Eric Schmidt on AI: A "Whole New Industrial Structure"

Former Google CEO Eric Schmidt believes the AI industry is not a bubble, but a "whole new industrial structure." He acknowledges that some AI executives are making "classic bubble" statements, but points to the chip market and hardware capacity as evidence of the industry's longevity. Schmidt invests in multiple AI companies and believes in the transformative potential of reinforcement learning chains.

Former Google CEO Eric Schmidt has expressed his view that the AI industry is not a bubble but rather a "whole new industrial structure." Speaking at the RAISE Summit in Paris, Schmidt acknowledged that while some AI executives are making "classic bubble" statements, he sees reason for confidence in the industry's continued expansion [1].

Schmidt pointed to the chip market and hardware capacity as specific signs of the industry's longevity. He noted that the AI industry's rapid growth, driven by investments from Big Tech and the subsequent talent war, has led to an estimated market value of $189 billion in 2023, projected to grow into a $4.8 trillion industry by 2033 [1].

While some industry experts have expressed concerns about potential overcapacity and a bubble-like situation, Schmidt believes that the hardware and chip market, particularly the demand for NVIDIA's GPUs, indicates a more sustainable future for AI. He stated, "You have these massive data centers, and Nvidia is quite happy to sell them all the chips. I've never seen a situation where hardware capacity was not taken up by software" [1].

Schmidt also highlighted the transformative potential of reinforcement learning chains, which he believes could be the defining aspects of humanity. However, he did not take a definitive stance on whether the AI industry is overbuilding or under-expanding, but he did emphasize that it is unlikely to face a bubble-level correction [1].

Not everyone agrees with Schmidt's assessment. On Wall Street, there is ongoing debate about a potential bubble in the AI market. Apollo Global Management's chief economist Torsten Sløk has warned that the stock market faces an even bigger bubble than the dot-com boom, citing AI as the primary culprit [1].

In parallel developments, DebitMyData™, founded by digital sovereignty pioneer Preska Thomas, has announced the global release of its LLM Security API Suite. This platform combines reinforcement learning with blockchain-verified digital identity, offering the first plug-and-play APIs for Agentic Logos™ and Agentic Avatars™, designed to secure AI at scale across commercial and regulatory settings [2].

The AI-driven content revolution is also reshaping marketing and SEO industries, with semiconductor giants like NVIDIA and cloud infrastructure leaders like AWS emerging as the real winners. The demand for hardware and cloud capacity to run AI systems is surging, driven by the adoption of tools like ChatGPT prompts and AI SEO optimizers. Semrush's data shows that AI Overviews now appear in 13.14% of Google searches, up from 6.49% in early 2025, with informational queries dominating 88% of these results [3].

Investors should focus on the infrastructure enabling these tools, rather than the tools themselves. The AI content revolution is a tectonic shift in how businesses compute, store data, and interact with customers, and the companies that supply the hardware and infrastructure for this shift will be the beneficiaries of a multi-trillion-dollar market. For investors, this is a long game: bet on the enablers, not the apps [3].

References:
[1] https://www.businessinsider.com/eric-schmidt-ai-market-not-bubble-2025-7
[2] https://www.prnewswire.com/news-releases/debitmydata-launches-reinforcement-learning-powered-llm-security-api-suite-to-set-new-global-ai-trust-standard-302508395.html
[3] https://www.ainvest.com/news/ai-content-revolution-semiconductors-cloud-infrastructure-growth-engines-2507/