NTT DATA CEO: The AI bubble is fading fast, but the rebound will be stronger.

The head of the Japanese IT company NTT DATA said that the potential AI bubble will deflate faster than previous technology cycles, but after the bubble bursts and enterprise applications catch up with infrastructure spending, a stronger rebound will follow. NTT DATA CEO Abhijit Dubey said in an interview that despite concerns about the supply chain, the development direction is clear. "Without a doubt, AI is a huge long-term trend," he said. "I think in the next 12 months, the market will experience some normalization... this will be a short-term bubble, and AI will come out stronger." He added that due to the demand for computing still exceeding supply, "the future two to three years, the supply chain is almost booked." Pricing power is beginning to shift towards chip manufacturers and hyperscale cloud service providers, mirroring the high valuations in the public markets. AI has sparked the biggest technological revolution since the advent of the internet, driving trillions of dollars in investments and remarkable stock gains. But it has also led to storage chip shortages, regulatory scrutiny, and increased anxiety about future work. Dubey, who also serves as the company's Chief AI Officer, said that as AI reshapes the labor market, his company has begun to reconsider its recruitment strategy. "There will obviously be implications... there may be labor mismatches in the next 5 to 25 years," he said. But he added that NTT DATA continues to recruit in various regions. At an industry conference held in New York, speakers discussed how AI could disrupt work and employment growth. May Habib, CEO of AI startup Writer Inc., said that clients are now focused on slowing down the growth in workforce numbers. "When you sign a client, and you have the kickoff call with the CEO, they might say, 'great, how soon can I cut my team by 30%?" she said. However, a global workforce survey released by PwC in November showed that the actual use of generative AI has not met the expectations of board executives. PwC pointed out that the daily usage rate of generative AI is still "significantly lower" than the levels widely publicized by executives, although employees with AI skills can on average get a 56% salary premium - more than double the figure from last year. PwC also noted that skill gaps are widening, with about half of non-managers reporting access to training resources, while this proportion is about three-quarters among senior executives.