Peter Thiel, the American venture capitalist and co-founder of PayPal, has predicted that the artificial intelligence (AI) revolution will produce fewer monopolies compared to the internet boom of the 1990s. Speaking at an event in Berlin on Thursday, where he was honored with an award from German media company Axel Springer for his influence on the digital era, Thiel suggested that AI could lead to a more competitive market with benefits distributed more evenly among consumers.

During the internet expansion of the 1990s, technology giants such as Google, Amazon, and Meta Platforms emerged, capturing dominant positions in search, e-commerce, and social media. Thiel explained that these companies benefited from significant returns to scale, leading to a "winner-take-all" dynamic where a small number of platforms controlled large market shares.

In contrast, Thiel expressed skepticism about AI following a similar path. He proposed that despite the large market potential of AI, the technology’s value might be shared more broadly, with consumers receiving a greater portion of the benefits. “I wonder if the AI thing is actually the opposite, where maybe it’s going to be extremely competitive at the end of the day,” he commented.

Others in the industry have also weighed in on AI’s market impact. Alex Karp, chief executive of Palantir, a company co-founded by Thiel, characterized large language models as “commodity products.” Karp suggested that the true economic value of AI would primarily benefit those developing the underlying chips and software necessary for operationalizing these models.

Meanwhile, Jamie Dimon, chief executive of JPMorgan Chase, noted uncertainty around AI’s potential to boost profit margins in the banking sector, but also agreed that consumers are likely to be among the ultimate beneficiaries of AI advancements.

As AI technologies continue to develop, debates persist over how the economic gains will be distributed and what form the competitive landscape might take. Thiel’s remarks add to the discourse by challenging prevailing assumptions that AI will mirror the monopolistic tendencies witnessed in the previous digital revolution.