The EU’s investments in generative AI, blockchain, and the metaverse lead to concerns about their viability as strategic choices. Despite grand financial commitments, skepticism lingers regarding the profitability and transformative potential of current AI technologies. Past technological trends like VR and blockchain serve as cautionary examples, suggesting that a reactive investment strategy could misallocate EU resources without achieving meaningful advancements.
The European Union’s recent decisions to invest heavily in technologies like generative AI, blockchain, and the metaverse raise concerns about whether these choices are well-founded or merely reactions to trends popularized by the United States. French President Emmanuel Macron and European Commission President Ursula von der Leyen announced substantial funds for AI development, including a €109 billion initiative by France and a €200 billion commitment from the EU. These actions have sparked debate about their justification in light of emerging competition from lower-cost technologies like the DeepSeek AI tool from China.
Doubts regarding the profitability of current AI technologies, particularly generative AI solutions such as large language models, have been voiced even before the DeepSeek incident. Critics argue that the transformative capabilities of generative AI have not yet realized practical applications or profits to substantiate the heavy investments, leading to questions about the long-term viability of such ventures. Notably, Goldman Sachs’ Jim Covello noted that significant transformative applications still remain undiscovered nearly two years post the introduction of ChatGPT, which emphasizes the skepticism surrounding generative AI.
Moreover, data suggests that OpenAI, despite boasting millions of paying subscribers, is facing substantial financial losses, with projections indicating a potential $5 billion deficit in 2024. The broader economic impacts of AI adoption in the U.S. are anticipated to be modest, with economist Daron Acemoglu estimating just a 1% increase in GDP over the next decade. This raises alarms over the risk of overinvestment leading to a technology crash.
The EU’s commitment to generative AI also includes initiatives like GenAI4EU, which allocates €500 million to explore generative AI’s applications. Critics argue, however, that the EU should focus on other promising AI technologies that demonstrate more reliability and applicability, rather than exclusively pouring resources into generative AI. The example of high-profile trends like VR and blockchain serves as a cautionary tale, where initial excitement has not translated into real-world transformations or sustained demand, despite substantial EU investment.
Ultimately, Europe’s ongoing pursuit of fleeting technology trends may stem from comparisons to U.S. successes. This reactive strategy indicates a lack of confidence and could lead to misallocated resources, drawing attention away from more substantial scientific advancements. A thorough reevaluation of investment strategies may be necessary to ensure that funds are directed towards sustainable and impactful technological innovations, rather than fleeting hype.
Original Source: sciencebusiness.net
