The mid-twentieth century was marked by the birth of artificial intelligence (AI) and the growing phenomenon of machine learning to solve problems and make decisions. Within the first three decades of the twenty-first century, how has AI evolved within the marketplace?
A Brief History
The first-ever AI program is widely considered to be the Logic Theorist, a program funded by the Research and Development (RAND) Corporation. This program was created to mimic human intelligence and problem-solving skills by AI. It was presented at the 1956 Dartmouth Summer Research Project on Artificial Intelligence where the term “AI” was coined. While the event didn’t succeed in measuring AI standards for creation and implementation, it helped to introduce the concept of artificial intelligence to the public eye.
AI faced many obstacles in the early stages of its use and implementation, and programs developed through AI were considered to be no smarter than an individual human, causing doubt over the significance of artificial intelligence.
The power of AI, however, is in part due to the amount of information the computer’s memory can store. Computers during the mid-1900s couldn’t store a sufficient amount of information or process information quickly enough for exceptional AI use. AI and machine learning began thriving in the 1980s as computational memory and speed increased with advances in microchip technology.
The Marketplace with AI
At the forefront of the AI arms race are Microsoft and Amazon.
Microsoft Azure is Microsoft’s AI program, which was released in 2010 to the general public. Microsoft recently launched Azure Arc as a hybrid cloud program that combines multi-cloud and hybrid cloud platforms. Amazon’s AI system incorporates machine learning in AWS (Amazon Web Services) which was launched in 2002 to collect data and personalize data for business decisions.
Nvidia acts as a market disruptor. Nvidia is one of the world leaders in supplying computer processors that power cloud servers and data centers. This semiconductor firm accounts for the majority of high-performance and high-end chips that are used in machines to train and perform in advanced intelligence learning machine models.
The company’s increase in stock market price emanates from ChatGPT’s popularity after its launch in November 2022. Nvidia notably creates graphic processing chips (GPU) that allow for massive amounts of data to be suctioned for the purpose of training different machine learning systems.
As of right now, Nvidia dominates the marketplace in chips for graphics, especially in the gaming and data spheres. Competitors such as AMD (Advanced Micro Devices) can’t compete with Nvidia, as AMD focuses on both GPUs and CPUs (central processing units). Nvidia has a competitive advantage by only producing GPUs. As a result, Nvidia dominates this discrete industry.
However, Nvidia still must keep up with innovation in multiple fields to stay ahead of Intel and Apple’s rapid AI production development.
At the beginning of 2022, Nvidia’s stock had a value of $361 billion. More than a year later, they have seen an increase in stock value to nearly $1 trillion: an increase of 160% and the highest market cap the company has yet to see, according to The Guardian.
The stock price of Nvidia pushed to $940 billion this past week, which is a 24% increase in the stock price as compared to the previous week. Tesla’s market cap rate for its stocks, in contrast, reached $584.7 billion last week. Compared to other AI companies—such as Microsoft, which has a market cap rate of $2.48 trillion, and Amazon, with a market cap rate of $1.3 trillion—Nvidia’s stock prices are proof of the competitive edge that this company is bringing to this sector of the market.
Nvidia is considered a new front-runner with this nearly one trillion dollar market cap. The marketplace may be witnessing the emergence of a new tech giant, and this market capitalization changes the playing field for technology investments in semiconductor firms and silicon in the rush to monetize computer intelligence and AI.
As AI continues to grow and change the tech landscape, Nvidia’s future outlook is positive.