Artificial intelligence (AI) is one of the fastest growing technology sectors. While its reputation may still be tied to sci-fi concepts and movie plots, AI serves as the central backbone of a wide variety of industries.

In the coming year, the sky is the limit for this market, as a potential recovery in the global economy allows for further investment.

Here, Investing News Network (INN) presents a glimpse of where AI is headed in 2023.

1. The health of the technology market can improve in 2023

From the biggest names in technology to startup startups, companies that don’t yet have AI capabilities are evaluating AI tools or looking for other ways to enter the industry.

However, technology investments suffered a colossal recession in 2022 due to enormous global pressures, including interest rate hikes from the US Federal Reserve.

Some experts expect these increases to stop in March, which could change the way investors view the technology. According to Fortune, CitiBank analysts believe that if the Federal Reserve loosens up, investors will turn their attention to growth stocks and riskier plays.

“Analysts added that sectors with the greatest potential for high profits, including healthcare and technology, will be prioritized by investors,” the news outlet states.

However, the end of rate hikes does not mean the end of volatility, CitiBank analysts said. Investors will still need to be cautious in the AI ​​market and the technology market in general.

Speculation also continues as to whether the US will enter a recession in 2023 and how that could affect the market.

2. Investment dollars are set to flow to the big AI players

The gap between major AI companies and emerging ones has widened in 2022, and this trend may be exacerbated in 2023 as major players continue to generate significant interest.

A report prepared by the McKinsey Global Institute indicates that the largest companies in the AI ​​space already have a huge advantage and will continue to receive heavy investment.

“The bottom line: High performers are already well positioned for sustained AI success, greater efficiency in developing new AI, and, as a result, a more attractive environment for talent,” the report states.

Michael Chui, a partner at the McKinsey Global Institute, said the most successful AI solutions companies are the ones that have spent a significant amount of time and money on their operations rather than trying to get a quick advantage.

Chui praised those who learned from their mistakes and slowly added to their AI operations.

“Not only are they investing more, but they are also investing smarter, with the goal of creating a true AI factory that allows them to embed more AI into more areas of the business, first in adjacent ones where some existing capabilities can be reused and then into completely new ones,” he wrote.

3. Security to gain new importance in AI discussions

While the excitement around AI solutions continues to grow, experts want more investors to consider security measures.

In their latest annual State of AI Report, AI investors Nathan Benaich and Ian Hogarth have included a new category of “security.” In this section, they explore what is being done to mitigate rogue AI.

“Security is gaining awareness among major AI research entities, with an estimated 300 security researchers working in large AI labs, up from less than 100 in last year’s report, and increased recognition from major AI labs. AI security academics is a promising sign when it comes to AI. security is becoming a mainstream discipline,” the researchers wrote.

“Increased awareness of the existential risk of AI is generating a greater number of employees, with an estimated 300 researchers now working full-time on AI security.”

Benaich and Hogarth are encouraged to see more researchers than ever join the AI ​​security category. However, the number pales in comparison to the number of researchers in the broader field of AI.

The pressing need for AI security stems from increased concern when it comes to “the risks of human-level AI and superhuman (artificial general intelligence) in the near future.”

investor takeaway

Despite the excitement and limitless potential associated with AI technology solutions, the industry will continue to be at the mercy of technology market trends as volatility continues to reign in the broader markets.

Don’t forget to follow us @INN_Technology for real-time news updates!

Securities Disclosure: I, Bryan McGovern, do not have any direct investment interest in any of the companies mentioned in this article.

Editorial Disclosure: Investing News Network does not guarantee the accuracy or completeness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the views of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

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