This Week In AI Business: AI, From CapEx to OpEx [Week #16-2025]
With all the buzz in AI, and the assumption that we’re getting closer to mass adoption, in reality, we’re only at the start of a journey, where AI adoption hasn’t even scratched the surface.
And technically speaking, we’re only yet at the “CapEx phase of AI adoption.” And we won’t see actual mass adoption, which is sustainable, until we reach the OpEx phase of AI adoption.
In short, the artificial intelligence industry is transitioning from a model of heavy capital expenditure (CapEx) as organizations build infrastructure to one centered on operational expenditure (OpEx), focusing on generating sustainable revenue.
This shift is reshaping every facet of the AI landscape—from how consumers experience the technology to the competitive landscape, organizational structures, performance metrics, and business models that drive value creation.
The weekly newsletter is in the spirit of what it means to be a Business Engineer:
We always want to ask three core questions:
What’s the shape of the underlying technology that connects the value prop to its product?
What’s the shape of the underlying business that connects the value prop to its distribution?
How does the business survive in the short term while adhering to its long-term vision through transitional business modeling and market dynamics?
These non-linear analyses aim to isolate the short-term buzz and noise, identify the signal, and ensure that you can reconcile the short-term with the long-term.