Artificial Intelligence (AI) and Quantum Computing
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We talked recently about how the possibility of artificial intelligence creating the world’s next trillionaire would only be realized if some company provided one or more of the following; AI hardware, AI software, or AI as a Service (or as we’ve decided to coin it, AAS). Someone said recently that the worst AI algorithm can become the best AI algorithm if you feed it enough delicious big data so let’s consider AI software and “big data” as synonymous. The company that has the best data therefore, also has the best algorithms. This may be the most compelling reason to think that Google is the current leader in AI.
Regardless of which companies develop the best AI algorithms, they’ll all need hardware. One of the reasons AI is here now, today, is because of Nvidia GPUs that allow for artificial intelligence algorithms to run at a viable speed. You’ll recall recently we talked about computational drug discovery startup Numerate, and the fact that running their algorithms on a single desktop would take 10,000 years, whereas cloud hardware allows for the same calculations to take place in just hours. Of course this reminds us of the value proposition that quantum computing poses. A problem that would take current computing systems billions of years to solve could be solved in seconds. A startup called D-Wave has a quantum computer available now at a $10 million price point. The D-Wave 2000Q system is a remarkable contraption that is cooled to 180x colder than interstellar space:
There was an article published last week by MIT Technology Review titled “Google’s New Chip Is a Stepping Stone to Quantum Computing Supremacy“. (When we talk about “quantum supremacy”, we are referring to the first time a quantum computer proves that it can do something that a classical computer can’t – like simulate chemical structures.) In that article, a principal investigator in the MIT quantum computing research group said in relation to quantum computing that “Google is one of the leaders” and “it’s pretty comparable between Google and IBM“. While everyone seems to be focused on what D-Wave is getting up to, we have Google and IBM leading the race along with other companies like Microsoft and Intel. Here are the various approaches being taken best described in this brilliant graphic that was recently published in Science Magazine:
Here’s an update on the progress each of these giant tech players are making:
- Google (NASDAQ:GOOG) – After 8 years’ work, a 25-strong group of Google engineers has made a new quantum chip that they hope to demonstrate before the end of the year. If successful, this will be a benchmark for all other quantum computers to come.
- Intel (NASDAQ:INTC) – A team of quantum hardware engineers in Portland, Oregon are working to develop a quantum computer using silicon. According to an article by MIT Tech review late last year, they can “now layer the ultra-pure silicon needed for a quantum computer onto the standard wafers used in chip factories“.
- Microsoft (NASDAQ:MSFT) – The company has 35-40 engineers working on a “topological quantum computer” for the past decade, a method described in this article by Nature as “a more tortuous route than its rivals”. Their method won’t need extensive and expensive error correction and there’s no ETA yet for when we can expect something.
- IBM (NYSE:IBM) – On March 6th, IBM said they will roll out the world’s first commercial ‘universal’ quantum-computing service called “IBM Q” which will be unveiled this year, will be cloud based, and accessible over the internet for a fee. Currently, you can tool around with building algorithms for quantum computing using the IBM Quantum Experience. 40,000 users have run over 275,000 experiments so far on the tool which you can access via this link.
It’s tempting to think that some superior architecture is hiding somewhere waiting to spring out and improve the performance of AI algorithms exponentially. Then, said startup will proceed to have an IPO and then go on to create the world’s first AI trillionaire. This doesn’t seem likely. Do we really think these multi-billion dollar chip companies, all of them, will somehow not be keeping tabs on the technology and let something slip by? They’ll be aware of it no doubt, and the appeal of a successful exit by any major chip company will be hard to pass up for any entrepreneur. It’s a pretty safe bet that one or all of these companies will develop a quantum computer, so then what?
In the early 2000s, for example, people thought it would take about 24 billion years to calculate on a quantum computer the energy levels of ferredoxin, which plants use in photosynthesis. Now, through a combination of theory, practice, engineering and simulation, the most optimistic estimates suggest that it may take around an hour. – Alex Bocharov, Nature Magazine Interview, October 2016.
With a quantum computer that is 100 millions times more powerful than classical computers, we could do things like simulate your entire body digitally and create custom drugs specifically for whatever ailment you might have. More importantly though, we could fire up some AI agents on those quantum computers and make them create better instances of themselves. Can you even begin to imagine what that might look like? Using synthetic biology, we could literally create anything. Remember how Bryan Johnson talked about how one day we might be able to “grow spaceships”? We could grow a dyson sphere and start to harness all of the energy from our star to power even bigger computing machines.
You think that’s crazy? Not as crazy as the founder of D-Wave, presumably a brilliant man who is mentally stable, claiming that with quantum computers, we can “start to exploit parallel universes by reaching into them and pulling out their computing power“. Why can’t society spend more time talking about these amazing ideas instead of “social media”?
Yes, those are the sorts of doors that artificial intelligence and quantum computing will open up. Whichever company nails that technology first will have a head start that just might create a gap so wide that no other quantum computer could ever close. This implies that there may only be one winner, and that winner will create those AI trillionaires Mark Cuban was talking about. As investors, it might not be a bad idea to get some skin in the game here. Even if all 4 companies fail at developing a quantum computer, they’re all still solid investments.
The superior chipset for AI doesn’t have to come from one company though. One analogy would be how AMD and Intel both thrived throughout the majority of the desktop computing era.
Conclusion
Right now, Nvidia has put their stake in the ground and all but claims that they are the AI hardware company. Other startups are trying to come up with AI chips that are optimized for artificial intelligence to get a piece of that pie. If you’re an investor in Nvidia, you need to be aware that things can change in a hurry. Technology moves at an incredible speed and there is nothing that guarantees Nvidia can keep their market share. If any one of these 4 tech giants unveil the world’s first quantum computer this year, and then starts to use it to improve itself, the entire AI landscape could shift. Owning shares in all 5 of these tech companies doesn’t seem like a bad idea.
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Overhype in this words…
We may have to respectfully disagree with you on this one. These four tech giants are making good progress and two are expected to unveil something this year – IBM and Google. Both have cognitive computing capabilities and it’s not a stretch to think that a priority will be to start running these on quantum computers. We’ll have to wait and see.
We always appreciate feedback from our lovely readers!
Would you guys still recommend investing in TURN (formerly Harris and Harris Group) for quantum computing, or has that ship sailed?
You won’t find us recommend that you invest in anything… except maybe a well-diversified portfolio of DGI stocks, a robo-advisor, or a broad market ETF, all of which offer low fees and good diversification.
With that said, we don’t have any exposure to D-Wave at all but there are 3 ways to as seen below:
https://nanalyze.com/2016/05/3-ways-to-invest-in-d-wave-stock-right-now-pre-ipo/
You can also see the below article which looks at D-Wave’s impact to NAV for TURN:
https://nanalyze.com/2015/01/investing-in-quantum-computing-with-tiny-and-d-wave/
The ideal way to do that would be through buying their shares directly which is a $25K USD minimum.
At some point we’ll take another look at TURN to see what they’ve been getting up to and how they are presently valuing their D-Wave investment (you should find that in any of their filings).