Data was the new oil five years ago. Is it still true?

22nd February 2024

Sam Volkering

Mar 05, 2024

Welcome to AI Collision 💥,

Create a whimsical and colorful image depicting the concept 'Data is the new oil'. The scene should be vibrant and imaginative, showcasing data flowing like oil from a giant computer or server into various devices like smartphones, tablets, and laptops. The data should be visualized as a bright, sparkling liquid, symbolizing its value and power. The background should be filled with abstract digital elements and icons related to technology and information, enhancing the fantastical atmosphere of the image.

In today’s collision between AI and our world:

The Economist was actually right
Me, tonight, live, AMA… LIVE TONIGHT
Don’t try this at home

If that’s enough to get the data barrels pumping, read on…

AI Collision 💥 is AI just machine learning?

One of the critical takes on AI (and I’ve been guilty of this before) is that the “intelligence” part of the conversation is so subjective.

In a world where computers are fundamentally binary based (yes or no, 1 or 0) to exist in the area of grey is not ideal.

This changes when we look to quantum computing, but we’ll have that discussion another day.

Therefore if you look at what AI does, there’s a fair question to ask about whether it really is “intelligent” yet, or if it’s just really, really good at processing data.

So the question exists, is AI truly AI at this point, or is it just good machine learning (ML)?

To understand where we are, we should think about what AI is and why it’s different to ML.

AI and ML are often used interchangeably, yet they are distinct concepts in computing.

Artificial intelligence is a broader field focused on creating machines capable of performing tasks that would typically require human intelligence.

The key elements in that sense mean the computing requires reasoning, perception, learning, and decision-making.

The vision for AI has always been to create systems that can function autonomously, adapt to new situations, and solve complex problems without direct human intervention.

It's a big-picture idea that encompasses various techniques and methodologies, from rule-based systems to natural language processing.

If you look at ML, it’s really a subset of AI that provides the ability to automatically learn and improve from experience without being explicitly programmed.

ML focuses on developing algorithms that can process massive amounts of data, recognise patterns, and make decisions with minimal human oversight.

The core idea is that machines can learn from data, identify patterns, and make decisions with minimal human input.

On the face of it, there’s not much different there. But it’s that concept of performing an intellectual task and adapting on the fly that is the big differentiator.

And while they both serve a big role in how our world connects, accesses information and grows, there’s one underlying lifeblood that neither can live without…

Data.

I recall in 2017, The Economist ran an issue with the following cover:

It was rinsed for a long time. And it’s not hard to find a whole host of articles saying that data is NOT the new oil.

But five years on from that piece, I challenge anyone to see which has performed better…

Companies aligned to data, or companies aligned to oil.

The answer is well known, but I’ll leave the chart of Exxon Mobil and Meta here just to highlight the point.

Exxon $80 to $105 in five years.

Meta, $162 to $499 in five years.

I don’t think the idea of data as the new oil is lost on anyone these days, and it’s been coming at us as clear as day. Now people are figuring it out because the market is reflecting it.

And it’s a trend that’s going to continue. It’s why if you can pin down the companies that are best at processing, analysing, transporting and connecting data, that’s where I think you’ll find the real gems in this AI boom.

AI gone wild 🤪

Last week I broadcast a new briefing on the rise of the AI boom and what it means for investors.

Importantly I spoke about how to invest in this game-changing market and how I go about picking stocks that I recommend to my paid subscribers.

We had some great feedback from that event, and a bunch of new subscribers to my Predictive Edge publication.

We also got LOADS of questions.

We condensed a few, and read in-between the lines for some others, but as a starting point here’s some of the questions we got:

Is AI just another fad? I’ve been burnt by “the next big thing” before
Have I missed the boat on AI stocks? Nvidia, etc, all seem to have made huge gains already
What are the AI sectors you’ve got your eye on in 2024?
Should I be using AI to invest as well as investing in AI?
How exactly are you using AI to make your picks?
Do you only look at AI stocks or do you look at things like crypto stocks too?
How do I actually invest in these stocks?

As you can see, that’s just a start, and they range from the nitty gritty about how I go about it through to the more straightforward fundamentals of just buying a stock in the stock market.

Because we got a lot of questions, and because it’s clear that a lot of people are dead-keen on AI investing, I’ve decided to do a LIVE Q&A session tonight.

Sorry about the short notice, but in our team meeting at Southbank only yesterday, I threw up the idea of another livestream Q&A and talk with everyone about how exciting this market is, how to invest in it, and what I’m doing with my subscribers at Predictive Edge to capitalise on it.

It was agreed that was a pretty good idea.

So I’m doing it.

Tonight at 7pm GMT I’ll be hosting a live stream where I will answer those questions above, some others we’ve had flooding through but crucially any questions you have about all of this, live in real time.

That means you’ll be able to jump onto the stream and ask me directly any questions you’ve got about AI and AI investing, LIVE.

I suggest you grab a drink, allocate at least an hour, and jump onto the stream with me.

Note: I will most certainly have a beer or a wine (it will be 7pm, and my kids will be asleep, so it only makes sense!).

All you need to do is hit the button below and it’ll take you to the registration page, then just join me on the stream at 7pm SHARP.

Sam's AI Ask Me Anything Livestream

Anyway, I hope to see you there (well at least, you’ll see me, I’ll see your questions) and look forward to all the questions you’ve got for me.

[Capital at risk.]

Boomers & Busters 💰

AI and AI-related stocks moving and shaking up the markets this week. (All performance data below over the rolling week).

man in black suit jacket and black pants figurine

Boom 📈

BigBear.AI (NASDAQ:BBAI) up 77%
Appen Ltd (ASX:APX) up 30%
GuardForce AI (NASDAQ:GFAI) up 24%

Bust 📉

iRobot (NASDAQ:IRBT) down 12%
BigTinCan Holdings (ASX:BTH) down 14%
Brainchip (ASX:BRN) down 22%

From the hive mind 🧠

We could almost start a new section called “AI Election Interference” because it seems that every day now something is happening where AI is in use to impact and influence voters. Here’s another example from Trump supporters.
Worms on a computer used to mean a crazy game where you’d blow the crap out of another player with increasingly violent weaponry. Incredible fun! Today it means using artificial intelligence to create something that steals your data and sends you lots of spam.
This actually made me laugh out loud (lol). AI giving out bad tax advice. Well, I mean, that makes AI more human than machine doesn’t it? Could be worse, the tax authorities could be using AI I guess.