Alibaba Ramps Up AI Spending in Pursuit of AGI

In the next three years, Alibaba will spend more on artificial intelligence (AI) than it has in the last decade.

AI played a key role in the Chinese conglomerate’s earnings call Thursday (Feb. 20), with management saying the company’s AI investments are based on the primary goal of achieving artificial general intelligence (AGI). The company’s stock soared following the report, which showed revenues up 8% year over year.

“We aim to continue to develop models that extend the boundaries of intelligence. Why is that the primary aim?” Eddie Wu, the company’s CEO, said during the earnings call. “Well, it’s because all of the visible AI application scenarios today that we see around content creation, search and so on and so forth have arisen precisely as a result of the ongoing extension of those boundaries, and we want to keep pushing out those boundaries to create more and more opportunities.”

Beyond that, he added, pursuing AGI can contribute to business value, noting studies which have shown that the standard for AGI is artificial intelligence that can replace or achieve 80% of human capabilities.

“Well, around 50% of global GDP is manpower salaries, including both intellectual or mental work and physical labor,” Wu said.”So if AGI can be achieved, then that could have a tremendous impact in terms of restructuring industry around the world and could have a significant influence on or even replace 50% of global GDP.”

As PYMNTS wrote earlier this year, most of the world’s biggest tech players have made developing AGI a goal, including OpenAI, Google and Meta.

OpenAI CEO Sam Altman “fanned the flames” — as that report said — at the start of the year when he wrote on his personal blog that the company is “now confident we know how to build AGI” as the technology has been traditionally understood.

“Achieving AGI would have big implications for business. For example, one AI system can analyze market trends while simultaneously redesigning the supply chain to adapt to those changes,” PYMNTS wrote. “It can handle customer service while using those interactions to inform product development. It can manage operations while developing innovative solutions to efficiency problems. It can make strategic decisions by synthesizing information across multiple industries and domains, which requires high-level general reasoning.”

Alibaba’s earnings come on the heels of the news that the company was working with Apple to help that company launch the latest AI-powered version of the iPhone in China.