Does AI make strong tech companies stronger?

Machine learning is probably the most important fundamental trend in technology today. Since the foundation of machine learning is data - lots and lots of data - it’s quite common to hear that the concern that companies that already have lots of data will get even stronger. There is some truth to this, but in fairly narrow ways, and meanwhile ML is also seeing much diffusion of capability - there may be as much decentralization as centralization. 

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The end of the beginning

Close to three quarters of all the adults on earth now have a smartphone, and most of the rest will get one in the next few years. However, the use of this connectivity is still only just beginning. Ecommerce is still only a small fraction of retail spending, and many other areas that will be transformed by software and the internet in the next decade or two have barely been touched. Global retail is perhaps $25 trillion dollars, after all.

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Tesla, software and disruption

When Nokia people looked at the first iPhone, they saw a not-great phone with some cool features that they were going to build too, being produced at a small fraction of the volumes they were selling. They shrugged. “No 3G, and just look at the camera!”

When many car company people look at a Tesla, they see a not-great car with some cool features that they’re going to build too, being produced at a small fraction of the volumes they’re selling. “Look at the fit and finish, and the panel gaps, and the tent!”

The Nokia people were terribly, terribly wrong. Are the car people wrong?

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Ways to think about machine learning

We're now four or five years into the current explosion of machine learning, and pretty much everyone has heard of it, and every big company is working on projects around ‘AI’. We know this is a Next Big Thing. I don't think, though, that we yet have a settled sense of quite what machine learning means - what it will mean for tech companies or for companies in the broader economy, how to think structurally about what new things it could enable, and what important problems it might actually be able to solve.

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