Few industries have taken off in human history as AI in recent times, and even some of the players that have benefitted from this growth are now saying that it might be too much, too soon.
OpenAI CEO Sam Altman has hinted that we could be in an AI bubble. “When bubbles happen, smart people get overexcited about a kernel of truth,” he explained while speaking to a group of journalists. “If you look at most of the bubbles in history, like the tech bubble, there was a real thing. Tech was really important. The internet was a really big deal. People got overexcited. Are we in a phase where investors as a whole are overexcited about AI? My opinion is yes. Is AI the most important thing to happen in a very long time? My opinion is also yes,” he added.
Altman seemed to be be saying that while AI was a breakthrough new technology, people could be getting overexcited about it — while the internet ended up being incredibly transformative, betting too soon on the technology had disastrous results, such as during the dot-com crash of 2000.
But while Altman might tell journalists he thinks AI could be in a bubble, his actions don’t necessarily show that he believes this is the case. “You should expect OpenAl to spend trillions of dollars on data center construction in the not very distant future,” he said in the same interview. “We have to make these horrible trade-offs right now,” he said. “We have better models, and we just can’t offer them because we don’t have the capacity. We have other kinds of new products and services we’d love to offer.” If Altman truly believed that we were in an AI bubble, he wouldn’t be spending “trillions” on data centers.
As such, Altman speaking up about an AI bubble could be a smart strategic move — if OpenAI’s CEO says we are in an AI bubble, it could reduce investor enthusiasm in OpenAI’s many competitors including Meta and xAI. Meta has been poaching top researchers away from OpenAI with pay packages of as much as $250 million — if Altman can put the word out about an AI bubble, it could cause both public and private investors to be more cautious, and make it harder for OpenAI’s competitors to raise money. But Altman could be right about a bubble as well — while AI has become incredibly powerful, it still hasn’t had the kind of impact that putting a PhD in every phone could’ve been expected to have. But whether it is smart strategy or his genuine belief, it’s still an unusual move — the bigger player in an industry doesn’t normally come out and say that their entire sector could be in a bubble.