Bubble or not, here are five predictions for what AI will really deliver

Last Thursday, the Nasdaq experienced a sharp decline of 5.5 percent, causing a loss of approximately $2.5 trillion in market value. Asian markets followed suit the next day, as concerns over potential restrictions on data center construction intensified due to the US midterm elections. These concerns coincide with the staggering AI investment of $2.7 trillion this year, raising questions about market valuations, energy consumption, and the sustainability of returns that have yet to fully manifest.

The comparison to the dotcom bubble may be tempting, but it is crucial to differentiate between whether investors are paying too much for AI companies and the potential transformative impact of artificial intelligence on the global economy.

Over the past two years, the cost of running AI models at a given benchmark performance has plummeted by over 280 times. Despite the turmoil in technology shares, AI is becoming increasingly affordable, regardless of the market's sentiment. This shift in cost might be the most significant indicator of AI's potential, revealing a perspective from Anthropic, a five-year-old American AI company behind Claude, which is currently preparing for one of the largest stock market offerings in history, potentially valuing the company at around $1.5 trillion.

In its IPO prospectus, Anthropic boldly states, "For the first time in history, intelligence is something humans can build." This claim suggests that the ability to reason, analyze, create, and solve problems can now be produced on an industrial scale and made available on demand, potentially transforming the economy more profoundly than electricity, industrialization, or the internet.

While these claims require evaluation from investors, they highlight the distinction between simply building premium hardware, faster computers, or better software and creating the capacity to manufacture intelligence itself. This groundbreaking potential will endure beyond any stock market fluctuations or corrections. As we look ahead to the next year and beyond, here are five predictions for how AI will deliver in reality.