Unlocking the Potential of Collaborative AI -- On the Socio-technical Challenges of Federated Machine Learning

Abstract: The disruptive potential of AI systems roots in the emergence of big data. Yet, a significant portion is scattered and locked in data silos, leaving its potential untapped. Federated Machine Learning is a novel AI paradigm enabling the creation of AI models from decentralized, potentially siloed data. Hence, Federated Machine Learning could technically open data silos and therefore unlock economic potential. However, this requires collaboration between multiple parties owning data silos. Setting up collaborative business models is complex and often a reason for failure. Current literature lacks guidelines on which aspects must be considered to successfully realize collaborative AI projects. This research investigates the challenges of prevailing collaborative business models and distinct aspects of Federated Machine Learning. Through a systematic literature review, focus group, and expert interviews, we provide a systemized collection of socio-technical challenges and an extended Business Model Canvas for the initial viability assessment of collaborative AI projects.