Sam Altman Isn’t Clear if AI Is a Bubble or a Rising Technology
(Synopsis)

In recent comments to reporters, Sam Altman said “investors are overexcited about AI models.” He predicted that some investors will lose a “phenomenal amount of money” on AI failures. Sam Altman’s comments agree with a recent MIT report which underscores widespread enterprise AI failures. Currently, For example, Palantir’s trading stands at an astonishing 280 times its anticipated earnings, while past indicators of the bubble during the dot-com boom were much lower, around 35 times earnings, making the bubble, if it really is one, already 8 times larger.

However, the contradiction in Altman’s overall message is intriguing. One wouldn’t expect a technology leader to speak in such terms if they thought their sector was about to collapse. Altman warns of a bubble yet simultaneously seeks a valuation for OpenAI that surpasses major, profit-making firms. Even though OpenAI reached $1 billion in monthly revenue in July, it’s projected to encounter an annual loss of $5 billion, raising questions about the current state of affairs.

Looking at Altman’s past remarks indicates a layered strategy. He often makes striking assertions, eyeing a valuation for AI chip manufacturing that eclipses the semiconductor industry. By acknowledging the potential bubble while discussing substantial investments in infrastructure, he cultivates urgency while attempting to deflect criticism. This mixture of warnings with ambitious plans might initially seem contradictory, but it reflects the unique and highly capitalized state of today’s AI market.