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Investors expect AI use to soar. That's not happening

economist.com

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Re: Investors expect AI use to soar. That's not happening

#51

Post by MarkLowenstein »

bossyTeacher wrote: post #19

As soon as every big corp started stuffing their UIs with AI buttons, we all knew it was investors pushing for AI use to go sky high without a care for the nuances of the current state of AI. The reality is that AI usage isn't as impactful as it was promised. Where is the productivity increase in being able to generate a picture via some prompt? When deep research could contain hallucinated text or references, where…

Example: new Yahoo! Mail AI summaries helpfully added to the top of each mail. Thanks, now I get to read each email twice! With the original text now placed in a variable location on the screen.

Unfortunately it's the coders who are most excited to put themselves out of business with incredible code-generation facilities. The techies that remain employed will be the feature vibers with 6-figure salaries supplied by the efforts of the now-unemployed programmers. The cycle will thus continue.

Re: Investors expect AI use to soar. That's not happening

#52

Post by swatcoder »

lateforwork wrote: post #42

> Three years into the generative-AI wave, demand for the technology looks surprisingly flimsy. Lets compare to the adoption of the internet. Mosaic was released in 1993. Businesses adopted the internet progressively during the 90s, starting slow but accelerating toward the decade's end with broad adoption of the internet as a business necessity by 2000. Three years is a ridiculously small amount of time for business…

Ironically, you're making the point you mean to be arguing against.

The dot-com bubble didn't form and burst because the technology or opportunity of the web wouldn't be revolutionary. It formed and burst because investment grossly outpaced how fast the technology could mature into commercial value. That's pretty much what we're seeing here.

LLM's, diffusion, etc are radical new avenues for technology and probably will have made a huge impact on society and business when we look back in 20 years, but investors desperate for high yield in an otherwise stagnating economy flooded the engine, betting as though these dramatic changes would happen immediately rather than gradually.

Unsurprisingly, to people who didn't put their chips on the table at all, this all-in bet on immediacy is proving more and more to be a losing one.

Re: Investors expect AI use to soar. That's not happening

#53

Post by keeda »

Maybe the archive link stripped it out, but it would be really useful to look at the actual sources, because TFA seems to be, uhh, "selective" in what stats it presents. For example, this source (Alex Bick at the St Louis Federal Bank) seems to be cited:

https://www.genaiadoptiontracker.com/

TFA presents the most pessimistic stat it could find: daily GenAI usage at work growing from 12.1% to 12.6% in a year. (Interestingly there was a dip to 9% in Nov 2024; maybe end-of-year holidays?)

It does not mention that the same tracker also shows that overall usage (at and outside work, at least once last week) has steadily climbed from 44% to 54%. That is a 10 percentage point growth in a year. (This may also be why OpenAI reveals WAU rather than DAU; people mostly regularly use it on a weekly basis.)

Here is something even more interesting from the same authors at the St Louis Fed using the same data:

https://www.stlouisfed.org/on-the-economy/2025/nov/state-gen...

Really, read that article, it is short and a bit astounding. Money quote:

> When we feed these estimates into a standard aggregate production model, this suggests that generative AI may have increased labor productivity by up to 1.3% since the introduction of ChatGPT. This is consistent with recent estimates of aggregate labor productivity in the U.S. nonfarm business sector. For example, productivity increased at an average rate of 1.43% per year from 2015-2019, before the COVID-19 pandemic. By contrast, from the fourth quarter of 2022 through the second quarter of 2025, aggregate labor productivity increased by 2.16% on an annualized basis. Relative to its prepandemic trend, this corresponds to excess cumulative productivity growth of 1.89 percentage points since ChatGPT was publicly released. ... ...

> We stress that this correlation cannot be interpreted as causal, and that labor productivity is determined by many factors. However, the current results are suggestive that generative AI may already be noticeably affecting industry-level productivity.

Re: Investors expect AI use to soar. That's not happening

#54

Post by strangattractor »

venturecruelty wrote: post #27

Investors don't "expect" AI to soar, they NEED AI to soar. Why are we still engaging in this absolutely ridiculous kabuki theatre? This entire cracking edifice is propped up by fictitious capital and pipe dreams, and the music is about to stop. Turns out, you can't charge $20 a month for something no one wants and expect to get a trillion dollars out of it. Shocker!

Shocker! is correct.

A popular belief these days is that investors from 2000 ultimately got it right. Truth - they simply got it wrong. They dumped tons of money into things that had no hope of justifying an ROI. They thought adoption of the technology would happen at a pace that was unprecedented or even possible. They assumed things would happen in 3 years that actually took 20. Yes - Shocker!

Re: Investors expect AI use to soar. That's not happening

#55

Post by keeda »

ckbkr10 wrote: post #34

I am using it for ansible, php, java, c, linux configuration issues or general questions. Preparing excel sheets etc.. It's sped the time I need to produce projects from a usual span of 4-20 days to 1-2 days with another 2-3 Testing. Of course I still bill the time it would have taken me but for a professional it can be a great improvement. While my country will be slow to adopt, we haven't even adopted to smartphone…

> Of course I still bill the time it would have taken me but for a professional it can be a great improvement.

This may be a flippant comment, but it actually represents one of the reasons it is difficult to track GenAI usage and impact!

Multiple researchers have hypothesized (often based on discrepancies in data) that the gains from workers using GenAI are not necessarily propagated to their employers. E.g. any time savings may be dedicated to other professional or leisure pursuits.

Re: Investors expect AI use to soar. That's not happening

#56

Post by strangattractor »

swatcoder wrote: post #43
hintymad wrote: post #14

What is the definition of "soaring"? The charts in the article showed that the percentage of the companies that adopt AI for automation has increase 3X. At least 40% of the companies pay for GenAI, and at least 10% of the employees use GenAI daily. Combined with the fact that the companies like OpenAI and Anthronpic frequently run out of capacity, how is the AI use not soaring?

I don't want to be all "did you read the article?" since that's against guidelines, but the text of the article (the stuff in between the graphics and ads) is kind of about exactly that. Adoption was widespread at first but seems to have hit a ceiling and stayed there for a while now. Meanwhile, there's been little evidence of major changes to net productivity or profitability where AI has been piloted. Nobody is pul…

I get confused about the word "adoption". By adoption is it meant that a company tried to use AI, determined it useful and continues to use it. Just trying something out is not adoption in my mind. Companies try and abandon things all the time.

It has been my experience that technology has to perform significantly better than people do before it gets massively adopted. Self driving cars come to mind. Tesla has self driving that almost works everywhere but Waymo has self driving that really works in certain areas. Adoption rates for consumers has been much higher with Waymo (I was surrounded by 4 yesterday) and they are expanding rather rapidly. I have yet to see a self driving Tesla.

Re: Investors expect AI use to soar. That's not happening

#57

Post by anon7725 »

orphea wrote: post #36
hintymad wrote: post #14

What is the definition of "soaring"? The charts in the article showed that the percentage of the companies that adopt AI for automation has increase 3X. At least 40% of the companies pay for GenAI, and at least 10% of the employees use GenAI daily. Combined with the fact that the companies like OpenAI and Anthronpic frequently run out of capacity, how is the AI use not soaring?

> at least 10% of the employees use GenAI daily. Remember that this includes people who are forced to use it (otherwise they wouldn't meet KPIs and would expect conversations with HR)

how much of this usage is replacing a web search or spelling/grammar checks with something orders of magnitude more costly?

Re: Investors expect AI use to soar. That's not happening

#58

Post by zkmon »

A lot of people who think AI is being used heavily, are coders. It's like a blacksmith making a hammer for himself and thinking that everyone is using the hammer everyday all the time.

Let's check agentic AI. Which agents do people mostly talk about? Aha - coding agents!

Re: Investors expect AI use to soar. That's not happening

#59

Post by _pdp_ »

petetnt wrote: post #33
_pdp_ wrote: post #16

Anecdotally, I use a lot more AI then ever before - at least 5x more - hard to measure.

And to support the claim in the heading you are also invested in AI through your ChatBotKit project, so…

I am sure everyone is invested in their own project - I just happen to be invested in a project that is somewhat connected to this topic.

But yes I do use a lot more AI then I used to 6 months ago - some of them internally built - many others are sourced externally. I bet I will be using even more AI going forward.

I think it is inevitable!

Re: Investors expect AI use to soar. That's not happening

#60

Post by AlexandrB »

I like how the framing of the article assumes that AI is a revolutionary technology that everyone should be using and the adoption is just mysteriously slow. This was particularly funny:

> In recent earnings calls, nearly two-thirds of executives at S&P 500 companies mentioned AI. At the same time, the people actually responsible for implementing AI may not be as forward-thinking, perhaps because they are worried about the tech putting them out of a job.

Ah, those brave, forward-looking executives with their finger on the pulse of the future while their employees are just needlessly stalling adoption. Completely absent from the article is the possibility that the technology is not as revolutionary as claimed.

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