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The tech market is fundamentally fucked up and AI is just a scapegoat

bayramovanar.substack.com

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Re: The tech market is fundamentally fucked up and AI is just a scapegoat

#171

Post by Havoc »

TheOtherHobbes wrote: post #144
Havoc wrote: post #120

Don’t think it needs to be either or. ZIRP, AI, over hiring, and a wave of boot camp labour supply I suspect all contribute. Plus we’re also likely approaching saturation on a lot of fronts with attention and ad density saturation. Things like YouTube seem to be on the edge of how much ads they can force feed without people just not using yt because it’s unusable. Enshitification isn’t a cycle, it’s a one way trip. C…

But on the other side there are countless opportunities for valuable revenue-generating products that aren't based on dopamine addiction and/or ad tech. It's a values problem, not an opportunity problem. Tech industry management is locked in a death spiral because it lacks the ethics or the vision to create real value, as opposed to extractive predatory value. This applies equally to consumer relationships and employ…

> there are countless opportunities for valuable revenue-generating products that aren't based on dopamine addiction and/or ad tech.

Perhaps a bit of a hot take but I’d be inclined to disagree. The boom in big tech is I think almost exclusive driven by dopamine, brain rot and ad tech either directly or indirectly. Meta and Google - almost entirely ad funded. Netflix - binge watching and they’re trying hard to force more ads in. Apple makes the black rectangle to watch the content and ads - without the iPhone 1 doomscrolling wouldn’t be a thing. Amazon runs an ad empire, produces video content for binge watching and has a store designed to maximise consumerism and retail therapy.

Even the portions that are more infra like AWS - I’d bet a large portion of that fulfilling demand by things that are part of the attention/dopamine economy. All those TikTok dances aren’t served off a raspberry pi.

Don’t get me wrong not trying to discount tech as not having genuine ethical value or opportunities not existing. But the explosive growth seen in tech over past 20 years specifically is I think almost exclusively driven by adtech and attention economy.

And if that reaches saturation either this changes tracks to similar on AI or the growth plateaus. Other value creation certainly exists and is valid but I don’t see it filling the shoes of adtech.

Google and meta indirectly acknowledged the problem years ago already with their balloons over Africa to connect more eyeballs to the internet plan. If you can’t force feed more ads to current user base then you need more users. It’s telling I think that a wild plan like balloons in Africa was the plan selected, rather than going for the countless other valuable opportunities as you say. Speaks to the relative profitability

Re: The tech market is fundamentally fucked up and AI is just a scapegoat

#172

Post by cyberge99 »

j05ev1f3 wrote: post #52
jasode wrote: post #15

>In traditional industries like manufacturing you don’t hire 500 factory workers unless you have a production line that needs them. You don’t over-hire based on a guess. Traditional factories do make wrong guesses about the future and overhire all the time. Example: https://www.google.com/search?q=Ford+f150+lightning+laid+off...

The whole article rests on this false economic claim, that traditional industries don’t overhire based on expectations. They absolutely do, ALL THE TIME. Manufacturing, automotive, airlines, energy etc. all of them make demand bets and lay people off when those bets fail. Cheap money amplified this cycle, but this isn’t a tech specific "failure", it’s just how forecasting under uncertainty work. It’s incredible how s…

They typically have an elastic workforce padded with several contractors or temp workers that can expand or contract based on market conditions.

Re: The tech market is fundamentally fucked up and AI is just a scapegoat

#173

Post by random3 »

The author describes hiring strategy relative to Fed policy as one assumption that presumably motivates the current context in the market, but completely fails to make a point about AI, or to generally back their claims. In fact, even the main claim seems to be pulled out of the hat wrt to Europe where there’s no Fed. No hiring/layoff numbers, etc. I get it that it’s just a guy with a blog, but it’s on top of HN now, and IMO vacuous, describing one motivation that’s been floating around for quite some time. Perhaps as long as they wanted to write about it until this “last straw”

Re: The tech market is fundamentally fucked up and AI is just a scapegoat

#174

Post by roncesvalles »

direwolf20 wrote: post #75
epolanski wrote: post #45

> The result is the worst of both worlds. European engineers now face US-level job insecurity with European-level compensation and limited mobility. Firing people in most of Europe is still not as easy as it is in the US. The opposite is also true, it's not that easy to leave your employer and you have to give 1/3/6 months notice before leaving, depending on your role/seniority/contract. Sometimes companies even make…

Indeed. It's not impossible to lay off people in Europe but they can't just say "you're fired!". There's a process and it costs time and perhaps 3 to 6 months of salary and you have to prove the layoff is needed. The business is incentivized to reduce hiring and find other work for the employee to do, instead.

To be fair, "you're fired!" doesn't happen in the US tech industry either. Even for performance-based firings, the employee almost always gets a few months of salary and garden leave in exchange for a release of claims. One of the positive effects of America being an overly litigious society. Unemployment insurance also kicks in.

Re: The tech market is fundamentally fucked up and AI is just a scapegoat

#175

Post by packetlost »

syx wrote: post #67
cong-or wrote: post #47

Interesting framing. The article makes a compelling case that we're seeing the hangover from 14 years of ZIRP-fueled hiring rather than an AI apocalypse. But I'm curious what people think the equilibrium looks like. If the "two-tier system" (core revenue teams + disposable experimental teams) becomes the norm, what does that mean for the future of SWE as a career? A few scenarios I keep turning over: 1. Bifurcation -…

As someone with many animator friends, this sounds very bleak. Their work processes are very similar to software engineering, with the difference that their hiring process is much quicker (they just show a bunch of reels and shots they made for previous films or cartoons, and they’re hired). The sad part is that they have almost no labor rights, and competition is incredibly high, which means pay is very low and turn…

The difference is animation is part of the entertainment industry and software engineering is part of every industry. I don't really think it will ever be like animators are today, but I wouldn't be surprised if wages fall.

Re: The tech market is fundamentally fucked up and AI is just a scapegoat

#176

Post by kjs3 »

mexicocitinluez wrote: post #44
oytis wrote: post #24

Anecdotally, I didn't see more safety for engineers working on cash cows. Quite the contrary, if a product is already bringing revenue, it is an easy decision for the business to squeeze a bit more margin by letting people go. Stable, cash-generating projects are often first to be put into efficiency/maintenance mode.

Also anecdotally, I've had a handful of software development positions throughout the years (never at a position with more than 200-300 person company) and have yet to be laid off due to money. I've yet to be laid off at all, but that's irrelevant. I truly believe that these new tools will actually hurt the bigger companies and conversely help smaller ones. I'm in healthcare. The big players in the EMR space are Epic…

What if, instead of having to reach out to the big players, the economics of having a software developer or 2 on staff make it such that you could build custom-tailored, bespoke software to work "with" your company and not against?

Because the hospitals those practices want to associate with say "we're on Epic and expect you to be as well"?

Wife in healthcare management...overhear this conversation once or twice a week.

Re: The tech market is fundamentally fucked up and AI is just a scapegoat

#177

Post by alansaber »

bluescrn wrote: post #115
oytis wrote: post #24

Anecdotally, I didn't see more safety for engineers working on cash cows. Quite the contrary, if a product is already bringing revenue, it is an easy decision for the business to squeeze a bit more margin by letting people go. Stable, cash-generating projects are often first to be put into efficiency/maintenance mode.

> Stable, cash-generating projects are often first to be put into efficiency/maintenance mode Or they're actively enshittified, aiming to extract more short-term revenue at the cost of a long-term future...

If you're a company where the future looks uncertain, short term over long term starts to look mighty appealing

Re: The tech market is fundamentally fucked up and AI is just a scapegoat

#178

Post by direwolf20 »

random3 wrote: post #173

The author describes hiring strategy relative to Fed policy as one assumption that presumably motivates the current context in the market, but completely fails to make a point about AI, or to generally back their claims. In fact, even the main claim seems to be pulled out of the hat wrt to Europe where there’s no Fed. No hiring/layoff numbers, etc. I get it that it’s just a guy with a blog, but it’s on top of HN now,…

Europe is still connected to US financial markets. The USD is the most influential currency. When it contracts, money in general contracts.

Re: The tech market is fundamentally fucked up and AI is just a scapegoat

#179

Post by direwolf20 »

roncesvalles wrote: post #169
direwolf20 wrote: post #70

Earlier quoted context omitted.

The market can remain irrational longer than you can remain solvent. But why do you think gold has tripled in price?

1. Mass hysteria. 2. Central banks rotating into gold to de-risk from USD combined with their usual slow bureaucratic processes. By the time they've decided that gold needs to be bought, the price has already run up by 50% and it's no longer a good idea to buy, but they still need to execute on their decisions anyway. The USD isn't going anywhere for the simple reason that the USA can simply counterfeit any non-USD c…

North Korea is a prolific USD counterfeiter. Where are the missiles?

Digital currencies can't be counterfeit. China is cashless, so are some parts of Europe.

Re: The tech market is fundamentally fucked up and AI is just a scapegoat

#180

Post by dkoy »

billy99k wrote: post #81
cong-or wrote: post #47

Interesting framing. The article makes a compelling case that we're seeing the hangover from 14 years of ZIRP-fueled hiring rather than an AI apocalypse. But I'm curious what people think the equilibrium looks like. If the "two-tier system" (core revenue teams + disposable experimental teams) becomes the norm, what does that mean for the future of SWE as a career? A few scenarios I keep turning over: 1. Bifurcation -…

"Consulting/contractor becomes default - Full-time employment becomes rare; most devs work project-to-project like other creative industries" I'm in the tech industry and have been doing this for 12+ years now. In the beginning, it was because I wanted to live overseas for a few years, without a break in my career. Now, it's about survival. I buy my own health insurance (me and my family) in the marketplace every yea…

Have been doing this for ~3 years as a way to bring into the industry. Has more or less worked (to that end), but the art of finding + maintaining a pipeline of potential clients while working contracts full-time to sustain a family is.. difficult. (And now that I'm qualified to get a real job in the industry, many raise eyebrows at the plethora of short-term contracts).

I'm happy to hear it's been working out for you, though. How do you manage/succeed?

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