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AI in 2025: Experts Predict a Bursting Bubble, More Regulation, and New Developments

Vytautas Kirjazovas

2025-01-092 min read

Over the last few years, artificial intelligence, especially generative AI (Gen AI), has attracted enormous investments, stirring up huge expectations. Co-founder of Technosophics Adi Andrei, research fellow at University College London (UCL) Ali Chaudhry, both of whom are members of Oxylabs’ AI/ML Advisory Board, and the company’s CEO Julius Černiauskas agree that there will be obstacles for a continuation of this hype in 2025. Yet, the experts also expect the upcoming year to be marked with exciting developments in AI and machine learning (ML) as well as other tech fields.

Prospects of diminishing returns and a bursting bubble

Experts predict that in 2025, companies and investors will have to lower their expectations regarding what Gen AI and large language models (LLMs) can do. According to Ali Chaudhry, in some cases, technology is not as scalable as expected.

I think we will see diminishing returns in the capabilities of LLMs. Some AI labs are already hinting that scaling laws are not as effective anymore.

Ali Chaudhry, Research fellow at UCL

Chaudhry names increasing regulation and general concerns regarding the dangers of AI as factors that will play into taming the Gen AI enthusiasm.

I am predicting more regulations for controlling the negative impact of Generative AI. Generally, 2025 will be very important for AI Safety, and we will see a lot of work (technical and non-technical) in this space.

Ali Chaudhry, Research fellow at UCL

Oxylabs has been spearheading AI adoption in the web intelligence solutions industry. Its CEO, Julius Černiauskas, seconds Chaudhry’s caution regarding AI’s growing scrutiny.

Responsible AI and Green AI will become even bigger topics next year as we are more used to the technical capabilities of AI. Servers that support AI development put a strain on the environment, and there are many risks flowing from a lack of transparency in how AI is developed and functions. AI companies must answer these concerns to earn and keep public trust in the benefits of this technology.

Julius Černiauskas, CEO at Oxylabs

Adi Andrei, who has over 25 years of experience in AI/ML and data science, including in NASA, is more skeptical about the future of Gen AI.

The Gen AI bubble will most likely burst in 2025. I was talking about the hype going away last year, but the new influx of money pumped into it without any proof of ROI transformed the dying hype into a bubble about to burst big time.

Adi Andrei, Co-founder of Technosophics

Andrei also points to the example of Tom Siebel, CEO of C3.ai. Siebel has been quoted saying about AI, “The market is vastly overvaluing it,” and “Absolutely there’s a bubble.” According to Andrei, this sentiment is shared by many Silicon Valley CEOs and experts.

There is also a rising movement of ordinary people from diverse professions, such as writers, artists, computer scientists, engineers, and philosophers, who found common ground against the (gen) AI paradigm. This has raised awareness within the general population of the irreconcilable issues posed by technology and the fact that it is being forced onto people by billionaires and their organizations.

Ali Andrei, Co-founder of Technosophics

Exciting developments around the corner

Nevertheless, the experts foresee emerging technologies and positive developments manifesting next year. For Andrei, progress in decentralization technologies, rather than AI, will be fascinating to follow.

2025 will be a year of paradigm changes in the social system, and we will see the emergence of technologies - including information technologies - to facilitate a decentralized way of life and of building community, most likely decentralized social networks, local currencies, and so on.

Ali Andrei, Co-founder of Technosophics

Being an AI researcher and founder of ResearchPal, an AI-powered tool for academic research, Chaudhry foresees “more AI contributions for scientific discovery.

I think 2025 will be a big year for multi-modal models, especially text-to-video models, which will improve significantly in terms of the length of videos, their quality, and their obedience to the laws of physics. We might get some interesting insights into the inner workings of deep neural networks in foundational models.

Ali Chaudhry, Research fellow at UCL

Černiauskas is hopeful for advancements in automated machine learning (AutoML), which opens this field for those without specialized ML expertise by delegating ML development to algorithms.

AutoML is a crucial step toward democratizing machine learning and AI. With more experts in diverse fields being able to create ML tools tailored to their needs, AI and ML adoption in business can accelerate and open new possibilities. Thus, companies have all the reasons to invest in AutoML, and we might see impressive results already in 2025.

Julius Černiauskas, CEO at Oxylabs

About the author

Vytautas Kirjazovas

Head of PR

Vytautas Kirjazovas is Head of PR at Oxylabs, and he places a strong personal interest in technology due to its magnifying potential to make everyday business processes easier and more efficient. Vytautas is fascinated by new digital tools and approaches, in particular, for web data harvesting purposes, so feel free to drop him a message if you have any questions on this topic. He appreciates a tasty meal, enjoys traveling and writing about himself in the third person.

Learn more about Vytautas Kirjazovas

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