AI Déjà Vu: Learning from the Internet Era
Why AI is even a bigger moment that the Internet moment
The Internet Moment
In the late 1990s, as the Internet emerged, 99% of organizations viewed it merely as an additional distribution channel—an "online presence moment" for their existing offline businesses & established business model . However, the visionary 1% organizations recognized the Internet not just as a tool, but as the foundation for entirely new business models.
The 99% undoubtedly reaped the benefits, with online sales becoming a valuable new revenue stream for businesses worldwide. However, if you examine the dominant businesses of the 21st century, most emerged from the visionary 1%—not the 99%. These were the companies & founders that didn’t just adapt to the Internet but fundamentally reimagined entire industries and business models around it. Google, Amazon, Facebook, and AOL are prime examples—organizations that leveraged the Internet not as an add-on, but as the very foundation of their success.
The best example of this shift is Netflix. Reed Hastings recognized early on that the future of entertainment was streaming. However, in 1997, when he co-founded Netflix, internet bandwidth was too limited for high-quality video streaming. As a strategic move, he launched Netflix as a DVD rental-by-mail service, anticipating that technology would eventually catch up. When broadband speeds improved, Netflix pivoted fully to streaming, fundamentally transforming the entertainment industry.The AI moment
AI represents a similar transformative moment—arguably an even bigger one. Once again, 99% of companies view AI primarily as a tool for automation and operational efficiency. While this is valuable and can enhance their bottom line by 2–5%, it is not the playbook for industry leadership. The true winners of the AI era will be those who go beyond efficiency gains and fundamentally rethink their businesses in the age of intelligence.
We've already seen this play out with OpenAI, which recently raised $40 billion at a staggering $300 billion valuation. Another striking example comes from the pharmaceutical industry. Instead of using AI merely to build chatbots for HR and finance, pharma giants are leveraging it to tackle their most critical challenge—drug discovery. AI is revolutionizing how pharma companies come up with candidate molecules for diseases, accelerating breakthroughs that were once unimaginable.Bottom Line
CEOs/Founders/Boards must recognize that AI is not just another cloud or mobile moment—it is a tectonic shift.
The responsibility for business strategy has always rested with the CXO team, starting with the CEO/Founders. AI cannot be an exception.
Your CTO, CIO, and CXO team have decades of experience with deterministic software. AI, however, is stochastic. This changes everything.
So, what should every CEO/Founder/Board do?
We will address this in our next post.