Artificial Intelligence – Will It Change the World Soon‎?

Giuseppe Donvito, Partner P101 | January 20th, 2016

I’ll teach it to let friends in by looking at their faces when they ring the doorbell,” said Mark Zuckerberg speaking of artificial intelligence in a recent Facebook post, referring to the idea of designing his own Artificial Intelligence by the end of the year. AI is no new hobby for the inventor of Facebook: together with the actor Ashton Kutcher and Elon Musk, founder of Tesla, he invested $40 million in Vicarious FPC (a secretive AI company). Vicarious had – and probably still has – an ambitious purpose: replicating the neocortex, the part of the brain that sees, controls the body, understands language and does math.

Artificial intelligence will transform all sectors of the economy. And its impact won’t be trivial, as it allows you to “train robots” to think and make decisions like humans, with a small difference (at least until now…), namely, that all decisions are empirical, in other words, based on data analysis. And this is why artificial intelligence is inextricably linked to the world of Big Data.

Artificial intelligence is a rapidly growing market, which is estimated to reach $40 billion by 2022. Such figures have attracted the attention of Venture Capitalists: in 2014, VC funding for pure AI startups amounted to approximately $300 million, + 300% compared to 2013.

Big players like Google have also started to show their interest in AI. The Mountain View giant has recently scored a new record in this area, buying the British company Deep Mind to over $500 million. Deep Mind is a London-based company that operates in the deep learning branch of artificial intelligence, which consists in information technologies – more specifically, algorithms for statistical calculation – related to automated machine learning. These algorithms are structured on different layers of abstraction that allow the system to understand how the human brain works and interprets, for example, human speech or the images passing through our optic nerve.

Artificial intelligence will have disruptive effects on all kinds of businesses. Suffice it to say that thanks to AI, computers will understand what human users write on social websites like Facebook. In this way, they will be able to interact with people, understand what they want, what their mood is, even whether they like the content they have just viewed. Artificial intelligence will also have disruptive effects on the e-commerce industry. As claimed by Babak Hodjat, co-founder of Sentient Technologies (one of the AI companies that has received more funding to date – $143 million), AI will be able to transform e-commerce, making it intelligent. Based on how the user shops online, his/her shopping history, and the way she/he looks at the screen, a software algorithm will be able to identify the product that you would like to buy and then send the design of that product to a 3-D printer! This is what Hodjat calls “automated design”.

In addition to this, AI will start a new consumer era. Today, predictive analysis techniques help us understand future trends starting from historical data; but artificial intelligence will allow us to go further: if we have some significant gaps in a series of data, AI-based applications will be able to infer the missing data and fill these gaps in an “intelligent” way.

There has recently been much turmoil over one of the most evident and disruptive applications of AI, that is, robotics. In particular, there have been discussions about the possibility of building intelligent robots that will become an essential part of our lives. A recent report by Bank of America Merrill Lynch has concluded that the creation of “intelligent machines” is to be considered as the next industrial revolution.

The combination of AI, deep learning and natural user interfaces (for example, voice recognition) is driving us towards the automation of working tasks that we thought machines could not perform. There’s an ongoing debate between those who argue that the potential long-term impact of AI will be the disappearance of jobs, and those who believe that, on the contrary, AI will open the door to new professional opportunities.

To identify the consequences of this revolution is not easy. Certainly, companies management teams will have to weigh the impact of artificial intelligence on their value chain as soon as possible, since (as mentioned by Roland Berger) the transformational effect of AI will be dramatic, with the implicit risk that one day the very management team will be replaced by intelligent machines.