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AI revenues are growing fast, but not fast enough

economist.com

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Re: AI revenues are growing fast, but not fast enough

#81

Post by IAmGraydon »

ant6n wrote: post #45
VCFundedGenYer wrote: post #22

I mean, all one has to do is review https://isaiprofitable.com/ to see just how bad it is. None of this is a profitable venture. It's just a money pit for all players involved, all the while draining our ability to buy electronics and drink water. This has to end at some point.

It's kind of funny. I was looking at the top of the page thinking 1.5T investment for so far 770B revenue isn't bad at all, that could break even after some time. But then you look the listed companies, there costs vs revenue. Turns out 516B of the revenues are from Nvidia, which is not an AI company, but just selling shovels. Nvidias revenues are effectively costs to actual AI companies.

Yep. Click the button that hides the infrastructure companies. The entire thing is a scam. The only thing holding it up is the belief that AI will replace the majority of human labor in the foreseeable future. So far, it has replaced almost none of it.

Re: AI revenues are growing fast, but not fast enough

#82

Post by bandrami »

Gagarin1917 wrote: post #60
an0malous wrote: post #6

> A back-of-the-envelope calculation finds that covering aicapex through identifiable ai income requires revenue on the order of $2.5trn per year, more than tech’s entire combined revenue today. … > All these complex calculations roughly tally with a much simpler one: adding up the ai revenue of the firms selling most of the ai. Anthropic pulls in perhaps $75bn, annualised; Openai makes tens of billions; Google, via…

I thought SpaceXAI was making like $25 billion a year renting out hardware now?

That's $25B before discounts, and their discounts to Anthropic in the current quarter alone are $12B of that.

Re: AI revenues are growing fast, but not fast enough

#83

Post by lbrito »

>That said, revenues may soon grow even more quickly, if two conditions are met. The first is that AI boosts productivity markedly. For now, there is little evidence that AI is transforming businesses.

I've been hearing this for years at this point. How long is it going to take for people to accept that there is no productivity boost? Or are we going to keep us this charade forever? GPT 3.5 was almost 4 years ago now, and still no magical 10x productivity gain. When is enough enough? 5 years? 10 years?

Re: AI revenues are growing fast, but not fast enough

#84

Post by Gagarin1917 »

bandrami wrote: post #82
Gagarin1917 wrote: post #60

Earlier quoted context omitted.

I thought SpaceXAI was making like $25 billion a year renting out hardware now?

That's $25B before discounts , and their discounts to Anthropic in the current quarter alone are $12B of that.

I’m not sure what you’re referencing, I can’t find any source for this.

Why would they offer an 80% discount? Hardware is the limiting factor for many AI companies.

Re: AI revenues are growing fast, but not fast enough

#85

Post by roryirvine »

thrw045 wrote: post #72
yurish wrote: post #70

Earlier quoted context omitted.

> Back before LLMs and before that again, it was very hard to write code. That's why so many people asked questions and figuring out how to write a piece of code was a big part of the value add This may be true if you work in unfamiliar area or on frontier of programming. But this is not were most of programmer jobs are. That writing code itself is hard is a view of non-programmer. Programmers know that past some thr…

Sure it may be that way now. But if you go back 20 years to for example video game programming, the hard part was figuring out how to solve the problem, not spend weeks or months trying to figure out the abstract design of the code itself. 10-20 years ago a lot of the value of programming was figuring out how to do something, which is by its nature about writing the code, I would argue. Edit: Also, even outside of vi…

You're very definitely misremembering.

10 years ago was the peak of DDD and Context Mapping, 20 years ago was when The Wiki ruled and everyone was obsessed with design patterns, 30 years ago was UML and Object Mapping... and on, and on, and on.

Fashions change, but one of the few constants in our industry is that everyone has always been obsessed with software design.

Re: AI revenues are growing fast, but not fast enough

#86

Post by bandrami »

Gagarin1917 wrote: post #84
bandrami wrote: post #82

Earlier quoted context omitted.

That's $25B before discounts , and their discounts to Anthropic in the current quarter alone are $12B of that.

I’m not sure what you’re referencing, I can’t find any source for this. Why would they offer an 80% discount? Hardware is the limiting factor for many AI companies.

The xAI Anthropic deal was pretty widely covered, but the press release is here: https://x.ai/news/anthropic-compute-partnership

The absurdly large discount was why Anthropic could claim a revenue-positive quarter for the first time. But that discount window ends IIRC in September. The problem remains that xAI announced the discounted revenue as "revenue before discounts".

Re: AI revenues are growing fast, but not fast enough

#87

Post by trollbridge »

misterderpie wrote: post #47
nemomarx wrote: post #34

Earlier quoted context omitted.

If you look at recent trends in consumer spending, a lot more of it is from the upper classes and less from the middle. Selling services to the rich can displace the loss of white collar workers. (in theory). as a bonus, ideally you create some more really wealthy people to spend on things during this shift.

I'm yet to see what part of AI really wealthy people would like to spend their money on. It's not like we can get AI Yachts and AI Rockets. What would the premium product for the upper class be?

My experience with rich people is they don’t even sign up for ChatGPT Pro. They’re happy to use a free tier or pay $20 a month.

Re: AI revenues are growing fast, but not fast enough

#88

Post by bigmadshoe »

ryathal wrote: post #80
bigmadshoe wrote: post #42

Earlier quoted context omitted.

The Apollo program wasn’t for profit and if it was it never would have yielded a return on investment.

The Apollo program successfully beat the USSR after having been noticeably behind. As a proxy for conflict it was a great deal.

Sure, but none of this would be profitable in the context of a private enterprise.

Re: AI revenues are growing fast, but not fast enough

#89

Post by Gagarin1917 »

bandrami wrote: post #86
Gagarin1917 wrote: post #84

Earlier quoted context omitted.

I’m not sure what you’re referencing, I can’t find any source for this. Why would they offer an 80% discount? Hardware is the limiting factor for many AI companies.

The xAI Anthropic deal was pretty widely covered, but the press release is here: https://x.ai/news/anthropic-compute-partnership The absurdly large discount was why Anthropic could claim a revenue-positive quarter for the first time. But that discount window ends IIRC in September. The problem remains that xAI announced the discounted revenue as "revenue before discounts".

No, no, I get that the general deal was public information. I’m not doubting that Anthropic partnered with SpaxeXAI for additional computer. I said as much in my original comment.

What I’m doubting is your claim that SpaceXAI is giving them a 12 billion dollar discount. That link does not say anywhere that SpaceXAI is giving them an 80% discount after charging them $15 billion. That doesn’t make any sense.

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