No company immune if AI bubble bursts, warns Google boss
What's the story
Sundar Pichai, the CEO of Alphabet (parent of Google), has warned that no company would be spared if the current artificial intelligence (AI) boom were to collapse. In an interview with BBC, Pichai described this period as an "extraordinary moment" but also noted some "irrationality" in the market. He compared it to the "irrational exuberance" seen during the dotcom era.
Market impact
Google's resilience amid AI market concerns
When asked how Google would handle a potential market downturn, Pichai expressed confidence in the company's ability to weather the storm. However, he also admitted that "no company is going to be immune, including us." Alphabet's shares have jumped nearly 46% this year as investors remain optimistic about its competition with ChatGPT-maker OpenAI.
Valuation concerns
AI valuations and market sustainability
The sustainability of AI valuations has been a topic of much debate among analysts. In the US, worries over high AI valuations have started to affect broader markets. British policymakers have also raised concerns over potential bubble risks in this sector. These developments highlight the growing unease about the long-term viability of current AI market trends and investments.
Strategic moves
Google's investment in UK AI infrastructure and research
In September, Alphabet announced a £5 billion investment for building a new data center in the UK and funding DeepMind, its London-based AI lab. Pichai also revealed that Google plans to start training models in Britain, a move aimed at helping the country become the world's third-largest AI "superpower" after the US and China. He also highlighted the "immense" energy demands of AI, saying that Alphabet's net-zero targets could be pushed back as it ramps up computing power.