close this bookVolume 1: No. 21
View the documentNews -- research funding; technology transfer
View the documentNews -- software industry
View the documentNews -- information industry
View the documentNews -- information services
View the documentNews -- AI in MIS
View the documentNews -- job opportunities
View the documentNews -- new journals; calls for papers

The AI freeze appears to be thawing a bit. Most of the Fortune 500 companies are still actively involved in expert-system projects, and are starting to see the benefits. One survey showed that 43% plan increased spending on AI applications. (Harvey Newquist says that the average project -- other than at DEC and Ford -- is under 100 rules at takes six weeks to six months for development.) Case-based reasoning is also being used. There is little activity yet in neural networks, machine translation, or voice recognition, but expert-system development tools are starting to sell better than in the last five years. Paul Harmon says that the best companies can expect 40% growth in 1991 and 50- 60% in 1992. Most AI analysts foresee 20-30% annual sales growth through the end of the century. MIS managers will be looking for practical solutions, though, and will demand delivery on multiple, conventional platforms. [Barbara Francett and Charles Burton, Computerworld, 7/29.]

The same issue of Computerworld listed some of the strategies currently pursued by AI vendors. Aion Corp. (Palo Alto, CA), with $18M revenue in '91, is going after the Fortune 1000 market. AI Corp. (Waltham, MA), $22.5M, maintains close ties with IBM users. (Either company could be badly hurt if IBM enters the AI market.) Inference Corp. (El Segundo, CA) is de-emphasizing LISP and moving to workstations and mainframes -- funded in part by a $5.5M infusion from J.P. Morgan & Co. Intellicorp (Mountain View, CA) didn't make the move from LISP soon enough, and is suffering from a 50% drop in revenue. Syntelligence (Sunnyvale) went into Chapter 11 bankruptcy late last year. Symbolics (Cambridge, MA), on the other hand, will take in $44M this year -- down from $114.2M in '86, but not bad. Neuron Data (Palo Alto, CA) is doing well with Unix applications that run on multiple platforms. DEC will make about $50M on AI consulting, Carnegie Group (Philadelphia, PA) will take in $18M, and Alpnet, Inc. (Salt Lake City, UT) expects $23M. [Charles Burton.]

Despite the thaw, it may be too early to expect venture capital to boost the industry again. Technologic Partners (New York, NY) says that AI venture-capital investments were $65M in 1985, $0 in 1989. [Charles Burton.]