Pichai calls the AI boom an ‘extraordinary moment’ but warns of market irrationality
[LONDON] Alphabet chief executive Sundar Pichai said no company would be unscathed if the artificial intelligence boom collapses, as soaring valuations and heavy investment in the sector fuel concerns of a bubble.
Pichai said in an interview with the BBC published on Tuesday (Nov 18) that the current wave of AI investment was an “extraordinary moment” but acknowledged “elements of irrationality” in the market, echoing warnings of “irrational exuberance” during the dotcom era.
There has also been much debate among analysts about whether AI valuations are sustainable.
Asked about how Google would cope with a potential bursting of a bubble, Pichai said he thought it could weather the storm but added: “I think no company is going to be immune, including us.”
Alphabet shares have surged about 46 per cent this year, as investors bet on its ability to compete with ChatGPT-maker OpenAI.
In the US, concerns about lofty AI valuations have begun to weigh on broader markets, while British policymakers have also flagged bubble risks.
In September, Alphabet pledged £5 billion over two years for UK AI infrastructure and research, including a new data centre and investment in DeepMind, its London-based AI lab.
Pichai also told the BBC in the interview conducted at Google’s California headquarters that Google would begin training models in Britain, a move Prime Minister Keir Starmer hopes will bolster the country’s ambition to be the world’s third AI “superpower” after the US and China.
Pichai also warned of the “immense” energy needs of AI and said Alphabet’s net-zero targets would be delayed as it scales up computing power. REUTERS
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