(Bloomberg) -- In IBM Chief Executive Officer Ginni Rometty’s vision of the near future, all businesses will need artificial intelligence to succeed, but software and machines will take jobs away from very few actual humans.
“There’s so much fear-mongering around what AI is,” Rometty said in an interview at Bloomberg’s Sooner Than You Think conference in New York. “When it comes to complete job replacement, it will be a very small percentage; when it comes to changing a job and what you do, it’ll be 100 percent.”
Rometty said the issue of skills is “front and center” in the U.S. now, even without considering the impacts of AI. She reiterated her view that education has to be “fundamentally revamped” in this country for “the era of man and machine.”
Rather than a dystopian vision in which robots rule the world, Rometty sees AI, or cognitive computing as IBM calls it, as a tool for humans to make better business decisions. And there’s a $2 trillion market for that, Rometty said.
Every company owns troves of data that can be used to train algorithms to identify pertinent insights, she said. That proprietary information gives companies a competitive advantage, and can provide a boost to those businesses with long histories and lots of institutional knowledge that are threatened by fast-moving upstarts.
“I am betting that the incumbents will come roaring back when they realize they have those advantages,” she said.
For her part, Rometty, 60, said her legacy at the 106-year-old International Business Machines Corp. is to leave it “reinvented for this next era so it will live on for the next 100 years.” While she has reached the traditional retirement age for IBM CEOs, Rometty has said she plans to stay at her post for a while because her work to transform the company isn’t finished.
Since taking over as CEO in 2012, Rometty has been working to reposition Big Blue as a purveyor of cloud-based technology and services, distinguished by a focus on selling large businesses applications using artificial intelligence techniques. The shift has required significant investment and pushed down profit, even as Rometty has assured investors that IBM is also focused on being a high-value company. Revenue has fallen for 21 straight quarters, showing that IBM has yet to offset declines by adding new business. Investors are keen for tangible results, especially with Watson, the brand encompassing IBM’s AI products.
“Watson is exactly where we thought it would be,” Rometty said. She highlighted Watson’s achievements in health care, noting that by the end of the year Watson will be trained on what causes 80 percent of the world’s cancers. The company doesn’t provide data on Watson’s sales.
Because IBM is such a big business -- booking almost $80 billion in sales in 2016 -- expectations for Watson to grow the company “two times are unrealistic,” Rometty said. It takes time to teach Watson algorithms on data from industries including health care and finance, and the whole AI era still early, she said.
But pressure for results has mounted, particularly as one-time IBM champion Warren Buffett changed his tune on the company. Buffett, who first took a stake in 2011, said this spring that the competitive landscape IBM faces is more intense than he originally thought, leading him to lower his valuation of the company. Berkshire Hathaway Inc. cut its stake in the company by about 30 percent and is no longer the biggest shareholder.