I wouldn't necessarily call it a bubble. There has been a breakthrough in AI recently, and now we see the new companies following that. Of course, 95% or so will fail, and the invested money is gone, but that happens basically with every new technology shift. From my point of view, what is needed for a real investment bubble is that the investors are not aware that there is a high failure rate of AI startups, but I don't think that is the case here.
For comparison, in case of the crypto bubble, there's really a huge community that thinks BTC or other cryptos will go "to the moon" and they seem to be immune to common investing fundamentals.
I think the usage of the term "bubble" could use a little sharpening. In this context, for example, you could also use "gold rush" for an entirely different (yet similarly vague) effect.
Bubble implies an overall deflation. Gold rush implies a few people will get rich--especially those selling tools--and the rest will go belly-up. The latter seems more plausible in general. And, honestly, gold rush probably applies better to a lot of things in tech than bubble. (Though dot-com was probably more of a bubble even if some companies came out the other side.)
A bubble implies there's little or no actual value inside. I disagree completely.
As a senior software engineer that has fully integrated GPT-4 into my dev process, I can assure you there is definitely value here. I would say these LLMs (or where we go from here) are going to be at least as transformative as the smartphone.
Which is itself just a titanic wrapping on a gigantic effort, to convert all human knowledge into a spreadsheet - and becomes instantly tained by echolalia, as the AI output poisons itself.
For comparison, in case of the crypto bubble, there's really a huge community that thinks BTC or other cryptos will go "to the moon" and they seem to be immune to common investing fundamentals.