Artificial intelligence is losing hype
For some, that is proof the tech will in time succeed. Are they right?
![An illustration of a robotic hand with crossed fingers on a solid yellow background.](https://www.economist.com/cdn-cgi/image/width=1424,quality=80,format=auto/content-assets/images/20240824_FND000.jpg)
Silicon Valley’s tech bros are having a difficult few weeks. A growing number of investors worry that artificial intelligence (AI) will not deliver the vast profits they seek. Since peaking last month the share prices of Western firms driving the ai revolution have dropped by 10%. A growing number of observers now question the limitations of large language models, which power services such as ChatGPT. Big tech firms have spent tens of billions of dollars on ai models, with even more extravagant promises of future outlays. Yet according to the latest data from the Census Bureau, only 5.1% of American companies use ai to produce goods and services, down from a high of 5.4% early this year. Roughly the same share intend to do so in the coming months.
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This article appeared in the Finance & economics section of the print edition under the headline “Hype about the hype cycle”
Finance & economics August 24th 2024
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