Businesses are spending big on generative AI as more and more adopt the tech, with investment growing by 500% from 2023 to 2024, according to Menlo Ventures. Within the past year, companies have poured USD 13.8 bn into the technology in comparison to last year’s USD 2.3 bn, making it clear that companies are increasingly viewing AI as indispensable to their operations as advancements in the tech spur increased adoption across industries.

(Tap or click the headline above to read this story with all of the links to external sources.)

AI is increasingly becoming just another office standby: A recent Wharton School survey of over 800 senior business leaders found that the number of respondents that used genAI at least once a week has skyrocketed from 37% in 2023 to 72% in 2024. The growing adoption of AI platforms is seeing entire industries cash in on AI tools, with healthcare, legal services, financial services, and media/entertainment leading the way. And it's not just IT departments that are adopting AI-fueled solutions — the technology is now being used everywhere from customer-facing operations to payroll and HR.

So what’s changed? More competition, for one. A wider bench of companies are duking it out for a piece of the AI market, with big-name tech giants like Google and Apple increasingly pouring resources into developing their own proprietary models. This increased competition has prompted significant shifts in AI market share over the last year, with market darling OpenAI’s slice of the AI pie dropping from 50% to 34% between 2023 and 2024. A wider playing field has also offered businesses more platforms and models to play with and tweak — an opportunity that many are taking advantage of.

The tech is much more advanced than people think: Beyond the familiar AI chatbots, these platforms are able to fully perform complex tasks on behalf of their users. “The agent stuff is real — it’s not hype,” Tim Tully, a partner at Menlo Ventures, told CNBC. “I don’t think it’s going to cure cancer, necessarily, but is it going to make people more productive and help companies generate revenue? Yes.”

We are still in the experimentation phase. Despite its widespread adoption, AI’s full range of applications — and limitations — are not yet entirely clear. The tech also continues to face scrutiny with regard to data accuracy and potential privacy and ethics violations. “You should think of it as a tool, and tools are not intrinsically bad,” said Stefano Puntoni, Wharton marketing professor and faculty co-director of AI at Wharton. The key is finding out what the tool is good for, what it isn’t, and not letting it take on a life of its own.

Tags: