The Fallacy of the AI Bubble or the New Digital Feudalism

This article was written by Esteve Graells

Lately, entering almost any blog, YouTube channel, or similar platform means encountering a recurring topic: the artificial intelligence (AI) bubble.

Astronomical investment figures, the almost miraculous rise in valuation of certain graphics card and server memory companies, and the excessive euphoria surrounding any product labeled “AI” have set off alarm bells. Many analysts, still bearing the scars of the 2000 dot-com crisis, warn that this house of cards could collapse at any moment.

In this context, I want to be very clear: the bubble does not concern me. In fact, I believe that the more investment there is, the faster we will advance toward solving problems that we once considered unsolvable. What many call a “bubble” is, in reality, the largest capitalization effort in human history to build an infrastructure that will change absolutely everything.

In this context, I want to be very clear: the bubble does not concern me.

For me, the real issue is not stock prices, but who is consolidating this power and how a new technological oligarchy is taking shape—one that threatens to leave civil society and governments exposed or overwhelmed.

The Mirror of History: The Price of Civilization

History teaches us that no technological revolution has arrived quietly or with cautious budgets. In the 19th century, the world experienced the railway boom.

Enormous fortunes were invested, entire family estates were lost, and many railway companies went bankrupt. From a strictly financial perspective at the time, it was a devastating bubble. But when the dust settled and the speculators left, the tracks remained—and they enabled the birth of the industrial era.

The “bubble” is therefore the necessary mechanism to accelerate the future.

The same occurred with the internet bubble at the beginning of this century. Billions were burned on ideas that made little sense, but the capital deployed allowed the installation of thousands of kilometers of fiber optics that now sustain our digital economy. The “bubble” is therefore the necessary mechanism to accelerate the future. The more capital injected into AI, the faster medical, energy, and productive solutions will arrive. Private investment is the indispensable engine, and instead of fearing it, we should celebrate its boldness.

The Real Risk: The Technological Oligarchy

This is where the debate must take a critical turn. While economists worry about the volatility of NVIDIA, OpenAI, or Microsoft stock, society should focus on who owns this infrastructure. We are witnessing the consolidation of a technological oligarchy: an ultra-reduced group of corporations that control not only software, but also hardware (chips) and the massive server farms required to run it.

This concentration of power places us at the threshold of a new “digital feudalism.”

This concentration of power places us at the threshold of a new “digital feudalism.” If the entry cost to develop cutting-edge AI is so high that only a few hands can “play,” democracy weakens. We are no longer speaking of companies competing in a free market, but of an elite that owns the “castles” of knowledge and computation, forcing the rest of humanity to become mere vassals who pay tribute—in the form of subscriptions and data—to access intelligence.

The Privacy of the Soul: Control of Intimate Data

This oligarchy is not only accumulating money; it is gathering the most precious treasure of our species: our intimacy. Until recently, big tech companies knew what we bought. Now, through AI, we are handing over ultra-sensitive data in real time. Every time we interact with a language model or generative AI, we reveal patterns of thought, fears, emotional insecurities, and often preventive medical data that we ourselves have not yet processed.

Can we allow such deep information about our psychology and biology to be exclusively in private hands? A company’s primary objective is shareholder profit, not the common good.

Without public infrastructure guaranteeing sovereignty over this data, the technological oligarchy will possess unprecedented power of manipulation in history: it will have everything it needs to exercise authoritarian control.

Where Is the State in Building This New “Electric Grid” of Intelligence?

This is where my criticism turns toward the public sector. Where Is the State in Building This New “Electric Grid” of Intelligence? Europe has chosen a commendable but reactive path: regulation. We are leaders in establishing ethical limits through the AI Act, but regulating without production capacity turns us into a museum with many rules but no future of our own.

In Spain, interesting steps have been taken with the creation of AESIA (Spanish Agency for AI Supervision) and the intention to promote AI in Spanish. In Catalonia, we have the Barcelona Supercomputing Center (BSC), a true crown jewel housing MareNostrum, one of the most powerful computers on the planet. Initiatives such as the Aina project, which ensures Catalan remains a fully recognized language in the digital era, are examples of necessary sovereignty.

But it is not enough. The public sector cannot limit itself to managing subsidies or acting as a client of the technological oligarchy. We need public computing and data infrastructure as accessible to a regional hospital or a small business as running water is today. We need talent trained at our universities to innovate on a sovereign and public foundation, without having to surrender control of their innovation to a Silicon Valley giant simply due to insufficient computing capacity.

Conclusion: A New Social Contract

The goal of these lines is not to call for caution in investment. On the contrary: I call for more investment, more boldness, and much greater speed. The more innovative it is, the more diseases we will cure, the more autonomous vehicles we will see, and the less time we will spend on repetitive tasks.

The AI revolution is our generation’s great opportunity to solve the major challenges of the 21st century, from climate change to high-quality longevity.

Investment is the engine, but sovereignty must be the steering wheel.

We cannot allow this revolution to be hijacked by a technological oligarchy while we debate whether stock prices are too high. My debate is not whether there is a bubble; my debate is whether we will be free citizens in an era of shared intelligence or mere subjects of an algorithmic monopoly.

Investment is the engine, but sovereignty must be the steering wheel. It is time for the public sector and civil society to stop watching from the sidelines and start building their own foundations. The future does not belong to those who invest the most, but to those who ensure that the fruits of that investment become a common good for all humanity.