""I think there's certainly a correction coming in valuations," he said. "These valuations do seem pretty crackers. I don't see any business model yet, even of the leading AI hyperscalers, that can recoup that capital expenditure. Some of the AI labs that don't have a particularly good business model will be very exposed in a market correction.""
""I think it's pretty difficult to assert anything other than that we are a vassal state of American technology," he sai"
Sir Nick Clegg warned that current AI sector valuations look unsustainably high and predicted a correction. Leading AI firms and hyperscalers are struggling to show how large capital expenditures will generate sustainable returns. Some AI labs with weak business models face significant exposure if valuations reset. Economists and regulators have raised similar concerns, likening the situation to past market bubbles and warning of sudden corrections. Investors have poured tens of billions into foundation models and AI infrastructure despite high compute costs, slow commercial deployment and unclear monetisation. Clegg also criticised Britain’s heavy reliance on American technology infrastructure, calling it a vassal relationship.
Read at Business Matters
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