Every company would be affected if the AI bubble were to burst, the head of Google’s parent firm Alphabet has told the BBC. Speaking exclusively to BBC News, Sundar Pichai said while the growth of artificial intelligence (AI) investment had been an “extraordinary moment”, there was some “irrationality” in the current AI boom.
Luke Jones from BBC World Service spoke to Andrew to get his views.
Interview Transcript
Luke Jones
Let’s discuss this with two experts in this field. Takara Small is a technology columnist for CBC Metro. Morning. She’s in Toronto, Canada. Welcome to Takara. Hello. Also with us is Andrew Grill, an AI expert who helps businesses with their AI strategies. And he’s in Warsaw Poland. Welcome Andrew
Andrew Grill
Luke, good to be here
Luke Jones
Takara, if I can start with you. Sundar Pichai, though, was talking about how, in terms of the sheer amounts of investment that we’re seeing going into AI, there might be as well as some rationality, some irrationality about it. What’s your view on this? Are people just getting a bit too giddy with the amount of cash they’re throwing in?
Takara Small
I think it’s so interesting that we’re seeing someone of this level talk about perhaps irrationality and excess. That is something you would not have heard of. You know, perhaps a couple of months ago, I think people are starting to see that there are limitations. There have been several studies in recent months that showcase their limitations to AI, but also recognising that the immediate return that people expected from AI may not be, may not be realistic. And so this all speaks to the idea that, you know, I think as a company, is trying to ensure that investors recognise there may be some downfall coming, but also showcase that there will be a potential opportunity in the near term. But you know, again, I think it speaks to how AI has been overvalued, and that you have leaders trying to dial down this enthusiasm.
Andrew Grill
Andrew AI, really it is somewhat overhyped, overcooked. We’ve seen what happened with the metaverse and Bitcoin. I think what we’re seeing is everyone wants to build the capability. In the last three years, since chat GPT launched, it’s almost three years this month, I’ve probably spoken to hundreds and hundreds of companies. They’re wrestling with what to do with it. The technology has advanced so quickly it’s caught people on the hop they’re saying, Well, how do we involve it? How do we integrate it into our into our workflows? So it’s the application that I believe is there. And as a Futurist, I would say that, but I think people are getting caught up by saying it’s it’s available. Now, we’re all going to be using AI agents this year, but then when it comes down to the organisations, they’re saying, we’re not ready for this yet. We don’t know how to integrate it. So that’s part of the problem. The demand is, is not there, but the capability is but
Luke Jones
in terms of how this might affect me, and maybe the person listening is, you know, it’s all very well whether our workplace adopts this technology or not, but in terms of the bubble maybe bursting, say, a bit like the.com boom in the 90s, there a number of companies go bust. Because actually, in the end, we decide the AI we, like most, is made by this company, and they’re the winners in all of this, but all these other players fall away and investors lose billions. Does that really affect me? Takara, if there’s this big rationalisation, I guess some people will lose their jobs, some funds will have to write off big losses. But does it affect me, the random worker?
Takara Small
I think it will affect the random worker. And this is why, first of all, a lot of these AI companies, especially if we’re looking at the US, they’re the reason why we see the stock market reach fresh highs, why it’s bolstering GDP. And in the past, when there have been recessions or there have been a bust of some kind, you see companies pull back, and a lot of that time that happens with talent and employees, that’s one of the very rare spaces where they can alleviate some expenses and costs. And so I’m sure there are people listening thinking, well, if AI disappears, my job will be safe. Unfortunately, I don’t think that’s the case.
Luke Jones
So what do you think is going to happen? Andrew, looking forward, how quickly might this rationalisation come about, or will we still be in this ever inflating bubble for a few more years
Andrew Grill
now, I think there’ll be some sort of correction, because it’s not sustainable. I read somewhere that open aI have committed to spend a trillion dollars buying computing power and data centres and everything else, but they haven’t said that their revenue will match that for some years. And I’m not an economist, but you’ve got to have your cost below your revenue. So I think people will come to their senses. But what I’m seeing also is you’ve got lots of companies are building all these little applications, and then the big guys, like open AI and Google come along, add some more functionality, and it really cuts them off at the knees. So I think what we’re finding is people are saying, do we have to invest in the large organisations, because they’re the ones that are basically ploughing through like an icebreaker, and the smaller companies can’t keep up, because the technology keeps innovating. For example, if you have a note taking service today, chat GPT will do that for you. So you know, what happens if I have an AI company and I want people to invest
Luke Jones
in that? What about the environment in all of this? Because Sundar Pichai, in his interview with the BBC, did suggest that the rate at which they were hoping to make progress at Google on their climate climate targets will be impacted. I guess Takara because of just the sheer amount of energy that these data centres, which power artificial intelligence scoop up.
Takara Small
Yes, the energy, the amount of water in many places, the. West, you’re seeing a lot of, you know, towns and cities see increasing energy bills, you know. And just as another aside, meta recently announced $600 billion will be spent on creating new AI data centres as well. So I think it’s almost impossible for governments, as well as these private entities, to continue with their environmental promises. It’s, unlikely that be able to commit to that and see the infrastructure that they are hoping to implement in the next couple of years.
Luke Jones
Andrew,
Andrew Grill
it’s the other thing in the room. Every time I present on AI, someone puts up their hand and says, What about the energy issues, not only the electricity required to power these data centres, as Takara said, it’s the water. These GPU chips run so hot you have to cool them either with running water or by immersing them in liquid. And that comes at a cost. What I think we’ll see, though, is it will actually maybe have some more innovation around other forms of power. So Sundar, in the interview that you played, talked about nuclear power. They’ve just signed a deal for new nuclear power. Microsoft said they’re going to reopen Three Mile Island in a couple of years. I think we might see some innovation around new technologies, smaller, modular nuclear reactors. That might be a good thing, because people will say, we need to make sure we can reduce the use of energy, and we need to find new sources of stable energy.
Luke Jones
Andrew, Takara good to talk to you both. Andrew Grill is an AI expert currently in Warsaw Poland and Takara Small is technology columnist for CBC Metro Morning.
