The bets on Artificial Intelligence (AI) continue to arrive, although its success has not been assured. The American technology company Advanced Micro Devices (AMD) presented its latest AI processors during the Computex technology fair in Taipei.
AMD CEO Lisa Su unveiled the MI325X accelerator, which will be available in the fourth quarter of 2024, and detailed the company’s plans to develop AI chips over the next two years.
“AI is our number one priority and we are at the beginning of an incredibly exciting time for the industry, as AI transforms virtually every business, improves our quality of life and reshapes every part of the computing market,” he said during his speech. opening.
However, this transformation that the executive director speaks of may be in question. As The Wall Street Journal reports, the pace of AI improvement is slowing and there appear to be fewer practical applications than originally imagined, even for the most advanced models.
Added to this, competition is increasing. Prior to AMD’s announcement, Nvidia announced its next-generation Rubin AI chip platform to be launched in 2026, CEO Jensen Huang said on Sunday during the same event.
The Rubin chip family will include new graphics (GPU), central processors (CPU) and network chips. The new CPU will be called Versa, and the new graphics chips, designed to power AI applications, will incorporate next-generation high-bandwidth memory, produced by companies such as SK Hynix (000660.KS), Micron (MU.O) and Samsung (005930.KS).
Huang also reported that Nvidia now plans to launch a new family of AI chips every year, accelerating its previous release cycle of roughly every two years.
This is not a surprise. Nvidia, which dominates approximately 80% of the AI chip market, thus positions itself as the main facilitator and beneficiary of the growing development in the field of artificial intelligence.
But this context raises questions about whether AI could become a mere commodity, its potential to generate income and especially profits, and whether a new economy is really being born. Spending on AI could be getting ahead of itself, as the American newspaper points out.
Additionally, the recent Goldman Sachs report “The transition to AI a year later: on the way, but the macro impact is still several years away”, notes that current rates of adoption of Generative AI are relatively low, with less than 5% of companies using these technologies. Barriers to broader adoption include lack of knowledge, privacy and security concerns, and immature technology.
The large increase in AI-related investment and productivity gains among early adopters reinforce confidence that generative AI will eventually drive economic growth. However, adoption rates are still limited a year and a half after generative AI became a major topic within the market.
This idea supports that any increase in productivity will not exceed 0.1 percentage points until 2027 in the United States and until 2028 in other developed markets, with most of the impact on global GDP after 2030.
Added to this prolongation is the costly execution of AI models and spending on chips that exceeds income, generating uncertainty about their long-term profitability. According to the most recent earnings reports, companies such as Google, Microsoft and others have seen an increase in revenue from cloud services, attributed in part to the momentum generated by these platforms for the development of AI in other companies.
However, the sustainability of these revenues depends on other companies and startups managing to extract enough value from AI to justify continued investments in training and running these systems.
Furthermore, despite high expectations, the adoption of AI in the workplace has been slower than anticipated. Although many workers use AI in various capacities, only a small subset depends on it and is willing to pay for its services, as The Wall Street Journal notes.
Even so, competition in AI is increasing, and the technology giants are not left out. Alphabet, parent of Google, Nvidia, Meta and Microsoft are investing in AI, while rumors about a new AI update by Apple are also increasing.
