Mere minority of orgs put GenAI in production after year of hype

Folks are dipping their toes in without a full commitment

Despite a huge surge in awareness over the last year, just 10 percent of organizations have adopted generative AI technology in production environments, according to a survey by Intel.

Overall, 45 percent have made some steps in adopting generative AI, either through pushing solutions to prod, developing the models but not launching them, or starting early pilot projects. But research carried out by Intel-owned cited a number of difficulties hampering global organizations' efforts to embrace the technology.

The biggest barrier for most of the 434 tech pros that fed into the study was down to basic infrastructure, with 46 percent citing it as a reason for not developing large language models (LLMs). Compliance and privacy (28 percent), reliability (23 percent), high cost of implementation (19 percent), and a lack of technical skills (17 percent) were also highlighted as key influences for the low rate of uptake.

The findings broadly echo those of similar studies; earlier this year, digital services biz Nash Squared revealed that just 10 percent of UK organizations have a significant AI implementation, while around a third have at least started piloting generative AI.

Nash CEO Bev White said that organizations are conscious of the compliance and safety risks, and feel unprepared for the challenges presented by generative AI adoption.

What won't be helping decision-makers commit to AI plans is the regulatory landscape, which hasn't matched the explosive pace of development over the last year.

The European Commission, for example, today entered what are expected to be long and labored talks to hash out key points of its AI Act. Once finalized, those looking to adopt AI in the EU will have a clearer understanding of the rules governing its development and implementation, it's claimed.

The latest findings come after analyst house Gartner told El Reg that for end-user organizations, investment in generative AI is the "least important" part of a growing worldwide spend on IT.

Vendors are investing significantly more into the technology than their customers are right now and, as many will have noticed over the past year, the majority of vendors are sprinkling the technology across their product portfolios but are yet to see returns on that investment.

Ultimately, the amount of money that organizations are estimated to spend on generative AI isn't likely to change a great deal, said John-David Lovelock, distinguished vice president analyst at Gartner. If most vendors are sprinkling AI across their products, customers will instead make their decisions based on which org has the better AI, but that alone won't play a big role in how much is spent overall.

However, for those that choose to make the investment in generative AI, the benefits have been felt, as per Intel's survey. More than half have improved their customer experiences, upped efficiency, and enhanced product capabilities, the report claimed, adding 47 percent believed they'd saved money in the process. 

"While still in early development, generative AI has been one of the most talked-about technologies of 2023," said Markus Flierl, general manager of Intel Cloud Services. 

"The survey suggests organizations may be hesitant to adopt GenAI due to the barriers they face when implementing LLMs. With greater access to cost-effective infrastructure and services... we expect greater adoption in the next year as it will be easier to fine-tune, customize, and deploy existing LLMs without requiring AI talent to manage the complexity."

Taking it all the way to the bank. Gulp...

The IT and software industries, perhaps unsurprisingly, are leading the way with adoption, while financial services, defense, and insurance closely follow behind.

Research from McKinsey this week pegged banking's potential annual earnings gains from deploying generative AI to be in the region of $340 billion, between a 9-15 percent increase in operating profits – among the largest lifts across any industry.

Legal and risk management sectors are also set for large potential benefits, but a greater proportion of that is comprised of traditional AI and analytics, the consultancy claimed.

That said, most industries stand to benefit in some way. Software engineering is one of the early beneficiaries of generative AI, although there has been criticism of the quality of the code. GitHub's Copilot tool has so far proven a hit among devs, despite the Microsoft-owned company running it at a loss and facing serious legal challenges. ®

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