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AI: The Catalyst for Next-Gen Technological Ecosystems

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AI has transitioned from experimental applications to real-world use cases. In 2024, many of us are harnessing AI to enhance our work efficiency, yielding tangible productivity gains. Concurrently, AI models and services are becoming more cost-effective and responsive. Output quality has risen by far during the last year and since ChatGPT first launched. The response speed is now subject to competition between the model operators and chip manufacturers. Secure deployment is facilitated by clever platforms that restrict AI’s operational scope to the user-space, safeguarding data within a tenant’s domain. This data is not assimilated into the model’s training but is instead incorporated into the AI’s output via retrieval-augmented generation (RAG).

As technology providers integrate new AI applications and modules into their platforms, it is imperative for companies to formulate a strategy to navigate the AI evolution. Ignoring AI adoption is a strategic dead end, potentially leading to a swift competitive decline. While large platforms with established data reserves offer enticing AI use cases, the landscape is also populated by startups. A plethora of APIs from entities such as OpenAI, Microsoft, Groq, Google, AWS, and others are propelling technological innovation.

The scenarios outlined below offer insights into the potential impact of AI on the future technology landscape. Each scenario is predicated on distinct AI capabilities, and while none are implausible, a hybrid of these scenarios is more probable, influencing specific technologies or market segments. Regulatory factors also play a crucial role in curbing monopolistic tendencies and maintaining market fairness.

Scenario 1:

AI catalyzes the development of solutions, potentially autonomously, leading to an unprecedented proliferation of new technologies. This accelerates the diversification of the technology landscape and reduces costs of development. The rapid emergence of new technologies could disrupt even the largest platforms, which may respond by acquiring and assimilating these innovations into their ecosystems. Such dynamics could swiftly alter market shares among major platforms. This will be a main driver for innovation and increase the overall speed of technological advancements. At the same time, it will give companies more options to choose from when looking for a specific solution. Moreover, companies will need to become more agile when selecting, implementing and changing solutions within their ecosystem in order to keep pace and benefit from these market conditions.

Scenario 2:

AI fosters platform-centric growth by necessitating data consolidation and maximizing automation coverage. This trend could amplify the influence of major platforms, potentially driving the formation of monopolies within the technology vendor market. Platform lock-in poses significant challenges for companies, as switching platforms can result in data loss or necessitate substantial migration efforts. The convergence of capabilities within a single platform demands adaptability from users and acclimation to new tools. Microsoft exemplifies this scenario, but other platforms like Palo Alto Networks, ZScaler, Elastic, and Tanium also facilitate a wide array of AI-driven use cases, contributing to power consolidation. Large platforms can deliver value to their customers, as they build the foundation for a broad spectrum of solutions, allow unified user experience, management and holistic insights.

Scenario 3:

AI empowers organizations to develop bespoke solutions on their own, granting them greater autonomy and reducing reliance on software vendors, thereby decreasing technology costs. The emergence of low-code or no-code platforms exemplifies this trend, although they remain tethered to a provider’s platform. AI can simplify software development, enhancing the capabilities of platform users. NVIDIA CEO Jensen Huang’s assertion that coding may no longer be a future-proof skill underscores this shift. Companies can solve smaller problems without the need to buy a software, and have streamlined solution without the baggage of multi-purpose software.

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