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AI technology is rapidly developing. Not a day goes by without some new AI program, functionality, or development.
Against that backdrop, it’s not too surprising that OpenAI CEO Sam Altman audaciously just predicted, in a personal post titled The Intelligence Age, that we are on the path to achieving superintelligence, an AI with intelligence far greater than humans.
Altman bases his prediction on the success of AI deep learning: “In 15 words: deep learning worked, got predictably better with scale, and we dedicated increasing resources to it.” Thus, “To a shocking degree of precision, the more compute and data available, the better it gets at helping people solve hard problems.”
Meanwhile, Goldman Sach’s Jim Covello recently predicted something altogether different: an economic bubble for AI businesses, in a report titled: Gen AI: Too much spend, too little benefit?Here’s a quote from Covello:
Allison Nathan: Are you just concerned about the cost of AI technology, or are you also skeptical about its ultimate transformative potential?
Jim Covello: I’m skeptical about both. Many people seem to believe that AI will be the most important technological invention of their lifetime, but I don’t agree given the extent to which the internet, cell phones, and laptops have fundamentally transformed our daily lives, enabling us to do things never before possible, like make calls, compute and shop from anywhere.
Covello, who was featured in a recent New York Times article, was concerned when ChatGPT was launched in 2022 amid comparisons to launch of the world wide web. As he explained to the New York Times: “‘That’s not what anybody should be rooting for,’ he said, recalling the millions of jobs that were lost.”
The AI Catch-22: Is it possible both sam altman and jim covello are right?
On the surface, the predictions of Altman and Covello seem at odds. If Altman is right about superintelligence, shouldn’t we expect AI businesses to profit? And, if Altman is wrong, won’t Covello be proven right?
Perhaps. But perhaps not.
Let me offer a third possibility: both Altman and Covello can be right in some respects. AI superintelligence may be developed in the near future, and it might not translate into profits for OpenAI or other AI companies, much less an economic boom for the U.S.
The development of superintelligence is a technological advancement. But whether businesses can increase their revenues through AI uses is a business question whose answer depends not only on the business model, but also the consumer or enterprise demand for whatever the business sells. The successful business models, even of tech companies, tend to be traditional. Google’s is heavily dependent on advertising, Apple’s on iPhone sales, NVIDIA’s on GPU sales, and Microsoft’s on cloud services and software licensing. These aren’t innovative business models. They are downright archaic.
It’s quite possible that businesses will build superintelligence soon, but, in an AI Catch-22, not make huge profits from it. Even worse, it could result in more job losses of workers in the tech sector and continue to erode the disposable income people have to purchase things, including subscriptions to or devices with superintelligence. Therein lies the quandary.