The two questions we always think about when it comes to artificial intelligence (AI) are: “is it a bubble?” and “what industries, or jobs will be eliminated next, following the ‘Saas (Software as a Service)-Mageddon’ i.e. the meltdown of the software sector on the back of the new AI models that can now code?”
Our world is changing at warp-speed, and these two questions really highlight our confusion and desperate attempt to make sense of this new environment. But they cannot exist together. Either we are in a bubble, or AI is about to change everything.
We are in the second camp; it will change everything. And more than that, we believe AI is the biggest tech revolution we have seen so far.
If I must summarise why this is the biggest revolution we have ever seen in one sentence: AI is taking down the cost of intelligence to zero. Our entire economy, society, technology and world formation have depended first and foremost on the race for knowledge and intelligence. AI is about to change all of that.
Are we all mistaken, when it comes to AI?
So, what are we missing? The biggest mistake we keep making is to associate AI only with the chatbots. ChatGPT, Gemini and other LLM models are just one application of AI. They can do a lot and are developing very fast. They introduced AI into our lives. Yet, they are only one small use case of the revolution. The discussion about an AI bubble comes from the wrong assumption that we are spending trillion of dollars on a chatbot that can summarize our emails.
See also: DeepSeek slashes fees for new AI model in Chinese price war
So why are we investing so much? Because of the real use cases of AI that will change our lives. Rich AI simulations have already proven to develop drugs in days instead of years, and at a fraction of the cost. AI has helped us to map all the different protein folding structures and changed the healthcare market for good. AI simulations have led to the development of more than 2 million new materials – the equivalent of 800 years of knowledge compressed into weeks. Agriculture inputs have fallen by more than 90% with massive yield improvements. It has helped us to diagnose diseases and has improved weather calculations dramatically. AI now drives millions of miles with autonomous vehicles and has improved our energy efficiency with grid development. This is why we are spending trillions.
We build our world in the 1950s to fit a different world
This transition will need trillions of dollars. The world we live in was largely built in the 1950s after WWII. We topped it with software in the 1990s (Internet) and more hardware in the 2010s (mobile). Now, though, we need to rebuild everything. We need more data centres for this revolution. We need more land than Singapore to host them, and energy than India will consume in 2030, to power them. We need way more bandwidth than 5G can supply us, vast quantities of critical materials and rare earth metals for the buildout and we will need water. So much water. Every 40 prompts of ChatGPT “drink” roughly a litre of water and there are billions of commands, across all the different models out there. In 2025, already two-thirds of the planet was facing severe water shortages – we got to that point before building all the extra data centres needed.
See also: Why agentic AI push hinges on data readiness, not model power
Whoever is making the investments, and looking at it holistically, could have a huge advantage in the future. For example, China is adding the equivalent of the US grid electricity capacity, every 18 months.
It’s not East vs. West anymore. It’s the “ChatGPT block vs. the Deepseek block”
And this is the essence of the story; the global race for AI is on. Or, as we call it: “the AI wars”. Countries that want to lead the race, should look at the new battlefield holistically. It’s not just the models, or the developers, it’s the technology, the infrastructure around it, the increased energy capacity, and new grid to support it. Access to rare earth minerals and control over the supply chain are just a few elements of the entire ecosystem that are needed to lead this revolution. More than that, we cannot rely on former allies to help us close the gap. AI is a key player in the deglobalization trend we are seeing right now. Resource independency is critical in this race, and we are seeing the leading countries introducing higher barriers of entry to keep the advantage in-house. Again, this should lead to more investments. Last year, China taught the world that limited resources could lead to massive breakthroughs. Deepseek proved to the world AI could be better, and so much cheaper. Scarcity is the bedrock of all innovation.
Do I need to look for a new job?
I started this article with the two questions on everyone’s minds. But there is a third one: what could happen to all of our jobs. So many professions have been threatened by AI. We live in a tech golden era, but the demand for software developers in some areas is plummeting, while the market is going through a structural change. Fewer juniors are being hired, and companies are rethinking their hiring strategies.
Again, we are asking ourselves the wrong question: AI will not take our jobs, but it will take over our skills. There will still be lawyers, accountants, architectures, call centres, coders, or media specialists. But their skills will have to change. Instead of summarizing court cases, we will need negotiators, and litigators. Do not ask yourself if AI will take my job. This is the wrong question! Ask yourself what skills will AI take? Yes, the market will change; employees with creativity, social skills, ethics and critical thinking will be much more valuable than university graduates.
AI is about to change the world, but this is also just the preview
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Three-and-a-half years ago we woke up to the “ChatGPT moment”, and it now looks like a very different world – for better or worse. But this is just the preview. We are heading into a ChatGPT moment on steroids. The next fire moment for humanity will be quantum computing. A human would have to perform one sum every second for c.50 quintillion years to equal what a quantum computer can do in a single second. This could be the biggest revolution for humanity since discovering fire. A technology that can perform endless complex calculations in zero-time, warp-speeding human knowledge and development, solving a problem that traditional computers could not solve in any feasible amount of time.
For example, in December 2024, Google, one of many companies racing to develop quantum computer technology, announced a new quantum chip ‘Willow’. It is reported to be able to solve a complex benchmark problem in under five minutes. This would have taken the world’s fastest supercomputer roughly 10 septillion years (that's 25 zeros) to complete.
AI will change the world. Quantum, though, can do so much more – level the tech playing field and reset everything. “Never underestimate the future. It always comes”.
Haim Israel is the head of global thematic research at BofA Global Research.
