AI: Reversion to a New Normal
One of the things that amazes me about AI tech like ChatGPT is just how fast it’s evolving and being adopted. Let’s take a look at the different phases of adoption and how the advantage from technology adoption changes. And more importantly, let's explore the questions to ask when AI reaches a “New Normal.”
Hope you enjoy!
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With the rise of generative AI tools like ChatGPT, many businesses, startups and creators are racing to adopt AI and integrate it into their business / day-to-day.
The hope is that leaning into the “new thing” brings competitive (first mover) advantages.
But AI is a very different technology.
It is evolving quicker than any other technology we’ve seen.
ChatGPT reached 100M users in just 2-months after launch, making it the the fastest application to reach this milestone.
In today’s hyper-connected world, headlines like this and all the chatter on the Internet about ChatGPT brings more attention to it, encouraging more people to use it.
The early adopter advantages are fleeting.
Using AI in some way, shape or form in your business is quickly becoming table stakes.
Fleeting Adoption Advantages
Let’s think about the advantages from adopting a new technology across 3 phases.
Early Adopters Phase
The early adopters enjoy the first mover advantage. In this phase, the advantage comes from the fact that the competition isn’t using it yet.
At some point, enough non-early adopters see the benefits of those using the new technology that they also decide to jump in.
Post Chasm, Pre-Mainstream
After the early adopter phase, there is a phase where the technology has “crossed the chasm.” The first mover advantage goes away because there are a lot more users adopting the technology — bringing more competition.
In this phase, to stand out from the rest of the group, those who integrate the technology into their business must increasingly find novel ways to use the technology. The winners in this phase develop a “craft” around using the new technology.
After the “Post Chasm, Pre-Mainstream” phase is a “New Normal” where the new technology is widely adopted. The new technology becomes table stakes. The advantages that come from adopting the new technology is low and you might get penalized for not using it.
AI will largely follow this phased approach to adoption, what is different is the timing of those phases.
Reversion to (New) Normal
In Carlotta Perez’s Technology Adoption Framework, she noted that once new fundamental technologies are introduced to the world, it might take anywhere from 40 - 60 years for the technology to hit maturity (from an adoption standpoint).
So far AI is speed running the adoption curve.
A recent survey asked 1,000 business leaders to understand how many of them are using / plan to use ChatGPT in their business. Here are the key findings:
The rate of AI adoption makes the early adopter advantage short lived.
If we re-imagine our above framework for AI, we get something that looks like this.
The time in the “Early Adopters” phase and the “Post Chasm, Pre Mainstream” phase shrinks. AI is quickly marching towards the “New Normal,” and we’ll be in the “New Normal” before we know it.
Because AI is becoming more accessible to more users and companies at low marginal costs, AI will eventually be accessible to everyone who wants to access it.
AI will usher in a “New Normal” like the Internet did. Today, the number of businesses and people who have some sort of Internet presence is only going in one direction — up and to the right.
Being on the Internet today is table stakes.
Once mass adoption happens, using and integrating AI becomes table stakes.recently wrote a great piece on Open AI's business model highlighting how there is “no real competitive advantage to using OpenAI’s Intelligence APIs, but there’s a disadvantage for not using them.”
[Check out's essay here].
Said another way, once we enter the “New Normal” phase for AI, if you don’t use AI in your business, you risk getting left behind.
But if in the “New Normal” phase, there is no real advantage to using AI (because everyone else is using it), the key question becomes how does one preserve / develop a competitive advantage in this world?
What Won’t Change in the New Normal
In the modern world, we are obsessed with change.
But we don’t spend enough time thinking about what won’t change.
The things that won’t change are as important because in a world that is rapidly changing, understanding what is timeless could be a source of competitive advantage.
One of Jeff Bezos’ frameworks is to invest in things that won’t change.
For him and Amazon, what won’t change is what customers want:
“I very frequently get the question: ‘What’s going to change in the next 10 years?’ And that is a very interesting question; it’s a very common one. I almost never get the question: ‘What’s not going to change in the next 10 years?’
And I submit to you that that second question is actually the more important of the two — because you can build a business strategy around the things that are stable in time … In our retail business, we know that customers want low prices, and I know that’s going to be true 10 years from now. They want fast delivery; they want vast selection.
It’s impossible to imagine a future 10 years from now where a customer comes up and says, ‘Jeff I love Amazon; I just wish the prices were a little higher,’ [or] ‘I love Amazon; I just wish you’d deliver a little more slowly.’ Impossible. […] When you have something that you know is true, even over the long term, you can afford to put a lot of energy into it.”
While Bezos understood that customers will want good customer service in the future, how customer service is delivered in the future will obviously be different than the present because of new technologies, capabilities and tools.
It’s important to ask: (1) what won’t change, i.e. what are the timeless principles and (2) how will those timeless principles play out in a future with new technology.
Here is what this could look like in the “New Normal” phase of AI.
Quality vs Quantity:
In a world of AI generated content, what won’t change is the desire for quality. AI raises the definition of “average” which raises the bar for what we consider quality content.
What won’t change: We’ll still want the thing that is high quality over the thing that is low quality.
What will change: The volume of everything goes up.
Signal vs Noise:
AI introduces a lot more abundance to the world, but that also introduces a lot more noise.
What won’t change: Constrained / razor thin human attention span.
What will change: We focus less on production and focus more on curation.
Input vs Output:
AI gives us tools of mass production at our fingertips and heavily decreases the cost of producing (almost) anything.
What won’t change: desire for creative output that satisfies human needs
What will change: the average human has the power / tools of a bunch of specialized fields (artists, coders, writers, etc)
In the “New Normal” of AI, life will look very different but in many ways it will look the same.
What won’t change versus what will change are two sides of the same coin — both are important to understand.
Same, same but different.
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