Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Alphabet's cash burn raises alarm for Big Tech as AI spending climbs

reuters.com

Post reply on HN
Print view View original

301–306 of 306 posts

Re: Alphabet's cash burn raises alarm for Big Tech as AI spending climbs

#301

Post by maxglute »

fooker wrote: post #288
maxglute wrote: post #276

Earlier quoted context omitted.

Companies are run by people, 100 billion dollar companies are ran by people who want to stay billionaires and will street accordingly. But I'm not sure what we're disagreeing on, yes the talent will migrate, AI industry will eventually settle on some none bubble equilibrium, but that doesn't mean current AI economics is sensible, or inflated hardware costs beyond yield is not danger indicator. Like yeah, risky bets a…

> that's independent of whether business models and broader economy is going to explode. It's independent of the former, but not the later. That is my point. Businesses and business models fail all the time, does not mean the 'broader economy is going to explode'. It could, sure. But that has been predicted several hundred times and happened only a few times.

You're making a classic logic error by accidentally equating corner bodega with trillion dollar keystone industry.

Business models fail all the time, trillion business models that underpins entire macro economic growth engine exploding and causing massive contagion happens rarely, not even generationally. But when they do the leading bubble mathematic indicators are more clear.

Re: Alphabet's cash burn raises alarm for Big Tech as AI spending climbs

#302

Post by CuriousSkeptic »

CuriousSkeptic wrote: post #263
mcbuilder wrote: post #140

Earlier quoted context omitted.

We have probably hit a limit to scaling LLMs through raw parameter count alone, at least we're not seeing the exponential pace. I personally think we'll end up with a nice sigmoid curve plateauing in the sub 10T parameter regime. The amount of tokens processed (in inference) is increasing exponentially though (I've been following open router usage stats for years and it's always been exponential). We will of course m…

> We have probably hit a limit to scaling LLMs through raw parameter count alone, at least we're not seeing the exponential pace. Source?

FWIW it was a genuine question. I’ve only seen charts where the exponential trend remains, or even accelerates.

Re: Alphabet's cash burn raises alarm for Big Tech as AI spending climbs

#303

Post by heaney-555 »

Noaidi wrote: post #281
heaney-555 wrote: post #273

Earlier quoted context omitted.

Why are you assuming the demand will drop?

Because AI has a negative ROI for the user.

Why are you assuming that AI has a negative ROI for the user? And that it always will?

Re: Alphabet's cash burn raises alarm for Big Tech as AI spending climbs

#304

Post by redwood »

maxglute wrote: post #301
fooker wrote: post #288

Earlier quoted context omitted.

> that's independent of whether business models and broader economy is going to explode. It's independent of the former, but not the later. That is my point. Businesses and business models fail all the time, does not mean the 'broader economy is going to explode'. It could, sure. But that has been predicted several hundred times and happened only a few times.

You're making a classic logic error by accidentally equating corner bodega with trillion dollar keystone industry. Business models fail all the time, trillion business models that underpins entire macro economic growth engine exploding and causing massive contagion happens rarely, not even generationally. But when they do the leading bubble mathematic indicators are more clear.

You may be conflating magnitude of dollars invested in AI being at records with the fact that they're actually a lower percentage of GDP than other speculative bubbles have been ... this is important to understand because the magnitude of a slow down maybe much smaller than you seem to think

Re: Alphabet's cash burn raises alarm for Big Tech as AI spending climbs

#305

Post by maxglute »

redwood wrote: post #304
maxglute wrote: post #301

Earlier quoted context omitted.

You're making a classic logic error by accidentally equating corner bodega with trillion dollar keystone industry. Business models fail all the time, trillion business models that underpins entire macro economic growth engine exploding and causing massive contagion happens rarely, not even generationally. But when they do the leading bubble mathematic indicators are more clear.

You may be conflating magnitude of dollars invested in AI being at records with the fact that they're actually a lower percentage of GDP than other speculative bubbles have been ... this is important to understand because the magnitude of a slow down maybe much smaller than you seem to think

Direct DC/AI capex lower bound ~2.5% gdp already comparable to dotcom / dark fiber. Include down stream supply chain / infra and its ~5% - railway territory. Either way relative magnitude of AI financial footprint is systemic risk is within historic bubble territory. Also important to understand AI basically only major growth driver, other sectors underperforming, there's nothing to cushion, and fallout maybe much larger than you seem to think. Strip away IT 90s baseline economy was still growing 3%, strip out AI, 2026 baseline growth ~1%, negative once you factor in money printing and historic ~3% (and growing) burnt in debt servicing. Stack on hardware depreciation, and I wouldn't say contagion magnitude will be slow/small.

Re: Alphabet's cash burn raises alarm for Big Tech as AI spending climbs

#306

Post by yunwal »

erwald wrote: post #290
yunwal wrote: post #130

Earlier quoted context omitted.

The guy who sells $20 bills for $10 also generates a lot of revenue

That's a point about margins, not revenue

It's literally a point about revenue. The point is, it's very easy to record a lot of revenue when you (and your investors) don't care about your margins
Post reply on HN