Goldman Sachs has expressed concerns about the high costs and unreliability of artificial intelligence, questioning whether the "overhyped" technology will justify the massive investments required.
The firm highlights that AI processing expenses are substantial and its benefits remain uncertain, potentially impacting its financial returns.
Corporations and investors are heavily investing in AI, with models like GPT-4 costing hundreds of millions to train, and next-gen models approaching a billion dollars.
Goldman Sachs questions if these investments will pay off, as Sequoia Capital estimates the AI industry needs $600 billion annually to break even. Experts are divided: some are skeptical about AI's economic returns and efficiency, while others believe the capital expenditure cycle is promising and analogous to past technological advancements.
Training current LLMs like GPT-4 costs hundreds of millions of dollars. Next-generation models are expected to push these costs up to a billion dollars. Major corporations such as Nvidia, Microsoft, and Amazon are heavily investing in AI to secure a competitive edge in the market.
Other experts see the current capital expenditure on AI technologies as promising. They draw parallels to the investment cycles of prior ground-breaking technologies. These experts suggest that, like previous technological advancements, AI investments may initially seem excessive but will eventually pay off as the technology matures and becomes more widely adopted.
The broader and faster adoption of AI technologies across industries will be crucial for achieving substantial returns. Successfully integrating AI into existing business processes and overcoming adoption barriers will determine the pace and extent of its impact.
The debate over the return on AI investments is ongoing, with valid points on both sides. Skeptics question the economic efficiency and potential returns of AI technologies, while optimists see a promising future akin to previous technological revolutions. The ultimate payoff of these investments will depend on continued technological advancements, market adoption, and a supportive regulatory environment.
See What’s Next in Tech With the Fast Forward Newsletter
Tweets From @varindiamag
Nothing to see here - yet
When they Tweet, their Tweets will show up here.