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AI is setting off a great scramble for data

The Economist | August 13, 2023 

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Not so long ago analysts were openly wondering whether artificial intelligence (AI) would be the death of Adobe, a maker of software for creative types. New tools like dall-e 2 and Midjourney, which conjure up pictures from text, seemed set to render Adobe’s image-editing offerings redundant.

Far from it. Adobe has used its database of hundreds of millions of stock photos to build its own suite of AI tools, dubbed Firefly. Since its release in March the software has been used to create over 1bn images, says Dana Rao, a company executive. By avoiding mining the internet for images, as rivals did, Adobe has skirted the deepening dispute over copyright that now dogs the industry. The firm’s share price has risen by 36% since Firefly was launched.

Adobe’s triumph over the doomsters illustrates a wider point about the contest for dominance in the fast-developing market for AI tools. The supersize models powering the latest wave of so-called “generative” AI rely on oodles of data. Having already helped themselves to much of the internet, often without permission, AI firms are now seeking out new data sources to sustain the feeding frenzy. Meanwhile, companies with vast troves of the stuff are weighing up how best to profit from it. A data land grab is under way.

Demand for data is growing so fast that the stock of high-quality text available for training may be exhausted by 2026, reckons Epoch AI, a research outfit. The latest ai models from Google and Meta, two tech giants, are likely trained on over 1trn words. By comparison, the sum total of English words on Wikipedia, an online encyclopedia, is about 4bn.  It is not only the size of datasets that counts. The better the data, the better the model. 

As demand for data grows, accessing it is getting trickier, with content creators now demanding compensation for material that has been ingested into AI models.  The upshot has been a flurry of dealmaking as AI companies race to secure data sources.  Holders of information are taking advantage of their greater bargaining power.  AI firms are also gathering data through users’ interactions with their tools. Many of these have a feedback mechanism, where users indicate which outputs are useful.

As a consequence, model-builders are working hard to improve the quality of the inputs they already have. Many AI labs employ armies of data annotators to perform tasks such as labelling images and rating answers. Some of that work is complex; but much of it is mundane, and is being outsourced to places such as Kenya where labour is cheap.

There is, however, one source of data that remains largely untapped: the information that exists within the walls of the tech firms’ corporate customers. Such information is especially valuable because it can be used to fine-tune models for specific business purposes, such as helping call-centre workers answer queries or analysts spot ways to boost sales.  Yet making use of that rich resource is not always straightforward.  Nevertheless, the scramble for data is only just getting started.

3 key takeaways from the article

1. Not so long ago analysts were openly wondering whether artificial intelligence (AI) would be the death of Adobe, a maker of software for creative types. New tools like dall-e 2 and Midjourney, which conjure up pictures from text, seemed set to render Adobe’s image-editing offerings redundant.
2. Far from it. Adobe has used its database of hundreds of millions of stock photos to build its own suite of AI tools, dubbed Firefly. Since its release in March the software has been used to create over 1bn images.
3. Adobe’s triumph over the doomsters illustrates a wider point about the contest for dominance in the fast-developing market for AI tools. Having already helped themselves to much of the internet, often without permission, AI firms are now seeking out new data sources to sustain the feeding frenzy. Meanwhile, companies with vast troves of the stuff are weighing up how best to profit from it. A data land grab is under way.

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Topics:  Technology, Artificial Intelligence, Competition