AI Consumer Products: The Road to Maturity
Three years into the generative AI boom, it’s clear that most AI startups are finding success in selling to businesses rather than individual consumers. While general-purpose language models like ChatGPT have been embraced by consumers, specialized consumer GenAI applications have yet to gain traction.
Chi-Hua Chien, co-founder of Goodwater Capital, noted at a recent JS event that early AI applications in video, audio, and photo were exciting until new models like Sora and Nano Banana emerged, disrupting the market. This shift reminds him of the evolution of the flashlight app, which was initially popular before becoming integrated into iOS.
Chien believes that AI platforms need time to stabilize before groundbreaking consumer apps emerge, likening the current state of consumer AI to the early days of mobile platforms before the rise of giants like Uber and Airbnb.
Google’s Gemini, a competitor to ChatGPT, signals a step towards stabilization in the consumer AI space, according to Chien.
Elizabeth Weil, founder of Scribble Ventures, agrees with Chien’s assessment, describing consumer AI applications as being in an “awkward teenage middle ground.” She suggests that the next evolution in consumer AI may require a new device beyond the smartphone.
Both Chien and Weil believe that the smartphone’s limitations, particularly its lack of ambient presence, hinder the full potential of AI consumer products. Startups and tech companies are exploring new personal devices to replace smartphones, such as screenless pocket-sized devices and smart glasses controlled by gestures.
However, not all AI consumer products will rely on new devices. Chien envisions personalized AI financial advisers, while Weil anticipates “always-on” personalized tutors delivered through smartphones.
Despite the excitement surrounding AI’s potential, both Chien and Weil express doubts about the emergence of AI-powered social networks where bots interact with user content. Chien questions the viability of turning social networking into a solitary experience, emphasizing the importance of human connection in social interactions.
