IBM was one of the earliest frontlines of artificial intelligence. Known for designing some of the world’s first personal computers, the company built the first AI to beat the world champion in chess in 1997, and built the AI that won the first in 2011 at the quiz show Jeopardy I did.
In 2025, the AI Frontier looks very different. The flashiest headlines often focus on AI models created by Google, Openai and others. However, IBM’s approach is different. The company is zeroing in building smaller AI tools with a focus on reliability and helping clients apply it to specific use cases.
IBM’s strategy speaks to one side of the currently raging debate in Silicon Valley and Wall Street. Does the economic benefits from AI mainly occur in some large companies that invest billions in so-called “basic models” like Openai and Google? Or will it flow to thousands of companies to use AI to increase productivity?
Recently, the tide appeared to be facing towards IBM. At the end of January, the release of a highly efficient open source AI model by Chinese lab Deepseek has led many Wall Street analysts to see more similar technologies as they have, making it a massive US high-tech. They concluded that companies may struggle to recover their huge investments. Available cheaply elsewhere. In the same week, IBM announced its latest revenue. This has resulted in a 10% increase in bespoke AI software sales, falling below analyst expectations. Its stock rose 12% on the news, hitting an all-time high, valuing the company at around $240 billion.
Deepseek News felt like a validation of his strategy with Arvind Krishna, former leader of IBM’s research division who has been CEO since 2020. “Small models can be successful, although much less computing is applied to train them,” he said in an interview with Time. That may not be good news for the big tech companies at the forefront of AI racing, he suggests. “If you spend a 1/100th of the training cost (AI model) and you can deploy it on a much smaller infrastructure, then everyone has to be competitive, so I think it will promote different economic benefits. ” he says. “So I think it’s going to put pressure on (their) economics.”
Of course, IBM is more than just an AI company. Run cloud computing services, design all kinds of software, run consulting business, helping clients knit them all together. He is also a major investor in quantum computing research. This is a quest to build a completely different kind of computer based on quantum principles that can perform billions of times more computations than existing machines. Krishna said she is bullish that the research will soon bring about even bigger breakthroughs, and expects that “we will see something amazing happen” before 2030.
If so, Krishna can be added quickly, but much of its value comes not only to IBM, but to clients as well. However, he also said that such a breakthrough would help IBM return to its dominant position in the high-tech industry, as did IBM, as the world’s largest PC manufacturer, for much of the second half of the 20th century. I say it’s possible. “If we assume the timeline and (quantum) breakthrough I’m talking about, it gives us a tremendous position in that market and the benefits of first movers. Those technologies,” he says. . “Like I helped invent the mainframe and PC, I might have the same position on Quantum.”
This profile is published as part of the Time’s Time100 Impact Awards Initiative and recognizes leaders around the world driving community change. The next award ceremony for 100 Impact will be held in Dubai on February 10th.
