Nokia Chief Sees AI ‘Super Cycle’ Driving Long-Term Growth Despite Bubble Concerns

AI Investment Momentum to Continue

Nokia CEO Justin Hotard has declared that artificial intelligence investments are unlikely to slow down because the technology is in the middle of what he describes as a “super cycle” with massive long-term prospects, according to his recent comments to CNBC. The former Intel executive, who took over Nokia’s leadership in April, stated that AI represents a “secular growth trend for many years” that extends far beyond current applications.

Early Days of AI Adoption

Sources indicate that Hotard believes the AI revolution remains in its infancy despite significant recent advancements. “If you look at what we are doing in AI today, we are largely using LLMs for language-based applications,” he reportedly told CNBC. He highlighted several areas with minimal current penetration, including autonomous vehicles, augmented and virtual reality, smart glasses, and robotics, suggesting substantial growth potential remains untapped across multiple sectors.

Network Infrastructure Demand

The report states that AI has created “tremendous demand around the network buildout,” according to Hotard’s assessment. This perspective comes from his previous role as executive vice president and general manager of Intel’s Data Center & AI Group, giving him particular insight into infrastructure requirements. Analysts suggest this network expansion represents a significant opportunity for telecommunications equipment providers like Nokia.

Bubble Concerns Acknowledged

While expressing long-term optimism, Hotard acknowledged that some observers view current AI investment patterns as resembling a bubble. “Yes, we had a bubble in the internet, but even if you look at that over a two, or three, or five-year period, you see that bubble burst, and then you see tremendous growth well above where the bubble was,” he stated, according to the CNBC interview.

This perspective aligns with comments from other industry leaders, including Meta’s former president of global affairs Nick Clegg, who told CNBC in October that AI has “certainly got some pretty prominent features of what looks like a bubble.” Clegg pointed to an “absolute sort of spasm of almost daily, hourly, dealmaking” that could potentially lead to a market correction.

Tech Giants Double Down on AI

Despite these concerns, technology companies continue making substantial AI investments. Reports indicate that Meta CEO Mark Zuckerberg has committed to spending at least $600 billion on US data centers and infrastructure through 2028. In a September podcast appearance, Zuckerberg acknowledged that an AI bubble is “quite possible” but stated he would rather err on the side of over-investing than under-investing.

“If we end up misspending a couple of hundred billion dollars, I think that that is going to be very unfortunate, obviously. But what I’d say is I actually think the risk is higher on the other side,” Zuckerberg reportedly explained, suggesting that the potential cost of missing the AI revolution outweighs the risk of temporary over-investment., according to market analysis

Long-Term Outlook Remains Strong

According to the analysis presented by Hotard, while short-term predictions about AI are challenging, the technology‘s fundamental prospects remain robust. “It’s hard for me to predict what exactly will happen in AI on a quarter or one-year basis, but I think the long-term prospects are massive,” he told CNBC. This perspective suggests that despite potential market fluctuations, industry leaders anticipate sustained growth and innovation in artificial intelligence across multiple domains for years to come.

References

• http://en.wikipedia.org/wiki/Nokia
• http://en.wikipedia.org/wiki/Artificial_intelligence
• http://en.wikipedia.org/wiki/Intel
• http://en.wikipedia.org/wiki/CNBC
• http://en.wikipedia.org/wiki/Chief_executive_officer

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