AI Toys: The Future of Play or a Privacy Nightmare for Kids

A new generation of AI-powered companion toys is making its way into children's bedrooms, promising to serve not just as playthings but as friends, tutors and entertainers. These plush robots and interactive characters, powered by artificial intelligence large language models like ChatGPT, can hold coherent conversations, remember a child's favorite color and even create personalized bedtime stories.

Companies like Curio and the global toy giant Mattel are leading this technological transformation, drawing both enthusiasm and concern from parents, educators and child development experts.

A toy industry overview from the British Toy and Hobby Association and the Toy Association notes that smart and connected toys have grown rapidly as a share of overall toy revenues in recent years. This growth is driven by advancements in large language models that enable unprecedented levels of interaction, moving far beyond the pre-programmed phrases of toys from just a decade ago.

The Technology Behind the Toys

Products like Curio's "Grem" and "Gabbo" embed AI language models within plush toys. These companions connect to Wi-Fi, converse dynamically, answer questions, tell stories and adapt to individual children's learning needs, even for kids as young as 3.

Curio, a leader in AI-enhanced toys, is developing conversational plush companions that aim to balance technological innovation with emotional connection. Meanwhile, Mattel, the company behind brands like Barbie and Hot Wheels, recently partnered with OpenAI to create a new line of smart toys expected to launch by the end of 2025, targeting both younger children and teenage "kidults."

Privacy and Development Concerns

The very technology that makes these toys appealing is also the source of the deepest concerns. To personalize conversations, these devices must collect vast amounts of data, including voice recordings of children. This has sparked criticism from privacy advocates who question where this sensitive information is stored, who has access to it and how it might be used.

Child development experts are also urging caution. A clinical psychologist writing for Psychology Today warns that AI-powered toys could reduce peer play, creative problem-solving, and essential social development. Children may become emotionally attached to their AI companions and prefer them over human friends, potentially undermining their ability to learn compromise, empathy, and the art of getting along with others.

Studies reviewed on International Journal of Research and Innovation in Social Science also highlight that excessive reliance on AI companionship can weaken human-to-human connections in the long term, reduce motivation for real-world social interactions, and lead to diminished empathy and adaptability, especially among younger users

This highlights the central debate: Are these toys innovative educational tools or vehicles for data collection and social experimentation? The industry is closely watching as parents grapple with the appeal of interactive AI playmates against growing privacy and developmental concerns.

For now, the smart bear in the corner of the room is listening, and the world is watching to see what happens next.