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Ask HN: Is the rise of AI tools going to be the next 'dot com' bust?

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Re: Ask HN: Is the rise of AI tools going to be the next 'dot com' bust?

#21

Post by spacebanana7 »

There's a persistent pessimism - almost to the point of paranoia - in tech from the trauma of the dot come bust. People fear waves of mass layoffs and 99% reductions in the value of their companies.

In reality most things go in an S curve and the excitement fades in a rather boring way. People were worried about bubbles in 2016, but they never really happened.

There was never a mobile bust, or a social bust, or a big data bust. These things just got boring after a while and the valuations stabilised. Sometimes companies went bust and sometimes they kept growing, but the super exponential growth in validation stopped. And we moved on to talking about the next thing.

Re: Ask HN: Is the rise of AI tools going to be the next 'dot com' bust?

#23

Post by alberth »

mattbrewsbytes wrote: post #20
alberth wrote: post #8

I think it’s similar in that… - Everyone knew the Internet (and now AI) was going to be transformational. - It was clear it would reshape economies and open up entirely new possibilities. - But no one really knew what the killer use case would be, or how big any given Internet (now AI) business might get. So, like a gold rush, huge amounts of money poured in, and everyone hoped their idea would turn into the next mas…

Cisco still exists and was a winner for a long time. The company that emerged hugely successful out of the dot com era was Amazon, they dominate ecommerce today. Take a look further back to the Personal Computer era in the 80's into early 90's. There were tons of PC makers out there, IBM became dominant but they haven't been in that business for a long time now. Microsoft was the enormous winner coming out of that. W…

And note: it took Cisco 25-years to recoup its market cap bubble from its high of 2000.

https://finance.yahoo.com/quote/CSCO/

Re: Ask HN: Is the rise of AI tools going to be the next 'dot com' bust?

#25

Post by oinfoalgo »

DanielHB wrote: post #6

I was too young at the time, but people who were there at internet companies in the 2000s what was it like? Did people think the same way as today where there is too money going in and not enough value coming out? Was it obvious to insiders only or to the general public as well? These days it seems even a significant porting of the general public is aware of the overhype. But back then internet wasn't much of a thing…

No, it is not the same at all.

I worked at a small investment firm in college during the time and I remember the portfolio manager doing the portfolio allocation for a retirement plan. Randomly picking Janus mutual funds in the hall right before he went to lunch.

I remember the secretary complaining in December 1999 how she knew a secretary at another firm that got rich from an IPO.

There has just never been a level a speculation like in late 1999 that I have ever experienced. This was over geocities level webpages on dial up modems with almost no business plans to even make money.

Re: Ask HN: Is the rise of AI tools going to be the next 'dot com' bust?

#26

Post by brettgriffin »

We won't see anything on the scale of the dot com bust again, but certainly the market will correct. All markets on a long enough time line are going to weed out the failures and leave you with the 'best and brightest' - that's a feature, not a bug, of capitalism.

Re: Ask HN: Is the rise of AI tools going to be the next 'dot com' bust?

#27

Post by pdxandi »

alberth wrote: post #23
mattbrewsbytes wrote: post #20

Earlier quoted context omitted.

Cisco still exists and was a winner for a long time. The company that emerged hugely successful out of the dot com era was Amazon, they dominate ecommerce today. Take a look further back to the Personal Computer era in the 80's into early 90's. There were tons of PC makers out there, IBM became dominant but they haven't been in that business for a long time now. Microsoft was the enormous winner coming out of that. W…

And note: it took Cisco 25-years to recoup its market cap bubble from its high of 2000. https://finance.yahoo.com/quote/CSCO/

Isn't that true for other companies that survived the times? That the bubble created extreme highs before it burst and now the companies have grown more naturally?

For example, Intel: https://finance.yahoo.com/quote/INTC

Honest question. Not my area of focus.

Re: Ask HN: Is the rise of AI tools going to be the next 'dot com' bust?

#30

Post by HeyLaughingBoy »

oinfoalgo wrote: post #25
DanielHB wrote: post #6

I was too young at the time, but people who were there at internet companies in the 2000s what was it like? Did people think the same way as today where there is too money going in and not enough value coming out? Was it obvious to insiders only or to the general public as well? These days it seems even a significant porting of the general public is aware of the overhype. But back then internet wasn't much of a thing…

No, it is not the same at all. I worked at a small investment firm in college during the time and I remember the portfolio manager doing the portfolio allocation for a retirement plan. Randomly picking Janus mutual funds in the hall right before he went to lunch. I remember the secretary complaining in December 1999 how she knew a secretary at another firm that got rich from an IPO. There has just never been a level…

I do miss it somewhat. At the time, a selected number of us on my product team were given retention bonuses because the company didn't want us being poached for internet jobs. I'm not complaining, because it was free money but anyone wanting to poach us away would probably have just offered more.

OTOH, I remember being in SF in spring 2001 for Embedded Systems Conference and overhearing a couple of Web developers on the same bus talking about how everyone they knew was losing their jobs. So I guess by that time, the end was in sight! Our bonuses continued for at least a year after that.

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