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Why Wall Street is ignoring big tech's debt [video]

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Re: Why Wall Street is ignoring big tech's debt [video]

#41

Post by Aurornis »

borzi wrote: post #21
WarmWash wrote: post #9

I don't know a single white collar worker who isn't using AI for their job. Not like forced, but like "Oh damn, this bot thing can do a lot of tedious leg work for me". To think that people won't pay $60-$80/mo to continue using it is wild to me. In a white collar environment it pays for itself in a few hours of use. If you focus on how much value AI brings to people (mostly in time saved), the bubble hardly looks bu…

The reason uber didn't loose that much business is because it replaced the established businesses and left most consumers with little alternative. That's not the case with AI - unless the frontier labs achieve AGI or some sort of super intelligence that lets them create infinite economic value (at which point, any further discussion is pointless for obvious reasons), the average worker can do most of their tasks with…

> The reason uber didn't loose that much business is because it replaced the established businesses and left most consumers with little alternative.

The established businesses were awful. There was not a thriving and beloved taxi service in every city pre-Uber. Taxis were bad and very expensive.

Also did you forget that Lyft exists and normal taxis are still available? Taxi services had to improve their business when the ride sharing companies entered the market because they previously relied on their own grip on on-demand transportation to keep prices high and service poor.

Re: Why Wall Street is ignoring big tech's debt [video]

#42

Post by TacticalCoder »

WarmWash wrote: post #9

I don't know a single white collar worker who isn't using AI for their job. Not like forced, but like "Oh damn, this bot thing can do a lot of tedious leg work for me". To think that people won't pay $60-$80/mo to continue using it is wild to me. In a white collar environment it pays for itself in a few hours of use. If you focus on how much value AI brings to people (mostly in time saved), the bubble hardly looks bu…

I agree that it's working good enough and that it's here to stay: mostly everybody around me uses AI too but...

> Did Uber die when a trip across town went from $3 to $13? No. It's giving more rides than ever, 10x more than when it was $3.

The competition from open-weights models is already putting pressure on how much this can be billed. That's today, with stuff like OpenAI announcing 80% cuts on terra and luna. Tomorrow, in addition to the pressure from open-weights models, there's going to be pressure from chinese hardware: Tencent, Alibaba, etc. are all already working on their own AI chips.

What good would, say, a SOTA open-weights model running on chinese chips (chinese chips located in China or elsewhere btw) do to, say, Meta or Oracle's insane AI investements?

And it doesn't even have to be chinese chips: what good AMD AI chips doing inference by having weights etched on silicon will do to OpenAI and Anthropic?

All the people, especially here on HN, who were explaining six months ago that OpenAI and Anthropic models where so good for coding that coding was solved once and for all can now run better open-weights models than the proprietary ones from six months ago. For a fraction of the price.

If people, instead of paying $20 per month pay $80 per month for their AI subscriptions, what makes you believe that money is going to go to one of these companies participating in this $2 trillion debt?

And really, in which new domain have we seen the first movers being able to keep a lifetime grip on the market without getting their arse handed to them by the competition? Things moves quickly today: I'm not sure OpenAI and Anthropic are the Ford equivalent for AI.

For all I know OpenAI is "La Mancelle":

https://fr.wikipedia.org/wiki/La_Mancelle

And Anthropic is Panhard.

That AI is here to stay is a given. That people may be willing to pay more is likely (even though IMO they won't pay 4x more for something only marginally better). But that the current players are going to stay on top even though the competition closed the gaps to weeks?

I don't buy it.

Re: Why Wall Street is ignoring big tech's debt [video]

#43

Post by rdedev »

porridgeraisin wrote: post #36
TrackerFF wrote: post #16

Earlier quoted context omitted.

But the question is how much are people willing to pay for AI. I use AI every day at work, but I only pay $20. That's the most I will ever want to pay. And, so far, it gives me everything I need. If OpenAI or Anthropic suddenly said "Sorry, the game is up. You'll have to pay $100/month now", I would 100% look into cheaper Chinese solutions. I suspect the AI subscription (or API) economy is whale economy. You have a s…

> Even adding something like $20 - $100 subscriptions to every user is a serious enough financial obligation that it needs to go through budget planning / boards I doubt that. In my tiny town in India, office workers use the 1800 INR (20$) plans. 1800 INR/month is like... 4% of the salary these guys get. And since this is mostly MS-office and windows explorer and chrome based stuff in very small, non-tech companies,…

Remember that 20$ is a subsidized rate openai is currently willing to provide. Once that goes down you think these guys would be willing to pay token based billing charges ?

Re: Why Wall Street is ignoring big tech's debt [video]

#44

Post by w29UiIm2Xz »

WarmWash wrote: post #9

I don't know a single white collar worker who isn't using AI for their job. Not like forced, but like "Oh damn, this bot thing can do a lot of tedious leg work for me". To think that people won't pay $60-$80/mo to continue using it is wild to me. In a white collar environment it pays for itself in a few hours of use. If you focus on how much value AI brings to people (mostly in time saved), the bubble hardly looks bu…

If you need fewer workers due to the increased productivity, then the number of white collar workers (the TAM) won't be as large as anticipated.

Re: Why Wall Street is ignoring big tech's debt [video]

#45

Post by inigyou »

generic92034 wrote: post #38
acivitillo wrote: post #14

Earlier quoted context omitted.

$80 per month in a 5,000 people Enterprise is 400k per month which translates to ~5m per year. That is easily in the 8-16% of their total IT budget. I don’t know you, but companies don’t like to increase recurring cost. Is AI good? Yes. Is it clear how it generates enough ROI to justify a material IT cost increase? No. This is the problem now, not how much white collar workers use AI, but what is the productivity nar…

> when Salesforce invented the CRM for example Huh? If that was not a joke, here is the history of CRM: https://en.wikipedia.org/wiki/Customer_relationship_manageme...

> Using it, people that FDR met were impressed by his "recall" of facts about their family and what they were doing professionally and politically.

Hmm. Today that'd be creepy.

Re: Why Wall Street is ignoring big tech's debt [video]

#46

Post by IncreasePosts »

johnbarron wrote: post #24
TrackerFF wrote: post #16

Earlier quoted context omitted.

But the question is how much are people willing to pay for AI. I use AI every day at work, but I only pay $20. That's the most I will ever want to pay. And, so far, it gives me everything I need. If OpenAI or Anthropic suddenly said "Sorry, the game is up. You'll have to pay $100/month now", I would 100% look into cheaper Chinese solutions. I suspect the AI subscription (or API) economy is whale economy. You have a s…

You can now, as of this week, run locally models with the same performance of a SOTA model of March this year: https://news.ycombinator.com/item?id=49214008 https://news.ycombinator.com/item?id=49229621 The FAFO day of Anthropic and OpenAI arrived.

Not many people have $10k of specific hardware lying around

Re: Why Wall Street is ignoring big tech's debt [video]

#47

Post by sneak »

w29UiIm2Xz wrote: post #44
WarmWash wrote: post #9

I don't know a single white collar worker who isn't using AI for their job. Not like forced, but like "Oh damn, this bot thing can do a lot of tedious leg work for me". To think that people won't pay $60-$80/mo to continue using it is wild to me. In a white collar environment it pays for itself in a few hours of use. If you focus on how much value AI brings to people (mostly in time saved), the bubble hardly looks bu…

If you need fewer workers due to the increased productivity, then the number of white collar workers (the TAM) won't be as large as anticipated.

That’s never really how efficiency gains tend to work except in places where entire industries ceased to exist (printers, weavers, clothes washers, etc).

Re: Why Wall Street is ignoring big tech's debt [video]

#48

Post by inigyou »

lkjdsklf wrote: post #35
api wrote: post #18

Earlier quoted context omitted.

After using it a bit I’m convinced it’s not, as a whole, a bubble. Bubbles exist around it. Data center construction may end up overbuilding, much like the dark fiber thing during dot.com, since better chips and models will shrink power and space requirements over time. But the core tech is the most powerful new thing I have seen since discovering the Internet, at least. Maybe more.

A bubble doesn’t mean a technology is useless. It just means it’s overvalued In the last 30 years, we’ve had multiple bubbles in the tech industry. Every one of them was backed by real stuff that we still use today. They were still bubbles and a ton of people were hurt when they popped.

The railway bubble and the optical fiber bubble left the world with lots of railways and optical fibers. Once their original owners went bankrupt, the assets themselves were quite useful and changed the world.

The cryptocurrency bubble, however, didn't. Not really. At best you can use it to buy drugs. Some of the GPUs may have been repurposed for AI, but not enough to make a dent in AI, and the AI reesarchers who kicked off the AI bubble were having to buy their GPUs for high prices to compete with the miners, not low prices after they went bust, so we can't even say miners helped kick it off.

Re: Why Wall Street is ignoring big tech's debt [video]

#49

Post by inigyou »

lokar wrote: post #13
steelkilt wrote: post #7

It might be more accurate to say that many retail investors are ignoring big tech’s debt.

That does not explain the buy recommendations for SpaceX

Oh that one's explained by bribery. Just pay some analyst to put out ridiculous "predictions" about your company

Re: Why Wall Street is ignoring big tech's debt [video]

#50

Post by intended »

porridgeraisin wrote: post #36
TrackerFF wrote: post #16

Earlier quoted context omitted.

But the question is how much are people willing to pay for AI. I use AI every day at work, but I only pay $20. That's the most I will ever want to pay. And, so far, it gives me everything I need. If OpenAI or Anthropic suddenly said "Sorry, the game is up. You'll have to pay $100/month now", I would 100% look into cheaper Chinese solutions. I suspect the AI subscription (or API) economy is whale economy. You have a s…

> Even adding something like $20 - $100 subscriptions to every user is a serious enough financial obligation that it needs to go through budget planning / boards I doubt that. In my tiny town in India, office workers use the 1800 INR (20$) plans. 1800 INR/month is like... 4% of the salary these guys get. And since this is mostly MS-office and windows explorer and chrome based stuff in very small, non-tech companies,…

I remember the piracy era, and it used to be a joke whether anyone could actually stop it.

Eventually MS dealt with piracy by going after firms, and finally by offering something cheap enough.

Between the legal aspects, and the fact that its MS office, paying Rs 1800 a month is possible.

I’ve been trawling every source I can find to understand what the story on the ground is, and when it comes to productivity it’s a huge mixed bag. The variance in outcomes between independent coders, frontier labs, someone in SV and someone in India is mind-bending right now.

Most firms which talk about their AI plans are not seeing traction, and the AI projects are going to the same place that the ML projects used to go to die.

It’s at the individual level that I am seeing productivity gains, however that isn’t something firms are happy to hear right now.

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