The deflationary unit economics of AI

One of the big discussion themes is how AI will scale up and impact us all. Is it a bane or a boon ?
It's instructive to look at the unit economics.
As the AI systems scale, the cost of producing additional outputs - whether it's content, decisions, insights, or services - drops sharply, often approaching zero
The rapid rollout of AI tools by tech giants such as Meta, Google, TikTok and Amazon, aims to replace much of the work traditionally carried out by ad agencies.
Artificial intelligence was hardly a recognized concept in 1956, when leading computer scientists gathered at Dartmouth College for a summer conference.
The term had just been coined by John McCarthy in the event's funding proposal—a visionary attempt to explore how machines might one day use language, solve problems like humans, and even improve themselves.
The group's bold founding belief was bold 'Any feature of human intelligence could ,in principle , be so precisely described that a machine can be made to simulate it.'
That is now a reality. Or is it ?
Meta, which owns Facebook and Instagram, with its 'Infinite Creative' is giving AI-powered, automated, scalable ad creation and optimization.
It's part of Meta's strategy to make advertising more efficient and performance-driven by combining machine learning, personalization, and automation.
Amazon Ads now offers
generative AI
tools that enable brands to create their own ads and dynamically allocate budgets in real time across both linear TV and streaming platforms.
This has major economic and societal implications.
Here's an expansion:
A) Near-Zero Marginal Cost
Once an AI model is trained (often at high upfront cost), it can generate results :text, images, predictions and code at almost no additional cost per unit.
AI doesn't tire, forget, demand higher wages, or require physical resources to scale its output.
B) Productivity Increases Without Proportional Cost
AI tools allow individuals and companies to do more with less.
A single employee with AI assistance can produce the output of a team, reducing the need for large headcounts and pushing prices down.
C) Market Pressure to Lower Prices
As more businesses adopt AI, competition forces everyone to reduce prices. Advertising , Media Buying, Design , Education, Legal services and other knowledge-based industries are vulnerable.
The question remain on the value of Differentiation, Trust, Curation and authenticity of Human experience.
The system is efficient.
The output is infinite.
But will a rolling tear on a cheek still produce poetry?

Try Our AI Features

Explore what Daily8 AI can do for you:

Learn with AIFact CheckingText to SpeechAI Summary

Related Articles

Mint

14 minutes ago

• Mint

Google introduces AI-powered Chromebook Plus 14: Features, specifications, and more

Google introduced the Lenovo Chromebook Plus 14, a new addition to the Chromebook line-up that features upgraded hardware and AI-powered software tools aimed at improving productivity and user experience. The laptop is now available for purchase in two configurations: a 12GB RAM model priced at $649, and a higher-end 16GB RAM variant with a fingerprint scanner for $749. The Chromebook Plus 14 is equipped with MediaTek's latest Kompanio Ultra processor, which includes what Google claims is the most powerful ARM-based Neural Processing Unit (NPU) ever integrated into a Chromebook. Capable of up to 50 trillion operations per second (TOPS), the chip is built to handle a wide range of AI-driven tasks. The device also offers up to 17 hours of battery life, marking the longest battery performance in the Chromebook Plus range so far. In terms of hardware, the new Chromebook includes a number of firsts. It is the first Chromebook Plus to feature Dolby Atmos support for audio and comes with an OLED display. A fingerprint scanner is included in the higher-spec model. These additions place the device at the higher end of the Chromebook market, positioning it as a tool for users managing multiple tasks and media-related work. New on-device AI features have also been integrated. Smart Grouping, for instance, automatically organises browser tabs and documents into groups based on the user's ongoing tasks. The Gallery app now includes AI image editing, which allows users to remove backgrounds or create stickers directly from their image library with a single click. In parallel with the hardware launch, Google is rolling out several AI features across the wider Chromebook Plus portfolio. These tools are embedded directly into ChromeOS and aim to simplify everyday digital tasks. One such feature is "Select to Search with Lens", which allows users to highlight any part of their screen and get contextual information, such as similar shopping options or explanations, without navigating away from the current page. Another addition, "Text Capture", enables users to extract editable text from images, such as receipts or handwritten notes. This information can then be used to automatically populate calendar entries or generate shopping lists in Google Docs. Meanwhile, the new "Quick Insert Key" offers the ability to generate images or insert photos and emojis directly into documents or presentations, streamlining creative workflows. "Help Me Read" has also received an upgrade. Beyond summarising lengthy passages, it can now simplify dense or technical text, making it easier to understand. These tools are available to all Chromebook Plus users, regardless of model. Customers purchasing a Chromebook Plus will also receive a 12-month subscription to the Google AI Pro plan. The package includes 2TB of cloud storage and access to Google's Gemini AI in Gmail, Docs, and more. Users will also be able to launch NotebookLM, Google's AI research and writing assistant, directly from the desktop shelf. The Chromebook Plus 14 also includes custom wallpapers developed in partnership with NASA. These images depict Jupiter's auroras during different phases such as day, night, sunrise and sunset, and are exclusive to this particular device. Finally, app support has been expanded. Netflix's Squid Game: Unleashed is being optimised for Chromebooks with keyboard and mouse controls, along with exclusive in-game content. Luminar, a popular AI-powered photo editing app, is now supported on Chromebooks and is being offered free for three months with the purchase of any Chromebook Plus model. The Lenovo Chromebook Plus 14 is currently available through Best Buy

Business Standard

15 minutes ago

• Business Standard

Tech Wrap June 23: OPPO K13x, Oakley Meta HSTN glasses, Perplexity AI on X

OPPO K13x 5G with Dimensity 6300, 6000mAh battery launched at Rs 11,999 Chinese smartphone brand OPPO has launched the K13x 5G smartphone in India, starting at Rs 11,999. Powered by the MediaTek Dimensity 6300 processor, the phone features a 6.67-inch HD+ LCD display, a 6000mAh battery, and several AI-based tools to simplify tasks and enhance creative workflows. Meta has partnered with an American company Oakley, which is a subsidiary of Luxottica, to come up with a new range of smart glasses targeted at athletes or consumers who are looking for rugged smart glasses. As per Meta, the Oakley Meta Glasses offer significantly improved battery life compared to the Meta Ray-Bans, delivering up to eight hours of continuous use and an additional 48 hours via the charging case. Video recording capabilities have also been enhanced, with resolution increasing from 1080p to 3K for clearer, more detailed footage. Perplexity has introduced a new feature to its chatbot on X (formerly Twitter), which allows users to create short, AI-generated videos with sound. The feature works by simply tagging @AskPerplexity in a post and adding a short prompt. Users receive an eight-second video clip that includes creative visuals, background music and dialogue. The new feature has led to more user activity, with people trying out how creative the AI can be. Nothing has officially confirmed that its maiden over-ear headphones, the Nothing Headphone 1, will launch in India on July 1, in sync with the global release. The confirmation came via a post on X (formerly Twitter) by co-founder Akis Evangelidis, who stated, 'Headphone (1) will be launched in India at the same time as global.' WhatsApp is introducing a new feature that allows users to generate AI-powered custom wallpapers for their chats using Meta AI. As per WABetaInfo, the feature is part of the latest WhatsApp beta update for Android and will be available to more users in the coming weeks. Apple is reportedly preparing to open up a new local connectivity option for third-party apps with the release of iOS 26. According to iHelp BR, a Brazilian publication focused on Apple technologies, a new feature called Wi-Fi Aware will enable apps to discover and connect to nearby devices over Wi-Fi, even without an internet connection or shared Wi-Fi network. Chinese smartphone manufacturer Vivo has unveiled the Vivo X200 FE smartphone in Taiwan, with a global release expected soon. Powered by the MediaTek Dimensity 9300+ chipset, the Vivo X200 FE features a 6.31-inch AMOLED display with 1.5K resolution and 120Hz refresh rate. The smartphone brings IP68 and IP69 ratings for dust and water resistance and includes several artificial intelligence (AI)-backed imaging features through a triple camera set-up co-engineered with Zeiss. Apple is reportedly planning a major design overhaul for the iPhone, aiming to release a mostly glass model in time for the product's 20th anniversary in 2027. According to a report by MacRumors, citing Bloomberg's Mark Gurman, Apple may start making gradual changes as early as next year, beginning with a smaller Dynamic Island on 2026 iPhone models. These changes would align with the company's broader visual shift, hinted at through the recently announced 'Liquid Glass' design language, which debuted with iOS 26 and other platform updates. A newly introduced Microsoft's Family Safety tool is causing Google Chrome to crash on Windows, leaving users frustrated for more than two weeks. As reported by The Verge, the issue began in early June and either prevents Chrome from opening or causes it to crash immediately after launching. Apple is reportedly exploring a potential acquisition of Perplexity AI, the US-based AI start-up. According to a recent Bloomberg report, Apple executives, including mergers and acquisitions head Adrian Perica, services chief Eddy Cue, and key decision-makers in AI, have held internal discussions about making a bid for the company. Overall, the Alcatel V3 Ultra is a smartphone that one should get if they are a fan of reading. If someone's an avid reader and they are looking for a smartphone in the budget segment that can also handle some multimedia experience, then this will be the right option for them. If someone's looking for a good battery life, then too Alcatel V3 Ultra can be a good option, however, only if they are willing to compromise on the colours of the display. Artificial intelligence will reshape the job market, but the transition is likely to be turbulent, according to LinkedIn Chief Executive Officer Ryan Roslansky. In an interview with Bloomberg, Roslansky warned that while AI will create long-term opportunities, it is first set to trigger 'a ton of disruption' and 'a ton of uncertainty' for workers across sectors.

Time of India

19 minutes ago

• Time of India

Big Tech's landmark deals: Major acquisitions by Apple, Google, Microsoft, Amazon and Meta

Recent reports spotlight growing acquisition interest from major tech giants. Meta's substantial investment in ScaleAI and rumoured pursuit of other AI startups have dominated headlines. Tired of too many ads? go ad free now Meanwhile, is reportedly in early talks to acquire Perplexity AI, eyeing its advanced search capabilities. While these developments are drawing significant attention, the strategy of acquiring innovative startups remains a well-established playbook in the tech industry. The world's largest technology firms have engaged in multi-billion dollar acquisitions to expand their service ecosystems and integrate key technologies. The Big Tech – Alphabet (Google), Amazon, Apple, Meta and Microsoft – have struck landmark deals and purchased companies with both competing and complementary technologies. These acquisitions have often served as a component of their growth and innovation strategies. Here are some of the key acquisitions and investments by the Big Tech in their history. Here are one-line summaries for each acquisition, including the year and finances involved. Alphabet, the parent company of Google, bought YouTube, Motorola DeepMind and Android YouTube: In 2006, Google acquired the video-sharing platform YouTube for $1.65 billion. In 2006, Google acquired the video-sharing platform YouTube for $1.65 billion. Motorola Mobility: Google purchased mobile phone manufacturer Motorola Mobility in 2012 for $12.5 billion. Google purchased mobile phone manufacturer Motorola Mobility in 2012 for $12.5 billion. DeepMind Labs: The UK-based artificial intelligence (AI) lab DeepMind was acquired by Google in 2014 reportedly for an estimated $400 million. The UK-based artificial intelligence (AI) lab DeepMind was acquired by Google in 2014 reportedly for an estimated $400 million. Android: Google acquired the mobile operating system Android in 2005 for an estimated $50 million. Amazon bought gaming, smart home security companies Twitch: Amazon bought the video game streaming platform Twitch in 2014 for $970 million. Amazon bought the video game streaming platform Twitch in 2014 for $970 million. Annapurna Labs: In 2015, Amazon acquired Israeli chip designer Annapurna Labs for an estimated $350 million. In 2015, Amazon acquired Israeli chip designer Annapurna Labs for an estimated $350 million. Ring: Amazon acquired smart home security company Ring in 2018 for approximately $1 billion. Apple purchased Beats and Intel's modem business Beats Electronics: Apple purchased audio brand and streaming service Beats in 2014 for $3 billion. Apple purchased audio brand and streaming service Beats in 2014 for $3 billion. Intel Modem Business: In 2019, Apple acquired the majority of Intel's smartphone modem division for $1 billion. Meta (formerly Facebook) got Instagram and WhatsApp WhatsApp: Meta (then Facebook) acquired the messaging application WhatsApp in 2014 for $19 billion. Meta (then Facebook) acquired the messaging application WhatsApp in 2014 for $19 billion. Instagram: In 2012, Meta (then Facebook) purchased the photo-sharing app Instagram for $1 billion. In 2012, Meta (then Facebook) purchased the photo-sharing app Instagram for $1 billion. Oculus VR: Meta (then Facebook) acquired virtual reality hardware company Oculus VR in 2014 for $2 billion. Meta (then Facebook) acquired virtual reality hardware company Oculus VR in 2014 for $2 billion. ScaleAI: As of mid-2025, reports of Meta acquiring ScaleAI are speculative, and no official deal, year, or amount has been announced. Microsoft made the biggest gaming deal in its history Activision Blizzard: Microsoft completed its acquisition of the video game publisher Activision Blizzard in 2023 for $68.7 billion. Microsoft completed its acquisition of the video game publisher Activision Blizzard in 2023 for $68.7 billion. GitHub: In 2018, Microsoft purchased the software development platform GitHub for $7.5 billion. In 2018, Microsoft purchased the software development platform GitHub for $7.5 billion. LinkedIn: Microsoft acquired the professional networking site LinkedIn in 2016 for $26.2 billion. Microsoft acquired the professional networking site LinkedIn in 2016 for $26.2 billion. Nokia: In 2014, Microsoft bought Nokia's mobile devices and services business for $7.2 billion.