The industry is now whispering that a reckoning is coming for the AI boom, but Google is trying to push back against the idea. The firm has cited new research supposedly showing the benefits of early generative AI adoption.
According to Google Cloud, the research, based on a survey of 2,500 C-Suite leaders, “showcases the tangible return-on-investment (ROI) of generative AI initiatives across industries and markets worldwide.”
The study shows that the majority of executives (61%) are harnessing the power of generative AI with at least one application in production. Among these early adopters, 86% reported an increase in revenue, estimated at more than six percent.
The survey found that GenAI initiatives in production are driving benefits in four primary areas: productivity, security, business growth, and user experience.
"Generative AI is not just a technological innovation. It's a strategic differentiator," said Oliver Parker, vice president at Global Generative AI Go-To-Market, Google Cloud.
"Our research shows that early adopters of gen AI are reaping significant rewards, from increased revenue to better customer service to improved productivity. Organizations investing in gen AI today are the ones that will be best positioned to succeed in the coming decade."
But that actually seems to be the problem for investors these days. Early this week, tech companies and their stocks found themselves in the middle of a devastating sell-off, and the reason might be the growing possibility that GenAI will not deliver returns anytime soon – if ever.
There’s an increasing belief that big tech has become too obsessed with AI. Sure, it's transformative, but there is uncertainty about whether it will ever make money, Cybernews wrote this week.
The investors, who are selling off their stakes in large tech firms, want to be convinced that mammoth spending on expensive chips and data centers will bring them money soon. However, they’re not entirely sold on the idea just yet.
Just like Google now, Microsoft also tried to project a bit of confidence recently when it forecast AI monetization in “the next 15 years and beyond.” Sure, the infrastructure needed to power GenAI is very expensive but investors do not seem prepared to wait that long – Microsoft’s shares dipped more than 2%.
Besides, most of them took note of an insight (PDF) by Goldman Sachs, an American investment bank, back in June. It said: “GenAI: too much spend, too little benefit?”
Jim Covello, Goldman's head of global equity research, suggested AI “must be able to solve complex problems” to “earn an adequate return” on the roughly $1 trillion needed to develop and run it.
“Replacing low-wage jobs with tremendously costly technology is basically the polar opposite of the prior technology transitions I’ve witnessed in my thirty years of closely following the tech industry,” wrote Covello.
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