Bill Gates Says This Type of AI Will Be Worth “10 Microsofts”

In This Article:

Microsoft (NASDAQ: MSFT) founder Bill Gates was speaking to a group of college students in 2004.

According to The New York Times, Gates was a bit concerned about the decline in the number of computer science majors, as well as the notion that the field had matured and there weren't many breakthroughs left to achieve in the area.

One student expressed doubt that there would ever be another tech company as successful as Microsoft. Gates' reply is eye-opening:

''If you invent a breakthrough in artificial intelligence, so machines can learn, that is worth 10 Microsofts.''

He wasn't kidding...

Image Source: Getty Images.
Image Source: Getty Images.

Fast-forward to today, and of course someone has figured it out. This special kind of artificial intelligence is called machine learning.

If anything, Gates was too conservative in his estimates. Experts say the market opportunity is now far, far greater than 10 Microsofts.

And Gates isn't alone in his optimism. Other top business leaders are on board as well.

  • Jeff Bezos, the founder of Amazon (NASDAQ: AMZN), said he thinks this new technology is the key to Amazon's future.

  • Sun CEO Greg Papadopoulos is calling it "a real revolution."

  • Even super investor Warren Buffett says that it will have a "hugely beneficial social effect."

When machines go to college

We've referred to machine learning before as the beginning of today's AI explosion. It's "simply" software that ingests data, learns from it, and can then form a conclusion about something in the world.

Thus, the key to understanding machine learning is that it's software that writes itself. Instead of explicitly programming software what to do, you instead provide it with large amounts of data and let it learn on its own. This allows machine learning to solve problems that earlier software with even billions of lines of code couldn't have solved.

A more powerful subset of machine learning is deep learning, which essentially simulates how neurons in the human brain strengthen connections between one another to learn.

If you're wondering how companies like Amazon, Google, Microsoft, and Facebook have grown to be among the largest in the world, part of the answer is how well they've integrated machine learning and deep learning into all aspects of their businesses.

So many examples, so little space

Amazon is a perfect example. It was among the quickest companies in the world to embrace the technology and it serves as a preview for what's to come. As CEO Jeff Bezos noted in a letter to shareholders:

"Machine learning drives our algorithms for demand forecasting, product search ranking, product and deals recommendations, merchandising placements, fraud detection, translations, and much more. Though less visible, much of the impact of machine learning will be of this type — quietly but meaningfully improving core operations."