Amazon founder Jeff Bezos said artificial intelligence is caught up in the “industrial bubble,” but claims it is a bubble that will ultimately benefit the world.
Speaking at Italian Tech Week in Turin on Friday, Bezos said the frenzy has all the classic signs of the bubble. Stock prices and valuations are separated from the foundation, and it is an atmosphere that it is almost impossible for investors to throw money at any idea and distinguish between promising and destined ventures.
“It's a kind of industrial bubble,” he told the audience.
“Investors are struggling in the middle of this excitement, distinguishing between good and bad ideas, and that's probably happening today too.”
He recalled how Amazon's own stock collapsed during the dotcom crash, and even if its basics improved, it fell from $113 to $6 per share.
“The employee was nervous, just as all the parents of the employees called them and said, 'Are you okay?' But all of the business metrics were getting better,” Bezos said. “That's what makes the bubble stand out. Stock prices can be completely cut off from the foundations of the business.”
Bezos pointed to small businesses where only a small number of employees raise huge amounts of money. He said the “very unusual” dynamics highlighted how hot the market has overheated.
Jeff Bezos said AI could be a frenzy, but called it a rare technology that touches every company in the world. Avoid Kasilli/Reuters
Why Bezos is a good bubble
Still, he said that speculative frenzy does not undermine the fundamental promises of technology.
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“AI is authentic and we're going to change every industry,” he said. “The benefits from AI to society will be enormous.”
The billionaire also suggested that bubbles could be productive in the long run.
He compared the biotech boom of the 1990s and the current wave of AI investment to the biotech boom of the 1990s, when many companies not only collapsed, but produced life-saving drugs.
” [bubbles] The industry isn't that bad,” Bezos said. Society benefits from those inventions. ”
Jeff Bezos said AI is on the bubble but argued that the technology is authentic and ultimately brings “huge” benefits to society. Avoid Kasilli/Reuters
Bezos is hardly alone in warning that the AI industry appears to be overheating.
Openai CEO Sam Altman, Alibaba co-founder Joe Tsai, hedge fund founder Ray Dalio and C3AI CEO Thomas Siebel all say the market is already in the bubble territory.
But for Bezos, the excitement around AI reflects past enthusiasts. However, he urged entrepreneurs and investors to focus on lasting principles.
The reality is “completely undefeated,” he said.
