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IBM CEO says there is 'no way' spending on AI data centers will pay off

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Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#381

Post by CrI0gen »

al_borland wrote: post #368
getnormality wrote: post #265

A decade ago, IBM was spending enormous amounts of money to tell me stuff like "cognitive finance is here" in big screen-hogging ads on nytimes.com. They were advertising Watson, vaporware which no one talks about today. Are they bitter that someone else has actually made the AI hype take off?

I see Watson stuff at work. It’s not a direct to consumer product, like ChatGPT, but I see it being used in the enterprise, at least where I’m at. IBM gave up on consumer products a long time ago.

Just did some brief Wikipedia browsing and I'm assuming it's WatsonX and not Watson? It seems Watson has been pretty much discontinued and WatsonX is LLM based. If it is the old Watson, I'm curious what your impressions of it is. It was pretty cool and ahead of its time, but what it could actually do was way over promised and overhyped.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#382

Post by foobarian »

echelon wrote: post #349
nish__ wrote: post #343

Earlier quoted context omitted.

Neither cloud computing nor AI are good long term businesses. Yes, there's money to be made in the short term but only because there's more demand than there is supply for high-end chips and bleeding edge AI models. Once supply chains catch up and the open models get good enough to do everything we need them for, everyone will be able to afford to compute on prem. It could be well over a decade before that happens bu…

This is my thinking too. Local is going to be huge when it happens. Once we have sufficient VRAM and speed, we're going to fly - not run - to a whole new class of applications. Things that just don't work in the cloud for one reason or another. - The true power of a "World Model" like Genie 2 will never happen with latency. That will have to run locally. We want local AI game engines [1] we can step into like holodec…

> You can't solve 6+DOF, dance routines, cutting food, etc. with 500ms latency.

Hopefully it's just network propagation that creates that latency, otherwise local models will never beat the fanout in a massive datacenter.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#384

Post by 7thaccount »

edm0nd wrote: post #278
getnormality wrote: post #265

A decade ago, IBM was spending enormous amounts of money to tell me stuff like "cognitive finance is here" in big screen-hogging ads on nytimes.com. They were advertising Watson, vaporware which no one talks about today. Are they bitter that someone else has actually made the AI hype take off?

Honestly I'm not even sure what IBM does these days. Seems like one company that has slowly been dying for decades. but when I look at their stock, its at all time highs lol no idea

My limited understanding (please take with a big grain of salt) is that they 1.) sell mainframes, 2.) sell mainframe compute time, 3.) sell mainframe support contracts, 4.) sell Red hat and Redhat support contracts, and 5.) buy out a lot of smaller software and hardware companies in a manner similar to private equity.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#385

Post by nunez »

7thaccount wrote: post #376
SamvitJ wrote: post #339

Earlier quoted context omitted.

"They have great R&D but just can’t make products" Is this just something you repeat without thinking? It seems to be a popular sentiment here on Hacker News, but really makes no sense if you think about it. Products: Search, Gmail, Chrome, Android, Maps, Youtube, Workspace (Drive, Docs, Sheets, Calendar, Meet), Photos, Play Store, Chromebook, Pixel ... not to mention Cloud, Waymo, and Gemini ... So many widely adopt…

They come up with tons and tons of products like Google Glass and Google+ and so on and immediately abandon them. It is easy to see that there is no real vision. They make money off AdSense and their cloud services. That's about it.

Google does abandon a lot of stuff, but their core technologies usually make their way into other, more profitable things (collaborative editing from Wave into Docs; loads of stuff from Google+; tagging and categorizing in Photos from Picasa (I'm guessing); etc)

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#386

Post by mike50 »

ericmcer wrote: post #78
ayaros wrote: post #37

Earlier quoted context omitted.

I'm a younger millennial. I'm always seeing homeless people in my city and it's an issue that I think about on a daily basis. Couldn't we have spent the money on homeless shelters and food and other things? So many people are in poverty, they can't afford basic necessities. The world is shitty. Yes, I know it's all capital from VC firms and investment firms and other private sources , but it's still capital . It shou…

The last 10 years has seen CA spend more on homelessness than ever before, and more than any other state by a huge margin. The result of that giant expenditure is the problem is worse than ever. I don't want to get deep in the philosophical weeds around human behavior, techno-optimism, etc., but it is a bit reductive to say "why don't we just give homeless people money".

Spending money is not the solution. Spending money in a way that doesn't go to subcontractors is part of the solution. Building shelters beyond cots in a stadium is part of the solution. Building housing is a large part of actually solving the problem. People have tried just giving the money but without a way to convert cash to housing the money doesn't help. Also studies by people smarter then me suggest that without sufficient supply the money ends up going to landlords and pushing up housing costs anyway.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#387

Post by winddude »

8T is the high-end of the McKinsey estimate that is 4-8T, by 20230. That includes non-AI data-centre IT, AI data-centre, and power infrastructure build out, also including real estate for data centres.

Not all of it would be debt. Google, Meta, Microsoft and AWS have massive profit to fund their build outs. Power infrastructure will be funded by govts and tax dollars.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#388

Post by nunez »

DaiPlusPlus wrote: post #292
jimmar wrote: post #275

Earlier quoted context omitted.

I don't know that I'd trust IBM when they are pitching their own stuff. But if anybody has experience with the difficulty of making money off of cutting-edge technology, it's IBM. They were early to AI, early to cloud computing, etc. And yet they failed to capture market share and grow revenues sufficiently in those areas. Cool tech demos (like the Watson Jeopardy) mimic some AI demos today (6-second videos). Yeah, i…

> but it just wasn't IBM's software that people ended up buying. Well, I mean, WebSphere was pretty big at the time; and IBM VisualAge became Eclipse. And I know there were a bunch of LoB applications built on AS/400 (now called "System i") that had "real" web-frontends (though in practice, they were only suitable for LAN and VPN access, not public web; and were absolutely horrible on the inside, e.g. Progress OpenEd…

Websphere is still big at loads of banks and government agencies, just like Z. They make loads on both!

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#389

Post by fwip »

ProjectArcturis wrote: post #322
bigstrat2003 wrote: post #297

Earlier quoted context omitted.

The difference is that the Internet was actually useful technology, whereas AI is not (so far at least).

More use cases for AI than blockchain so far.

Quite a low bar.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#390

Post by hadlock »

MegaDeKay wrote: post #357
Esras wrote: post #347

Earlier quoted context omitted.

I think the sentiment is usually paired with discussion about those products as long-lasting, revenue-generating things. Many of those ended up feeding back into Search and Ads. As an exercise, out of the list you described, how many of those are meaningfully-revenue-generating, without ads? A phrasing I've heard is "Google regularly kills billion-dollar businesses because that doesn't move the needle compared to an…

They bought YouTube but you have to give Google a hell of a lot of credit for turning it into what it is today. Taking ownership of YouTube at the time was seen by many as taking ownership of an endless string of copyright lawsuits, suing them into oblivion.

Youtube maintains an independent campus from the google/alphabet mothership, I'm curious how much direction they get, as (outwardly, at least) appear to run semi-autonomously.
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