NTT DATA CEO: The AI bubble is ebbing fast, and the rebound will be stronger

The Zhitong Finance App learned that the head of the Japanese IT company NTT DATA said that a round of potential artificial intelligence bubbles will disappear faster than the past technology cycle, but as enterprise applications catch up with infrastructure spending, the bubble will usher in a stronger rebound after the burst.

Abhijit Dubey, CEO of NTT DATA, said in an interview that despite concerns about the supply chain, the direction of development is clear.

“There's no doubt that AI is a huge long-term trend in the medium to long term,” he said. I think in the next 12 months, there will be some normalization in the market... this will be a short bubble, and AI will come out with a stronger attitude.”

As demand for computing still exceeds supply, “the supply chain is almost predetermined for the next two to three years,” he added. Pricing power has begun to be skewed towards chipmakers and hyperscale cloud service providers, which echoes their rising valuations in the open market.

AI has unleashed the biggest technological transformation since the advent of the internet, driving trillions of dollars in investment and astonishing stock returns. But it has also led to a shortage of memory chips, triggered regulatory scrutiny, and raised growing unease about the future of work.

Dubey, who is also the company's chief artificial intelligence officer, said his company has begun to rethink recruitment strategies as AI reshapes the labor market.

“There will clearly be an impact... Over a period of 5 to 25 years, there may be a mismatch of labor,” he said. But he added that NTT DATA continues to recruit in various regions.

At an industry conference in New York, speakers discussed how AI could disrupt jobs and employment growth. May Habib, CEO of AI startup Writer Inc., said that customers are concerned about a slowdown in headcount growth. When you sign a client and talk to the CEO to launch the project on the phone, they might say, 'Great, how long will it take me to cut 30% of my team? '” she said.

However, according to a global workforce survey released by PwC in November, the actual use of generative AI has not met the expectations of board executives.

According to PricewaterhouseCoopers, the daily usage rate of generative AI is still “significantly below” the level widely advertised by executives, even though employees with AI skills receive a pay premium of 56% on average — more than double last year's figure.

PricewaterhouseCoopers also notes that the skills gap is widening, with around half of non-managers reporting access to training resources, compared to about three-quarters among senior executives.