Arvind Krishna, IBM CEO, on AI investment: “It’s my view that there’s no way you’re going to get a return on that”
Big tech has been dumping vast sums of money on building out AI capabilities, but will it pay off in the long run? One tech insider shares his doubts.
Many people are worried about what the future of AI will hold in store. There have been many doomsdays predictions, and not just from everyday people, but also those who work in the industry.
From it just taking our jobs to wiping us out, completely. Not terminator style, but causing discord within the public through false news, videos, and more that we don’t know what is fake and real anymore.
But closer to home, at every kitchen table, what will it mean for my job, my children’s future, for life as we know it? Those may be longer term questions though, a few years at most, given many statements made by those in the know.
More pressing in reality could just be about, in rush to bring such systems online, the investments being made and what they could mean for the real economy, right here and right now.
Insider on AI investment: “There’s no way you’re going to get a return on that”
While the benefits of artificial intelligence are clear to Arvind Krishna, the CEO of IBM, he has serious doubts about what the massive investment in the technology will achieve in the short term.
“I’m not convinced that the current set of known technologies gets us to [Artificial General Intelligence (AGI)],” said the person who has been praised for his vision on the fast-advancing technology. He sees the probability of that happening at “about 0–1%.”
Krishna, whose surname is also that of the Hindu avatar Vishnu, the “all-attractive one,” said that he doesn’t see an AI bubble, but that the returns on the massive investment being made right now in mega data centers might not pan out, at this time. By his calculations of the roughly 100GW capacity commitments made worldwide, it will cost of around $8 trillion.
“There’s no way you’re going to get a return on that in my view because eight trillion of capex means you need roughly 800 billion of profit just to pay for the interest,” he said speaking on the ‘Decoder’ podcast with host Nilay Patel.
Depreciation of systems will drive up the cost of maintenance
Just as with any infrastructure that you build, you need to maintain it. While the AI future may be in our near future, it is still being built out, and by the time it comes to fruition it will most probably need to be retooled.
“You’ve got to use it all in five years because at that point, you’ve got to throw it away and refill it,” said Krishna.
“There can be only one”
“It’s a belief that one company is going to be the only company that gets the entire market. That’s a belief,” shared the IBM CEO. “That’s what some people like to chase. And I understand it from their perspective. That’s different than I agree with.”
“Just to be absolutely clear,” he added, “I think it’s going to unlock trillions of dollars of productivity in the enterprise.”
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