• Microsoft CEO Satya Nadella warned that AI must deliver clear societal benefits or risk losing public support
• Nadella urged AI developers to focus on improving health, education, and productivity
• Otherwise, people will reject AI energy use

Microsoft CEO Satya Nadella is concerned that if artificial intelligence doesn’t start delivering real, measurable benefits to society, people will be fed up with it and its price, ending its current form of existence. The Davos stage is an odd venue and audience to preach societal good over other goods, but it certainly helped his comments stand out.

AI developers “have to get to a point where we are using this to do something useful that changes the outcomes of people and communities and countries and industries. Otherwise, I don’t think this makes much sense,” Nadella explained during a conversation with BlackRock CEO Larry Fink.

“We will quickly lose even the social permission to take something like energy, which is a scarce resource, and use it to generate these tokens, if these tokens are not improving health outcomes, education outcomes, public sector efficiency, private sector competitiveness, across all sectors, small and large.”

The Davos crowd, used to a more digital transformation cheerleading role, sounded a little confused. But the discussion also shows how the AI hype train is both an illusion and real. Nadella should know what he’s talking about. Microsoft is one of the biggest drivers of the current AI boom, with tens of billions of dollars invested in OpenAI, its own Copilot suite baked into productivity tools, and a seat at nearly every major AI policy table.

But his message at Davos was that leadership now demands a reckoning – not just about how smart or useful AI tools are in theory, but whether they’re helping people in schools, clinics, small businesses, and city governments.

That’s not an abstract moral argument. It’s an infrastructure one. AI’s growth has been driven by immense computational muscle, which means it’s also driven by massive energy use. Training today’s biggest models consumes as much electricity as some small countries consume in a year.

And inference, when you run the model on your phone or desktop to answer a question or generate a response, adds to that cost every second it runs. AI doesn’t just use servers; it fuels an ever-expanding footprint of data centers, water-cooled systems, and grid-straining workloads.

Nadella’s social permission phrase gets to the heart of what might be next. Until now, the public has broadly accepted that cloud-based tech companies can use resources in exchange for productivity, entertainment, or convenience. But that goodwill isn’t guaranteed. If AI begins to look like a wasteful luxury, delivering novelty rather than necessity, citizens and governments may start to push back.

Value for AI energy

During the session, Larry Fink asked whether all this productivity talk would mean fewer jobs, and Nadella didn’t dismiss the concern. But he argued that AI’s potential lies in amplifying what people can do.

But this moment is different from past tech inflection points. The sheer scale of AI’s appetite. Cloud computing scaled gradually. Smartphones had physical limits. But AI can grow as fast as the models and capital behind it allow. That’s why Nadella’s call to focus on outcomes comes off as cautious as well as pragmatic.

Nadella’s message was simple but sharp: we are nearing the edge of public tolerance for black-box systems powered by opaque amounts of energy, with unclear societal benefits.

And maybe we should all be asking harder questions when the next shiny AI tool drops: Does this help me? Does it help someone? Or is it just burning energy to generate yet another token?

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Eric Hal Schwartz is a freelance writer for TechRadar with more than 15 years of experience covering the intersection of the world and technology. For the last five years, he served as head writer for Voicebot.ai and was on the leading edge of reporting on generative AI and large language models. He’s since become an expert on the products of generative AI models, such as OpenAI’s ChatGPT, Anthropic’s Claude, Google Gemini, and every other synthetic media tool. His experience runs the gamut of media, including print, digital, broadcast, and live events. Now, he’s continuing to tell the stories people want and need to hear about the rapidly evolving AI space and its impact on their lives. Eric is based in New York City.