Baidu CEO: 99% of AI companies won't survive bubble burst

Recap: The rising fame of generative AI has fixed spot to nan improvement of galore startups making bold claims astir nan technology's capabilities. Many onlookers liken nan inclination to a classical marketplace bubble, a sentiment shared by nan CEO of Chinese tech elephantine Baidu. However, erstwhile nan lofty expectations for AI collide pinch reality, astir AI startups whitethorn not survive.

Baidu CEO Robin Li believes that only astir 1 percent of AI companies will strengthen aft nan inevitable burst of nan AI bubble. Li suggests this will consequence successful a healthier marketplace pinch much realistic applications for nan emerging technology.

Generative AI has remained a basking taxable successful nan years pursuing its first surge, driven by companies for illustration OpenAI and Nvidia. The latter, which produces nan hardware that astir AI companies dangle on, could soon go nan world's most valuable company. Tech giants specified arsenic Microsoft, Apple, and Google are besides integrating AI into astir each of their early products.

However, galore companies often make eager claims astir nan jobs AI mightiness switch aliases what users tin create utilizing matter prompts.

Speaking astatine Harvard's Future of Business Conference, Li based on that galore of these products will move retired to beryllium mendacious innovations, incapable to find a sustainable market.

He compared nan existent business to nan dot-com bubble that burst astir nan move of nan century, wiping retired galore early net companies. Li besides believes nan AI marketplace has go quieter but healthier successful 2024 compared to caller years. Although immoderate businesses and investors support precocious hopes for AI, others are showing much caution, recognizing that Nvidia's meteoric emergence can't past forever.

Consumer enthusiasm for nan exertion remains lukewarm. Recent income reports bespeak that consumers aren't purchasing PCs pinch AI-focused hardware owed to a circumstantial liking successful AI, but alternatively because nan latest models from awesome vendors travel equipped pinch nan exertion by default.

If a melodramatic marketplace correction occurs, Li anticipates that nan remaining 1 percent of AI companies will connection highly valuable products and services. Addressing a persistent rumor successful generative AI, Li expressed optimism astir nan simplification of hallucinations successful chatbots, claiming that they person go importantly much meticulous complete nan past 18 months.

The CEO besides touched connected concerns astir AI-related occupation losses, acknowledging nan anticipation that AI could switch quality workers. Li believes a paradigm displacement successful employment whitethorn return spot complete nan adjacent 10 to 30 years.