"In the rush to cash in on the generative artificial intelligence gold rush, one possible outcome of AI's future rarely gets discussed: what if the technology never works well enough to replace your co-workers, companies fail to use AI well or most AI startups simply fail? Current estimates suggest big AI firms face a US$800 billion dollar revenue shortfall. So far, genAI's productivity gains are minimal and mostly for programmers and copywriters."
"Free genAI services, and cheap subscription services like ChatGPT and Gemini, cost a lot of money to run. Right now, however, there are growing questions about just how AI firms are going to make any money. OpenAI CEO Sam Altman has been candid about how much money his firm spends, once quipping that every time ChatGPT says "please" or "thank you," it costs the firms millions."
Generative AI has produced limited productivity gains so far, mainly benefiting programmers and copywriters, rather than powering a new economy. Major AI firms face massive potential revenue shortfalls—current estimates suggest an $800 billion gap—and many models are costly to operate, with high per-query compute expenses that can make paid accounts unprofitable. Startups follow a burn-to-acquire-users playbook, but sustainable tech winners historically scaled through low-cost, habit-forming products funded by advertising. Widespread adoption could fail due to underperformance, poor corporate integration, or startup failures, producing a future where AI is useful but not transformative.
Read at The Conversation
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