The Download: AI's impact on the economy, and DeepSeek strikes again | MIT Technology Review
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By Rhiannon Williamsarchive pageDecember 2, 2025 This is today's edition of The Download, our weekday newsletter that provides a daily dose of what's going on in the world of technology. The State of AI: Welcome to the economic singularity —David Rotman and Richard Waters Any far-reaching new technology is always uneven in its adoption, but few have been more uneven than generative AI. That makes it hard to assess its likely impact on individual businesses, let alone on productivity across the economy as a whole.
At one extreme, AI coding assistants have revolutionized the work of software developers. At the other extreme, most companies are seeing little if any benefit from their initial investments. That has provided fuel for the skeptics who maintain that—by its very nature as a probabilistic technology prone to hallucinating—generative AI will never have a deep impact on business. To students of tech history, though, the lack of immediate impact is normal. Read the full story.
If you're an MIT Technology Review subscriber, you can join David and Richard, alongside our editor in chief, Mat Honan, for an exclusive conversation digging into what’s happening across different markets live on Tuesday, December 9 at 1pm ET. Register here! The State of AI is our subscriber-only collaboration between the Financial Times and MIT Technology Review examining the ways in which AI is reshaping global power. Sign up to receive future editions every Monday. The must-reads I’ve combed the internet to find you today’s most fun/important/scary/fascinating stories about technology. 1 DeepSeek has unveiled two new experimental AI models DeepSeek-V3.2 is designed to match OpenAI’s GPT-5’s reasoning capabilities. (Bloomberg $)+ Here’s how DeepSeek slashes its models’ computational burden. (VentureBeat)+ It’s achieved these results despite its limited access to powerful chips. (SCMP $)2 OpenAI has issued a “code red” warning to its employeesIt’s a call to arms to improve ChatGPT, or risk being overtaken. (The Information $)+ Both Google and Anthropic are snapping at OpenAI’s heels. (FT $)+ Advertising and other initiatives will be pushed back to accommodate the new focus. (WSJ $)3 How to know when the AI bubble has burstThese are the signs to look out for. (Economist $)+ Things could get a whole lot worse for the economy if and when it pops. (Axios)+ We don’t really know how the AI investment surge is being financed. (The Guardian)4 Some US states are making it illegal for AI to discriminate against youCalifornia is the latest to give workers more power to fight algorithms. (WP $)5 This AI startup is working on a post-transformer futureTransformer architecture underpins the current AI boom—but Pathway is developing something new. (WSJ $)+ What the next frontier of AI could look like. (IEEE Spectrum) 6 India is demanding smartphone makers install a government appWhich privacy advocates say is unacceptable snooping. (FT $)+ India’s tech talent is looking for opportunities outside the US. (Rest of World) 7 College students are desperate to sign up for AI majorsAI is now the second-largest major at MIT behind computer science. (NYT $)+ AI’s giants want to take over the classroom. (MIT Technology Review)
8 America’s musical heritage is at serious riskMuch of it is stored on studio tapes, which are deteriorating over time. (NYT $)+ The race to save our online lives from a digital dark age. (MIT Technology Review) 9 Celebrities are increasingly turning on AIThat doesn’t stop fans from casting them in slop videos anyway. (The Verge)10 Samsung has revealed its first tri-folding phoneBut will people actually want to buy it? (Bloomberg $)+ It’ll cost more than $2,000 when it goes on sale in South Korea. (Reuters) Quote of the day “The Chinese will not pause. They will take over.” —Michael Lohscheller, chief executive of Swedish electric car maker Polestar, tells the Guardian why Europe should stick to its plan to ban the production of new petrol and diesel cars by 2035. One more thing
Inside Amsterdam’s high-stakes experiment to create fair welfare AIAmsterdam thought it was on the right track. City officials in the welfare department believed they could build technology that would prevent fraud while protecting citizens’ rights. They followed these emerging best practices and invested a vast amount of time and money in a project that eventually processed live welfare applications. But in their pilot, they found that the system they’d developed was still not fair and effective. Why?Lighthouse Reports, MIT Technology Review, and the Dutch newspaper Trouw have gained unprecedented access to the system to try to find out. Read about what we discovered. —Eileen Guo, Gabriel Geiger & Justin-Casimir Braun
We can still have nice things A place for comfort, fun and distraction to brighten up your day. (Got any ideas? Drop me a line or skeet 'em at me.) + Hear me out: a truly great festive film doesn’t need to be about Christmas at all.+ Maybe we should judge a book by its cover after all.+ Happy birthday to Ms Britney Spears, still the princess of pop at 44!+ The fascinating psychology behind why we love travelling so much. by Rhiannon WilliamsShareShare story on linkedinShare story on facebookShare story on emailPopularWe’re learning more about what vitamin D does to our bodiesJessica HamzelouHow AGI became the most consequential conspiracy theory of our timeWill Douglas HeavenOpenAI’s new LLM exposes the secrets of how AI really worksWill Douglas HeavenMeet the man building a starter kit for civilizationTiffany NgDeep DiveThe DownloadThe Download: the AGI myth, and US/China AI competitionPlus: China is considering cutting its native data centers a deal
By Rhiannon Williamsarchive pageThe Download: Big Tech’s carbon removals plans, and the next wave of nuclear reactorsPlus: ChatGPT is getting erotic
By Rhiannon Williamsarchive pageThe Download: how to fix a tractor, and living among conspiracy theoristsPlus: DOGE is no more
By Rhiannon Williamsarchive page Introducing: the body issuePlus: OpenAI's AI-powered web browser is coming
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The article, authored by Rhiannon Williams and archived December 2, 2025, synthesizes a collection of reports and articles examining the multifaceted impact of artificial intelligence, primarily focusing on its early effects on the global economy and technological developments. The core of the piece centers around the uneven adoption of generative AI, highlighting the stark contrast between the revolution experienced by software developers utilizing AI coding assistants and the limited tangible benefits seen by many other businesses. This disparity fuels skepticism regarding AI’s deep, systemic impact, echoing historical patterns of technological adoption where initial enthusiasm doesn’t immediately translate to widespread transformation.
The report details a landscape characterized by intense competition within the AI sector, with OpenAI taking the lead while facing challenges from Google and Anthropic. OpenAI’s declaration of a “code red” – a call to action for rapid improvements to ChatGPT – underscores the urgency felt within the company and its competitors to maintain technological dominance. This competitive pressure is driving rapid advancements and significant investment, albeit without a clear indication of a fundamental shift in economic productivity, at least in the short term.
Furthermore, the article examines a range of related developments across various industries and geographies. DeepSeek, a rival AI developer, is attempting to match OpenAI’s capabilities, though constrained by limited access to powerful computing resources. Simultaneously, concerns are raised about the financing of the AI investment surge, leaving questions unanswered about the sources of this unprecedented capital flow. The piece also touches on significant trends such as the increasing demand for AI majors in universities (specifically at MIT), the push for state-level regulations regarding AI discrimination (exemplified by California’s efforts), and the broader implications of AI for industries like music (highlighting the vulnerability of recorded music archives) and mobile phone manufacturing.
The report doesn't present a singular narrative, but instead reflects a complex situation of nascent technological disruption. The author demonstrates an awareness of the evolving interplay between technological innovation, economic forces, and policy considerations. The inclusion of diverse stories – from Amsterdam’s welfare technology experiment to Samsung’s tri-folding phone – illustrates the multifaceted nature of this transformation. Finally, the piece concludes with a brief, somewhat speculative, reflection on the broader implications of AI competition between the United States and China, adding a geopolitical dimension to the analysis. |