Google boss warns ‘no company immune’ if AI bubble bursts

Google boss Sundar Pichai’s AI warning

Google boss Sundar Pichai has warned no company would be immune if the AI stock market bubble were to burst as concerns grow in Silicon Valley over a potential crash.

Pichai, who is CEO at YouTube and Google parent company Alphabet, told BBC News while the growth of AI investment had been an “extraordinary moment,” there was some “irrationality” in the current boom.

The value of tech companies that have invested heavily in AI such as Microsoft, Apple and Alphabet has soared in recent months before dipping dramatically in recent days as overvaluation fears grow.

Many of the tech companies, which also include, Amazon, Meta, NVIDIA and Tesla, are now so big that were any of them to crash there would likely be huge repercussions for the global economy.

Pichai drew comparisons with the dotcom bubble in the early days of the internet, when stocks in start-ups ballooned during the late 1990s before an early 2000s crash.

“I think no company is going to be immune, including us,” Pichai said. “We can look back at the internet right now. There was clearly a lot of excess investment, but none of us would question whether the internet was profound.

“I expect AI to be the same. So I think it’s both rational and there are elements of irrationality through a moment like this.”

Last month Jamie Dimon, boss of US bank JP Morgan, told the BBC that investment in AI would pay off, but some of the money poured into the industry would “probably be lost.”

During the interview with the BBC, Pichai also voiced warnings about the “immense” energy needs of AI, which made up 1.5% of the world’s electricity consumption last year, according to the International Energy Agency.

It comes as parts of the use of AI in the entertainment industry becomes ever more commonplace, though no less controversial, as media companies look to reduce costs using the tech and the creative sector looks to protect itself while embracing technological change.