The AI graveyard: notable AI projects and startups that failed
In brief
- 42% of corporate AI initiatives are abandoned, per S&P Global Market Intelligence.
- Relay and Character.ai shut down after failing to differentiate against major players.
- Apple and Microsoft faced major setbacks with Siri and Recall, notably over privacy and delays.
Several AI projects and startups have been shut down or failed to meet expectations in recent years. Relay, an AI-powered workflow automation tool, closed in August after five years, unable to compete with AI features integrated by OpenAI and Google into their own platforms. Character.ai, a chatbot platform, filed for bankruptcy five years after its launch.
According to S&P Global Market Intelligence, 42% of corporate AI initiatives are ultimately abandoned, often due to insufficient funding, technical challenges, or lack of demand. OpenAI faced multiple setbacks, including the rollback of its ChatGPT redesign in July 2026, deemed too confusing, and the shutdown of Sora, its video generation platform, in March 2026 due to high costs and user retention issues. Apple repeatedly delayed the release of its new Siri, eventually deploying a partial version in July 2026 after a $250 million settlement over marketing claims.
Microsoft abandoned its Recall tool, designed to record user activity, following privacy concerns. Humane AI Pin, a wearable device, was discontinued in February 2025 after security and performance issues. These cases highlight persistent AI challenges: difficult integration, high expectations, and risk management despite massive investments.
What it changes for you
- Public SectorFailures of AI tools in the public sector highlight the need for strict regulatory frameworks to prevent privacy and data security risks.
- CybersecurityThe abandonment of projects like Recall or Humane AI Pin exposes vulnerabilities in consumer AI solutions and strengthens security and transparency requirements.
This summary gives you the essentials. The full article, its figures and quotes are on AI News & Artificial Intelligence | TechCrunch.
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