AI Jargon Buster
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What is a Proprietary Model?
A proprietary model is an AI system where the underlying code, training data, and technical architecture are kept secret and owned by a specific company. Unlike open-source models that allow anyone to inspect or modify them, proprietary models are treated as trade secrets, similar to a secret recipe for a soft drink. Users can typically access these models through a paid service or a digital connection, but they cannot see how the internal logic of the model works or how it was built. This gives the owning company full control over how the model is updated, secured, and monetized, while users must trust the provider to manage the system safely and effectively.
Why this matters to you
Understanding this distinction is vital for workplace security and strategy. Using a proprietary model means you are relying on a third-party vendor's closed system. You must consider the risks of vendor lock-in and ensure that the data you input remains private and is not used to train future versions of their product. It determines whether your organization has full ownership and transparency over the technology it uses to make business decisions or if you are dependent on an outside provider.
How you might hear this
Our legal department is reviewing the contract to see if we should use a proprietary model for our customer service chatbot or build our own internal system.
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