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AI buzzes Davos, but CEOs wrestle with how to make it pay
Global Banking & Finance Review®
Company
By Jeffrey Dastin
DAVOS, Switzerland (Reuters) – Bright banners tout the promise of artificial intelligence along the main promenade of Davos, but executives at the World Economic Forum (WEF) say they are grappling with how to turn early demos into money-makers.
The arrival of OpenAI’s viral ChatGPT triggered a frenzy of venture investment and an abrupt change of course inside the world’s biggest technology companies since late 2022.
This year, several CEOs at the WEF meeting in Davos told Reuters that the latest generative AI still has a lot to prove.
Cloud and internet security company Cloudflare CEO Matthew Prince told Reuters that the months ahead may even feel like an “AI letdown”.
“Everyone’s like, yeah, I can build these cool demos, but where’s the real value?” he said, echoing a theme among business leaders attending the WEF meeting.
ChatGPT’s rapid rise is in some ways an outlier.
In the first two months since its November 2022 launch, the chatbot reached an estimated 100 million users, making it one of the fastest growing applications in history.
The program brought so-called generative AI to consumers’ fingertips, letting people write a short prompt and generate a poem, school essay or gather information as if with a search engine. It also proved a good collaborator for developing ideas in “low stakes, not business-critical use cases,” said Victor Riparbelli, CEO of AI video generation startup Synthesia.
But “the enterprise is definitely not really ready” for this chat-based AI, he said in an interview.
One problem Riparbelli cited is there is no clear path to end so-called “hallucinations,” or false content generated by AI. While computer scientists have developed methods for constraining places from which chatbots can draw responses, business leaders may not want the risk.
Other concerns, said IBM’s Europe, Middle East & Africa Chair Ana Paula Assis, are stopping chatbot AI from reproducing human biases, and regulation.
“Clients are still very worried about how they bring those solutions within the boundaries of regulations and compliance,” she said.
Premier Li Qiang of China said in Davos that AI has to serve the common good but must be appropriately governed, because it “poses risks to security and to our ethics.” And China’s President Xi Jinping wants the United Nations to play a central role in AI discussions, U.N. Secretary-General António Guterres said Wednesday.
Meanwhile, some 90% of 1,400 C-suite executives said they were waiting for generative AI to take a step beyond recent hype or were doing only limited experimentation and pilots, survey results published by consultancy BCG showed.
Big tech companies including Microsoft, Alphabet’s Google and Amazon.com have pressed ahead, courting thousands of businesses to give the latest AI a try.
Some have marketed message-drafting, meeting-summarizing AI as a way to save employees time. Google, which has long used AI in its products, is experimenting with a chatbot-like collaborator it calls Bard.
And Microsoft CEO Satya Nadella said at a company event in Davos Wednesday that AI is poised to grow productivity and potentially accelerate science itself.
Yet businesses’ revenue and profit from recent efforts remain unclear.
‘GET REAL ABOUT AI’
While one Davos sign exhorted passers-by, “Let’s get real about AI,” efforts to find a market for it have led developers to consider diverse places.
Cohere, a high-profile AI startup that is focused on enterprises, views helping salespeople as one revenue path.
“It’s going to be on the sales side and making sales teams more productive,” Cohere CEO Aidan Gomez told Reuters. The hope would be “helping them do more outreach, more follow-ups, and automating a lot of that process.”
By contrast, medicine is more complicated. While speeding up note-taking for doctors is a worthy task for AI, automating the medical profession is not, as this could risk lives, said Gomez.
“We should be focused on assisting humans, not replacing doctors and having a chatbot doctor,” Gomez said.
Novartis CEO Vasant Narasimhan said the drugmaker was working with Microsoft with the aim of more widely rolling out AI to give samples to staff who submit 20 to 30,000 regulatory responses a year. The “next opportunity,” he said at Microsoft’s event, would be AI for drug design.
Tejpreet Chopra, CEO of BLP Group, a major wind and solar operator in India, told Reuters he is ready to incorporate AI chat technology “but only for internal use for writing good English, not for content.”
Elections are a high-stakes area concerning AI companies, as voters around the world head to the polls in 2024.
Regarding the use of AI in misinformation campaigns, Gomez said Cohere’s policies prohibit impersonation, while Riparbelli said Synthesia does not allow customers to make political content through its AI video platform.
OpenAI, which also bans abusive impersonation through its technology, on Monday said it is working with the National Association of Secretaries of State in the U.S. and will start directing users to CanIVote.org for election-related questions.
Understanding how content is created is a key concern among companies and policymakers, said Arati Prabhakar, director of the White House Office of Science and Technology Policy.
“If (people) see a video or an image, they should be able to know whether it is AI-generated or human generated,” Prabhakar told Reuters in an interview.
For Srini Pallia, an executive at technology services and consulting company Wipro, the AI buzz at Davos is loud and clear, filling the void left by crypto.
“You know the conversations – it’s AI, AI and more AI,” Pallia said.
(Reporting by Jeffrey Dastin; Additional reporting by Dmitry Zhdannikov and Divya Chowdhury; Editing by Kenneth Li and Alexander Smith)
Artificial Intelligence (AI) refers to the simulation of human intelligence in machines that are programmed to think and learn like humans.
Generative AI is a type of artificial intelligence that can create new content, such as text, images, or music, based on the data it has been trained on.
Enterprise applications are software solutions designed to meet the needs of an organization rather than individual users, often facilitating business processes.
Cloud computing is the delivery of computing services over the internet, allowing for on-demand access to storage, processing power, and applications.
Venture capital is a form of private equity financing that is provided to startups and small businesses with long-term growth potential.
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