We Have to Expect 70% of AI Use Cases to "Fail"

A healthy dose of humility typically is good advice for anybody who attempts to forecast the technology future, for the simple reason that we are so often wrong. 

That advice--to be humble about what could happen--might well apply to artificial intelligence as well, even if there are reasons to argue AI will have more impact that most other computing technologies. 

Consider success rates for new consumer electronics products, where success rates (wide adoption) can be as low as five percent. 

Title	Date	Publisher	Key Conclusions
Why Do Most New Consumer Electronics Products Fail?	July 3, 2024	Supply Chain Resources Group (SCRG)	Many failures stem from poor supplier selection, manufacturing quality issues, and inadequate oversight of offshore teams. Recommendations include rigorous quality control.
20+ Product Launch Statistics You Should Know in 2024	2024	G2 (learn.g2.com)	Reports a staggering 95% failure rate for newly launched products and highlights that only 20% of products survive longer than two years.
The Real Rate of New Product Failure	Various	Engineering Unleashed	Empirical studies from 1945–2004 report a failure rate of 30–49%, depending on the industry. Consumer electronics often face challenges in consistent quality and market fit.
Navigating the Pitfalls: Why New Consumer Electronics Often Fail	July 2024	SCRG	Focuses on manufacturing and supply chain challenges. Suggests steps to overcome these issues, including diversification and on-site audits.

Also, there often is a tendency to believe that the “best technology” will win, when past experience suggests there are all sorts of important drivers of adoption beyond “quality” of technology. Betamax had higher quality than did VHS, but VHS became the industry standard. LaserDisc had higher image quality than did DVDs, but lost out as the industry standard. 

Personal digital assistants never caught on. Virtually all music players other than the Apple iPod failed to gain wide acceptance, and even the iPod lost its value proposition once smartphones provided the same functionality. 

And, so far, 3D TVs and “smart glasses” have failed in the marketplace, though companies keep trying to create the replacement category for the smartphone. So far, smart watches are companions to smartphones, not really replacements, for example. 

Product	Era of Hype	Description	Reason for Failure
Betamax	1980s	Sony’s video cassette format, competing with VHS.	Lost to VHS due to shorter recording times and higher costs despite superior quality.
LaserDisc	1980s-1990s	Optical disc format for home video offering higher quality than VHS.	Expensive players, limited movie selection, and competition from DVDs.
Apple Newton	1993-1998	Early Personal Digital Assistant (PDA) by Apple.	High price, unreliable handwriting recognition, and competition from Palm Pilot. But PDAs failed, as a consumer or business product
Microsoft Zune	2006-2011	Microsoft’s portable media player to compete with the iPod.	Late to market, weak ecosystem, and inferior design compared to the iPod.
Google Glass	2013-2015	Augmented reality smart glasses with voice control and a head-up display.	Privacy concerns, high price, limited functionality, and cultural backlash ("Glassholes").
3D Televisions	2010s	Televisions offering a 3D viewing experience with special glasses.	High costs, lack of content, discomfort using glasses, and lack of compelling use cases.
Segway Personal Transporter	Early 2000s	Self-balancing personal vehicle, envisioned as a transformative urban transport solution.	High cost, impractical design for cities, and lack of consumer demand.
Blockchain for Everything	Late 2010s-2020s	Promised to revolutionize industries like healthcare, supply chains, and voting.	Limited scalability, regulatory issues, and lack of practical applications beyond cryptocurrency.
QR Code Payment Systems (Early)	2000s	Early QR code-based payments hyped for mobile commerce.	Poor user experience, limited smartphone penetration, and lack of retailer adoption in earlier phases.
Virtual Reality (Early Attempts)	1990s	Early VR systems like Nintendo’s Virtual Boy, promising immersive gaming experiences.	Poor graphics, discomfort (headaches/eye strain), and bulky equipment.
HD DVD	Mid-2000s	Competed with Blu-ray for the next-gen physical media format.	Lost to Blu-ray due to broader industry support and greater storage capacity.
Iridium Satellite Phones	Late 1990s	Global satellite phone network offering coverage in remote areas.	High cost of devices and calls, poor market timing, and competition from cellular networks.
MiniDisc	1990s-2000s	Sony’s digital audio format positioned as a replacement for CDs and cassettes.	Lost to MP3 players due to limited adoption and the rise of digital downloads.

Already, we might argue that AI has eclipsed the Metaverse, Blockchain, visual search, and even some other promising technologies because it has proven to be more versatile, immediately applicable, and capable of creating tangible benefits across a wider range of industries. 

We might also argue that is because AI seems to be a general-purpose technology, not simply a “new technology.” One characteristic of GPTs is that they wind up affecting almost all industries and life in general. 

Technology	Era of Hype	Description	Reason for Failure
Betamax	1980s	Sony’s video cassette format, competing with VHS.	Lost to VHS due to shorter recording times and higher costs despite superior quality.
LaserDisc	1980s-1990s	Optical disc format for home video offering higher quality than VHS.	Expensive players, limited movie selection, and competition from DVDs.
Apple Newton	1993-1998	Early Personal Digital Assistant (PDA) by Apple.	High price, unreliable handwriting recognition, and competition from Palm Pilot.
Microsoft Zune	2006-2011	Microsoft’s portable media player to compete with the iPod.	Late to market, weak ecosystem, and inferior design compared to the iPod.
Google Glass	2013-2015	Augmented reality smart glasses with voice control and a head-up display.	Privacy concerns, high price, limited functionality, and cultural backlash ("Glassholes").
3D Televisions	2010s	Televisions offering a 3D viewing experience with special glasses.	High costs, lack of content, discomfort using glasses, and lack of compelling use cases.
Segway Personal Transporter	Early 2000s	Self-balancing personal vehicle, envisioned as a transformative urban transport solution.	High cost, impractical design for cities, and lack of consumer demand.
Blockchain for Everything	Late 2010s-2020s	Promised to revolutionize industries like healthcare, supply chains, and voting.	Limited scalability, regulatory issues, and lack of practical applications beyond cryptocurrency.
QR Code Payment Systems (Early)	2000s	Early QR code-based payments hyped for mobile commerce.	Poor user experience, limited smartphone penetration, and lack of retailer adoption in earlier phases.
Virtual Reality (Early Attempts)	1990s	Early VR systems like Nintendo’s Virtual Boy, promising immersive gaming experiences.	Poor graphics, discomfort (headaches/eye strain), and bulky equipment.
HD DVD	Mid-2000s	Competed with Blu-ray for the next-gen physical media format.	Lost to Blu-ray due to broader industry support and greater storage capacity.
Iridium Satellite Phones	Late 1990s	Global satellite phone network offering coverage in remote areas.	High cost of devices and calls, poor market timing, and competition from cellular networks.
MiniDisc	1990s-2000s	Sony’s digital audio format positioned as a replacement for CDs and cassettes.	Lost to MP3 players due to limited adoption and the rise of digital downloads.
Technology	Era of Discovery	Description	Widespread Impact
Fire	~1.7 million years ago	Controlled use of fire for cooking, warmth, and protection.	Enabled cooking (improving nutrition), extended human activity into colder climates, and spurred toolmaking.
The Wheel	~3500 BCE	Cylindrical device enabling transportation and machinery.	Revolutionized transport (carts, chariots) and mechanical systems (pulleys, gears).
Writing	~3100 BCE	System for recording language using symbols (e.g., cuneiform, hieroglyphs).	Enabled record-keeping, legal systems, cultural preservation, and advanced trade networks.
Printing Press	1440 CE	Device for mass-producing written materials, invented by Johannes Gutenberg.	Accelerated knowledge dissemination, literacy, and cultural movements like the Renaissance and Reformation.
Electricity	18th-19th century	Understanding and harnessing electrical energy.	Foundation for modern lighting, appliances, communication (telegraph, telephone), and industrial machinery.
Steam Engine	Late 17th century	Engine using steam to generate mechanical work, pioneered by James Watt.	Powered the Industrial Revolution, transforming manufacturing, transport (railroads, ships), and urbanization.
Radio and Television	Early 20th century	Wireless communication (radio) and mass visual media (television).	Unified global communication, entertainment, advertising, and information dissemination.
Personal Computers	1970s	Small, affordable computing devices for individual use.	Revolutionized workplaces, education, entertainment, and communication, enabling the Information Age.
Internet	1980s-1990s	Global network of interconnected computers enabling communication and data exchange.	Created the digital economy, reshaped communication (email, social media), and democratized information.
Smartphones	2007 onward	Multifunctional mobile devices combining telecommunication, computing, and media.	Redefined daily life, enabling ubiquitous connectivity, mobile commerce, and digital ecosystems.
Artificial Intelligence	21st century	Systems mimicking cognitive functions (e.g., learning, problem-solving).	Transforming industries from healthcare to logistics, raising ethical considerations, and enabling automation.

The point is that we should expect 70 percent of AI-enabled innovations to fail in some major way. That doesn't mean outright inability to "work," but that the innovation fails to move the needle on value.

That might mean an innovation arguably "helps" in some way, but does not add value great term than the cost to implement.