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AI's Affordability Crisis

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Re: AI's Affordability Crisis

#261

Post by Gigachad »

steveBK123 wrote: post #54
piker wrote: post #49

Earlier quoted context omitted.

I.e., the demand for programming tokens turns out to be quite elastic.

I would imagine it only gets worse in the face of good-enough open/chinese/local models too right? Microsoft adding Deepseek support already as I recall? That is - for any definition of "they are behind X months" then eventually they get to the point Claude was in January when the world freaked out, but at 1/10th the cost. A lot of firms are going to mandate that is good enough for their developers.

Our org straight up turned off our AI access after the GitHub copilot price increase blew right through the budget.

At least on a personal I feel like I’ve been getting the same amount of work done but I have to think harder rather than sitting back and prompting and waiting.

Re: AI's Affordability Crisis

#262

Post by 1vuio0pswjnm7 »

Here are all the references in this blog post

https://sequoiacap.com/article/follow-the-gpus-perspective/

https://sequoiacap.com/article/ais-600b-question/

https://www.wheresyoured.at/brokenomics/

https://www.wheresyoured.at/exclusive-openai-financials/

https://www.wheresyoured.at/news-microsoft-to-shift-github-c...

https://archive.is/m5MHe#selection-1483.0-1483.74

https://www.youtube.com/watch?v=MNQDrF0HjtI

https://www.youtube.com/watch?v=VBHSjzHW-C8

https://www.derekthompson.org/p/the-great-ai-cost-panic-of-2...

https://www.tomshardware.com/tech-industry/artificial-intell...

https://www.tomshardware.com/tech-industry/artificial-intell...

https://blog.dshr.org/2025/10/depreciation.html

https://x.com/ThierryBorgeat/status/2060069195975422281

https://wlockett.medium.com/the-ai-industry-is-panicking-db5...

https://www.sofi.com/learn/content/average-salary-in-us/

https://www.theglobalstatistics.com/united-states-labor-stat...

https://www.bls.gov/news.release/pdf/ecec.pdf

https://www.businessinsider.com/ai-bubble-heads-doomers-sam-...

https://www.wsj.com/tech/ai/openai-considers-drastic-price-c...

https://www.bloomberg.com/opinion/articles/2026-06-11/anthro...

https://arstechnica.com/ai/2026/06/anthropic-pauses-token-ba...

https://x.com/bcherny/status/2040206441756471399?lang=en

https://code.claude.com/docs/en/agent-sdk/overview

https://windowsforum.com/threads/microsoft-plans-june-30-202...

https://www.datacenterdynamics.com/en/news/anthropic-to-use-...

https://techcrunch.com/2026/06/05/google-will-pay-spacex-920...

https://backofmind.substack.com/p/tokenalysis-and-john-henry

HN commenters quickly attack anything from Ed Zitron these days

But this seems to be flying under the radar

Re: AI's Affordability Crisis

#263

Post by jongjong »

The current situation reminds me of how far we've come from old ideals of delaying gratification today in order to have more later.

It seems like this ideology has been corrupted into a short-sighted "Establish a monopoly position as soon as possible at all costs, don't worry about tomorrow."

It's ironic because monopolizing a sector by investing heavily and suppressing profits used to be a long term move but it seems to have become a short term move as investors are racing each other.

Re: AI's Affordability Crisis

#264

Post by wqaatwt »

8n4vidtmkvmk wrote: post #77
hackingonempty wrote: post #53

Earlier quoted context omitted.

> The US govt is going to ban foreign models The people have a right to make and use whatever models they want, protected by the constitution. At a minimum, the models are described in research papers that are unquestionably protected speech. Skilled devs turn those into programs, also protected speech.

How could Trump ban tiktok then? And Fable for that matter. Maybe you're somehow legally allowed to distribute and download the weights, but most of us can't run GLM 5.2 at home.

They “banned” the company, not the product. US government could ban US citizens from buying tokens from certain Chinese provider but there is no precedent for banning the usage of specific software if you run it yourself.

Re: AI's Affordability Crisis

#265

Post by Gigachad »

wqaatwt wrote: post #141

This article seems to be struggling with telling apart the difference between R&D and operating expenses? The fact that AI companies are extremely unprofitable doesn’t mean they are subsidizing token costs, they still can have very decent gross margins on them

The accounting is all out of whack with these companies. If a GPU had a useful lifespan of around 3 years than it’s more a constant expense than R&D. They want you to believe they can cut the R&D at any time and be profitable but it’s likely they would completely collapse without that spend.

Re: AI's Affordability Crisis

#266

Post by stingraycharles »

burningChrome wrote: post #200
sdesol wrote: post #183

Earlier quoted context omitted.

Was there at least performance gains to be measured?

AFAIK nobody was collecting analytics. The one team I was working on had put out a goal of "30% more efficient" using AI tools. Its about as subject as you can get. We never got around to what exactly that meant before everything got shut down. Myself and several other devs were laughing about the whole thing. The company was so amped about what AI could do they never even bothered collecting any analytics that would…

> Even some of my team members were talking about the placebo effect AI has had on a lot of C-Suite folks.

What do you mean placebo effect? They thought things were created with AI while they actually weren’t?

Re: AI's Affordability Crisis

#267

Post by [deleted] »

chermi wrote: post #143

Lol I feel like no one has any attention span here. Tech shit is expensive in the beginning when it's new. It gets cheaper with time. This is a tech forum, don't we know this? Of course people overreact in both directions on both sides of the issue. It's a very fast technology, wait for things to settle before making grand declarations.

[deleted]

Re: AI's Affordability Crisis

#268

Post by wqaatwt »

recursivedoubts wrote: post #115

Once locals get to Opus levels I think it we may see a phase change because that + a reasonably competent programmer is going to be a very powerful combination for most practical programming problems. Frontier models may eventually achieve super-intelligence (no opinion beyond mild skepticism) but super-intelligence isn't necessary for most practical day-to-day programming. The problems, as always, become communicati…

> Once locals get to Opus levels

I find it hard to imagine it would ever be cost efficient vs hosted/cloud i.e. you should always be able to run faster and/or better models remotely at a comparable price since its just way more efficient due to batching

Re: AI's Affordability Crisis

#269

Post by sevenzero »

woeirua wrote: post #218

It's not an affordability crisis, it's a financial crisis. The models get cheaper super fast. By this time next year Fable 5 will cost less than Sonnet does today. That's not the problem. The problem is that many companies are going to realize that they don't get any ROI from AI. Generating code faster != more profit. Most of the Fortune 500 will likely realize this and then the token budgets will come crashing down.…

>The models get cheaper super fast.

Weird, why didn't my subscriptions decrease in price then? Oh wait..

Re: AI's Affordability Crisis

#270

Post by wqaatwt »

bryanlarsen wrote: post #142
LoganDark wrote: post #129

Earlier quoted context omitted.

A superintelligence is one that exceeds human intelligence in all areas. Which roughly translates to learning, adapting, and performing more quickly and efficiently than even the best humans. This is closely related to "the singularity", which is when technological growth becomes uncontrollable by humanity.

That sounds like a definition designed for goal shifting. This AI is better than human at 99.9% of things, but humans are better at pooping. Therefore we don't yet have a superintelligence.

A basic calculator is 100% better than humans at all the things its designed to do.
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