AI Is Not A Bubble, But Real Transformation Comes With Growing Pains

InnovationAI Is Not A Bubble, But Real Transformation Comes With Growing PainsByRhon Daguro,Forbes Councils Member.for Forbes Technology CouncilCOUNCIL POSTExpertise from Forbes Councils members, operated under license. Opinions expressed are those of the author. | Membership (fee-based)May 28, 2026, 07:45am EDTRhon Daguro is the CEO of authID, a leading provider of privacy-first biometric identity authentication solutions. getty​In the swirl of headlines about whether artificial intelligence (AI) is a market bubble ready to burst, the very question misses the point. To use a term from the '90s, there is "irrational exuberance” in the AI ecosystem. Valuations are crazy, start-ups appear overnight and capital chases anything tagged AI. But I believe calling the current moment a bubble oversimplifies what’s happening. We’re watching a structural revolution that slightly resembles the internet boom of the 1990s with some key differences. During the dot-com tech boom, when a lot of us cut our teeth, thousands of companies popped up and then collapsed quickly when the internet frenzy became a correction. A friend of mine remembers being on a company outing in Maui in April 2001 when all his colleagues called the East Coast to scream, “Sell!” on a morning when it looked like all the dot-coms were imploding. But the crash didn’t erase the underlying transformation that helped finance the infrastructure that now underpins every modern business. The dust left behind wasn’t a ruin, but the foundation of the digital economy that we all enjoy today. The Reality Isn't Mania—It's Foundation​​AI differs from classic speculative bubbles in that even early and imperfect deployments are creating tangible business value. Enterprises are embedding AI into workflows, enhancing productivity and even signing multi-year commitments for AI services. The joke in the 1990s was that a business plan scribbled on the back of a napkin could get you funding. But these days, cap...