Though many executives and analysts are trying very hard to figure out which firms benefit most from generative artificial intelligence and AI in general, the prior experience of firms with the internet suggests there also will be losers.
And those losers could come from industries focused on digital and physical products such as “print” media, as our experience with the internet suggests.
Study Title | Authors | Year | Focus | Key Findings |
How the Internet Changed the Market for Print Media | NBER | 2019 | Impact on print media | Household adoption of broadband significantly reduced print readership and circulation, leading to revenue decline for newspapers. |
The Impact of the Internet on Media Industries: An Economic Perspective | Oxford University Press | 2008 | Economic impact on media | The internet weakens intellectual property protection, making it easier to distribute content illegally and reducing potential revenue. |
Similar losses can be noted in retailing as well, with a shift from place-based and physical retail to online retail.
Study Title | Authors | Publication Year | Key Findings |
The Impact of E-Commerce on Retail Employment | Autor, D., Dorn, D., Hanson, G. | 2017 | Found that increased e-commerce adoption led to job losses in retail sectors most susceptible to online substitution (e.g., electronics). |
Omnichannel Retailing and Customer Engagement: A Review of the Literature | S. Verhoef, M. Kannan, P. Bharadwaj | 2009 | Highlights the importance of omnichannel strategies for retailers to enhance customer engagement and satisfaction in today's digital age. |
The Impact of Online Shopping on Brick-and-Mortar Stores | T. Van den Poel, R. Verhoef | 2003 | One of the earlier studies exploring the potential negative impacts of e-commerce on traditional brick-and-mortar retailers. |
Advertising has seen some of the greatest shifts from the internet, though. 
Source: Gemini
Put simply, digital now claims up to 82 percent of all U.S. ad placements and revenue. Print has declined from 42 percent to less than three percent. Linear video dropped from 38 percent to 16 percent. Radio dipped from 10 percent to half a percent.
Channel | 1996 (Billions) | 1996 (%) | 2023 (Billions) | 2023 (%) |
Print (Newspapers, Magazines) | 80.0 | 42.1% | 10.0 | 2.7% |
Linear Video (TV Broadcast, Cable) | 72.0 | 37.9% | 60.0 | 16.2% |
Network Radio | 10.0 | 5.3% | 2.0 | 0.5% |
Other (Radio Spots, Out-of-Home) | 28.0 | 14.7% | 18.0 | 4.9% |
Digital Ads (Search, Social Media, Display) | - | - | 300.0 | 81.7% |
It might be reasonable to expect the content industries, advertising and retailing will again be among the industries to see early AI disruptions.
Financial services might also be included on the list of industries that saw early internet disruption, and might see further challenges from AI. More recently, various forms of “sharing” (transportation and lodging, for example) also have emerged, and might see further changes from AI.
But manufacturing and pharmaceuticals seem poised for AI disruption as well. On the other hand, construction might see relatively low amounts of disruption.
Industry | Potential AI Impact | Drivers |
Manufacturing | High | Robots can handle repetitive tasks, improve precision, and optimize production processes. AI can also be used for predictive maintenance and quality control. |
Transportation | High | Self-driving vehicles, logistics optimization, and automated traffic management are all powered by AI. |
Customer Service | High | Chatbots and virtual assistants can handle routine inquiries, freeing human agents for complex issues. |
Finance | High | Algorithmic trading, fraud detection, and risk assessment can be significantly enhanced with AI. |
Healthcare | High | AI can assist in medical diagnosis, drug development, and personalized medicine. |
Retail | Medium | AI can personalize recommendations, optimize inventory management, and automate tasks like pricing and promotions. However, the human element in customer service and product selection might remain crucial. |
Legal | Medium | AI can analyze legal documents, predict case outcomes, and streamline research tasks, but human judgment will likely remain essential for legal proceedings. |
Education | Medium | AI-powered tutors can personalize learning experiences, but human teachers will likely remain central for guidance and social interaction. |
Media & Entertainment | Medium | AI can personalize content recommendations and automate content creation tasks. |
Construction | Low | Manual labor and on-site decision-making are still crucial aspects of construction, making widespread AI adoption less likely. However, AI can be used for design optimization and project management. |
Hospitality | Low | The human touch remains essential in hospitality, but AI can automate tasks like booking and guest communication. |
Arts and Culture | Low | Human creativity and emotional connection are central to the arts, making AI unlikely to replace artists entirely. However, AI can be used for artistic exploration and content creation tools. |
Right now, attention is logically focused on industries and functions that are susceptible to AI automation. But equally big changes could come if AI allows competitors to enter markets in new ways. Think ridesharing and peer-to-peer lodging.
And there always is the possibility that new industries are born. Think search and social media.
No comments:
Post a Comment