Search begins its long decline
AI chat is, quite simply, a superior experience to search in many cases. You get an answer right away instead of trawling through a dozen spammy search results, each time threading the needle through ads, newsletter prompts, and cookie warnings. In 2024, the gap will widen as LLMs keep improving while search quality deteriorates in the wake of an abundance of AI-generated content. This is a negative feedback loop. The quality of high-ranking search destination sites will continue to decrease as their traffic declines. At this stage, most people are still using search and few people are paying for premium LLM access. Therefore, the trend will be slow at first, but I expect it will start to become an agreed long-term trend among tech followers and investors in 2024.
Industrial AI FUD Campaigns
2024 is the year when many professionals will be exposed to generative AI as it will begin to be shipped as a production feature in mainstream tools such as Microsoft Office, Google Workspace, Adobe Creative Cloud, as well as all the AI-native startups. Professionals will begin to notice clients getting advice from LLMs, such as doctors hearing from patients who shift from “Doctor Google” to “Doctor GPT”. This all starts to feel like quite a threat to entrenched interests. We’ve seen pushback from the designer community since 2022, often with bizarre arguments about what constitutes art mixed in with naieve opinions about copyright law. We then saw the 2022 Hollywood strike, the first major campaign to be entangled with AI. The spring is coiled for protected professions such as doctors, lawyers, teachers to ramp up their opposition. Expect to hear horror stories about people who took the wrong medicine, lost their home, failed their exam. Warnings about hallucinations and misalignment. There’s elements of truth here, but you can rely on publicity campaigns that dwell on the negatives and ignore the dramatic improvements that can be made. As with other revolutionary technologies, FUD campaigns can only add temporary friction for an unlucky subset of founders and investors. FUD campaigns won’t really put any meaningful brakes on AI progress.
IPOs are back
Companies get to choose the timing of their IPOs and, after a dearth of IPOs, 2024 is shaping up as a good choice. Since the bear market began two years ago, there’s been a lot of money sitting on the sidelines due to nervous investors who would rather benefit from bonds, where they can yield north of 5% with negligible risk. There’s now an expectation, based on Chairman Powell’s commentary and the fact it’s an election year, that rates will gradually be lowered again, and if that proves to be the case, said funds will be poured back into the markets. (They already have ploughed in on expectation, leading to all-time highs, but a bull market, fuelled by AI promise and growth companies maturing, has potential to rise a lot further. Especially if geopolitical conflicts cool.) A strong bull market is the reason there were so many tech IPOs in the late ’90s and the early pandemic ’20s. Companies who IPO’d funds at those irrational levels built themselves a solid war chest to survive the recent bear market. There are mature companies like Stripe and SpaceX, who chose not to take advantage of that climate, as well as companies like Reddit who have leaned down and ramped up profits at a time when they can be more ruthless towards their users and employees. Their metrics will look good for IPO and investors will be hungry for it.
Calls for TikTok Spinoff
TikTok’s algorithms have been controversial and there have been calls to ban the app in the US and other western countries. However, TikTok also has many adoring users, some of whom vote, and investors with a strong interest in keeping the giant asset alive and well. It also appears to be well-positioned to take advantage of AI innovation, with its algo-first approach lending itself to virtual characters, AI-enhanced posts, and an overall trajectory towards a total “audience of one” feed. Instead of banning TikTok, or trying hopelessly to sever its operations geographically, a better solution is simply to spin off a “western” (essentially ex-China) version. I’m not really sure if calls for it happen this year as there’s no major catalyst, so it’s a dark horse bet. If there’s a case for it happening, it will be the aforementioned hype for tech IPOs combined with concerns over the US election and many other elections happening around the world.
It’s already possible to generate realistic synthetic video with basic tooling. A social media bot can work 24-7 and a-b test content that is as compelling as possible. I believe we’ll see a huge rise in these kinds of accounts. This one is hard to verify short term because it’s much more effective for bots to masquerade as a real person; while we’ve seen “AI newsreaders” and so on for decades, they never really take off. At least until now, people gravitate towards accounts that present as real people. Therefore, I think the prediction would need to be verified indirectly, such as a marked rise in crypto scams arising from such accounts or an increase in agencies offering to build virtual person brands, ideally with case studies.
Normalisation of smart glasses
A decade on from Google Glass and it seems smart glasses are going to be acceptable now. There’s a degree of inevitability that may dampen anyone’s resistance to it. The Glass lesson has been learned by Meta, who’s partnered with Ray-Ban to produce glasses that look pretty much like normal. The cyborg dream has been reigned in for now, with audio being the only sense augmented by reality. Audio AR turns out to be pretty great when there’s LLM capability combined with always-available vision. Most people won’t even realise someone is wearing smart glasses - out of sight, out of mind, and there will be little pushback. The video they produce could only be dreamed of in the early 2010s, enough benefit to offset whatever stigma remains for many potential users.