"I call it the ‘dot AI’ bubble, and it hasn’t even started yet."
Dot AI Bubble
There's a tremendous amount of hype surrounding AI, with investors pouring billions of dollars into burgeoning AI startups as they hope to catch the next big tech wave.
But not everybody believes the trend will stick around for long. Even Emad Mostaque, the CEO of open-source AI company Stability AI — which is behind the immensely popular image generator Stable Diffusion — is afraid the industry will collapse like a house of cards.
"I think this will be the biggest bubble of all time," Mostaque told banking analysts on a call last week, as quoted by CNBC, explaining that the tech isn't ready for the financial industry just yet.
"I call it the ‘dot AI’ bubble, and it hasn’t even started yet," he added.
But should we really take Mostaque at his word? Why would an AI CEO of his stature tell investors that AI is a bubble? Besides, just three months ago, Mostaque took a very different tack, adamantly telling the audience at a conference that "of course" AI isn't a bubble and that it's "bigger than 5G or self-driving cars."
So which is it?
The CEO's many colorful claims have drawn plenty of scrutiny. According to a Forbes profile published last month, Mostaque has made misleading claims, down to the fact that he never got a master's degree from Oxford. He also reportedly misled investors and bolstered his success with "exaggeration and dubious claims," the publication claimed.
While Mostaque has since denied these claims, it feels like important context for his latest prognostication. Even if the résumé stuff is a misunderstanding, should we really be listening to a CEO who says he "missed the ceremony and didn’t send the form" to receive his diploma from Oxford?
Ironically, Mostaque has raised over $100 million from investors, according to CNBC, which would mean he appears to be a significant contributor to the growing AI bubble himself — which raises the question: why is he raising funds for an industry that he thinks could eventually collapse in on itself?
It's difficult to reconcile the opinion that AI is "the biggest bubble of all time," while also telling investors last week that AI needs an investment of $1 trillion "because it’s more important than 5G as infrastructure for knowledge."
Are we at the precipice of a huge opportunity or the biggest money pit of all time?
There's a good chance that Mostaque is simply hedging his bets to appease investors. After all, you can't be wrong if you maintain that any outcome is possible.
More on AI bubbles: Economist Says AI Is a Doomed Bubble
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