While AI and Big Data have certainly transformed many industries, much that we hear about how it affects typical businesses has been runaway hype inflation. No less than Hewlett Packard found that out the hard way. In 2011, the US IT titan bought a UK-based Big Data company, Autonomy, for over eleven billion dollars. Within one year, they had written off over eight billion dollars. What happened?
Autonomy had real software—it had specialized tools for searching “unstructured data” such as emails, documents, etc. While these tools are certainly useful for a variety of business tasks, they are not an eleven billion-dollar business. However, the hype around Big Data had caused HP to take a much less critical look than they should have when they bought the company.
Why bring this up now? Autonomy continues to be in the news because the prosecution against its executive team netted a conviction and sentence. In May of this year, Autonomy CFO Sushovan Hussain was sentenced to a five year prison term and a ten million dollar fine because he was held “ultimately responsible for Autonomy’s revenues having been overinflated by $193m between 2009 and the first half of fiscal 2011.”
“Overinflation” (hype) is costly to the believer when it drives people to make bad decisions. But every so often, as in this case, it is costly to the hypester as well.
Counting back: 2019 AI Hype Countdown #10: Sophia the Robot Still Gives “Interviews” In other news, few popular media ask critical questions. As a humanoid robot, Sophia certainly represents some impressive engineering. It is sad that the engineering fronts ridiculous claims about the state of AI, using partially scripted interactions as if they were real communication.