"Hello and welcome to Eye on AI. In this edition...the U.S. Census Bureau finds AI adoption declining...Anthropic reaches a landmark copyright settlement, but the judge isn't happy...OpenAI is burning piles of cash, building its own chips, producing a Hollywood movie, and scrambling to save its corporate restructuring plans...OpenAI researchers find ways to tame hallucinations...and why teachers are failing the AI test."
"Concerns that we are in an AI bubble-at least as far as the valuations of AI companies, especially public companies, is concerned-are now at a fever pitch. Exactly what might cause the bubble to pop is unclear. But one of the things that could cause it to deflate-perhaps explosively-would be some clear evidence that big corporations, which hyperscalers such as Microsoft, Google, and AWS, are counting on to spend huge sums to deploy AI at scale, are pulling back on AI investment."
"So far, we've not yet seen that evidence in the hyperscalers' financials, or in their forward guidance. But there are certainly mounting data points that have investors worried. That's why that MIT survey that found that 95% of AI pilot projects fail to deliver a return on investment got so much attention. (Even though, as I have written here, the markets chose to focus only on the somewhat misleading headline and not look too carefully at what the research actually said."
Corporate and market indicators point to growing concern about an AI valuation bubble driven by uncertain enterprise adoption and investor pessimism. A U.S. Census Bureau biweekly survey of 1.2 million businesses asks whether companies used AI, machine learning, natural language processing, virtual agents, or voice recognition to produce goods or services. An MIT survey finding that 95% of AI pilot projects fail to deliver a return on investment increased investor worry despite nuance in the results. Hyperscaler financials have not yet shown a broad pullback, but mounting data points raise the prospect that reduced corporate AI spending could trigger a sharp revaluation.
Read at Fortune
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