Will artificial intelligence affect how much you pay for basic goods and services?

Source- infoworld.com

It’s easy to imagine artificial intelligence as a force that makes existing technology more convenient or more powerful, or as one that opens the door to entirely novel possibilities. But one overlooked effect could dramatically change our society, and how we live in it: the costs of goods and services.

Thanks to AI-empowered technology, we may soon be headed for a post-scarcity society, in which the basic goods and services we need to live and be happy are so inexpensive and/or easy to procure, they might as well be free. But is this vision too optimistic, or is it feasible to hope for?

Consolidation of hardware

We’re already seeing the drastic cost-reducing potential for AI in the consolidation of hardware. Though some tech reviewers have criticized the “new normal” price point for smartphones being $1,000, the reality is smartphones have replaced dozens, if not hundreds of other single-function devices, including everything from portable stereos to flashlights to TVs, not to mention personal computers. The average person has more computing power and more high-tech functionality in his or her pocket than even the wealthiest family had back in the 1990s. If that trend continues, we’ll see even more functionality in even cheaper, smaller devices.

Energy and resources

AI will also be capable of making energy much less expensive to produce and store. The average consumer already has access to hundreds of products capable of reducing the amount of energy they consume, including “smart” appliances like refrigerators, which can optimize and automate certain functions to keep energy costs low. On a bigger scale, AI algorithms can make clean, renewable energy sources (like wind and solar) more efficient, ultimately reducing the cost of production, and the costs of producing and distributing food products.

Insurance payments

Though not the first area of cost reduction that people think of, AI has the power to greatly reduce the cost of insurance in all areas, including health insurance and auto insurance. Refined algorithms can more specifically calculate an individual’s risk factors, giving them the best possible rate for any policy. Plus, advanced algorithms can lower the risk of needing to file an insurance claim. For example, AI-powered self-driving cars have the potential to greatly reduce the risk of collisions, which in turn would make insurance dramatically cheaper for everyone, and advanced algorithms in the medical field can detect instances of cancer and other complex illnesses sooner, reducing the total costs associated with curing or treating those illnesses.

Data

Many modern tech companies exist on the premise that consumer data is more valuable than any single product or service they could offer; estimates put the average value of a customer’s data over the course of a year to be $240 at a minimum—and probably much more valuable than that. This is why it’s free to use apps like Facebook and Google.

In the future, AI algorithms will be so sophisticated and tech companies will be so mature that the value of consumer data will be much higher, and the average consumer will provide more data with every digital interaction. At that point, tech companies may be interested in providing consumers with smartphones and other devices for free, with the intention of collecting enough data to counteract the costs of production and distribution.

Transportation

We alluded to the effects of AI on the transportation industry a bit in our section on insurance, but it pays to do a somewhat deeper dive. The big breakthrough here will be self-driving technology, which could transform not only the average consumer’s car-based commute, but public transportation as well. With a fleet of always-ready self-driving (presumably electric) cars at the ready, street congestion could be greatly reduced, the cost of car ownership would be better distributed, parking needs would disappear, and the average cost per trip would be much lower (since no driver would be necessary). Consumers will also have more time to focus on other tasks, whether it’s working productively or enjoying themselves, which can improve both productivity and quality of life.

Health care

Health care costs will likely remain high for the foreseeable future, but gradually, AI will gain the power to reduce those costs. Proactive screenings can be automated, AI algorithms will detect conditions faster (and more reliably), and certain surgeries could be performed without the need for an expensive doctor.

A jobless, moneyless future?

Technological optimists have been painting a vision for a future where jobs aren’t necessary (or common), while their opponents have criticized this idea as either ludicrous or destructive (or both). But the reality is, we’re already seeing enormous progress toward reduced costs. If followed to its natural conclusion, it’s only a matter of time—whether that’s years or decades—before we find ourselves in a post-scarcity society. The time is now to start thinking about what that future could look like, and how we should form our economies and social structures around it.

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