Media may be sitting on an AI bubble, but the technology isn’t going away

[This article was originally published in The Chartered Institute of Journalists' Journal, Winter 2025 edition]

Some of the UK’s biggest media organisations are investing in artificial intelligence (AI). In February this year, The Guardian announced a strategic partnership with leading US AI research and deployment firm, Open AI, to make its reporting and archive journalism available as a news source within ChatGPT. Two months later, The Financial Times made a similar move – unveiling an agreement to incorporate FT journalism into ChatGPT, and collaborate on developing new AI features for readers. 

Appetite among media organisations for striking AI deals has been just as fierce across the pond, with The Washington Post, The Atlantic, and Vox Media – among others – also jumping onto the proverbial wagon. Their hope is that AI will be a means to supercharge audience reach, while at the same time razing inefficiencies in the back office. 

But it is not yet clear how successful AI will prove on either count. Indeed, an undercurrent of concern is swirling among investors as to whether the technology can deliver on its promises of heightened productivity, product innovation, and new revenue streams. The AI delivery gap, in other words, is widening. 

Despite being the breeding ground of some of the world’s most prolific technology firms, the US has seen almost zero economic productivity growth from AI, claims The Economist. And, notwithstanding a global $7 trillion race to scale data centers, Gartner has predicted that over 40% of agentic AI projects (an increasingly popular use case) will be abandoned by end-2027. 

With valuations soaring and “AI juggernauts like Nvidia and Palantir driving a tech-bloated S&P 500,” Forbes characterises the under-performance as a bubble. So outweighed are profits by hype, in fact, that The Guardian’s own senior economics writer, Philip Inman, has questioned whether the AI bubble is “about to burst and send the stock market into freefall.” 

If any of this sounds like the infamous dotcom bubble – and its subsequent crash – of the late 1990s, that’s because it is. Similar to today’s AI bubble, the dotcom equivalent was generated by a period of speculative mania that sent the stocks of US internet-based technology firms sky-high. While the equity markets bloated exponentially, the speculation leaned solely on the promise of profitability, rather than actual earnings. At the turn of the millennium, the market inevitably imploded and countless dotcom stocks went bankrupt, while numerous high-profile tech companies waved goodbye to over 80% of their market value. So severe was this correction that the Nasdaq took 15 years to reclaim its previous high.

Speaking in August on today’s AI bubble, the CEO of OpenAI himself, Sam Altman, opined: “Someone is going to lose a phenomenal amount of money.”  

But whether AI’s stock prices crash soon or later, the technology itself is not going away. Though the dotcom bubble severely dented confidence, the technology and business models behind it still thrive today. In fact, thanks to increased smartphone and internet penetration, ecommerce is booming. In 2023 its global market was valued at $20 trillion – a figure which will swell to around $100 trillion by 2032, according to Statista. 

Perhaps a similar trajectory will be followed by AI; its stocks imploding but its use cases staying the course. This is the hope of the media industry, at least, which continues to shake hands on eye-wateringly large content and licensing deals with AI firms. 

So, in light of this prognosis, how should the industry and journalists respond? Responsible AI development, supported by fit-for-purpose legislation, is key – focusing on the transparency and explainability of models’ decisioning processes, with constant human oversight. Precise use cases are also critical, meaning newsrooms should identify high-quality solutions to specific, on-the-ground challenges, as opposed to simply diving headfirst into the AI goldrush. In general, investments should start small, with targeted proof-of-concepts – as opposed to big-bang migrations – which gradually broaden across the organisation.  

Above all else, journalists must recognise that the genie is out of the bottle and get abreast of these trends. They can start by educating themselves about the potential challenges ahead – such as the erosion of human perspective and trust, the proliferation of misinformation, and the consolidation of media power – while putting in place strategies to exploit the opportunities, whether they be the automation of routine tasks, the enhancement of investigative tools, or the personalisation of news stories. 

If the AI bubble proves anything, it is that human intelligence and ingenuity is exceedingly hard to simulate. That’s cause for (momentary) celebration. As media organisations await the fate of the bubble on which they sit, they must use this window to ensure their deployments truly serve readers and – most importantly – champion human-made content.