The Generative AI Gold Rush: A Fear-Driven Frenzy?
The field of artificial intelligence (AI) has been abuzz with a new wave of innovation: the much vaunted generative AI. This technology, capable of creating entirely new text, code, images, and even music, has ignited a firestorm of excitement and investment across industries. However, alongside the genuine potential it possesses lies something all too familiar — the fear of missing out (FOMO).
We are all aware of the potential uses that generative AI has been pegged to provide us with; medical research and drug production, writing copy of any kind, and photorealistic image generation, to name but a few. However, the potential economic impact of this technology is what’s truly staggering.
Multiple reputable organisations, including Microsoft and PwC, have said that generative AI could add up to $15.7tn to the global economy by the end of the decade. This potential windfall is a major driver of the current AI gold rush, with companies scrambling to secure a foothold in this nascent field and maximise their opportunities within it.
Now, there are many reasons for this rush that we’re seeing at the moment, but an undoubtedly large factor is FOMO. Tech giants, ever wary of being left behind by the next big thing, are pouring billions into the field, Amazon’s recent $2.75 billion investment in Anthropic, a competitor to Google’s own generative AI model, is a prime example.
This investment spree isn’t just about securing cutting-edge technology; it’s also about sending a message — one that says, “We’re at the forefront of AI innovation”.
This FOMO isn’t limited to established players, with startups in the generative AI space attracting record levels of funding as well. Investors, eager to get in on the ground floor, are overlooking traditional due diligence in favour of speed, which can lead to inflated valuations and a potential bubble in the generative AI market.
We all know the dangers of bubbles after all. On top of this, 53% of bosses across Europe, the US, and China believe that they are not as prepared as they should be for the generative AI rush according to Wavestone.
To continue this in a national perspective, when asked for a response to the statement “GenAI is a real gamechanger that will deeply disrupt the way we work and do business”, just 57% of UK respondents agreed. This compared to 78% in Asia, 71% in the US, 64% in France and 63% in Germany.
UK respondents were meanwhile most likely to be concerned about regulatory requirements, with around 34% of UK respondents stating “regulatory requirements” are a risk associated with GenAI, compared with 27% in the US, 24% in France, 21% in Asia and 20% in Germany.
Speaking on the findings, Shakti Mohapatra, an associate partner with Wavestone UK, commented, “This is not necessarily a sign of scepticism, rather an indication of the UK’s ‘fast follower’ approach that we have seen with previous disruptive innovations.
The heightened awareness of the regulatory landscape shows the UK’s commitment to cautious and compliant technological progression, ensuring GenAI is implemented responsibly and ethically.”
This is an important position to take with such transformatory technological advancements, as the breakneck pace of development fueled by FOMO can have unintended consequences. A misallocation of resources by companies rushing into generative AI may lead to neglect for other important areas of research and development, stifling innovation in crucial sectors unrelated to AI.
The pressure to be first to market could also lead to the release of half-baked models which, as we well know, could be extremely dangerous, and a talent war between AI companies could result in inflated salaries for under-qualified individuals and a shortage of properly qualified workers — the demand for skilled AI researchers and developers already being very high.
While a healthy dose of FOMO can drive innovation, it’s crucial to find the right balance by prioritising longer-term strategic thinking over short-term hype.
As much as companies may believe that having the term “AI” somewhere in their products or services will ensure higher sales, this is a fallacy and ends up being counterproductive more than anything else. Generative AI is only useful when there is a genuine application for it and, whilst the understanding of it and its capabilities is still fledgling, people will begin to see through these marketing ploys and the term will lose its allure quicker than it has gained it.
As well as ensuring that generative AI is effectively utilised, the focus must also be on responsible development. Creating a large language model that is unbiased, transparent, and accountable is just as important, if not more so, than being the first to market. It’s therefore paramount that companies prepare to invest in fundamental research and development rather than chasing quick fixes or wins with generative AI.
The potential of generative AI is undeniable. It has the power to revolutionise countless industries and improve our societies in profound ways. However, navigating the current gold rush requires a cautious and strategic approach that includes prioritising responsible development, focusing on long-term goals, and mitigating the risks associated with FOMO.
We can ensure that generative AI reaches its full potential and reshapes the future in a positive and sustainable way if these principles are followed.
