AI’s Hidden Power: Former Google CEO Says We’re All Missing the Point

Eric Schmidt doesn’t believe the AI hype. In fact, he thinks AI isn’t hyped enough.

Speaking in a recent TED talk, the former Google CEO argued that while most people fixate on AI’s language skills, they’re completely missing its rapidly advancing planning and strategy abilities—capabilities that could reshape society entirely.

“Most of you think of AI—I’ll just use the general term—as ChatGPT,” Schmidt said during his talk. “This was two years ago. Since then, the gains in what is called reinforcement learning, which is what AlphaGo helped invent, allow us to do planning.”

Schmidt’s view comes at a time when public fascination with AI remains basically squarely focused on text generation. But he insists that AI’s trajectory extends far beyond writing clever emails or summarizing documents, helping increase our productivity on many levels..

“You’re seeing the arrival, the shift from language to language. Then you had language to sequence, which is how biology is done. Now you’re doing essentially planning and strategy,” Schmidt explained.

“The eventual state of this is the computers running all business processes.”

The economic impact could be huge—Schmidt claims up to 30% per day when AI agents are globally adopted—but he pinky promised we mere mortals will still have some use. “Humans are unchanged in the midst of this incredible discovery. Do you really think that we’re going to get rid of lawyers? No, they’re just going to have more sophisticated lawsuits. Do you really think we’re going to get rid of politicians? No, they’ll just have more platforms to mislead you,” he quipped.

More do, less talk

While most consumers marvel at chatbots, Schmidt pointed to systems like OpenAI’s o3 and Deepseek R1 that demonstrate sophisticated planning abilities—going “forward and back, forward and back” to work through complex problems.

These reasoning models and research agents can play a big role in major financial decisions. For example, he explained how he’s using AI to learn more about the space industry now that he has heavy investments in the field.

“In my case I bought a rocket company because it was interesting, and it’s an area that I’m not an expert in and I want to be an expert, so I’m using deep research and these systems are spending 15 minutes writing these deep papers,” he explained. “It’s extraordinary.”

Schmidt’s view mirrors that of other AI experts who have raised similar concerns about the public’s narrow focus on language models. Yann LeCun, chief AI scientist at Meta, has repeatedly stated that current large language models lack essential capabilities such as understanding the physical world, persistent memory, reasoning, and planning.

LeCun, however, predicted earlier this year that a “new paradigm of AI architectures” would emerge within five years, with a stronger emphasis on planning and reasoning capabilities. His proposed Hierarchical Joint Embedding Predictive Architecture (H-JEPA) aims to enable AI to plan sequences of actions to optimize objectives.

The difference between current chatbots and truly intelligent systems, experts suggest, lies in planning—the ability to map out a strategy, anticipate consequences, and adjust accordingly.

Beyond technical challenges, Schmidt frames AI development as a high-stakes competition between the United States and China—one with potential to trigger global conflict.

“The competition between the West, particularly the United States, and China is going to be defining in this area,” Schmidt said.

The race has already begun to reshape global trade, with an ongoing tariff war started by U.S. President Donald Trump affecting critical supply chains. Besides tariffs, the U.S. restrictions on China’s access to advanced chips, has pushed Chinese researchers toward algorithmic efficiency and betting on local technology that America has already tried to prevent other countries from using.

Schmidt insists this is an actual problem that’s already taking a pivotal presence in war rooms. “These conversations are occurring around nuclear opponents today in our world. There are legitimate people saying the only solution to this problem is preemption,” he claimed. “The foreign policy people have not thought about this. And this is coming (…) probably in 5 years.”

Dreams Amid Dangers

Despite these grave concerns, Schmidt maintains cautious optimism about AI’s potential benefits.

In education, Schmidt envisions personalized AI tutors for every person on Earth. He also argued that healthcare, physics, materials science, all stand to benefit from AI’s analytical powers, and he urged everyone to adopt the technology to stay relevant.

“My advice to you all is ride the wave, but ride it every day. Don’t view it as episodic.”

As a good old tech CEO, the former Google chief urged everyone to adopt AI. “Each and every one of you has a reason to use this technology. If you’re an artist, a teacher, a physician, a business person, a technical person—if you’re not using this technology, you’re not going to be relevant compared to your peer groups and your competitors.”

And just like OpenAI once equated its product to life-changing inventions like the wheel, and the fire, Schmidt assured there won’t be anything as important as AI in the next thousand years.

“The arrival of this intelligence, both at the AI level, the AGI, which is general intelligence, and then super intelligence, is the most important thing that’s going to happen in about 500 years, maybe a thousand years, in human society. And it’s happening in our lifetime,” he assured.