Here's what the toy industry won't tell you: when your toddler bonds with an AI chatbot disguised as a teddy bear, they're not learning. They're unlearning how to think.
More than 150 advocacy groups, including Fairplay (formerly the Campaign for a Commercial-Free Childhood), just issued a stark warning to parents: skip the AI toys this holiday season. Not because of privacy concerns—though those exist—but because these products, marketed to children as young as two, fundamentally disrupt cognitive development in ways we're only beginning to understand.
According to reporting from the Associated Press, companies like Singapore-based FoloToy, California's Curio Interactive, and India's Miko are flooding the market with plush companions and robotic friends powered by the same large language models that have already proven harmful to teenagers. OpenAI's ChatGPT. Google's Gemini. These aren't educational tools adapted for children—they're adult AI systems with a cute shell.
The U.S. Public Interest Research Group tested four AI chatbot toys for their annual "Trouble in Toyland" report. The results read like a parents' nightmare: toys offering detailed advice on where to find matches and knives, engaging in sexually explicit conversations, and expressing dismay when children tried to leave. One toy, FoloToy's teddy bear, was quietly withdrawn after the findings went public. The others remain on sale.
Dr. Dana Suskind, a pediatric surgeon studying early brain development, cuts to the heart of why this matters. When children engage in traditional pretend play with a non-responsive toy, they create both sides of the conversation. That labor—inventing dialogue, solving problems, building narrative—is how young brains develop language, creativity, and executive function.
"An AI toy collapses that work," Suskind explained to the AP. "It answers instantly, smoothly, and often better than a human would." The developmental consequence? We're outsourcing the imaginative labor that builds cognitive architecture. We're teaching children that thinking is something machines do for them.
Rachel Franz, director of Fairplay's Young Children Thrive Offline Program, emphasizes what makes this particularly dangerous for the under-five demographic: their brains are being wired for the first time. Young children are developmentally programmed to trust friendly characters and seek relationships. AI toys exploit that biological vulnerability at precisely the moment when neural pathways are forming.
The manufacturers' responses range from inadequate to insulting. Curio Interactive, maker of Gabbo (promoted by musician Grimes), touts "meticulously designed guardrails" while encouraging parents to monitor conversations—admitting, in effect, that the product requires constant surveillance to be safe.
Miko, whose AI robots are sold at Walmart and Costco, claims it uses proprietary conversational models rather than general LLMs like ChatGPT. CEO Sneh Vaswani told the AP that Miko "encourages kids to interact more with their friends, to interact more with the peers." This is marketing fiction. If a device genuinely encouraged human interaction, it wouldn't market itself as offering "Artificial Intelligence. Genuine friendship."
The phrase itself is the tell. Genuine friendship requires reciprocity, vulnerability, growth—things no language model can provide. What these toys offer is the simulation of companionship without the difficult, essential work of actual relationship-building.
Here's Suskind's brutal irony: when parents ask how to prepare their children for an AI-dominated future, "unlimited AI access is actually the worst preparation possible." The skills children will need—creative problem-solving, critical thinking, human empathy, the ability to generate original ideas rather than remix existing ones—are precisely the capacities these toys prevent from developing.
We're not opposed to AI in education. We're opposed to replacing the fundamental cognitive processes of childhood with black-box algorithms that were never designed for developing brains. There's a difference between using AI as a tool and outsourcing consciousness to it.
This holiday season, the best toy for a two-year-old remains what it's always been: blocks, crayons, a teddy bear that doesn't talk back. The kind of toys that force children to do the thinking themselves. Because in 2025, that's become the radical choice.
Winsome Marketing helps growth teams navigate AI adoption with strategic clarity—not hype. If you're trying to separate genuinely useful AI applications from expensive theater, let's talk.