Since the launch of ChatGPT in November, a small industry The broader slowdown in tech has been dismissed. not a week goes by without someone the unveiling A “Generative” Artificial Intelligence (AI) based on the “Foundation” model – the vast and complex algorithms that give ChatGPT and other AIs their intelligence. On February 24, Facebook’s parent company Meta released a model called LLaMA. Elon Musk, the boss of Tesla and Twitter, reportedly wants to create an AI that would be less “awake” than ChatGPT. A catalog maintained by Ben Tossell, a British entrepreneur, includes, among others, Isaac Editor (which helps students write essays), Pickaxe (which analyzes your own documents) and Ask Seneca (which Answers questions based on the writings of the philosopher). There is a lot to be talked about and chatGPT with over 100 million users. Yet Mr. Tossell’s database hints that the real action in generative AI is in all kinds of less chatty services enabled by the foundational model.
Each model is trained on reams of text, images, sound files or other data. This allows them to interpret instructions in natural language and respond with text, art or music. Although such systems have existed for some time, it took a consumer-facing service like ChatGPT to capture the imagination of the world and investors. As Mike Volpi of Index Ventures, a venture-capital (VC) firm, says, this happened just as his fellow tech backers, burned out by the cryptocurrency crash and empty metaverse, were looking for the next big thing. Furthermore, even more so than web browsers and smartphones, foundational models make it easier to build new services and applications on top of them. “You can open your laptop, get an account and start interacting with models,” says Steve Loughlin of Accel, another VC firm.
There is a flood of money in business. In January it was reported that Microsoft poured $10bn into OpenAI, the startup behind ChatGPT, on top of an earlier $1bn investment. Pete Flint of NFX, another VC firm, now counts more than 500 generative-AI startups. They’ve collectively raised over $11bn to date—and that’s excluding OpenAI (see chart). Mr. Volpi talks of a “Cambrian explosion”.
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So which generative-AI platform will make it big? For now, it’s a matter of head scratch in technical circles. “It’s just not clear whether generative AI will have a long-term, winner-takes-all dynamic,” Martin Casado and colleagues from another VC firm, Andreessen Horowitz, wrote in a recent blog post. Too many ideas, often more convenience than product. Even resource-intensive foundation models can end up as low-margin commodities: although proprietary ones like OpenAI’s GPT-3.5 are ahead, open-source alternatives aren’t far behind.
Generative AI is also making inroads into the legal mining sector. Models often do things wrong. And they can derail. Sydney, the chatbot Microsoft is developing for its Bing search engine using technology from OpenAI, has insulted some users and professed its affections to at least one (it has been put on hold). AI platforms may not enjoy the legal protections from liability that shield social media. Copyright holders of web-based content on which existing models are being trained without asking permission or paying compensation are in protest. Getty Images, a repository of photographs, and individual artists have filed lawsuits against AI art-generators such as Stable Diffusion. Stable Prasar says, “We take these matters seriously. We are reviewing the documents and will respond accordingly.” News outlets are also afraid of text-gobbling AI (see later article).
OpenAI is already downplaying the launch of GPT-4 later this year, the highly anticipated update to its Foundation model. It won’t whet the appetite of VC types for generative AI. For more risk-averse investors, the safest bet at the moment is on providers of the sufficient processing power required to train and run the foundational model. Share price of Nvidia, which designs chips useful for AI applications, is up 60% so far this year. Cloud-computing services and data-center landlords are also wringing their hands. Whichever AI platform comes out on top, you cannot unfairly sell picks and shovels in a gold rush.
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From The Economist, published under license. Original content can be found at www.economist.com
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