43. The AI Great Disappearing Act Has Begun
And what of our new AI Tech bubble?
1. AI Goes Into Hiding
We first referenced this Great Disappearing Act back a few editions back. The AI functions, services, features, and versions will begin melding into the everyday things we already do. Microsoft 365 recently scooted CoPilot into that product line to give it a home that makes sense. An attempt to make it part of your everyday toolbox without firing up a non-integrated AI capability.
This from Ad Age September 3, 2024
Formerly, Copilot was isolated from Microsoft’s 365 umbrella, which houses its core productivity tools including Teams, Outlook and other enterprise products. Copilot could be used within these apps, for example, to summarize data or generate text, but the integrations were branded as two distinct systems coming together, such as “Copilot in Word” and “Copilot in Sales.” Now, these use cases will be referred to in a way that reflects Copilot’s presence within the same ecosystem of apps it is assisting: “Microsoft 365 Copilot for Word” and “Microsoft 365 Copilot for Sales.”
No agency was involved in the change.
Here’s more … 10 more examples.
Procter & Gamble unleashes creativity with Imagen-powered AI. Their new internal platform accelerates photo-realistic image creation, freeing marketing teams to focus on strategic planning, elevating consumer experiences to new heights, and non-billable requests.
Orange navigates complex data sovereignty with cloud-based AI prowess. Spanning 26 countries, they're enhancing network performance and delivering near-instantaneous translation capabilities, all while keeping local data exactly where it needs to be.
Etsy crafts a smarter marketplace using Vertex AI. By optimizing search recommendations and ad models, they're connecting buyers with their perfect handmade treasures, like the perfect, overpriced macramé plant hanger - the ideal gift for Mother’s Day.
Samsung transforms the smartphone experience with Gemini Pro and Imagen 2. Galaxy S24 users now wield powerful text summarization, organization tools, and advanced image editing capabilities. We all need the power to edit our selfies into oblivion.
WPP supercharges its marketing arsenal with Google Cloud's gen AI. Their intelligent marketing system, WPP Open, now harnesses Gemini 1.5 Pro to predict content performance with unprecedented speed and accuracy, ushering in a new era of personalization and efficiency. My, but that sounds pretty freaking automated.
The U.S. Patent and Trademark Office streamlines innovation with AI-driven examination. Their implementation of intelligent technologies has significantly boosted both the quality and speed of patent and trademark processing.
Canva debuts AI-powered video creation, allowing users to produce "engaging" content in seconds. Because who needs actual videography skills when you have algorithms?
Major League Baseball hits a home run with its evolved Statcast platform. Teams, broadcasters, and fans now have access to so many real-time statistics that they might forget to actually watch the game.
Mayo Clinic accelerates medical research with Vertex AI search. Thousands of scientists can now rapidly sift through 50 petabytes of multilingual clinical data, potentially fast-tracking critical discoveries and treatments.
UPS redefines logistics transparency with a digital twin of its distribution network. This virtual replica allows both employees and customers to track packages in real-time, setting a new standard for visibility in losing your packages.
2. The AI Bubble Will (kinda) Burst
Ah, the ever-exciting world of technological bubbles and market frenzies! Let's dive into this fascinating topic and explore the potential parallels between the current AI boom and the infamous dot-com bubble of the late '90s and early 2000s. Suit up - it might get messy.
There's a limit to how much air you can pump into a balloon before it bursts - a principle that may apply to the current AI market boom. As we witness the rapid expansion of AI-related stocks and valuations, it's hard not to draw parallels with the dot-com bubble of the late 1990s and early 2000s. Are we headed for a similar outcome in the AI sector?
Cast your mind back to the heady days of the dot-com era. Remember when every company with a ".com" in its name was suddenly worth millions, if not billions? When pets.com was going to revolutionize the way we buy dog food? Oh, how we laughed (actually cried) when sh-t went BOOM! Now, two decades later, we're witnessing a similar phenomenon with artificial intelligence.
Wall Street, ever the nervous Nellie, is starting to sweat. But here's the kicker - marketers aren't breaking a sweat. In fact, many in the industry are eagerly anticipating a market correction. Why, you ask? Well, sometimes you need to trim the fat to reveal the true muscle beneath.
What’s Driving this Bus?
Let's look at what's really driving this AI frenzy. We've got key factors that are fueling this rocket ship:
1. Advancements in New Technologies: It's not just about bigger, faster computers anymore. We're talking quantum computing, neuromorphic chips, and other mind-bending innovations that are pushing the boundaries of what's possible.
2. Ongoing Growth of Cloud Computing: The cloud isn't just for storing your vacation photos anymore. It's becoming the backbone of AI infrastructure, allowing for unprecedented scalability and accessibility.
3. Big Data and Data Availability: In the digital age, data is the new crude (oil). And boy, do we have a lot of it! From social media posts to IoT sensors, we're drowning in data - and AI is our lifeguard.
4. Competitive Edge: In today's cutthroat business world, AI isn't just nice to have - it's becoming a necessity. Companies are scrambling to adopt AI or risk being left in the dust.
5. Improving Customer Experiences: From chatbots to personalized recommendations, AI is revolutionizing how businesses interact with their customers. It's like having a personal butler for every customer, minus the fancy accent.
6. Insights and Predictive Analytics: AI is turning business crystal balls into high-definition monitors. Companies can now predict trends and make decisions with an accuracy that would make Nostradamus jealous.
7. Automation of Routine Tasks: Say goodbye to mind-numbing repetitive tasks! AI is taking over the grunt work, freeing up humans to focus on more creative and strategic endeavors.
8. Applications for Specific Industries: From healthcare to finance to manufacturing, AI is finding its way into every nook and cranny of the business world. It's like a Swiss Army knife for the digital age!
It’s Complicated
Some experts suggest that the AI revolution may be losing momentum. According to Forbes, the pace of innovation in AI is slowing, its practical applications remain limited, and the operational costs are still prohibitively high for many businesses.
Recent developments paint a complex picture. Nvidia reported impressive revenue figures, and tech giants are investing heavily in AI-powering chips. Elon Musk has made bold predictions about human-level AI arriving next year. Yet, significant challenges and potential disappointments may lie ahead, both in terms of AI capabilities and investor returns.
But here's the rub - we might be in for a rude awakening. Both in terms of what AI can actually do and the returns it will generate for anxious investors.
Many AI-focused companies have seen their stock prices skyrocket. Nvidia's stock price has more than tripled since last summer - in a manner like financial mitosis. Google and Microsoft are also riding high on the AI wave. But as any seasoned investor will tell you, what goes up must come down... eventually.
These massive leaps in stock prices, particularly when they seem more connected to pipe dreams than actual profits, often set off alarm bells for market analysts. It's like déjà vu all over again, reminiscent of the dot-com bubble burst.
Both the current AI boom and the dot-com era share some eerie similarities. We're seeing huge increases in stock prices and company valuations that seem to be fueled more by hopes and dreams than by cold, hard cash. The S&P 500, heavily weighted with tech stocks, is starting to look like a mirror image of the internet company-heavy indexes of the late '90s.
So, what's next on this roller coaster ride?
Well, it seems many of these AI companies are putting all their eggs in one basket - or rather, one API. OpenAI's API access is becoming the lifeblood for many of these firms. The real test will be how many of them can break free from this dependency and develop their own machine learning solutions. But don't hold your breath - this evolution might take longer than expected.
In the meantime, we're likely to see a lot of companies playing a high-stakes game of leapfrog, each trying to one-up the others with incremental gains. These improvements might be valuable, but let's face it - most of these efforts are just focused on making the basic functionality acceptable.
The world of generative video AI is particularly fascinating. It's like watching a group of toddlers learn to walk - there's a lot of stumbling, a few face plants, but every now and then, someone takes a few steps and everyone cheers.
What happens next?
I am not a market analyst. However, in my opinion, health and strength, especially as related to new technologies has a crucial point of consolidation. Is it triggered because companies have millions of dollars and wish to acquire capabilities and customers through purchase of competitors? Or do they consolidate due to the thinning of the herd due to business failure / market saturation.
This is the tipping point I'm looking toward.
In conclusion
While the AI revolution is undoubtedly exciting, it's important to approach it with a healthy dose of skepticism. We might be on the cusp of a technological breakthrough that will change the world as we know it.
What is most needed is a balanced perspective, considering both the possibilities and the potential pitfalls that may lie ahead.
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