Get ready for decentralized innovation
Vinayak HV
Senior Partner, Singapore
The idea that companies with the biggest data sets will lead the way in innovation (such as AI) took a hit in 2022. We’ve seen numerous start-ups emerge with compelling products that are going to give some of the large tech companies a run for their money.
That reality is reflected in a number of AI products that are generating buzz, such as Stable Diffusion, which got 10,000 stars on GitHub in less than two months, or ChatGPT, which crossed the threshold of one million users in just five days. I recently asked ChatGPT to write a poem about Web3, and although I wouldn’t necessarily call myself a literary critic, it was surprisingly good. The implications are enormous, from improving search to increasing developer productivity.
These developments represent the maturing of AI “decentralization,” which refers to the development of advanced AI technologies that are not monopolized by players with access to massive, centralized, proprietary data sets. In 2023, we can expect to see early signs of how this decentralization can disrupt different sectors, likely starting in the entertainment, gaming, and media areas, where traditionally we’ve seen new technologies make early inroads.
The big challenge and opportunity for companies in 2023 will be how they can position themselves to take advantage of these decentralized AI capabilities. For business leaders, it will be important to think through how their business models can take advantage of decentralized technologies. For the CIO or CTO, the focus will need to be on how to rework their architectures to easily incorporate APIs (such as those from OpenAI and Stability AI) and embed “intelligence” into a wider swath of applications and processes. This capability can, for example, provide automated suggestions of code or code libraries to draw from or auto-generate code to kick-start the development. The goal should be to have AI-driven intelligence built into every part of the technology stack.
Enabling this means allocating sufficient resources to experiment. Top innovators allocate 1 to 5 percent of their revenues to innovation that could yield disproportionate returns. Protecting this budget will be especially important as businesses feel the screws tightening on budgets, as the ability to effectively innovate during downturns allows companies to position themselves to grow quickly when the economy recovers.