Artificial intelligence is more than just a buzzword – it is a new type of computer-generated technology that takes the logical next step from digital automation. Investors tend to respond enthusiastically to everything AI – whether it be a car manufacturer that incorporates AI into a new model, or a software producer that launches an AI assistant. This article offers a look at the AI field currently – the two main players, challenges for the field and, conversely, the challenges that the field poses for other industries.
AI has been around for at least two decades, but in very basic forms. The auto-completion feature on your smartphone keyboard and the suggestions on Google’s search engine are two examples. What is new is generative AI, which reads and processes a large corpus of texts and images and can use the material to generate completely new content or to answer questions. The consumer-facing side of AI currently provides similar Q&A services but can also write essays and assignments on demand – creating problems for schools and universities when assessing students. Corporations use AI for data entry and analysing large data sets. One area where corporates and consumers meet is in customer service – many organisations, from retailers to banks, offer a chatbot instead of a human as the first point of call for customers in need of help.
The easiest way to invest in AI today is to buy shares in one of the major companies on the AI scene – Alphabet with Gemini, Microsoft (which has backed but does not own OpenAI), or one of the groups providing the required hardware – notably Nvidia. As ever, the option to invest in a tech start-up pioneering AI in different ways also exists, but with the related risks of investing in un-listed companies.
When assessing the future of AI, there are two aspects to consider – first, how the ways in which consumers’ and businesses’ uses of the software will evolve, and, secondly, which company is more likely to adapt to the changing tastes. These two aspects are closely interlinked – and sometimes, a company with a good marketing strategy is able to create a demand that was not there before. For example – the iPhone (and, after it, the iPad) created a multi-billion dollar industry and became not just a gadget but an essential object within just a few years. Ultimately, the company with the most cash available for research and development will be the one that dominates. However, there is one caveat – with the apparent importance of AI, neither the US nor the EU are likely to allow one firm complete dominance but will encourage competition. This may protect junior players from absorption.
With the recent advent of AI, we have seen a real race of B2B and B2C companies to integrate the technology into their products or business processes. An example is the recent partnership between Apple and OpenAi, which will allow the Cupertino-based company to integrate the ChatGPT system into its operating systems. For Apple, the integration of this technology could be a re-launching tool, after the sales and growth difficulties experienced recently, especially in China. On the other hand, however, this could cause questions of privacy and data security, with Elon Musk, for example, already threatening to ban the use of these products in his companies.
The use and deployment in each sector of the technology will largely depend on the preferences and needs of humans in different contexts and the prospects for its application. Although AI offers new opportunities and solutions, such as content generation and advanced data analysis, historical examples show that emerging technologies do not always completely replace existing ones, but coexist and adapt according to different needs. For example, stairs survived the invention of the escalator. Similarly, despite the spread of e-books, printed books maintain a strong market presence and there are still people who prefer them, despite the fact that they may be less convenient to carry and read. This suggests that the artificial intelligence will coexist with current technologies, adapting to different contexts, needs and user preferences. The adoption of AI will therefore be driven by how people choose to integrate it into their daily lives and the specific needs of different sectors.
In conclusion, the future of AI will depend on what the market – both businesses and consumers – want it to do, and which company is best suited to predict, shape and meet that demand.
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