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Broadcom chief executive Hock Tan has questioned whether AI companies can turn demand into enough paying customers to cover the cost of developing and running their models. He also criticised businesses for spending on AI experiments without working out where they generate returns, Fortune reports.
Why it mattersTan compared token spending to feeding arcade machines and leaving with nothing to show for it. Fortune also cites a McKinsey survey in which 80% of respondents said AI improved their individual productivity, but only 37% said it had contributed to their organisation’s EBITDA. About one in five said AI-related operating costs had constrained their use of the technology. That is a useful distinction: people feeling more productive is not the same as a business seeing a return.
Discuss: Should companies keep experimenting with AI until valuable uses emerge, or demand evidence of returns before spending more?
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