Warren Buffett says he dumped a third of his IBM stock
money.cnn.com
money.cnn.com
I'm not sure how much of an impact a contract of this size has on IBM's value, but it indicates to me that their competitors are a contract renewal away from being absorbed by IBM.
Watson is trying to force a solution to a typically unknown problem and not the reverse. Projects like this always fail. IBM has failed to make a cloud presence with there own products. Buffet's own investing rules is to understand the product, so maybe he's finally coming to his senses even IBM doesn't understand it's own products and the market demand.
It's a solid business plan if you ask me. There's a lot of money to be made on outsourcing operations that don't need to be in the US.
"What they [IBM] have run into is some pretty tough competitors. And What I would say is Amazon, which, I've never seen a guy succeed in two businesses simultaneously that are really divergent in terms of customers and operations [Retail and AWS]"... he then praises Jeff Bezos even more.
Question/quote starting at around 11:00
Amazon could apply their same principles of cost-effective retail, logistics and software to IT to come up with a cloud. It's not a huge leap or anything. Just requires different talent hired to focus on the concept with same principles. It helps that the competition that did pay on demand for enterprises kept prices up and tech proprietary as much as possible. Not too unlike some of Amazon's retail competition in brick and mortar.
The old quote "Nobody ever got fired for choosing IBM" had some truth to it, as IBM was the safe default choice. In the cloud, the truth seems to be "Nobody ever got fired for choosing AWS". AWS is the safe default choice... you'd really need a good reason to go with IBM in the cloud.
Edit: Given that this is HN, I suppose I should clarify that I'm using "AI" as a catch-all term for Machine Learning/Language Processing/Deep Learning/etc. I apologize for any confusion or emotional distress my use of a commonly understood general term apparently caused...
But look at how slowly they have evolved. Siri is barely better than she was 5 years ago. I haven't seen Watson really do much beyond the same language processing and information lookup stuff it did on Jeopardy years ago. The other assistants are somewhat evolved versions of Siri. But they all require special coding to teach them any new task. None of them is really anything like true AI. They are AI only in the sense that they are programs which appear to exhibit intelligent behavior in a very narrow and specific role, like an AI opponent in a video game. But I strongly believe we are not appreciably closer to true AI than we were 10 years ago. We are just in another bubble like the 80s because the people with money don't understand the massive gap between Siri and Hal.
The voice recognition of digital assistants has gotten decent (for appropriate speakers and languages). But we don't seem to be remotely close to, for example, a digital assistant that can compete with the most marginally competent human admin--even for digital-native tasks.
Watson does do marketing well. There may be some domain-specific tasks, e.g. in medicine, that it turns out to be good for. But, again, at IBM's scale the business opportunity has to be huge to move the needle.
The Jeopardy game was marketing. The Kasparov game was marketing. Both were very impressive, but they were marketing.
I think it is telling that whenever anyone mentions IBM and AI near each other in speech that mention of a public AI project (see:marketing demo) is usually just a moment away.
It would be much more impressive to me if someone once said "Oh Company X saves Y amount using Watson" or "Watson tech enables X" which are examples that are easy to come up with when speaking of IBM's competitors.
Determining product-market-fit, and go-to-market strategy are also 'marketing.' Most of the time (and, definitely in this case), when people use the term 'marketing' on HN, it is better replaced by promotional/advertising which are much more specific/ meaningful.
I don't think we need human level intelligence to have a more real intelligence. After all there is not just one tier of human intelligence, even among "normal" human brains. A toddler isn't very intelligent compared to an adult.
For me the difference is between:
A: A piece of software designed to fulfill a narrow task which appears to be intelligent to those who don't know how it works.
B: A piece of software which can actually understand and reason in some capacity about things more generally and especially does not need explicit programming to add new features.
As per my previous comment, I think Siri, Watson, Alexa, etc. are applications which appear intelligent as opposed to actual AI because they do not really understand anything. They appear to understand things, but it's a trick. They understand the command "Give me directions to Starbucks." but only in the same sense that bash understands "egrep -r 'PizzaController' ./bloated-app/classes". bash only knows those are arguments that get passed into the egrep program. The current assistants are just audio command lines.
This is a long way of saying; yes I guess you could say that I think only "general AI" is real AI. That's because anything short of that, at least that we've seen so far, is just really applications that appear intelligent but aren't in any real sense intelligent. Importantly, like I said before, I don't think they've moved us forward toward general AI. Look how slowly they have advanced and the techniques used to create them, other than the voice processing and voice responding, are not techniques that will lead to general AI, because all the features are explicitly individually coded. Which is something you absolutely cannot do for general AI.
EDIT:
I realize it sounds like I'm just shitting all over Alexa, Siri, etc. but I don't mean to. They are useful pieces of software, but I think they are over hyped by calling them AI and especially how the media and certain people who should know better take them and say "strong AI is just around the corner!"
The whole "AI is just around the corner!" thing has happened in the past (the last major investment boom being in the 80s), and I see no reason to be any more optimistic about this one. Our computers are more powerful and our datasets are bigger, but I don't see any techniques that are revolutionary, and the datasets and computer power are still a joke compared to a human brain.
From the Wikipedia article on Artificial Intelligence: "In computer science, the field of AI research defines itself as the study of "intelligent agents": any device that perceives its environment and takes actions that maximize its chance of success at some goal."
Is a thermostat an AI?
Something something...AI...once it's understood...
You think AI is something like "true AI", I think a toaster that exhibits a basic decision tree is AI, which of us is right? There's just no way to know, we've come to an impasse :)
We should stop using the term since every decade AI applies to a different set of techniques and tools, and the old ones become standard algorithms and data science.
Edit: typo
To your question, the hospital wasn't "done" with teh effort and is still shopping around for IBM Watson competitors as a substitute to go forward with.
[0] https://www.wsj.com/articles/hospital-stumbles-in-bid-to-tea...
Yeah seems pretty damning, at least for that effort given how much money was spent. Perhaps not damning Watson's capacity, but without a good integration strategy you can have the best AI on the planet and it'll be a race car without any gas.
From the article: "He also added IBM "wasn't responsible" for integrating Watson with MD Anderson's new electronic medical records."
Also: "The way medical information is stored and labeled can differ widely, even between departments at the same institution, he said. For instance, "there's no standard way to record a heart rate, a blood-glucose value or temperature measured at the bedside," he said. If the way data is stored or labeled changes, often the artificial-intelligence software must be retrained, he said. "
All valid complaints, but clearly IBM failed to properly consider the implementation challenges. That's never a good thing from a business perspective.
Although I agree, I'm sure the 5 layers of clueless, infighting management deserve no blame. There's too much dead wood for even the best CEO to make a difference
What market segment is he talking about, and who are the competitors?
IBM made a push to be a cloud provider fairly early on. However, aside from the fruits of its Softlayer acquisition, none of that has really panned out--at least not at a scale relevant to IBM's financials.
Also, Power is not selling that well in the mid-range segment. The new workloads are being designed for horizontal scalability which is where Linux comes in.
If I was a Bluemix head honcho I'd create a twin foundry 'Hobbymix' free for all, no questions asked, no credit cards, no resource limits, watson enabled, just play and get addicted with all the cool toys. Then when you're ready, just transfer it all to our enterprise-ready, pro-version at Bluemix with pro level support.
That's how MS took the world by storm. That's how Android is taking it from Apple who's ignoring the poor bases focusing only in the 10% which in the long run will cost them the whole market. That's how Whatsapp took the messaging markets.
Technology is a winner takes all approach, like Google or Facebook. You have to have the whole world using your services no matter what, whether they bring money in or not. Then you can figure out how to milk them, how to show them your new toys and convince them to pay for them, or at least how to praise you for being the cool guy on the block. They have the resources, they need the vision.
I still have test pages I developed on Google App Engine a decade ago. It costs them nothing for I seldom use them, but they have a loyal follower and I go to them for my quick hacks. Instead, Bluemix first didn't allow me to have test pages, now they allow me but with a warning that they will be deleted after a year, plus they charge me for everything I try to use like databases. Bye Bluemix, moved to Heroku now for my tests with free space and free databases. Now you want me to use your new free database? Too late. See? Make it all free, everything, and I may give it a last try once again.
Some may say they focus on enterprises because hobbyists are an annoyance. Sure we are, but we also are the ones who write blogs, twits, who shake the social webs. And people listen to us.
Do you want to know why I learned Python? Because it was free on Google App Engine. Why I learned Go? Free on Google. Why Java? Free on Google. So with the tools I know, where do you think I'll go to try my next ideas? Yep. Google. Now, let me try Swift on Bluemix, then Kotlin, then Rust, then DB2, then Watson, then I'll go to build whatever new project I need on your platform, with your tools. I won't go before, I'll go during and after I learn them. But not on your platform if you won't let me try it.
So, tl;dr; open Bluemix for the whole world to try with an eternal free tier without limits or expiration dates and I'll go with you to try all your new toys. Then we'll help you conquer the world, again.
But even if you do, the horrible documentation, bad configuration and sheer technical debt apparent in those products will make you run for the hills ASAP. Because that's what happens when you're best devs leave, and then you fire the average ones to keep your stock price up.