Bill Gates on why AI will become “hyper competitive.”
Bill Gates speaks to CNBC at Abu Dhabi Finance Week.
CNBC
Bill Gates has warned that some AI companies with high valuations will lose out in the “extremely competitive” AI industry as investors weigh whether a bubble is about to burst.
“AI is the most important thing that happens,” he said Microsoft Founder and philanthropist told CNBC’s Tania Bryer at Abu Dhabi Finance Week, amid rising capital spending and a series of circular deals that made the market nervous.
“Does that mean all of these companies with high valuations are going to be winners? No, it’s going to be highly competitive,” Gates said on Monday.
“AI is a bubble only in the sense that not all of these valuations will ultimately go up. Some of them will go down,” he said, adding that AI is “a profoundly profound technology that will reshape the world. There is not the slightest doubt about that.”
Many AI companies have ratings that are well above average. Palantir And Tesla have a P/E ratio – the ratio between the stock’s price and its earnings per share – of well over 200, compared to an average of about 25 for S&P 500 companies.
Global markets fell in November as fears of a bubble burst gained traction.
Gates said that “a reasonable percentage of these companies won’t be worth that much.”
Although AI is still very controversial in some parts of the sector, Gates said AI would fundamentally change lives for the better. “Is this profound and real and will it bring all of these benefits, including health, education and agriculture, that we’re working on? Absolutely, no one should have any doubts about that.”
Earlier this week, the Gates Foundation and other international leaders and philanthropists pledged $1.9 billion to fight polio by providing vaccines to millions of children and strengthening health systems to protect them from other preventable diseases.
Gates predicted that next year would be a big one for global health.
“We can take these wonderful promises that we have just received and make sure that we use them very effectively. It will be a year where we test many of these AI tools, the virtual doctor that supports all African dialects, the agricultural advisor… most people in Africa are farmers with very small plots of land and very low productivity today,” he said.
“We want to dramatically increase their productivity, and we see that it can be done,” he added.
