Most companies using AI are ‘lighting money on fire,’ says Cloudflare CEO Matthew Prince

The recent generative AI boom has companies across industries investing massive amounts of time and money into AI. Matthew Prince, co-founder and CEO of Cloudflare, thinks most of them are just “lighting money on fire.”

The CEO, who runs one of the world’s largest networks underlying the global internet, made the statement onstage at the Fortune Brainstorm AI conference in San Francisco Monday in response to a question about businesses experimenting with AI.

“I think most of the people in this room are affected,” he said, directing his statement at the audience.

Prince also took shots at the major cloud providers, especially Amazon, during the talk about the infrastructure-side of AI. He pointed to the shortage of GPUs as one of his top concerns about both the current infrastructure and lack of competition in AI, but argued this problem is “somewhat artificial.”

“If you look at big cloud providers, one of the decisions they made early on was to make it more expensive for you to move your data from one region to another or from one cloud provider to another. AWS, for example, marks up their transport costs 4,000 times what their underlying costs are. And what that is doing in the AI space is actually further artificially constraining access to GPUs,” he said, later adding that if the price of taking data out were the same as putting it in, “we’d have a lot more competition in the space.”

Jennifer Tejada, chairperson and CEO of cloud computing company PagerDuty, took a more optimistic stance and spoke about more high-level concerns among companies such as keeping AI strategies simple, creating a path between research and actually delivering products, and training the workforce for AI transformation, including preparing the c-suite and board members. 

Among her clients, she spoke about seeing the fear of risk keeping some companies from jumping into AI. For a straightforward approach, she suggested starting from the ground-up with employees and having them create what she calls a “toil bucket,” essentially a list of everything they hate doing that they hope AI could take off their plate.

“We found that employees that are closest to the business problems, that understand the most about the business problems, often come up with the most practical use cases,” she said.

Read more from the Fortune Brainstorm AI conference:

Box CEO Aaron Levie’s top takeaway from OpenAI meltdown: ‘Don’t have weird corporate structures’

Google VP Sissie Hsiao: the Gemini AI demo video ‘is completely real,’ though Google ‘did shorten parts for brevity’

Khan Academy’s founder says AI ‘coaches’ will soon submit essays to teachers instead of students

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