Everyone seems overly optimistic about AI in 2025. I onboard with a slowdown. It's to expensive for to little results (financially).
2025 might be a bit to early, but I think we will see a medium size backlash against AI and at least a certain segment of people will start to actively avoid LLMs and seek out alternatives. Some companies will find a niche in "Never talk to an AI/don't let computers solve human problems" and will be able to charge a premium.
2025 could however be the first year we see the first high profile AI companies close their doors. I think OpenAI is high on the list of companies that will in some sense fail. The brand is huge, but they are burning way to much cash, so they'll probably be rolled into Microsoft and their technology will live on inside SharePoint, VSCode and Outlook. Again, next year is a little early, but I'm still on a 25% chance of OpenAI being swallowed up by Microsoft.
The data strongly suggests that AI is dealing with a bad case of a bubble, and it's not that far out there to suggest that the bubble will pop next year. That's not to say that some companies won't come out ahead—there were success stories that came out of the .com bubble too—but I'd give it no more then three years before the bubble bursts and the startup casualties stack up.
The AI bubble as of now is nothing compared to the dotcom bubble. The only real reflection of it is in the nVidia stock price. We're not seeing IPOs of companies making no revenue and being valued in billions. It is all mag 7 capex going into nVidia.
Private startups having high valuations is completely irrelevant. VCs getting wiped out is not relevant for the wider economy.
After 3+ years, the case for "AI startups" could then begin to weaken, but integration of AI in most startups should then remain central to their existence.
Wasn't there some statistics showing that 90% of AI startups fail within a year, and others showing that is was perhaps closer to 85% in the first three? Both a rather bad, especially considering the amount of money these startups burn.
I don't think it's unreasonable to see investments go down, if the risk remains this high, for little to no profit.
Those are VC investments, nothing new to see here. They have all the incentives to ride the AI hype cycle, grow those investments and extract as much value from them as they can. Just as they've done before with other cycles as Big Data, Metaverse, Crypto/DeFi, etc.
Think about it, how many practically identical AI IDEs/editors are sponsored by YC alone? They're just hoping one of all those projects stick along enough to cash at least something in.
The big question is about trends in AI investment and usage from "old" corporations, SMBs and common people. Those will indicate if the world is really trusting the tech.
> The big question is about trends in AI investment and usage from "old" corporations, SMBs and common people.
These are only just getting started, from the large corps down. There is a decade of work ahead for them even if the AI tech stopped maturing right now.
I dunno, I work at a big old corp (finance/fintech industry) with a solid foundation in Data & Analytics, and still things are moving slowly. Not that much high of a hype in the C-level, maybe because sellers are not selling that well due to not really knowing how to extract value from (Gen)AI. Depending on the provider or consulting partner, sometimes they
just don't know how to promote its benefits.
Confidence is slowly building up but still is very far from the hype levels I saw in the middle to late Big Data (2015-2017) era.
