The Only Thing We Have To Fear Is The Fear Of AI
It is now the era of artificial intelligence; the age of the synthetic mind. An increasing number of the world’s leaders all acknowledge this increasingly evident truth. The question now is not whether AI is coming (it is here), or how large an impact it will have (it could automate 35% of our jobs by the 2030s and is at the center of the burgeoning “Tech War” between China and the United States). It is instead how society will choose to engage with this new revolution. Will we configure our public education, social contracts, business models and international agreements to capitalize on the incredible new potential AI brings, or will we shrink back in fear?
Certainly, there are developments that should be concerning. The open and transparent development of AI is at risk as looming export controls threaten to pull it into an ever expanding “Tech War” between China and the United States. Autonomous weapons are probably being developed. AI language analysis techniques are already being used to gather information on citizens the world over. Intelligence agencies have attempted to alter electoral outcomes by creating automated psychographic profiles of millions of individuals, and then targeting them in influence campaigns.
Daunting as they may seem, these threats emerge not from some sentient, superhuman genocidal AI hatching a Machiavellian plot to spell humanity’s doom, but from the application of artificial narrow intelligence (ANI) under human control. Today’s real threats are illustrated by more quotidian news: bias creeping into AI systems used for loan approvals, abusive bots that spew racial hatred and failed facial recognition algorithms that confuse humans with animals.
Furthermore, there are the nearly insurmountable competitive moats the largest data-driven technology companies have been able to create, virtually stifling competition. Now, emerging startups know their salvation lies in being acquired, not in attempting to compete with the incumbents. Leaders like Cisco Chairman Emeritus John Chambers have even cited the resultant reduction in IPOs as a threat to the strength of the U.S. startup ecosystem.
For business, what makes AI formidable is its incredible ability to concentrate power and business advantage in the hands of early adopters. The insights gained from data enrich products, enabling further use and more data in a rapid positive spiral, unleashed at scale and machine speed, that quickly locks out the competition. A recent McKinsey study even suggests that early AI adopters will build unassailable leads in their respective categories. Those left behind may never overcome the competitive advantages that accrue to first movers.
Whether for companies or countries, the greatest risk around AI today is one of exclusion. This exclusion manifests itself in the business landscape as increased potential for monopolies, and it manifests itself in the social landscape as growing inequality. In truth, the malevolent sentience immortalized in Hollywood’s “Terminator” films isn’t a near-term threat to anyone. But failing to integrate artificial intelligence into businesses and national defense may very well be. Those who fail to understand and embrace AI leave themselves vulnerable to an insurmountable disruption by those who come to grips with it first.
Indeed, disruption is a constant in the modern world, but the pace at which disruption unfolds becomes faster every year. The number of years a company stays on the S&P 500 shrank from 60 years in 1959 to 20 years today, and it is projected to be a mere 13 years by the mid-2020s. Prior waves of digital transformation have reshaped entire industries, but it is the coming cognitive transformation that will be the most profound.
What makes the coming transformation unique is that it will allow for infinite scalability of cognitive tasks, essentially reducing to zero the incremental cost of embedding “intelligence” in a product or service. Artificial intelligence isn’t just about doing business better; it’s about inventing entirely new ways of doing business. This can already be seen in the way that technology companies such as Google, Apple and Amazon are morphing into “everything companies.” The skill sets these companies bring to bear are not their unique mastery of retailing or logistics, but their ability to quickly find key insights from data and automate the thousands of individual processes needed to scale a business. It doesn’t matter to them whether the insights they seek relate to oil and gas, commercial real estate or the sales of Beanie Babies. Transforming data, insight and predictions into a product or service is where they excel.
It shouldn’t be surprising that these “everything companies” are launching aviation businesses, selling home appliances and developing cars. Leveraging AI, they will continue to expand their reach across industries, disrupting businesses that never considered them competition. Who would have predicted ten years ago that Amazon would one day own Whole Foods? Everything companies will use data and AI to compete with virtually anyone.
Of course, AI-powered disruption can be a double-edged sword. If they slow down or miss a market, even tech giants can land themselves in trouble. Much of the truly fearsome competition is likely to come from China. Even now, Chinese e-commerce firm JD.com is pushing into western markets, aided by AI technology that outstrips Amazon’s.
JD.com is arguably the world’s leading company in delivery via autonomous systems—technology Amazon is still testing or only now rolling out in a few locations. It possesses the largest drone delivery system on the planet, as well as robot-run warehouses, drone “airports,” and driverless delivery trucks. And it’s not the only competition. Chinese ridesharing giant Didi boasts three times Uber’s global ride volume. With the ability to generate larger data streams, leverage a larger domestic user base and make use of massive government investments in AI, Chinese companies such as Alibaba, Tencent, Baidu, Weibo, Face++ and Didi may end up disrupting the disruptors.
As the ancient Greek adage proclaims, “change is the only constant.” In the age of AI, change is a super-exponential function. Today, it is not technology that should scare us. The only thing truly worthy of fear is our own inaction.