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A friend recently shared her parenting plans, saying the rise of ChatGPT, the natural language dialogue model developed by OpenAI, has convinced her that the rote learning adopted in conventional schools is outdated and only international schools will suffice for her kids. In an era with information instantly available, AI is rendering memorization obsolete in education.

OpenAI is an AI research company founded in 2015 to develop technologies like robotics, autonomous driving, speech recognition, natural language processing (NLP) and gaming. In 2019, Microsoft invested $1 billion in OpenAI, becoming one of its partners. AI stocks have skyrocketed, with some software stocks surging by up to 500%.

Disruption of Digital World by AI

In fact, many tech giants have quietly started revolutionary work to avoid disruption like Kodak’s bankruptcy when film became obsolete. Google developed AI generators like the GAN (Generative Adversarial Networks) in 2014 for generating images of faces, landscapes, etc. IBM created NLP tools like Watson Assistant to generate conversational text for chatbots, customer service, etc. Microsoft and NVIDIA built AI generators like DALL-E and StyleGAN for generating animal and object images. Chinese tech firms like Baidu, Alibaba, JD.com and Tencent are also actively researching and developing NLP and AI technologies.

Such disruptive chatbots can respond to any query, from astronomy to mathematics to drawing and writing. This has caused a big headache to the education sector. Many universities have banned ChatGPT over cheating concerns for assignments and papers.

AI quickly analyzes and utilizes the content from the specified databases. But the databases also have errors, so AI may provide some inaccurate information. Google’s conversational AI Bard recently made a mistake in an advertisement, incorrectly claiming that the James Webb Space Telescope (JWST) took the first image of an exoplanet which, however, was actually captured in 2004 by the European Southern Observatory’s Very Large Telescope (VLT). This triggered investors’ concerns, with Alphabet (Google’s parent company) shares plunging 7% and losing $100 billion in market cap in one day. In the future, the ability to discern true and false information online would make AI more trusted and adopted.

For investors who are bullish on AI, the related stocks can be accessed through ETFs tracking global internet companies as a long-term play.

Learn more: https://www.nikkoam.com.hk/etf