Technology & Telecommunications

The stock market is experiencing a dramatic bifurcation. While traditional sectors surge – energy companies are up over 20 per cent and materials firms 15 per cent – a different story is unfolding in the technology and financial services sectors. Established players are watching their valuations crumble as investors grapple with the answers to a simple question: which companies will survive the artificial intelligence (AI) revolution? continue…

by Roger Montgomery Posted in Market commentary, Technology & Telecommunications.

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I joined Paul Turton on ABC Newcastle Mornings to discuss the recent volatility in global markets, driven by U.S. tariffs, political uncertainty and rapid developments in artificial intelligence (AI). I explained that because the U.S. represents around 30 to 40 per cent of global market capitalisation, what happens there inevitably affects Australia, and heightened uncertainty is making investors less willing to pay elevated valuations. continue…

by Roger Montgomery Posted in Companies, Radio, Technology & Telecommunications.

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How do you produce a ball of wool? Pull on the thread of a woollen jumper! What was once a fine, handmade piece of clothing can quickly become a jumbled mess on the floor, and all one has to do is pull on the thread.

I wonder whether that’s a fitting metaphor for what’s going on in equity markets right now. continue…

by Roger Montgomery Posted in Market commentary, Technology & Telecommunications.

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Investors around the world are desperately trying to discern the future, and in particular, the impact of artificial intelligence (AI) on it.

On the one hand, you have the hyperscalers warning of an apocalyptic future involving mass layoffs, business collapse and the creation of an omnipotent AI god.

Anthropic CEO Dario Amodei says we’re nearing “the exponential”, where AI generates trillions of dollars and the economy grows 10-20 per cent a year. At the same time, Amodei says this new force with God-like abilities, requires regulation around “AI safety.” continue…

by Roger Montgomery Posted in Market commentary, Technology & Telecommunications.

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I joined Juliette Saly on Ausbiz to discuss how AI-generated content is becoming so hyper realistic that it is increasingly difficult to distinguish from reality.

For investors, this pace of improvement highlights both the extraordinary power of the technology and the speed at which competitive advantages can erode. If breakthroughs are emerging globally and alternative approaches reduce reliance on massive chip and data centre buildouts, the dominance and pricing power currently assumed for some AI leaders may not prove as durable as markets expect. continue…

by Roger Montgomery Posted in Technology & Telecommunications, TV Appearances.

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Recognising this isn’t the first time I have expressed concern about the ultimate fate of humans in an artificial intelligence (AI) world, I pondered several AI-related questions over the weekend. 

The first is that if many, and maybe most, of us are using AI already – and some very effectively – with existing infrastructure, how many more data centres do we really need? Flipping the question, if the competition among AI agent providers is driving the cost of AI access down to zero – many use Google’s Gemini daily, and it costs nothing – for what purpose are a thousand more data centres really being built?

The second question is related: AI tools are already so ubiquitous and cheap they amount to a commodity. Consequently, AI infrastructure players may believe that to make any money, they’ll have to race to be the first to create something dangerously powerful. continue…

by Roger Montgomery Posted in Market commentary, Technology & Telecommunications.

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Another week, another artificial intelligence (AI) powered disruption. This time, two big announcements from China that may threaten the valuations of the big U.S. hardware-centric tech giants. 

The news

First, the release of AI-produced hyper-realistic movie-quality video from the Chinese company ByteDance-owned AI Seedance 2.0 has gone viral and simultaneously rocked Hollywood by completely reframing what the movie industry thought was possible. continue…

by Roger Montgomery Posted in Market commentary, Technology & Telecommunications.

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The artificial intelligence (AI) industry is currently grappling with what some experts call a ‘trillion-dollar math problem’. The numbers might not stack up because customers might simply lack the funds to spend on AI tools to allow hyperscalers to achieve a decent return on their AI infrastructure investment.

With hyperscalers projected to spend US$3 trillion on AI infrastructure by 2029, the market faces a substantial revenue gap. To justify current valuations and maintain reasonable margins, AI services would need to generate revenue equivalent to 10 per cent of the entire U.S. Gross Domestic Product (GDP) of US$30 trillion. This represents a massive commercial risk; if expectations of an adequate return on investment in two or three years evaporate, this historic capital expenditure risks producing a multi-trillion-dollar overcapacity. continue…

by Roger Montgomery Posted in Market commentary, Market Valuation, Technology & Telecommunications.

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I joined Paul Turton on ABC Mornings to discuss how AI is evolving beyond simple prompts into autonomous agents that can act on our behalf, but warned that market expectations may be getting ahead of reality. With trillions set to be spent on infrastructure, current valuations imply adoption levels that look ambitious, raising the risk of overcapacity and corrections, particularly as AI begins to disrupt the software as a service model and pressure established data and information providers.

Listen from 36:40 here: ABC Newcastle Mornings

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by Roger Montgomery Posted in Market commentary, Radio, Technology & Telecommunications.

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Former CEO, public speaker and author, Jay Grewal once said, “When it comes to the final nail in your coffin, it doesn’t matter if it’s dull or sharp, it’ll still hold, because a lifetime of prior nails have helped seal that coffin shut.”

In what may prove to be merely another accumulated nail in the coffin of the artificial intelligence (AI) boom, the narrative on Wall Street shifted dramatically last week as the tech-driven optimism that has fueled the market for years hit a psychological and structural barrier. continue…

by Roger Montgomery Posted in Market commentary, Technology & Telecommunications.

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