A couple of years ago I met a guy running a company that uses artificial intelligence to help oil companies find more oil. Oil exploration is getting harder, because all the easy oil \u2014 and even much of the trickier oil \u2014 has been found already. But the geology of each oil and gas basin is different and drilling exploratory wells is expensive; no one wants to hand over their data to some AI model they don\u2019t own.<\/p>\n
So a lot of the new AI economy involves selling a model that companies can own, trained with some specialist industry data and ready for further training (with some help from the techies selling the AI) using the private data gleaned from a company\u2019s own activities.<\/p>\n
It all makes sense, in theory. But a report from MIT last week suggested that nearly all the money companies are spending on projects like this is going to waste. According to the research, only one in 20 investments of this kind makes a big difference to company profits. So much for the \u201cfourth Industrial Revolution\u201d, or whatever politicians like to call it.<\/p>\n
Yet AI is still being taken up en masse. It\u2019s just being done by individual workers making their own lives easier by using publicly available tools like ChatGPT<\/a> for simple tasks. In one instance MIT cites, a US law firm spent $50,000 buying in and training its own AI model, only for its staff to shun the company tech and quietly use ChatGPT instead, for $20 a month. As one anonymous lawyer put it, the cheaper tech is just \u201cbetter\u201d. As for complex tasks involving clients, AI is still largely useless.<\/p>\n The report caused a small tech panic in markets<\/a>, the word \u201cbubble\u201d was thrown about, then things calmed down a bit. In a nutshell, you and your precious data are not as special as you think you are. The big language models have already ripped off practically every piece of literature in existence, after all. It shouldn\u2019t be a massive surprise that some random law firm\u2019s database of corporate contracts is not adding a lot of value. Instead, these firms are becoming the AI equivalent of the gadget-hoarder, the guy with all the gear and no idea. And as any sports guy will discover, all the gear in the world won\u2019t make you an Olympian.<\/p>\n Baddies age poorly<\/p>\n