Krishna's Bold Bet on Commodified AI

IBM CEO Arvind Krishna is navigating the company through the AI boom, which he believes requires taking bold risks. 'I actually think that trying to muddle along without taking risk is the riskiest path,' he says.

Krishna took over as CEO and chairman in 2020, just as the AI market was gaining momentum. He thinks that in the end, models will become commodities, with most of the value accruing to companies like IBM that build applications on top.

However, this prediction has yet to fully pan out. IBM's shares have nearly doubled since Krishna took over, but they tumbled 25% in July as customers shifted spending from mainframes to AI infrastructure. The company's reputation working with enterprises in highly regulated sectors will be an advantage, according to Krishna.

Krishna believes that proprietary data will be a differentiating factor rather than raw model-power, and that trust becomes key. He thinks IBM can differentiate itself by leveraging its expertise and experience in the enterprise sector.