AI Disruption Deepens with Chegg Plunge, IBM Hiring Halt, Samsung Chatbot Ban
(Bloomberg) — The speed of disruption caused by a worldwide rush to artificial intelligence was on full display this week, sending shares of education technology company Chegg Inc. tumbling, prompting IBM to halt hiring and prompting a chatbot ban at Samsung Electronics Co.
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Chegg shares lost half their value on Tuesday after the company said OpenAI’s ChatGPT threatens the growth of homework help services. The San Diego-based company makes most of its money from subscriptions and offers online tutoring for testing and essay writing, tasks some students outsource to freely available ChatGPT tools. Educational publisher Pearson Plc fell the most in a year in London trading.
Read more: Chegg drops 42% as ChatGPT threatens growth prospects: Street Wrap
International Business Machines Corp. CEO Arvind Krishna said in an interview with Bloomberg on Monday that the company will stop or slow hiring for jobs it believes will be replaced by artificial intelligence. That̵[ads1]7;s about 30% of the 26,000 employees in non-customer-facing roles over a five-year period, he said.
The Writers Guild of America, which represents more than 11,500 Hollywood writers, included regulation of AI among its demands when it launched its first strike in 15 years on Tuesday. Although the union does not oppose the use of artificial intelligence as a tool, it says it should not share writing credits, or get a share of the residuals.
Generative artificial intelligence – software that can create text, images or videos based on a user’s questions – is beginning to show how dramatically it will reshape the world’s industries, markets and economies. Goldman Sachs Group Inc. said last month that the technology could drive 7% growth in global GDP over the next decade and that nearly two-thirds of American jobs would be affected — some expanded, some replaced.
“These tools are really going to revolutionize how we do business in virtually every sector of the economy,” Anton Korinek, a fellow at the Brookings Institution, said in an interview. “Indeed, there is a risk that businesses do not fully appreciate the scale of the revolution that is taking place. The impact will be very big.”
Introduced to the public less than six months ago, ChatGPT started a race among the world’s biggest tech companies to own the AI space, pitting Alphabet Inc., Meta Platforms Inc. and Microsoft Corp. against each other. Yet the rush to expand the availability of AI has also raised fears about what the technology could be used for.
Read more: The technology behind the amazing, flawed new chatbots: QuickTake
Samsung said this week it would ban employees from using generative AI tools like ChatGPT, according to a memo reviewed by Bloomberg News and confirmed by the company. The company is concerned that data sent to AI platforms may be stored on remote servers, making it difficult to delete and at risk of being disclosed to other users. Samsung joins a number of Wall Street banks, including JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc., which had also banned or restricted the technology.
Geoffrey Hinton, one of the pioneers of the “neural networks” that underpin today’s generative AI systems, said this week that he would quit Google after a decade so he could speak freely about what he sees as its dangers. rapid rollout, according to an interview in the New York Times.
In March, more than 1,100 people in the AI industry signed a petition calling for a six-month break from training AI systems more powerful than the latest iteration behind ChatGPT to allow for the development of shared security protocols. Signatories included Elon Musk, University of California Berkeley computer science professor Stuart Russell and Apple Inc. co-founder Steve Wozniak.
Wozniak said Tuesday in a Bloomberg Television interview that the growing interest in the technology, and growing concern about AI’s use in spam and hoaxes, underscored the need for caution.
“New technology brings pluses and minuses, and we’ve seen so many examples of that,” he said. “When new technology brings big changes – sometimes it’s ‘Be responsible, think about pluses and minuses.’
Chegg’s difficulties may illustrate the disruptions that lie ahead for education, as well as the need for guidance in using the new tools. Seattle education nonprofit Code.org has joined organizations including the World Economic Forum to form TeachAI, an effort that will guide schools to safely integrate AI into the classroom.
“There is going to be major disruption in education, technology and also in classrooms as we rethink not only the tools of education, but even how teaching is done and even the purpose of education,” Code.org CEO Hadi Partovi said in an interview on Bloomberg Television. “The real issue we need to talk about is not seeing the use of new technology as cheating, but figuring out how to move the goalposts of education.”
–With assistance from Jake Rudnitsky, Celia Bergin, Ed Ludlow, Caroline Hyde and Marguerite Gallorini.
(Updates with comments in sixth, 12th and last paragraphs, updating shares)
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