Companies Struggle with AI Investment Returns
In brief
- Most companies that invest in AI do not see a good return on their investment.
- A survey found that 88% of organizations use AI in at least one business function, but only 39% report any impact on their earnings.
- The impact of AI on earnings is usually small, less than 5%.
- Many companies, 60%, generate no material value from their AI investments.
- It takes two to four years to see a satisfactory return on a typical AI use case.
- Only 5% of companies create substantial value from AI at scale.
- As companies continue to invest in AI, they will look for ways to improve their returns.
- They will try to find new ways to use AI to make more money.
Read full story at Harvard Business Review →
More briefs
Peregrine Technologies Raises $250 Million
Peregrine Technologies raised $250 million in funding at a $6.8 billion valuation. The company provides a public safety platform for law enforcement. The platform connects data from various sources and makes it searchable in real time. This helps public safety leaders make better decisions. The company now serves over 400 agencies and organizations, representing 125 million people. The company plans to work with close to 1,000 cities by the end of the year.
Google Invests in A24 for AI Film Tools
Google invested $75 million in A24 to develop AI-powered filmmaking tools. This matters because A24 will get access to Google's DeepMind research and infrastructure. A24 will use this to build new workflows and techniques for filmmakers. The deal is significant as it will help A24 expand its storytelling possibilities. A24 will work with Google to develop new AI tools for filmmakers. The future of filmmaking will be shaped by this partnership.
AI Spending Hits $49m in Midterm Elections
New York City's primary has become a key battleground in the midterm elections with AI-focused Super Pacs spending heavily. The AI industry has raised over $100m this cycle and spent $49m so far. Half of this spending has gone to a single Manhattan congressional race. The spending is focused on influencing the first generation of AI legislation. The election will continue next week.
Micron's Big Bet on AI Memory Fuels Claude's Growth
Micron Technology, a major memory chip maker, has inked a deal with AI startup Anthropic. Under this agreement, Micron will supply memory chips for Anthropic's Claude AI system and invest in the company's Series H funding round. This partnership underscores the importance of memory in training and running large AI models, as highlighted by Anthropic co-founder Tom Brown. The move has sparked mixed reactions. While some see it as a strategic win for both companies, critics worry about potential market distortions or a bubble fueled by such deals. Notably, Micron's stock price has surged over tenfold in just one year, raising questions about its valuation and long-term sustainability. Looking ahead, the collaboration aims to co-design AI memory architectures, which could enhance efficiency and scalability for next-generation AI systems. This partnership could set a precedent for how hardware and software companies work together in the AI race.
Samsung Deploys ChatGPT Enterprise and Codex for Employees
Samsung Electronics has expanded access to ChatGPT Enterprise and Codex, providing these advanced AI tools to all employees in South Korea and those in its Device eXperience (DX) division globally. This move aims to enhance productivity by streamlining code development with Codex, which assists in writing software code, and improving internal communication using ChatGPT for more efficient queries and problem-solving. The integration of these tools underscores Samsung's commitment to leveraging AI for competitive advantage. By equipping employees with cutting-edge AI capabilities, the company seeks to accelerate innovation across its operations. While specific metrics on expected improvements aren't provided, the rollout reflects a broader trend in industries adopting AI to boost efficiency and creativity. Looking ahead, this deployment could set a precedent for other companies to follow, especially those aiming to integrate AI into their workflows. Samsung's approach may pave the way for more widespread use of enterprise-grade AI tools in various sectors.