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AI is slowing down

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Re: AI is slowing down

#341

Post by athrowaway3z »

Terr_ wrote: post #174
putzdown wrote: post #136

One of the "smells" that gives away a quacky ranter is they speak in impassioned, "Why doesn't everyone understand this?" tones, but in fact their argument just doesn't flow. If Zitron's argument were as solid as he keeps saying it is, you would read it and understand it and see that it is solid. He would begin somewhere–statistics on AI demand, say–and then walk the calculations carefully over to the next step–maybe…

> He would begin somewhere–statistics on AI demand, say–and then walk the calculations carefully over to the next step–maybe revenue needed for profitability by AI companies–and you could follow the argument. Which of the hyperlinks provided at the beginning sounded like what you wanted, and after you clicked it* how did it disappoint you? The information you are describing is stuff I would not expect anybody to repe…

He's right that its all going to pop dramatically and catastrophically for some. But having read a bunch of his stuff, there are two things he's just plain wrong about and they make his martyrdom tone too grating.

- His own objectivity - he consistently throws shade (rightfully) at the pro-AI side being financially 'required' to hold a certain world view, but is completely blind to his own claim to fame effecting him similarly.

- He consistently claims AI can't be made to work, and tries to prove this by calculating with the bubble prices. Its like saying tulips could never be profitable in the middle of the mania because ships were too expensive as proven by their current price to use for shipping tulips.

Add in the semi regular instance downplaying AI's usefulness contradicting my own experience and I mostly dont bother reading him anymore.

Its not like I'll be surprised that shit hits the fan, and he's not going to call the 'when' any better than wallstreetbets or an octopus.

Re: AI is slowing down

#342

Post by marcosdumay »

brindleth wrote: post #29

Whenever I read these kind of articles about AI financials, I'm reminded of identical screeds I read about Uber a few years ago. They were angrily insistent that Uber was a scam company run by criminals and charlatans and could never, ever become profitable or make money for its investors. It was a house of cards that would come crashing down sooner or later, and take everyone's money with it. Now it's 2026. Uber sti…

Funny thing, the uber's investor results from last year only mentions "profit" once, in a motivating paragraph where they say they will be great.

But it's famous for having collapsed after their IPO. It took 4 years to get back at the same nominal valuation (not inflation corrected), and after all the 2020s inflation it is still at 2x the initial price.

Re: AI is slowing down

#343

Post by sumeno »

mike_hearn wrote: post #292
cmiles74 wrote: post #284

Earlier quoted context omitted.

I don't read Ed Zitron, aside from when he appears here on Hacker News, and I also find his tone to be over-the-top. I think we might agree on that much. These articles are lengthy but, to my understanding, Ed's idea is... * AI companies have committed to purchasing X amount of compute * Data centers are being constructed to meet this demand, they'll need to charge amount Y * AI companies do not have sufficient reven…

Not the OP but Zitron makes clear errors: • He seems to think that the moment Nvidia release new hardware, all existing hardware becomes worthless. It doesn't and there are plenty of tokens being served by old GPUs. This makes all his calculations about how quickly datacenters have to pay off useless. • All his numbers about costs, revenues etc are guesses or attempts to work backwards from off the cuff and frequentl…

They don't immediately become worthless, but they don't last all that long either

https://www.tomshardware.com/pc-components/gpus/datacenter-g...

Re: AI is slowing down

#344

Post by LogicFailsMe »

mlyle wrote: post #336
LogicFailsMe wrote: post #331

Earlier quoted context omitted.

Well, he dismisses any value whatsoever to GenAI. That's immediate bozo bit criteria to me. And, well, if Anthropic revenue doesn't grow 5x between now and the end of the decade, I'll be pretty surprised. But, sure, if it doesn't, then someone will keep them around anyway. AMD almost died in the 2010s as one example, but they kept getting propped up and now they're back in the game swinging. There are people who can…

> Well, he dismisses any value whatsoever to GenAI. I didn’t read it that way. I see a lot of value in it. I just don’t see us justifying the amount of infrastructure being built or current valuations. Or in the unlikely event that we do, the societal upheaval is going to take away the ability to monetize it meaningfully. OpenAI and Anthropic may make it through. But that is different from saying valuations are justi…

"Those excited about generative AI are either the victim or the perpetrator of a con centered around a technology to ingratiate at the highest cost possible."

How else would you read the above statement? He's just preaching to his own choir IMO.

My take: like any gold rush, a lot of dumb ideas will get backed and they will all fail. And then we'll keep the ones that worked. SSND. Good luck picking the winners a priori.

Re: AI is slowing down

#345

Post by thewebguyd »

jredwards wrote: post #242
dofm wrote: post #239

Today Apple launched its revamped AI offering. Judging by several reports, Apple pays Google a mere billion dollars a year to operate it. Essentially just licensing the IP. Google are (allegedly) happy to turn over the right to operate and distill their models for only a billion a year. Consumer revenue is only a smallish share of the puzzle, but still: If you are a consumer and you have a Mac or an iPhone, what do y…

I expect that a lot of the money will be in Enterprise AI.

I think so too (Enterprise), but I think its going to look different from "Pay subscription for access to a model from OpenAI/Anthropic/Google."

I don't think people will be doing business with the labs directly. "Enterprise AI" will be distilled down into purpose built products, with the model just basically being a generic commodity, and nearly irrelevant to the enterprises buying whatever these products are much like how I don't care if whatever SaaS was built in React, Vue, or some other framework as long as it works.

Ironically, for as much shit as they get about Copilot, Microsoft I think has the right idea for the long game they just suck at execution. Copilot is the tool, integrated into the rest of their enterprise stack, it doesn't care what the model is behind the scenes (they already offer you the ability to choose between different models).

That doesn't really bode well for the labs and their trillion dollar IPOs, because they are effectively reduced down to being a developer framework.

Re: AI is slowing down

#346

Post by hparadiz »

dofm wrote: post #239

Today Apple launched its revamped AI offering. Judging by several reports, Apple pays Google a mere billion dollars a year to operate it. Essentially just licensing the IP. Google are (allegedly) happy to turn over the right to operate and distill their models for only a billion a year. Consumer revenue is only a smallish share of the puzzle, but still: If you are a consumer and you have a Mac or an iPhone, what do y…

You are kind of glossing over the B2B market where contract pricing is basically just MBA vibes and the fact that people don't really care necessarily about the performance of the language model once it hits a baseline. They care about how it integrates into their lives. Precisely where first mover advantage comes into play. Having to train a language model all over again is it's own sunk cost.

Re: AI is slowing down

#347

Post by marcosdumay »

irishcoffee wrote: post #325
marcosdumay wrote: post #289

Earlier quoted context omitted.

I really doubt the US will erase any money any time soon. The reset is prone to happen by other means.

I consider myself of average intelligence, and I see this coming. Maybe I assume too much.

Every government has complete control on how much of their money exists. If it disappears from the private finance market, it can compensate with any amount it wishes.

Re: AI is slowing down

#348

Post by discreteevent »

famouswaffles wrote: post #330
dofm wrote: post #318

Earlier quoted context omitted.

> Will Apple's offering be providing any meaningful/significant benefit over just using GPT ? If not, don't expect any miracles. Judging by the announcements today about its integration into the OSes? They are offering useful things ChatGPT cannot offer unless they write an "everything app". One can (maybe should) make the argument that this is the browser monopoly again, but given that the USA has seemingly no inten…

Just because Apple said they're 'integrating into the OS' (which can really mean a lot of things) doesn't mean they'll offer something users will actually care about that Open AI can't match.

> that Open AI can't match.

Open AI can match it but at what price?

Re: AI is slowing down

#349

Post by BoggleOhYeah »

lispisok wrote: post #275
putzdown wrote: post #136

One of the "smells" that gives away a quacky ranter is they speak in impassioned, "Why doesn't everyone understand this?" tones, but in fact their argument just doesn't flow. If Zitron's argument were as solid as he keeps saying it is, you would read it and understand it and see that it is solid. He would begin somewhere–statistics on AI demand, say–and then walk the calculations carefully over to the next step–maybe…

Oddly suspicious how this comment which was not one of the first comments which does not address the content at all but the tone skyrocketed to the top.

HN does this with every Zitron article.

Re: AI is slowing down

#350

Post by cyanydeez »

hparadiz wrote: post #346
dofm wrote: post #239

Today Apple launched its revamped AI offering. Judging by several reports, Apple pays Google a mere billion dollars a year to operate it. Essentially just licensing the IP. Google are (allegedly) happy to turn over the right to operate and distill their models for only a billion a year. Consumer revenue is only a smallish share of the puzzle, but still: If you are a consumer and you have a Mac or an iPhone, what do y…

You are kind of glossing over the B2B market where contract pricing is basically just MBA vibes and the fact that people don't really care necessarily about the performance of the language model once it hits a baseline. They care about how it integrates into their lives. Precisely where first mover advantage comes into play. Having to train a language model all over again is it's own sunk cost.

b2b needs actual ROI and that's no where near. CEOs would be yelling loudly if this were returning them cash instead they're just jettison people to afford the bills.
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