Nov 14, 2018

AI is still just talk for most businesses

Ina Fried, author of Login

Robot "Pepper" communicates with journalists and guests at the Museum der Arbeit in Hamburg, Germany. Photo: Christian Charisius/picture alliance via Getty Images

For all the talk around artificial intelligence, recent surveys show just 3%–4% of firms are actually using it for broad-scale business.

Driving the news: Microsoft used a San Francisco event Tuesday to show off some of the companies that are using the technology effectively.

  • AB InBev has a platform called SmartBarley that gathers data from 8,000 of the company's suppliers to help them improve yields and lower their environmental impact. The growers agree to share their data with AB InBev, which in turn shares back the AI-derived insights with the farmers. "We are not a digital company. We are a company that is being digitized," AB InBev's Tassilo Festetics says.
  • Arccos Golf showed how it's using AI to create a virtual caddie for golfers that is able to assess a player's stroke, weather and other conditions. The startup says the early results are promising, with customers shaving an average of nearly 4 strokes off their game.

Even if they don't know how to get started, companies are interested in the technology, says Julia White, a VP in Microsoft's Azure unit. "People recognize the promise of AI," she says.

The big picture: The problem, though, is that most still don't know what it takes to get started, White adds. Both Microsoft and the customers on stage Tuesday agreed that it mostly boils down to data. If you want to use AI in your business, you need lots of data and it has to be in a common format.

"Everyone wants to focus on the sizzle," White says. "Where’s my new bot? Well what’s your bot going to learn from?"

In response, Microsoft is increasing its investment in tools that help companies build their own chatbot. The company announced this morning it's purchasing XOXCO, maker of Howdy, one of the first commercial chatbots.

Yes, but: Expectations around the AI business are often overblown today. White acknowledges this, but puts the blame on other companies.

  • "There was so much hype around Watson and other things that have been disappointing," White says.

Doubts persist: Maribel Lopez, of Lopez Research, says her research shows that just 3% of companies have invested enough in AI to see a significant return on investment, while 89% said that the big cloud companies have overpromised on AI.

Flashback: A year ago, MIT-Boston Consulting Group released a survey that also said American business executives expect AI to have a large impact on their companies but few were actually adopting the needed technologies.

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