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IBM CEO says there is 'no way' spending on AI data centers will pay off

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Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#831

Post by tempfile »

tim333 wrote: post #818
blablabla123 wrote: post #533

Despite the flashy title that's the first "sober" analysis from a CEO I read about the technology. While not even really news, it's also worth mentioning that the energy requirements are impossible to fulfill Also now using ChatGPT intensely since months for all kinds of tasks and having tried Claude etc. None of this is on par with a human. The code snippets are straight out of Stackoverflow...

An issue with the doom forecasts is most of the hypothetical $8tn hasn't happened yet. Current big tech capex is about $315bn this year, $250bn last against a pre AI level ~$100bn so ~$400bn has been spent so far on AI boom data centers. https://sherwood.news/business/amazon-plans-100-billion-spen... The future spend is optional - AGI takeoff, you spend loads, not happening not so much. Say it levels of at $800bn. Th…

Lol. If you ballpark numbers like that probably anything is doable!

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#832

Post by trueismywork »

tim333 wrote: post #818
blablabla123 wrote: post #533

Despite the flashy title that's the first "sober" analysis from a CEO I read about the technology. While not even really news, it's also worth mentioning that the energy requirements are impossible to fulfill Also now using ChatGPT intensely since months for all kinds of tasks and having tried Claude etc. None of this is on par with a human. The code snippets are straight out of Stackoverflow...

An issue with the doom forecasts is most of the hypothetical $8tn hasn't happened yet. Current big tech capex is about $315bn this year, $250bn last against a pre AI level ~$100bn so ~$400bn has been spent so far on AI boom data centers. https://sherwood.news/business/amazon-plans-100-billion-spen... The future spend is optional - AGI takeoff, you spend loads, not happening not so much. Say it levels of at $800bn. Th…

65% of people in the world earn less than 3000 euros/year.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#833

Post by DebtDeflation »

evanjrowley wrote: post #786
mattlondon wrote: post #771

Earlier quoted context omitted.

Take this "sober" analysis with a big pinch of salt. IBM have totally missed the AI boat, and a large chunk of their revenue comes from selling expensive consultants to clients who do not have the expertise to do IT work themselves - this business model is at a high risk of being disrupted by those clients just using AI agents instead of paying $2-5000/day for a team of 20 barely-qualified new-grads in some far-off c…

Is this true in 2025? Asking because the biggest IT consulting branch of IBM, Global Technology Services (GTS), was spun off into Kyndryl back in 2021[0]. Same goes for some premier software products (including one I consulted for) back in 2019[1]. Anecdotal evidence suggests the consulting part of IBM was already significantly smaller than in the past. It's worth noting that IBM may view these AI companies as compet…

Yes. GTS was infrastructure services and was spun off. What's left is the old GBS - business services and systems implementation services.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#834

Post by dspillett »

tw04 wrote: post #797
mattlondon wrote: post #771

Earlier quoted context omitted.

Take this "sober" analysis with a big pinch of salt. IBM have totally missed the AI boat, and a large chunk of their revenue comes from selling expensive consultants to clients who do not have the expertise to do IT work themselves - this business model is at a high risk of being disrupted by those clients just using AI agents instead of paying $2-5000/day for a team of 20 barely-qualified new-grads in some far-off c…

Missed the boat? Have you been living under a rock? Watson AI advertising has been everywhere for years. It’s not that they aren't in the AI space, it’s that the CEO has a shockingly sober take on it. Probably because they’ve been doing AI for 30+ years combined with the fact they don’t have endless money with nowhere to invest it like Google.

> Missed the boat? […] Watson AI advertising has been everywhere for years.

They were ahead of the game with their original Watson tech, but pretty slow to join and try get up to speed with the current GenAI families of tech.

The meaning of “AI” has shifted to mean “generative AI like what ChatGPT does” in the eyes of most so you need to account for this. When people talk about AI, even though it is a fairly wide field, they are generally referring to a limited subset of it.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#835

Post by TheOccasionalWr »

blablabla123 wrote: post #533

Despite the flashy title that's the first "sober" analysis from a CEO I read about the technology. While not even really news, it's also worth mentioning that the energy requirements are impossible to fulfill Also now using ChatGPT intensely since months for all kinds of tasks and having tried Claude etc. None of this is on par with a human. The code snippets are straight out of Stackoverflow...

I'm not sure what you mean with the "code snippets are straight out of Stackoverflow". That is factually incorrect just by how LLM works. By now there has been so much code ingested from all kinds of sources, including Stackoverflow LLM is able to help generate quite good code in many occasions. My point being it is extremly useful for super popular languages and many languages where resources are more scarce for developer but because they got the code from who knows where, it can definitely give you many useful ideas.

It's not human, which I'm not sure what is supposed to actually mean. Humans make mistakes, humans make good code. AI does also both. What it definitely needs is a good programmer still on top to know what he is getting and how to improve it.

I find AI (LLM) very useful as a very good code completion and light coder where you know exactly what to do because you did it a thousand times but it's wasteful to be typing it again. Especially a lot of boilerplate code or tests.

It's also useful for agentic use cases because some things you just couldn't do before because there was nothing to understand a human voice/text input and translate that to an actual command.

But that is all far from some AGI and it all costs a lot today an average company to say that this actually provided return on the money but it definitely speeds things up.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#836

Post by eschaton »

brookst wrote: post #718
eschaton wrote: post #604

Earlier quoted context omitted.

We don’t need more software, we need the right software implemented better. That’s not something LLMs can possibly give us because they’re fucking pachinko machines. Here’s a hint: Nobody should ever write a CRUD app, because nobody should ever have to write a CRUD app; that’s something that can be generated fully and deterministically (i.e. by a set of locally-executable heuristics, not a goddamn ocean-boiling LLM)…

I’m with you. Anyone writing in anything higher level than assembly, with anything less than the optimization work done by the demo scene, should feel great same. Down with force-multiplying abstractions! Down with intermediate languages and CPU agnostic binaries! Down with libraries!

You have clearly entirely understood exactly what I was saying and don’t look like a fool at all with this reply.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#837

Post by Ragnarork »

mattlondon wrote: post #771
blablabla123 wrote: post #533

Despite the flashy title that's the first "sober" analysis from a CEO I read about the technology. While not even really news, it's also worth mentioning that the energy requirements are impossible to fulfill Also now using ChatGPT intensely since months for all kinds of tasks and having tried Claude etc. None of this is on par with a human. The code snippets are straight out of Stackoverflow...

Take this "sober" analysis with a big pinch of salt. IBM have totally missed the AI boat, and a large chunk of their revenue comes from selling expensive consultants to clients who do not have the expertise to do IT work themselves - this business model is at a high risk of being disrupted by those clients just using AI agents instead of paying $2-5000/day for a team of 20 barely-qualified new-grads in some far-off c…

> a high risk of being disrupted by those clients just using AI agents instead of paying $2-5000/day for a team of 20 barely-qualified new-grads in some far-off country

Is there any concrete evidence of that risk being high? That doesn't come from people whose job is to sell AI?

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#839

Post by golol »

trueismywork wrote: post #832
tim333 wrote: post #818

Earlier quoted context omitted.

An issue with the doom forecasts is most of the hypothetical $8tn hasn't happened yet. Current big tech capex is about $315bn this year, $250bn last against a pre AI level ~$100bn so ~$400bn has been spent so far on AI boom data centers. https://sherwood.news/business/amazon-plans-100-billion-spen... The future spend is optional - AGI takeoff, you spend loads, not happening not so much. Say it levels of at $800bn. Th…

65% of people in the world earn less than 3000 euros/year.

Getting 65% of the population to spend 1% of their income on some new digital toy forever does not seem so far fetched.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#840

Post by QuercusMax »

deepGem wrote: post #805
mattlondon wrote: post #771

Earlier quoted context omitted.

Take this "sober" analysis with a big pinch of salt. IBM have totally missed the AI boat, and a large chunk of their revenue comes from selling expensive consultants to clients who do not have the expertise to do IT work themselves - this business model is at a high risk of being disrupted by those clients just using AI agents instead of paying $2-5000/day for a team of 20 barely-qualified new-grads in some far-off c…

I would any day take chatGPT/Claude over an IBM consultant. I worked at IBM.

I'd rather be slapped in the face than kicked by a horse, but that doesn't mean either is a good thing
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