So if you want to describe Google as a (insert thing here) company, really the thing to insert in the parentheses would be something like "massive computing infrastructure".
And for better or worse, "AI" is still associated in many people's minds with things that the Google search box isn't close to resembling. People expect an AI to hold a conversation, or be able to reach (and explain) novel conclusions, rather than heuristically guess the next word you'll type (given the computing power, not terribly hard given the informational entropy of human languages) or scan a large database quickly to return the result you asked for. People mostly don't see fast brute-force searching of a problem space, for example, as "intelligence", but that's most of the secret sauce behind game-playing "AI".
So? The fact that it is worth a damn at playing go was unexpected to most people afaict. What do you mean "fundamentally novel", are you expecting the field to advance from cars that barely avoid accidents, to Ava in one fell swoop?
Frankly I would prefer that advancement in AI not occur in sudden unexpected bursts of progress, thanks.
Back when neural nets were "fundamentally novel" we didn't have the understanding or computing power to tap their potential. So they "weren't really AI" because they couldn't do much that was interesting.
Now, we have a better understanding of how to use them, and we have enough computing grunt to make them do really interesting things. But they're "not really AI" because they're "not fundamentally novel."
I think the concepts behind this were known 10 years ago - they improved and made it scale/we got the hardware and productized it - but would it really "blow your socks off" ? Hell I'm kind of disappointed at the development speed, I was expecting real personal assistants (not something trivial like Siri) by now.
Nowadays you can search for "young einstein" and get 3 pictures of Yahoo Serious and 10 pictures of Albert Einstein as a young man. It still looks like magic to me even though I know a bit about how it works.
To put it another way, if we define a Scotsman as anyone born in Scotland and/or related to someone born in Scotland, we've essentially just defined a Scotsman as every organism ever to be alive on Earth.
I have to imagine when the term first started to be used people imagined an AI as something more human than neural networks. Imagine HAL or any other hollywood perceived robot.
My personal bet is on people placing that line squarely on the divide between "Stoic Guru" and "Active Academy" UX models[1]. An AI is probably, to most people, an agent that continues to think and learn when it is not being interacted with—by surfing the internet, maybe—such that it can generate novel outputs, and revise its own previous beliefs, with no user-visible step that would be perceived as "re-training." Something that will come to you with thoughts it has had that you'll find relevant, that were inspired by new data the agent has acquired not derived from your input.
A simple example that people would probably think of as "AI" (and which people wouldn't accept as a UX paradigm unless it was presented to them through an agent-based interface) would be a spam filter like GMail's that learns from the classifications of everyone who uses it, that would go back and reclassify messages that it now had a more refined opinion on. Nobody would want a dumb algorithm to take emails that "were" in their inbox and move them over into their spam folder—that's destructive!—but they'd accept a (virtual) secretary using their judgement to do so. Thus, AI.
[1] https://scifiinterfaces.wordpress.com/category/active-academ...
it may be the case that 'intelligent' is just a word used to make humans feel special things about mammalian brains, but it's also consistent that we overestimate the difficulty of the abilities that add up to 'intelligent'. It's the difference between moving the goal posts and having our perspective changed so that we realize that the goal is further away than we thought.
What people want to see is artificial general intelligence, currently that is not possible.
Does running human software on biological hardware make it sentient, or would the same be true on other forms of hardware?
That hardware is just doing what it's been told to.