The current rush to AI is not just spectacular, it’s also spectacularly misguided.

you Rush to grab money

When there is a gold rush, or diamond rush or even an “oil” rush, it makes sense. There is cash to be found in the ground, as all three commodities are just like cash, very fungible as the market people would say. You rush to get your hands on the money, literally, if you’re lucky that is.

But in this case, the corporations and it’s highly paid CEOs, CIOs, CTOs, and Managing Directors for AI rushing to “implement AI” somehow missed the fact that there is no cash to be had with AI. AI is not a cash-printing machine; therefore, you will not miss out if you don’t join the rush.

But perhaps the genius of today’s business leaders comes from the fact that they recognize that even though there is no money to be made in AI, there is money to be saved. And to a corporate balance sheet, money saved is just like money made, cash in the bank.

And let’s give these people credit, they do have a point that when something so spectacular as a “fake AI” is given away (free basic use, almost unlimited use for $20 USD) for almost free you’d be stupid not to line up for the giveaway but within reason.

But there is one catch. What you get for free is “intangible”, you cannot see it, feel it, touch it, or smell it, and you can’t sell it either. The only way to use it is to, well we don’t really know how to use it. Some ideas are floating around and about a million startups convinced that only they know how to turn “fake AI” into “real gold”, but here is where the common sense and logic come into play.

The basic point is that you’re dealing with “fake AI”, it’s neither “Intelligence” nor “Artificial” (it’s a linguistic symbol manipulator/predictor), it has no understanding, no consciousness, no will, to do anything humane, hence it will not replace humans.

And no legs, hands or fingers to do anything physically useful. So what are you left with? It’s very, very hard to say.

The charlatans will try to convince you that none of the above is important because AI is nothing like we have ever seen before.

So let’s check the history. There are precedents, very recent precedents, for what is going to happen.

The offshoring to save money that ended up as onshoring that cost money

The great “offshoring experiment” started about 30 years ago. Today it’s mostly spent force, but it’s not over by any means. The “offshoring of work” very closely matches the rush to AI of today. The initial idea was that there was a great pool of intelligent, educated and experienced workers in IT in Asia, who were as good as domestic workers except much cheaper. For each domestic tech worker you could get 2-5 foreign workers. That was the basic math: “save money by offshoring IT work”. This is essentially the same idea: “save money by using AI for IT and other stuff”.

So what happened to the offshoring rush? It’s still going on, but it’s nothing like what the promise was. Today most companies that still offshore, do it in the back where nobody sees it. Offshoring was a bust and what actually replaced it was the great onshoring of the offshore workers, in other words mass immigration of the IT people from Asia to North America by the millions that cost the companies money instead of saving them.

If you are a business leader, think about this history lesson. There was a huge pool of educated, skilled and “intelligent” (not “fake AI”) workers in Asia, yet hardly any company was able to successfully integrate them offsite and the only solution was to import them into their own offices onsite. Do you still think you can integrate “fake AI” successfully into your own organization at this moment? Then you need a vacation.

The dot com boom and bust

And what about the “dot com” boom? Another surefire technology to print money. And just like “AI”, not really a money-making model, but rather a money-saving idea, i.e. replace brick and mortar stores with digital ones. Business, investors, and simple people went gaga over the website building boom, only to realize that it was a wrong business model; it cost a lot to be online, but everybody eventually paid it so you gained no advantage, just added costs and maybe miserable profit margins. And so a few years later, the “dot com boom” ended, costing investors and companies billions.

Why rush in to lose money?

I am not anti-AI, I am just trying to be realistic when I see foolishness all around. AI is going to make money for a few smart people I would think.

At this point, it looks like the best model for AI is to be used in small, agile companies that easily change their workflows and practices to accommodate it. AI is essentially a private quasi-intelligent companion, that’s how it was designed, developed and that’s what it does. It advises a person at a time. To make this a public, commercial service, advising private business will take years and years of trial and error finessing. If you feel that your organization wants to participate in this trial as a guinea pig and you’re willing to lose money, reputation and whatever else of value you have, then, sure, join the “fake” gold rush.

For the rest, watch the fools rush in, and enjoy your savings and peace of mind.