to other customers who will have access to such confidential information by virtue of access to the output data of the model and/or derivatives. This is why reviewing licensing terms in conjunction with termination rights is key. A customer may also request the ability to continue to use the output and derived data long after the contract terminates. Under a typical data license, the right to use the software and the associated data is revoked after termination. However, this may not be feasible for a customer if the output data and derived data is incorporated into a customer’s dataset. To avoid a potential infringement claim, a customer may want to include a continued use clause which allows it to use the data already provided without restriction. In turn, a vendor may want to potentially limit the customer’s ability to use its data after termination or expiration and without restriction so that any potential uses by the customer does not erode its business value. For example, if a customer has the output data and derived data in its database and turns around and sells such data to others, this could potentially undercut the vendor’s business. Vendors and customers should review termination rights carefully to ensure their future interests are protected.