How you’ll be using AI in 2026: note-taking rings and robotaxis – The Times

And it will be a very big year for hardware. The biggest, perhaps, since 2007, when Steve Jobs strolled on stage and unveiled the iPhone.

Companies such as Sandbar are scrambling to build a new generation of devices that take advantage of the unique properties of conversational AI: systems that can understand context, and increasingly, do things on your behalf. It is a technology that does not necessarily need a screen to be useful.

Indeed, it is thought that Sir Jony Ive, the iPhone designer who joined OpenAI this year, will release the ChatGPT developer’s first device, and that it will likely be screenless.

Start-ups such as Friend have created a coin-sized disk that is worn like a necklace and listens and comments on your life. Meta this month bought its rival Limitless, maker of an always-on wearable microphone, and is expected to ramp up sales of its AI glasses.

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Jon Callaghan, a veteran investor at San Francisco-based True Ventures, and a backer of Sandbar, said: “Very shortly we’re going to see all sorts of other interfaces. The ubiquity of AI is going to be a very big theme.” He held up his smartphone, adding: “In five or ten years, this is not going to be the ideal way for me to send you communications,” he said.

Yet any discussion of the future uses of AI cannot be divorced from the market, and the fears that the bubble is about to burst. Even after a sell-off over the past month, the “Magnificent Seven” tech stocks still added $3.2 trillion in combined value in 2025. The Mag 7 are Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla.

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The most vociferous critic, Michael Burry, is the investor whose bet against the US real estate market was dramatised in The Big Short, the Hollywood film about the 2008 financial crisis. His argument is that Nvidia’s biggest customers — namely, the other tech giants — have begun using questionable accounting practices to embroider their finances and boost their share prices.

Specifically, Burry — nicknamed Cassandra by Warren Buffett — claims that companies from Meta to Microsoft have extended the depreciation window of the very expensive Nvidia chips they are buying from three or four years to five and six years.

Extending the time period over which the value of an asset is reduced, and accounted for as such, sounds boring and arcane. It’s not.

The upshot, Burry has argued, is twofold. One, tech companies are overvaluing assets that will later have to be written down dramatically, not least because Nvidia is every year pumping out new chips that offer orders of magnitude greater computing power and energy efficiency. These new models render older chips drastically inferior overnight. So if anything, companies should be shortening their depreciation schedules, not lengthening them.

Burry’s second point is that companies, by reducing the annual depreciation bill, are making their profits look far healthier than they otherwise would be. “I estimate every one of these hyperscalers will overstate earnings by double digits, and each one will have tens of billions of overstated assets vulnerable to write down,” he wrote. “That is where my analysis comes out. Anywhere on the bingo sheet, the number is a problem.” Nvidia, and the rest of the industry, have dismissed Burry’s analysis.

So what does one trader’s fight with Silicon Valley have to do with me and you? A lot potentially.

If history is a guide, stock market crashes plunge the real economy into quicksand. The top tech stocks — the Magnificent Seven — make up roughly a third of the S&P 500 index. Without the hundreds of billions they are spending on data centres, the American economy would be mired in, at best, slow growth, or worse, stagflation.

Crashes force companies that once felt rich to cut back. Grand investment plans are shelved to preserve cash. Start-ups die by their thousands, leaving only the very strongest to survive. “If one or more of these [Big Tech] companies loses 50-70 per cent of its market cap, it could take down half a dozen big players and countless start-ups with it, triggering an economic shockwave and massive trainwrecks,” said John Chambers, the investor and former chief executive hardware giant Cisco, the poster child of the dotcom boom and bust. “The volatility index for the stock market will be a rollercoaster.”

All of which means that 2026 will be a very uncertain time to be an employee, whether you work at a start-up or a large company.

Firms have already begun to replace humans doing repetitive or simple cognitive work with digital workers. The flipside is that those who have embraced AI to be more productive are actually doing well, seeing higher wages and better job security.

But the transition will be chaotic and messy. “AI will create many new jobs over time, but there will be a lag between rapid job destruction and job creation in the early years,” Chambers wrote. “Recent high school and college graduates, as well as workers over 50 who can’t or won’t adapt to AI, will be hit the hardest.” Early studies from the Stanford Digital Economy Lab, showing a sharp drop in hiring of university graduates in AI-exposed fields, bear that out.

It all makes for rather bamboozling and unsettling times. Because even as it becomes harder for many to find and keep a job, the future will arrive in ways once thought fantastical.

Consider robotaxis. Market-leader Waymo was hatched as a wild idea inside the Google skunkworks, called X, 17 years ago. Last year, however, it finally broke through, ramping up dramatically in several American cities, including San Francisco and Phoenix, going from a handful of rides to 450,000 a week. Its self-driving Jaguars hit the streets of London this month ahead of an expected launch of commercial service next year.

British rival Wayve is also expected to start offering driverless rides in the coming year, and Chinese giant rival Baidu just announced plans to start piloting its technology on the streets of the capital in partnership with Uber and ride-share rival Lyft.

Dan Ives, an analyst at Wedbush Securities, expects Elon Musk’s Tesla to launch robotaxis in 30 American cities and start pumping out its futuristic cybercab in large volumes.

But it’s not just cars. How much would you pay to never wash a dish or hoover the floor? 1X, a Palo Alto, California start-up, reckons that the answer is $500 a month. That’s the subscription price it is charging for Neo, its humanoid, home-helper robot that it said will start shipping to people’s homes in 2026. Elon Musk said Tesla’s Optimus humanoid will be so capable that work will become “optional”, and that Tesla will be pumping out “thousands” in 2026, and selling “millions” by 2030.

The robot takeover will be far more gradual than they would like: people are, mostly, not yet ready for a droid in their midst. And while YouTube might be full of impressive demos — look up Unitree’s humanoid dancing on stage at pop concerts — there remains little proof of real-world utility. Expect humanoids to show up first in more controlled environments, such as warehouses, and of course, some spectacular corporate blow-ups when companies fall short of their starry forecasts.

What seems certain, however, is that we’ll spend more time with AIs. We’ll talk to them, potentially via a menagerie of new devices. We will let them drive us around. We’ll have them build websites, make new apps, and console us if, or when, one of them replaces us.

“We’ve never seen anything like this before,” said Callaghan, who has been investing in tech since the early 1990s. “This is the big one.”

The other tech stories to watch

The year of the Mega-IPO: Elon Musk’s SpaceX is reportedly gearing up for what would be the world’s first trillion-dollar float. Shares in the rocket and satellite-internet giant have recently changed hands in the private market at a $677 billion valuation. Investors could value the company at up to $1.5 trillion in a stock market offering, according to reports.

Such a deal would double the wealth of the world’s richest man, and help him fund his array of outlandish projects, from colonising Mars to flooding the world with humanoids and populating the streets with cybercabs.

The deal could open the floodgates for countless other highly valued tech companies, including AI pioneers OpenAI and Anthropic, which have recently been valued at $500 billion and $350 billion, respectively. After several fallow years in terms of new offerings, 2026 could be a banner year.

The backlash takes off: After three years in which investors fell over themselves to give money to AI companies, and ministers rolled out the red carpet around the world, the public backlash will take hold this year. This will broadly happen on two fronts. One will be over data centres. A growing number of cities in America have rejected proposed data centres after public outcry over potential increases to power prices, concerns over water usage (which data centres use to cool their systems), and the lack of new employment the projects provide once the construction is done.

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Amid reports of slowing hiring of young people, communities have begun to ask the very real question: why rubber-stamp the creation of a new digital workforce that strains community resources and potentially makes it harder for our children to find jobs?

The other front will be around the social impact of AI, as millions of people form relationships with algorithms. This threatens to deepen what the US surgeon general has dubbed a “loneliness epidemic” and in extremis, will see people led astray by their favourite chatbot. A number of lawsuits have been filed by family members whose loved ones took their own lives after lengthy conversations with chatbots. The rise of the AI “friend” will emerge as a flashpoint in 2026.

Climate tech gains, but not in the way you think: There was a time, not long ago, when climate tech was the hottest place to invest. Larry Fink, chief executive of the world’s largest asset manager BlackRock, predicted in 2021 that the “next 1,000” billion-dollar start-ups would be in climate tech. Today that prediction looks laughable.

Climate tech has slid back for two reasons: AI and Donald Trump. The emergence of AI saw investors divert hundreds of billions away from other industries, climate included. And the US president rolled back large parts of the Inflation Reduction Act, Joe Biden’s $1 trillion package of tax cuts and subsidies for green technologies.

But climate tech is far from dead. The West’s retreat has instead opened the way for China. Last year was the first that saw electric vehicles and hybrids pass the 50 per cent of new car sales in that country. Solar — most of the world’s panels are made in China — is now the cheapest form of electricity generation. And globally, renewable power passed coal as the world’s primary energy source for the first time. So while start-ups in the West grapple with the disappearance of subsidy programmes and policy reversals, China is set to gallop ahead, exporting its cars, solar panels and technology from London to Rio de Janeiro.

Social media’s “Big Tobacco” moment: Australia’s social media ban for under-16s may, in retrospect, be seen as a decisive moment in the regulation of social media. While opponents have slammed the move as unworkable and patriarchal, many governments appear ready to follow Australia’s lead after years of failing to pass meaningful regulation or convincing social media companies to make fundamental changes to their services.

Anne Le Hénanff, France’s minister of digital affairs, expects to introduce a proposal to ban social media under-15s early in the new year. Denmark is poised to do the same after gaining cross-party support for the move. Spain, Italy, Greece, Malaysia and New Zealand are considering bans, while prime minister Sir Keir Starmer is thought to be examining a prohibition for young people if the Australia experiment proves successful.

At the heart of these moves is a growing consensus among politicians that social media is akin to tobacco, a public health danger that must be more tightly regulated. Industry leaders, including Meta, owner of Facebook, Instagram and Threads, argue that there is no definitive link between social media and the rise in anxiety, depression and youth suicide, yet there is a growing body of clinical evidence showing strong correlations.