It will take time for artificial intelligence technology to be put to productive use by customers, says Richard Waters for Financial Times.
FILE PHOTO: An AI sign is seen at the World Artificial Intelligence Conference in Shanghai, China July 6, 2023. REUTERS/Aly Song/File PhotoSAN DIEGO: There are several truisms when it comes to tech bubbles. One is that it’s often difficult to see one when you are inside it: Each individual spending or investment decision can seem rational, even if the net effect looks extreme.
The investment boom triggered by the technology has been all too visible, but it takes time for all that new capacity to be put to productive use by the tech industry’s end customers. Wall Street’s patience is about to be put to the test.Software companies, which are best positioned to capture the value of the new technology by embedding it as features in their existing products, are struggling under a stock market cloud.
At best, this points to a lag in the widespread take-up of generative AI. At worst, it shows that the technology isn’t as transformative as tech companies have claimed. Pouring money into large language models and the infrastructure to support them has also become a strategic necessity for the big tech companies themselves. If machines that can “understand” language and images represent an entirely new computing platform, as many in the tech world expect, then all the big players will need a stronger foothold in the technology.
Meanwhile, the next big product cycle for chipmaker Nvidia, based on its new Blackwell chip architecture, isn’t even due to begin until the second half of this year.
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