Artificial Intelligence (AI) is on everyone’s lips—from front-page headlines to the multi-billion-dollar investments of major tech companies. But have we ever wondered if all this hype is really justified?
In his article “Why the AI Hype is Another Tech Bubble,” Luciano Floridi argues that the current excitement over AI shows the typical signs of a tech bubble. Floridi points out that the focus is often on financial aspects and huge investments rather than on tangible technical progress. This imbalance could lead to disillusionment, much like what happened during the dot-com bubble of the ’90s.
A recent report from Deutsche Bank warns that the current boom in AI investments, estimated at $340 billion, could eventually result in a significant financial crash. This scenario is reminiscent of past economic bubbles, such as Japan’s real estate bubble in the ’80s or the dot-com bubble. Although these investments are funded by profits rather than debt, a major correction could still impact the economy, given our dependence on leading tech companies.
Cory Doctorow, the well-known essayist and activist, points out that AI might represent an economic bubble similar to the one seen with blockchain. Despite the enormous interest and investments, AI struggles to generate revenues that match its high costs. Many companies slap the “AI” label on their products simply to boost market value, without a clear strategy for return on investment.
Beyond the financial hype, AI is bringing real changes to the workplace and businesses. In the financial sector, for example, AI is now integrated into almost every step of the value chain—enhancing data analysis, market forecasting, and operational efficiency. Banks are exploring the use of AI to support their digital transformations, despite challenges related to data quality and regulation.
Moreover, AI is revolutionizing customer service. For instance, Octopus Energy uses AI tools for automatic transcriptions, AI-generated summaries, and assistance in drafting responses, improving both efficiency and empathy in customer interactions.
While the financial excitement surrounding AI might be overblown and could lead to a speculative bubble, the technical advances and practical applications of AI are genuinely transforming various sectors. It’s crucial to distinguish between media hype and the real, concrete impact of AI, acknowledging both the potential financial pitfalls and the tangible benefits for businesses and the workforce.
