Former Cisco Systems CEO John Chambers, who led the company through the internet boom and subsequent crash of the late 1990s and early 2000s, sees parallels between that era and today’s surge in artificial intelligence (AI) investments. Chambers reflected on his experiences as Cisco’s leader during a period when the company’s market value soared from about $15 billion in 1995 to $550 billion by March 2000, before plummeting more than 80% after the dot-com bubble burst.
Chambers recounted that time as “the worst of my career,” though Cisco later stabilized under his leadership. The company has not returned to its peak valuation since then.
Now serving as chairman emeritus at Cisco and working as a venture capitalist focused on AI startups, Chambers shared his thoughts with The Associated Press about current trends in technology. He noted similarities between the AI boom and the internet era but highlighted key differences.
“Absolutely. There are a lot of parallels but there are also some spectacular differences. AI is moving at five times the speed and will produce three times the outcomes of the internet age. In the internet age, a startup would develop products for two years and then in year three, they would take that out into the market. Today, AI startups develop the product in a month and sometimes in a week, and then they bring it to market in one or two quarters,” said Chambers.
He cautioned about potential overexuberance: “In the internet age, there was an irrational exuberance on a really large scale. In this AI one, there is a lot of tremendous optimism that does indicate a future bubble for certain companies. Is there going to be train wreck? Yes, for those that aren’t able to translate the technology into a sustainable competitive advantage, how are you going to generate revenue after all the money you poured into it?”
On concerns regarding job displacement due to AI advances, Chambers stated: “It happened with the internet. The problem this time is that if I am right about AI moving at five times the speed of the internet, we are going to destroy jobs faster than we can replace them. Will we be able to replace them over time? Yes, but there is going to be a drought while we have to re-educate lots of people.”
When asked if this worried him, he replied: “Big time!”
To address these challenges, Chambers emphasized changes needed in education systems: “We need to change education. Entry-level jobs, both white and blue collar, are going to disappear fast. We are creating more productivity, but we have to create more jobs as well. If companies start making more money, they are either going to increase the dividend or invest in new areas. Hopefully, the majority will invest in new areas to create new jobs.”
He predicted significant shifts among major corporations: “You will see successful companies expand and grow dramatically, but you are probably going to see 50% of Fortune 500 companies disappear and 50% of executives of Fortune 500 disappear. They won’t have skills to adjust…because they were trained…to move at speed of five-year cycle as opposed to twelve-month cycle.”
Chambers described current conditions as highly unpredictable: “It’s most uncertain time on global basis ever. I would argue this is new normal…you have reinvent yourself which most CEOs don’t know how do especially with AI.”
Discussing Big Tech’s relationship with President Donald Trump during his second term he commented: “Let’s be realistic. Silicon Valley moved right; there shouldn’t be any doubt…They did it for economic reasons…regulation was getting out control…China was plainly beating us.”
The interview comes amid heightened attention on how enthusiasm around artificial intelligence has contributed significantly to stock market gains globally.
