For anyone not enthralled by AI, perhaps the most bizarre thing going on is the absolutely massive investment into AI Infrastructure by the large tech companies

If you have not yet drunk the AI Kool-Aid, then the amount of money being poured into AI by Microsoft, Apple, Google, Meta, Amazon, etc is just absurd.

Last Quarter (2nd Quarter of 2024) the Large Tech Companies had over $100 billion R&D investment in AI

$100 billion in a single quarter

The large Tech Companies sure think that whoever doesn’t win the AI race is toast. Perhaps it is something else.

I – If you think AI is the Next Big Thing, you must Invest

If a company believes AI is the Next Big Thing, there is no choice other than to invest. They might not win. However, they will at least not be too far behind. Additionally, AI is the kind of technology that might apply to EVERYTHING. So investing of any kind might pay off

If a company believes AI MIGHT be the Next Big Thing, the company is still forced to invest as if it is 100% The Next Big Thing

II – If you have loads of Money and loads of Profit, where else are you going to Invest

The amount of profits the large companies are making are absurd – $2 billion a month, $5 billion a month, $7 billion a month.

There is no new technology as interesting or promising as AI.

Justice Department & FTC have made acquisitions difficult. Leaving even fewer ways to leverage the growing cash hoard of the large tech companies.

AI is the safest place to invest. AI has become the new IBM. Just like no one ever gets fired for buying IBM. No Company or CEO ever gets punished for investing in AI.

III – If you don’t invest in AI, and you are wrong, you are left behind

Let’s say 2 of the large tech companies don’t invest in AI. The rest do. Then AI turns out to indeed be the biggest and most life-changing event of our lifetimes. The 2 companies that did not invest in AI will be completely wiped out. This might seem an exaggeration. However, it is not

Even super safe ‘moat’ companies like Amazon are being threatened by Temu and Shein. Supposedly untouchable companies like Meta have to use politicians to fight off TikTok.

AI will give AI specialized companies such a massive advantage that non AI companies simply won’t be able to keep up.

That is one of the beautiful things about AI. It provides an insurmountable advantage when it works. The ‘when it works’ part is crucial. When AI works, then it just blows the pants off of all competition.

Every large tech company must invest heavily in AI, because if they don’t they face extinction IN CASE AI does turn out to be everything it is hyped to be (or even 25% of the hype).

IV – AI is the magic word for increasing stock price and company valuation, so you must show AI investment

The stock market is richly rewarding companies for investing in AI.

So that $100 billion investment into AI by Big Tech Companies is showing up as stock price increases and company valuation increases.

Furthermore, companies that don’t invest in AI are being punished by the stock market.

So, at some level, large tech companies don’t have a choice. The capital markets are commanding them to invest in AI.

V – There might be Directives from the US Government and US Government Agencies to Invest

[Totally A Wild Ass Guess] As AI is now a China vs America vs Large Tech Companies War, it is not a huge stretch to believe that the US Government and many US Government Agencies are pushing the large technology companies to invest very heavily in AI.

If AI turns out to be a super transformational technology, then AI advancements are necessary for warfare, spying, intelligence gathering, and many other aspects.

Russia vs Ukraine is showing this – AI is going to dictate the course of a lot of future wars.

It is almost certain that the US Government is pushing the large technology companies to invest heavily in AI. Any sensible government would do so.

VI – Chinese companies and many other countries are investing, so you must invest to not get left behind

A lot of America’s standing is based on the advancements by Microsoft and Apple, and then by companies such as Google, Meta, Nvidia, etc

If China wins the AI war, then not only will China become the next sole world super power, Chinese technology companies will take over from the large US technology companies.

The large American technology companies absolutely must invest massively in AI to match the Chinese government’s massive investments into Chinese AI startups.