McDonald’s discontinues AI voice ordering system developed jointly with IBM

Despite claims that AI is permeating every corner of our lives, it won’t be used in McDonald’s drive-thru for now. The fast-food chain has canceled its two-year test of algorithmic, voice-controlled automated order taking (AOT) that it ran in partnership with IBM. CNBC reports on an email memo to franchisees announcing the plan to phase out AOT by July 26, 2024, in all 100 McDonald’s drive-thru locations that use it.

Despite the discontinuation of the IBM initiative, a statement from McDonald’s to CNBC makes it clear that the voice-based ordering technology will soon be seen under the golden gates again.

“Our collaboration with IBM has given us confidence that a voice ordering solution for drive-thru restaurants will be part of the future of our restaurants,” the statement said. “We see tremendous opportunity in the continued development of our restaurant technology and will continue to evaluate long-term, scalable solutions that will help us make an informed decision on a future voice ordering solution by the end of the year.”

As such, the discontinuation of AOT looks more like a pause to assess the situation and re-equip itself before rolling out a wider rollout of AI automated ordering technology. IBM also says it will introduce its AOT system to other prospects in the quick-service restaurant sector. However, performance issues with IBM’s technology may have been part of the problem: CNBC cites unnamed sources saying the system had trouble answering orders correctly when they were spoken with different accents and dialects. Issues with accuracy and high operating costs have caused frustration among franchisees.

In December 2023, McDonald’s announced a new strategic partnership with Google Cloud that will likely factor into the company’s future plans for voice-enabled AI ordering systems. In a statement released at the time, Brian Rice, McDonald’s executive vice president and global chief information officer, said: “Connecting our restaurants worldwide to millions of data points in our digital ecosystem means tools will be sharper, models will be smarter, restaurants will be easier to operate and, most importantly, the overall experience for our customers and staff will be even better.”

The Google deal could easily overshadow all previous developments in terms of scale and capacity.

However, McDonald’s CEO Chris Kempczinski has stated that IBM’s AOT will continue to be integrated into the company’s technology systems in some form.

After buying and rebranding AI-based voice recognition company Apprente in 2019, McDonald’s sold its McD Tech Labs to IBM in 2021 as part of the deal to accelerate the deployment of AI voice ordering in its restaurants. That same year, McDonald’s also sold its dynamic ordering technology Dynamic Yield to Mastercard.

After selling McD Labs to IBM, Kempczinski told investors that the fast-food company did not have the capacity to stay on the cutting edge of technology while selling billions of cheeseburgers.

Previous disputes with BIPA over voice biometrics and consent

Regulatory issues may have played a role in the decision to eliminate AOT in McDonald’s drive-ins. The Chicago-based company had previously violated the state of Illinois’ Biometric Information Privacy Act (BIPA).

In 2021, McDonald’s faced a $5 million class action lawsuit alleging that the company violated BIPA by using voice recognition software that collected users’ orders without their explicit consent. The lawsuit accused McDonald’s of seeking to monetize the collected data by identifying repeat customers and offering them special deals or upselling.

In 2023, another class action lawsuit under BIPA followed with similar complaints about the lack of consent to data collection in McDonald’s system. In response, the chain denied collecting identifying demographic data to link to biometric data and said no voiceprint was involved in its automated transactions.

This question is likely to come up again in the future, as a number of fast-food chains are integrating AI and voice recognition into their ordering systems. Panera, Del Taco, Checkers and Rally’s, Hardee’s, Carl’s Jr., Krystal, Wendy’s, Steak n Shake, Dunkin, Chipotle and Taco Johns have all tested AI technology in their drive-ins, as has Yum Brands, which owns KFC, Taco Bell, Pizza Hut and The Habit Burger Grill.

Article topics

AI | Biometrics | Data protection | IBM | McDonald’s | Research and development | Voice analysis | Voice biometrics