This year’s SXSW Sydney whirlwind blended tech, creativity, film and music, dissecting AI’s dual-edged potential; from Mo Gawdat’s humanity debate to demos of generative platforms and visions of efficiency-fuelled creativity. Yet, through casual chats, in between sessions a pattern emerged: most attendees and even some of the presenters’ applications of AI were superficial, tactical and far from transformative.
In a conference like SXSW my expectation is that the people attending and speaking would be at the forefront of surfing the wave of adoption, yet my observation and quick polls revealed most people are using tools like co-pilot to assist in drafting emails or ChatGPT assisting them to remodel their backyards.
These are fine personal use cases but hardly transformational and certainly far from integrated holistic workflows and the panacea of efficiency for businesses. In one session on rewiring creativity, the focus was on efficiency gains – automating rote tasks – rather than leveraging AI for emergent, human-AI hybrid creativity.
Low-level engagement at a conference like SXSW is a concerning canary in the coalmine of the broader AI landscape. While the tools are incredibly accessible, most businesses and employees are barely scratching the surface, treating AI like a novelty gadget rather than a foundational shift, leading to burnout from poor prompts, inaccurate outputs, and integration headaches.
This superficial adoption signals the peak of the hype cycle, where inflated expectations outpace underwhelming execution, much like the booms and busts of VR, blockchain, NFTs, and the early internet.
People are dabbling, not diving in, resulting in reports of up to 80 per cent AI project failures in enterprises, talent shortages for skilled prompt engineers and ethicists, and mounting regulatory scrutiny over hallucinations and biases.
Investors poured billions into AI startups last year, but without deep adoption, those valuations will face reality checks. The bubble bursts not because AI doesn’t work, but because we’ve overhyped its ease.
Hype outpacing substance breeds disillusionment, and superficiality ensures the gap between promise and payoff only widens.
At Paper Moose we are building our entire tech stack from first principles and adding new proprietary tools like Moose Review (creative testing tool powered by synthetic panels) into our systems and processes.
We have spent a lot of time ensuring these tools and systems are adopted, by building capability, through fostering an experimental mindset and an openness to trial and error, which is admittedly relatively easy for a team of 30.
But the result is a seismic shift in how we operate and collaborate with technology. I thought from our bubble in Surry Hills we were the norm, but post SXSW I feel like we may be an outlier in how we are using and embracing AI, amid the futurism, the real conversations were about integration pains, or people just plain stumped as to where to start.
So what does this mean? It might mean some valuations are going to tank but the technology itself certainly isn’t; and for companies that commit to the mindset shift they will reap the rewards.
As the bubble bursts, the survivors will be those who move beyond low-level tinkering to strategic depth. This means investing in systems and processes trained on proprietary data, building and inventing, blending AI with human intelligence for ethical, creative outputs, and measuring impact beyond vanity metrics.
At SXSW, glimmers of this emerged in sessions on augmented intelligence, where AI amplified human creativity rather than replacing it. The future isn’t AI solo. It’s hybrid teams pushing boundaries, much like the event itself: a chaotic mix of ideas yielding profound insights. Three day work week? Maybe.
Nick Hunter is co-founder & CEO of Paper Moose
