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Companies rein in AI usage as costs strain budgets

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Re: Companies rein in AI usage as costs strain budgets

#101

Post by danaris »

gortok wrote: post #31
danielvaughn wrote: post #3

We're in a dangerous valley where AI is _just_ good enough to fool some otherwise very smart people. Similar to the old adage of "a little bit of information is a dangerous thing." Lots of CEOs got duped into thinking that model capabilities were far ahead of where they actually were. I'm actually not sure if we're going to get out of the valley without figuring out a surefire way to reliably evaluate these things.

They got duped into it partly because of the enthusiasm and demoware shown by folks like the ones that topped HN with their exhortations about the wonders of AI for coding. We’re not innocent bystanders here, and it’s important to recognize that. Our hype added to the hype. Our optimism added to the optimism. After layoffs due to Section 172 and interest rates going up, technologists were looking for a reason to be i…

While it's true that HN, as a collective, was participating in that hype, you need to be very careful about trying to extend that to mean that every poster on HN is complicit in it.

Many of us were skeptical from the start, and have done nothing to hype up LLMs.

Re: Companies rein in AI usage as costs strain budgets

#102

Post by danaris »

simonw wrote: post #30
prymitive wrote: post #29

Earlier quoted context omitted.

Partially because they think that once employees put enough context and rules into markdown files they can be fired and replaced by an online subscription.

I'm not convinced that's happening, any good evidence that it is? The impact of AI on jobs appears to be more in terms of hiring slowdowns: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=5425555 > Following adoption, junior employment declines in adopting firms relative to non-adopters, while senior employment trends remain largely unchanged. This decline is concentrated in occupations most exposed to GenAI and…

The point isn't that it is happening.

It's that enough execs think it can happen.

No actual evidence is required for that.

Re: Companies rein in AI usage as costs strain budgets

#103

Post by pydry »

stefanfisk wrote: post #99
gamblor956 wrote: post #84

Earlier quoted context omitted.

But there's also obvious value. To say otherwise tells me you haven't actually tried to make use of these tools. The issue is not that AIs are useless. It's that they are objectively worse at the job (except apparently programming[1]), than a cheaper, entry-level worker on their first week still learning how to do the job, even though nearly a trillion dollars has been spent on them by this point. The worker gets sub…

That’s assuming that the tools should be able to replace juniors. I have a hard time seeing how a junior could take over the role which Claude code currently fills in my line of work and certainly not at the same price point even if I paid for the tokens rather than a subscription.

Juniors slowed me down way way way before AI came along but theyre getting stiff competition these days from the AI slop I'm having to wade through.

Re: Companies rein in AI usage as costs strain budgets

#104

Post by androiddrew »

simonw wrote: post #22
josefritzishere wrote: post #2

Companies are learning that even with mass layoffs, AI isn't worth what it costs for most use cases. This is an important inflection point because none of the AI companies are profitable, i.e. they're all still charging substantially less than what it costs to actually deliver the service. With things in that intermediate state, it's hard to know what a future stable state will be like.

If AI isn't worth what it costs why are some of these companies allowing $1,000+/employee/month?

Have you considered that that money would have gone to raises or promotions? From that perspective the company nets out while the employee that would have received that money feels the effects of wage suppression.

Re: Companies rein in AI usage as costs strain budgets

#105

Post by multjoy »

casey2 wrote: post #96
danielvaughn wrote: post #3

We're in a dangerous valley where AI is _just_ good enough to fool some otherwise very smart people. Similar to the old adage of "a little bit of information is a dangerous thing." Lots of CEOs got duped into thinking that model capabilities were far ahead of where they actually were. I'm actually not sure if we're going to get out of the valley without figuring out a surefire way to reliably evaluate these things.

No one was "duped" CEOs tend to look out 10-20 years in the future. Extrapolating with s, linear, and log curves. If they all look good then they hop on board. Any way you slice it AI will be unimaginable in 20 years, you don't want an engineering culture that focuses on retaining useless skills. Look at mega-caps like Google and Facebook, so called web native companies, are STILL shunned by "real devs" despite looki…

>No one was "duped" CEOs tend to look out 10-20 years in the future

Lol.

Re: Companies rein in AI usage as costs strain budgets

#106

Post by simonw »

androiddrew wrote: post #104
simonw wrote: post #22

Earlier quoted context omitted.

If AI isn't worth what it costs why are some of these companies allowing $1,000+/employee/month?

Have you considered that that money would have gone to raises or promotions? From that perspective the company nets out while the employee that would have received that money feels the effects of wage suppression.

You could say the same thing about the office snack budget, or the training budget, or the budget for the office holiday party.

Re: Companies rein in AI usage as costs strain budgets

#107

Post by antonvs »

shimman wrote: post #89
antonvs wrote: post #50

Earlier quoted context omitted.

> To say otherwise tells me you haven't actually tried to make use of these tools. There's also a lot of ideological opposition, which often tries to claim that the tech is useless etc. > Am I missing out on the work involved in learning things I would be forced to otherwise, also yes. Yes, but many of those things are things you might not really care about learning about. And if you want to learn about them, AI can…

Get it right, 99.99% of ideological opposition is mostly do to the naked display of wealth concentration where we are literally forcing Americans to bear the higher costs of electricity, noise pollution, actual pollution, and increased cancer rates while they are flushing down trillions of dollars into the drain while Americans lack medicare for all, universal childcare, free higher education, or even a public jobs p…

> Get it right

What did I get wrong exactly?

What I pointed out is that ideological objectors often try to claim that AI is actually technically useless.

The problem with that is that it makes their arguments seem less credible, and even misleads their own supporters into underestimating what they’re dealing with. It’s a literally self-defeating position.

Re: Companies rein in AI usage as costs strain budgets

#108

Post by KronisLV »

nixpulvis wrote: post #37

I'm so frustrated by both the zealous AI bulls and the blind AI opposition. There's a lot of issues, ranging over technical, cultural, environmental, and moral problems. But there's also obvious value. To say otherwise tells me you haven't actually tried to make use of these tools. It's one thing to get an AI google response and feel like it's dubious, it's another thing to know what you want and have an LLM find the…

Tried writing down my own take on it: https://blog.kronis.dev/blog/ai-psychosis-and-anti-ai-psycho...

To sum it all up, there are good arguments both for and against AI, but it increasingly feels like it's ideologically driven and feeds into delusions.

Not only that, but while the technology itself isn't inherently evil, you can leave it up to humanity to absolutely misuse it - together with unregulated capitalism, it results in one big mess.

Re: Companies rein in AI usage as costs strain budgets

#110

Post by gamblor956 »

stefanfisk wrote: post #99
gamblor956 wrote: post #84

Earlier quoted context omitted.

But there's also obvious value. To say otherwise tells me you haven't actually tried to make use of these tools. The issue is not that AIs are useless. It's that they are objectively worse at the job (except apparently programming[1]), than a cheaper, entry-level worker on their first week still learning how to do the job, even though nearly a trillion dollars has been spent on them by this point. The worker gets sub…

That’s assuming that the tools should be able to replace juniors. I have a hard time seeing how a junior could take over the role which Claude code currently fills in my line of work and certainly not at the same price point even if I paid for the tokens rather than a subscription.

I have a hard time seeing how a junior could take over the role which Claude code currently fills in my line of work and certainly not at the same price point even if I paid for the tokens rather than a subscription.

At the current, VC-subsidized price point, sure. But at the real market cost at which the AI companies would break even on their offerings, the junior is cheaper and more effective than Claude within about 3 months. And to be blunt, if that's not the case then the kind of programming you do is already basically junior-level development anyways and it's a waste to have seniors handing the role that could and should be handled by juniors.

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