ChatGPT – Passing fad, or the invention of the century?
A curiosity? Or a revolution? With ChatGPT – a next-generation chatbot – Generative Artificial Intelligence (AI) is stealing the spotlight. The worldwide craze seems to mark a turning point. Is it a passing fad, or the invention of the century? Insights from Rolando Grandi, CFA, Fund Manager for Echiquier Artificial Intelligence, La Financière de l’Echiquier.
Is this a turning point?
Designed by California startup OpenAI, this little revolution is either fascinating – or worrisome. While Stanford University is tolerating it, Parisian research university Sciences Po has banned it. This conversing software, adopted by 100 million users in under two months – a record – generates text and answers your questions in the blink of an eye, in many languages. It can summarise a long document and even write code. And Silicon Valley is bursting with similar projects. While Microsoft has invested more than $10 billion in ChatGPT, this week Google launched “Bard”, a similar AI tool that’s also aimed at the general public. Meanwhile, across the Pacific, Chinese internet giant Baidu has announced a rival service. The “AI Age,” as Microsoft CEO Satya Nadella calls it, is here, and with it, the tech race gains speed. The proliferation of apps using this kind of capacity in language algorithms is accelerating. These algorithms, which use enormous processing power, are a boon for suppliers like Nvidia, AWS and Azure. It’s estimated that ChatGPT costs about three million dollars a day in processing power – that’s more than a billion dollars a year. A paid version was launched in February to monetise this record-shattering platform.
These generative AIs may still have some way to go, but their impact will be real – and transformative. And the world’s reaction seems to mark a turning point. According to an IBM survey, 120 million jobs will be destroyed while others are created, in every sector, with gains in time and productivity.
In fact, these smart assistants can perform repetitive, time-consuming tasks. ‘No code’ or ‘slow code’ solutions are democratising the use of AI algorithms that can use deep learning to write code autonomously. They will make up for the worldwide shortage of developers, especially in Big Data. In December 2020, there was an unmet need for 40 million qualified workers.
According to Google, the speed of AI development follows its own law, doubling every six months – three or four times faster than Moore’s Law, which for decades dictated the pace of gains in processing power. ChatGPT’s AI model, GPT-3, leverages more than 175 billion parameters. GPT-4, the newest version set for release this year, should surpass one trillion parameters – a sixfold increase in three years! This revolutionary technology, developing at lightning speed, requires major investments in processing infrastructure. New Street Research has determined that for Google to deploy an algorithm similar to ChatGPT to run its search engine, which is used by more than four billion people every day, it would need more than $80 billion. That’s more than the datacentre investments made in 2021 by Microsoft, Amazon and Google, combined!
The progress of this disruptive technology known as AI is only gaining in speed. From ChatGPT, which reveals the potential of smart chatbots, to Dall-E, which has turned the digital image creation world on its head, this massive adoption of AI demonstrates that we are in the midst of an irreversible revolution.
When asked about its reach, ChatGPT itself is rational and measured. “It is possible that Descartes would have had some doubts as to an AI model’s ability to understand and simulate reality consistently and reliably. It is also possible that he would have been fascinated by the technological breakthroughs of AI and seen the potential of these models to improve human life.” Of that we have no doubt! We are still focused on capturing the value that AI generates. This kind of technological and sociological progress – as major as it is unprecedented – will transform sectors as diverse as automotive and medicine, by assisting humans intelligently. It demonstrates how fast things are moving in technology, and especially in AI, an area that promises opportunities never seen before.
Rolando Grandi, CFA, Fund Manager of Echiquier Artificial Intelligence – February 2023
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Disclaimer: The opinions expressed in this document are the fund manager’s own. LFDE shall not be held liable for these opinions in any way.
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