Its also a space where data collection and ground truth are expensive, so people try to boot strap solutions in odd ways. Its tough.
As the paper author, I'm not going to name any companies. Especially since one was sharing data with us for this work, and I don't want to inject any of my biases into a particular name. But we've done some fairly extensive testing of the models we've built. Both on data they gave us and data we got ourselves, and our model don't just label everything as malware. It is not quite AV quality at the moment, but we also have limited training data and are really still exploring the different ways one can tackle this problem with AI.
Jon did a great job in this blog post, but if you want more details on why there is so much work to still be done, I'd recommend reading our paper! We tried to make the intro section accessible to people with no AV/malware background.
I sure hope it wasn't Tehtris, because their "AI detection" is nothing short of random.
The problem is that to be a "good" program, yours has to do something other "good" programs do. And there aren't that many of those that use different software development paradigms (not different versions of the same one). So new different programs tend to be marked as malware.
This also brings up a very easy way to circumvent such AVs. Simply modify an existing goodware program and it will be marked as goodware. Add some obfuscation/polymorphism and it would be virtually impossible to detect such malware using static analysis/AI-based AVs.
Average size for malware is ~100kb-200kb btw. This is way smaller than almost any software besides some console games.
More than that. Currently there are a lot of shady security suppliers who do nothing except imitating a good protection. They put fancy design into UI coupled with a mediocre 3rd party anti-virus engine, and presto, you have yet another source of false positives. They do not react to reports nor provide any meaningful support. Instead, they are pretty busy with marketing, buzz and sales. Yes, what could go wrong.