Researchers at Alphabet's (GOOG 0.87%) (GOOGL 0.75%) Google DeepMind identified six levels of artificial intelligence (AI). All six levels have been achieved with "narrow" AI, which addresses only well-defined tasks.
The highest level of narrow AI is superhuman ability. Google's AlphaFold has already demonstrated superhuman skills in predicting 3D models of protein structures. Its AlphaGo has beaten the best human players at the complex game of Go.
Development is underway for technology that goes beyond narrow AI. And it could be the biggest AI game changer of all.
Coming soon?
Building artificial general intelligence (AGI) is the holy grail for AI researchers. Whereas narrow AI focuses only on specific well-defined tasks, AGI encompasses a wide range of tasks and includes learning new skills. Importantly, it usually refers to performing these tasks as well as humans or better than humans.
Some experts predict AGI could be coming soon. Google DeepMind co-founder and chief AGI scientist Shane Legg estimates a 50% chance AGI could be developed by 2028. Anthropic CEO Dario Amodei expects AI that performs at human levels will be available within the next two to three years. OpenAI CEO Sam Altman thinks AGI will be built in the next four to five years.
The most advanced large language models today such as Google Gemini and OpenAI's GPT-4 exhibit some attributes of AGI. These models probably fall into level one of general AI based on Google DeepMind's classification framework -- emerging AGI.
AGI holds the potential to accelerate scientific progress dramatically on multiple fronts. It could radically change the global economy. It could also make some investors a boatload of money.
Top stocks that could profit from AGI
With such a massive opportunity possibly on the way, several companies are scrambling to develop AGI. Unsurprisingly, Alphabet ranks among the leaders with its Google DeepMind unit. DeepMind has pioneered several major advances in AI, including the transformers that made models such as ChatGPT possible. (The "T" in GPT stands for transformer.) Google has also invested $2 billion in Anthropic, another AGI developer to watch closely.
NASDAQ: GOOGL
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Alphabet could profit from AGI in several ways. It could use the technology to power virtual assistants that revolutionize (and possibly replace) search engines. AGI could be integrated throughout Google Home devices. Google Cloud could host AGI apps for customers. The company's Waymo unit could use AGI to improve its autonomous vehicles.
OpenAI is another top AGI contender. You can't invest directly in the company; arguably the next best thing is to buy shares of Microsoft (MSFT 0.43%), which is a major investor in OpenAI. However, OpenAI's current license agreement with Microsoft specifically excludes rights to AGI technology.
NASDAQ: MSFT
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That doesn't mean Microsoft won't be able to benefit from OpenAI's AGI advances, though. I suspect that it will. If so, the company would likely be able to monetize AGI in several of the same ways as Alphabet, including hosting AGI apps on its Azure cloud platform.
If you're looking for a "pick and shovel" alternative to invest in AGI, Nvidia (NVDA 2.94%) could be up your alley. The company's graphics processing units (GPUs) are currently the gold standard in powering AI apps. Nvidia's heavy investments in research and development could allow the company to remain on top if and when AGI is developed.
NASDAQ: NVDA
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AGI could also help Nvidia make better chips. CEO Jensen Huang said earlier this year that the company's chips "can't be designed without AI" today. Huang, by the way, predicts that AGI could arrive within five years.
A reality check
Now for a reality check. It's possible that the predictions of AGI being ready in the near future could be overly optimistic. Some experts think it could be decades before we have AGI. Even Google DeepMind's Legg, who expects AGI might arrive in a few years, believes it will take decades for AGI applications to be developed across the full spectrum.
In the meantime, practical issues such as premium valuations could cause one or more of these AGI stocks to underperform. Over the long run, though, if AGI achieves its potential, Alphabet, Microsoft, and Nvidia could be even bigger winners than they've been in the past.
