Generative AI has been the talk of the tech world, but as we enter 2024, it is poised for a “cold shower.” Analysts at CCS Insight predict a significant reality check for generative AI, citing the diminishing hype, escalating operational costs, and mounting calls for regulation as key indicators of an impending slowdown in the field. In this article, we’ll explore the reasons behind this forecast and the potential implications for the AI industry.
Generative AI: Overhype
Generative AI has captured the imagination of giants like Google, Amazon, and Meta. Still, Ben Wood, Chief Analyst at CCS Insight, suggests the hype surrounding this technology in 2023 has been excessive. While AI holds great potential for economic and societal transformation, generative AI’s operational costs are becoming prohibitively high. Large companies are developing their AI chips, but this technology is becoming financially unviable for smaller organizations and developers.
Escalating Operational Costs: Generative AI 2024
Generative AI models, including well-known ones like OpenAI’s ChatGPT and Google Bard, require substantial computing power. Advanced graphics processing units (GPUs), typically designed by companies like Nvidia, are essential for running AI workloads. The deployment and maintenance of generative AI systems entail immense costs, posing a significant challenge for small developers and corporations. As such, generative AI’s viability is threatened by the rising expenses associated with its operation.
EU AI Regulation
While generative AI grapples with cost issues, CCS Insight also predicts regulatory hurdles in the European Union. Despite the EU’s history of pioneering tech legislation, AI regulation is expected to face multiple revisions and redraws due to the rapid pace of AI advancement. This delay in finalizing regulations means the industry may need to rely on self-regulation until late 2024. The EU’s AI Act is expected to introduce a risk-based approach to AI, potentially banning certain technologies, such as live facial recognition. These regulatory challenges further contribute to the uncertain future of generative AI.
Concerns and Controversies
Generative AI has garnered significant attention for its ability to create human-like responses to text-based prompts. While it showcases AI’s potential, it has also raised concerns about automation leading to job displacement. Several governments are now advocating for AI regulation, which has sparked controversy within the AI community. Some major AI model developers welcome regulation, while others advocate for multi-stakeholder approaches or independent government oversight.
AI Content Warnings
CCS Insight predicts that search engines will soon introduce content warnings to inform users when they are viewing material generated by AI, akin to the way social media platforms labeled COVID-19-related posts. With numerous AI-generated news stories containing factual errors and misinformation, such warnings, or “watermarking,” could enhance transparency and discernment among consumers.
AI-Based Identity Fraud
In 2024, CCS Insight anticipates that arrests will be made for AI-based identity fraud. The company foresees that individuals who use AI to impersonate others, whether through voice synthesis or deepfakes, will face legal consequences. Such deepfakes can have severe personal and professional ramifications. They can potentially lead to fraudulent activities in various sectors like banking, insurance, and benefits.
