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TechCheck

TechCheck+ AI’s trillion dollar time bomb 7/19/24

TechCheck

CNBC

Disruptors, Tech, Technology, Cnbc, Management, Business, Faang, Investing

4.566 Ratings

🗓️ 19 July 2024

⏱️ 10 minutes

🧾️ Download transcript

Summary

There’s a time bomb ticking in the AI space: spending is too high, and returns are too low. Megacaps like Meta, Google and Amazon have seen capex spending surge as they throw cash at building out the infrastructure to stay ahead of the AI game. Microsoft in particular has spent billions at a premium valuation, and shelled out $13 billion investing in OpenAI while Apple was reportedly able to secure a partnership with the startup darling for free just 18 months later. That could be a warning for the broader AI space, as experts sound the alarm on the widening gap between what companies are spending on AI, and what they’re getting back from it.

Transcript

Click on a timestamp to play from that location

0:00.0

Microsoft jumped on the Gen AI bandwagon early.

0:03.2

Microsoft is reportedly in talks to invest $10 billion in open AI.

0:07.6

Microsoft, yes, the largest company on earth,

0:10.5

tank the company's early aggressive bets on open AI.

0:13.8

I hope that with our innovation, they will definitely want to come out and show that they can

0:18.6

dance and I want people to know that we made them dance.

0:21.3

But now, Microsoft looks like the mark at a poker table.

0:24.4

Billions of dollars in cappex, a premium valuation, little AI sales to show for

0:30.0

it, and shelling out $13 billion for what Apple was able to secure for free just 18 months later.

0:36.5

Apple just announcing that Chatchi VT from Open AI will be integrated into iPhone,

0:42.4

iPad, and Mac software.

0:44.0

Microsoft could be a warning to the broader AI space

0:47.0

as experts increasingly warn

0:49.0

of a widening gap between what companies are

0:52.0

spending on AI and what they're getting back from it.

0:55.6

I'm Deja Bosa and this week on Tech Check, AI's trillion dollar time bomb.

1:03.0

Generative AI promised to change everything.

1:07.0

Generative AI is going to reset the internet as we know it and yes it will change

1:12.0

a life. Better productivity, medical breakthroughs, environmental sustainability,

1:16.2

personalized learning.

1:17.6

Of course we are only just getting started.

1:20.5

But instead we got deep fakes, disinformation, spam, and plagiarism.

...

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