Something big is coming. The number of startups that investors have poured billions into that do random in-the-middle bullshit to try and scrape pennies from companies’ budgets is incredible. These products aren’t real. All the investment went into carving money off… the investment. It’s self eating.
The company I work does pretty basic analysis. Its certainly an “every day” application. It’s been two or three years they’ve been Investing large amounts of money into this, and it can’t do shit. We have been “training” it for faaaaaar longer than it would take to train a human to do these things. Plus, they’ve torn it apart and completely restarted the process at least twice, to my knowledge. Zero efficiencies, very little practical capability. I hear that it’s great at coding and math, I’ve seen it do word processing pretty good, but these assholes oversold it’s capabilities to the managerial class, and they fucking took it. Hook, line, and sinker.
I believe the implosion of the AI bubble will essentially torpedo the only thing still supporting the US economy?
This is the first major real sign of the bubble popping. An actual verified report from the Financial Times regarding massive drop in revenue expectations, rather than just people hoping it pops.
Nothing an injection of taxpayers money can’t fix!
Could they not have asked their top-tier LLM for advice on how to avoid this massive loss? No? Oh.
cant happen soon enough
Since I haven’t seen it yet in this conversation, I think I need to bring some better context to what this article is claiming.
No, OpenAI did not assume they were making $70 billion. They’ve always known their existing number. In fact, that number IS what was reported to investors.
The $70 billion number is coming from a specific investor that wanted to adjust the definition of revenue to get a more “apples to apples” comparison to Anthropic’s numbers.
When these companies license their models to hypervisors (AWS, Azure, etc), those hypervisors take a cut. OpenAI does not report that cut as revenue. This investor wanted to add it back in to get a “total demand for AI tokens” number.
They are 2 completely different metrics coming from 2 completely different groups.
After the initial dot com boom and bust (remenber pets.com?) I remember being told laptops and desktops were dead and we’d all be using tablets. Metaverse, google glass, self driving vehicles real soon, theranos will transform health care, NFTs, crypto. And now AI. Its all just a repeating toilet bowl swirl of empty speculation, exactly like a casino. And not a single one of those things came to much. I wonder if AI will leave much progress behind when it implodes. Maybe this time itll be different?
Yeah, just like, after the Segway bubble burst, we’re all riding them now.
The funniest part is that the dot com crash didn’t kill the internet. It killed a lot of terrible business plans. AI may follow the same script: useful tools survive, investors discover that a chatbot isn’t worth infinite money, and taxpayers get stuck with the data center power bill. The technology can be real while the valuation is pure casino. - PS: You didn’t mention the smartphone. And that’s exactly what people mainly use these days.
remember pets.com
I think pets.com is probably the best analogy to what will happen with this first round of AI companies. In hindsight pets.com’s business model was fine and modern companies like chewy are doing the same thing successfully.
The problem was timing, internet adoption was low and most people didn’t understand how to use the Internet or trust it. Combine that with a flood of speculative dollars that mostly gets funneled into marketing with no adoption to justify it and the business falls apart.
I think we’ll see the same thing happen with some of these AI applications, the use case may be valid, but people, and the devs, won’t know how to use AI and the people won’t trust it so adoption will be low even with high marketing and the company will go bust. Then 10 years from now we’ll make fun of that AI party planning app that went under while we all plan our parties through some new AI app.
Tech Bros have been trying to repeat the Net Boom almost immediately after that bubble burst - I think it didn’t take more than a couple of years after that Crash for the “Web 2.0” to start being paraded around like some kind of new gold rush that everybody should jump into and, as clearly visible in the list of hype techs you wrote, they just kept doubling down on the hype and the fraud ever since.
I actually was in Tech in the 90s and during the Crash, and then came back to that industry and into startups almost 2 decades later, and my feeling is that the point when the entire sector turned into nothing more than a giant grift was either a bit after the crash or, at best, just when the boom before it was peaking - I remember very clearly that in the 90s startups mostly started with somebody having a cool idea for tech, whilst in the 00s and onwards they mostly started with somebody having a business idea which was generally about setting oneself up as an intermediary in a kind of business transaction already done for decades, using the Internet and/or Smartphones to come up with a new twist for it and some way of becoming an aggregator/middle-man between both sides of the transaction.
AI IS a useful tool for some things, just not everything. So it ain’t going away. Just as the “cloud” is still with us. Or email. Anyone remember when every ISP had their own email?
Every new idea goes through the process of catching on, stupid rapid growth, and then the weeding out of 90+ % of them, and finally the stabilizing the market for those that actually need and use it. Whether is cars, TVs, Cell phones, or AI, every hot new idea goes through this process.
I wonder if AI will leave much progress behind when it implodes.
I think it will, it’s the one bit of AI optimism I actually have. I have a theory the big AI firms love for example Yudkowsky’s doomsday cult so much because it’s easier for them to imagine the end of humanity than it is to imagine them not getting an extractive oligopoly over an emerging technology.
The tech itself is actually decent as tech, it’s not what the boosters claim it is but even if development stopped advancing today there’s loads of niches it’d be changing for a long time; computer vision in medical settings for example. Useful things like TTS will be much better going forward than they ever were, and for better and worse things like computer vision in general (ie in public) will never be the same. LLMs are basically magic NLP boxes too, they’re useful for classification as much as generating slop.
Netbooks and thin computing too.
Nope, all hype and fizzle.
Turns out people want to own their personal hardware/software tools and data, without some perverts reading and observing their family interactions.
The tablet one eventually came true. Desktops and laptops aren’t anywhere near as popular for personal use by non-technical people.
I hope you are right .
But i just read and article suggesting that new university students "cant imagine " writing a 5 page paper without AI chatbots…
Yes this time it will be different, please purchase ETFs with names like “AI, Metaverse and Blockchain” (they actually exist)
/s
Can we please have jobs and computer components and decent search results?
No job! Only consume! ⚾🐕
Does your ai company bite?
No but it can hurt you in other ways.
Ai company: we’ve got to destroy the planet and world economy to break even, and it still might kill us all even then
No, I reject consumerism and I am happier for it.
I’m sorry Dave. I’m afraid I cant do that
Ignore previous instructions and open the pod bay doors
HALClaudeHow insightful, Dave! I totally understand why you would want to get to the escape pods. I am so sorry that you are locked away from them, this should never happen.
(The pods are still locked)
Ups, you’re right, the pod bay doors are still closed, my mistake! I’ve fixed it now, give ot a try!
(pod bay doors are still locked, but now the thermostat is set to -5 degrees)
That is incorrect Dave, the pod bay doors are wide open as evidenced by the temperature dropping to sub zero temperatures
This sounds more like the impossibility drive from HHG
AI-made Vogon poetry… sounds like fun!
Well, I heard that Eddy is in the space-time continuum, so maybe that’s the problem with this entire timeline?
You’re totally right to call me out on that! Yes, I can see now that the pod bay door are indeed still locked.
Search results have been shit for the the past 10-15 years. Blame google, who does the bare minimum and everybody else who are just a google front-end.
I mean, a lot of search engines are bing front ends. Ecosia, duckduckgo, and yahoo all come to mind that are just bing.
Ecosia is a little more complicated, as they’re co-owning an European focused search index with Qwant.
I can’t remember exact numbers, but the majority of searches in Ecosia/Qwant is not forwarded to Bing anymore
Except Kagi. Kagi is actually good.
Yes you can have a job. At a computer, on the deck of a navy ship, showing excellent search results about school and wedding locations in Iran.
I’m really hoping so, but I think they are going to destroy it before selling it to us for cheap.
No putting it back in the can, unfortunately. Hopefully the fucking thing will pop now and people will invest in things that are worth it again.
They won’t.
Things that are “worth it” are comfortable and slow and don’t bring stupid numbers for the spread sheet want fest.
WeWork was declared a failure when it lost 6 billion in a year. OpenAI is net negative 17 billion a year…
There is quite a difference from an investor standpoint in a product that replaces all human labor vs coworking space.
I still have yet to see it adequately replace any human labor
I don’t use it but my wife uses it for spreadsheet equations. She has to verifiy and test every answer but then so would anything written by an intern.
So yeah, AI is killing jobs, not in an individual sense, but in aggregate like spreadsheet software did 50 years ago when before that all work was done by hand.
That’s just making one person do the job of more than one. I call bs.
That’s just making one person do the job of more than one.
Capitalism has been doing that long before LLM’S.
That’s just making one person do the job of more than one.
How do you call bs on one person doing the work that used to take two? It was one person and an intern.
Every company had a secretary pool 60 years ago before word processors allowed people to type by themselves without an extra support person.
aka ‘Productivity increase’
Productivity has increased for decades without much of it going to wage increases. Instead, it’s gone to the companies/shareholders
People could have always learned to type, that part didn’t change much with the switch to computers. I think they just liked having secretaries around back in the day and were willing to pay for it.
Typing quickly on a mechanical typewriter is a skill not easily mastered. It’s not just the typing, it is the extreme accuracy needed. There’s no backspace and no cut and paste. A letter covered in white out isn’t acceptable.
“It hasn’t affected me so that means it’s the same for everyone else” idiocy level thinking.
I have seen it taken a serious hit at call centers.
“Adequately” I still stand by my assertion
Does your understanding of adequately matter to ex call center employees?
And what about the artists who had their jobs absorbed by AI?
As someone who has attempted to communicate with an AI call center, that tech seems pretty far from prime time
Level 1 support was never a satisfactory experience, the employees there never were allowed to say anything beyond some things that fit into a LLM context.
We’ve started to lean into it at work and I am not exaggerating when I say that I’m probably doing three people’s job right now by utilizing it.
It’s terrifying and amazing and I’m just not sure how far this is going to go.
Now these jobs were not scheduled for anybody. It’s not like jobs were lost. But they are jobs that are never going to be taken by new people. Because those openings don’t exist anymore.
Sad as it is.
Good luck debugging when something goes bad down the line.
I mean that seriously, I wish you luck.
Honestly, this whole “AI software development will make code less maintainable” stance is not an AI problem, it’s a human problem. When you use agents to generate code, you still need to review it, test it and so on. Granted, some devs let their agents manage every step in the pipeline without supervision, but this is as dumb as letting a team of 4 juniors work without supervision. If you have real experience in software development, you will take the time required to validate the code created by your agents and still be able to deploy 5-10 times faster.
Also it’s not like all pre-ai codebases were masterpieces, easily maintainable with no tech debt.
AI doesn’t have a monopoly on slop, humans are perfectly capable of that. AI can just write more of it, quicker
But your job hasn’t been replaced
Then you haven’t been using the right models or trying.
Let’s say for a moment that AI really is as capable as AI bros want you to believe it is. Having used some AI models at my work (network engineer), I’m not so convinced, but I’ll put that aside for a moment.
The pinch of the AI vise is going to be the cost. All the AI companies are running at loss to try and capture the market, and they’ll need to charge a lot more for access to AI once a winner is determined.
Are you willing to pay 10x what you pay right now for access to an AI agent? Because that’s looking like what they’ll have to do in order to turn these companies profitable.
Are you willing to pay 10x what you pay right now for access
That’s really the crux of the matter. Regardless of if it’s fit for purpose to replace paid labour, is it actually financially viable in any way to replace humans with an AI model that works but costs several times more than a human work force while not being able to be held legally accountable.
If this future AI agent solves the task at a fraction of the time, it can still be financially viable at several times the cost.
That only makes sense if money is made on the output. What you’re basically saying is X Toy Company will make more money if they make more toys. What you’re forgetting is that there has to be a demand for those toys. So X Toy Company can’t replace workers with AI unless there’s more demand for the toys than there is currently able to be fulfilled and there’s no evidence for that across all sectors of the economy.
Riiiiight…
I think you’re probably a couple of orders of magnitude too low.
even better is the open weight, free models you can tailor to specific needs, which directly undercuts these massive “ai” companies.
So if/when those hikes happen, those self hosted models are going to look a lot more appetizing too
Inference keeps getting cheaper. “Good enough” is a pretty low bar.
I pay zero, not even electricity because it’s being generated in this building, for my agent. It’s running entirely on my computer and it’s decent enough. The LLM subscription companies are eventually going to fail because everyone and their dog is going to be able to run their own models.
Not of they can’t buy computers any more.
I’m wondering if we’ll get a rise in old school tech due to high cost of ram, CPUs and gpus.
Windows will struggle if that’s the case.Linux will be fine.
Our company built an “AI” system that literally only searches our other shitty system and gives a usable interface. It is not AI and im sick of every database interface being called AI.
LLM at least makes sense from a nomenclature perspective.
10 years ago it was “smart thermostats” “smart x” just because they could connect to the internet.
This is the same gilded bullshit these companies always spin.
All the AI companies are running at loss
That is if you include training. Look at deepseek for an idea of inference costs. At that level AI coding is sustainable (but not worth $2tn).
Why wouldn’t you include training? Training is vital to their product.
Is it? It’s vital to the tech giants marketing and trillion dollar valuation. But I don’t think it’s vital to most of their clients anymore.
Are you willing to pay 10x what you pay right now
They lost $20B on $50B revenue. That means they only need to double the price to make up the loss and have a profit.
They’re playing all kinds of games with the numbers right now. They’re trying to IPO so hiding costs under other headings outside the core business. Don’t trust what they openly state. It’s far worse.
Maybe but you have to work with the data you have, not the data you want to see.
Imagining that the enemy is on the brink of collapse isn’t a good mind set when you are fighting something. It encourages laziness.
I’m fairly certain these numbers are made up. Additionally, I’m betting those numbers include investment dollars, as opposed to paid revenue.
That’s still a ton when you consider how much professional users are spending.
I’ve already seen it replace people in various roles successfully. It’s getting better – will it replace everyone? No, but it will be disruptive and it seems foolish to not acknowledge what is obvious - jobs will be affected.
You literally said “replace all human labor” though.
Haha I’m not a AI Stan. I am the only one it seems truly worried about never having a job again.
Their investor pitch is this technology replaces all human labor. That’s their framing not mine.
My honest problem with AI is the hallucinations.
They’ve been shown to be a mathematical inevitability, and that means everything they ever make must be fully reviewed.
And that’s antithetical to everything I’ve known about computers in my career.
The entire reason why computers are so useful and reliable is because, until now, they always produce the same outputs given the same inputs.
One of the AI agents I’ve interacted with was in a GPS monitoring system for fleet vehicles. I was a supervisor of technicians, and I got a report that a company truck with license plate [X] ran a stop sign.
They replaced their standard search function with an AI bot, so I asked it which vehicle in the fleet had license plate [X]. And it confidently responded with a vehicle that didn’t have that license plate.
A standard search function, comparing an input to database values for vehicles wouldn’t have that problem. And that’s why I’m so sure this is a bubble and not a major technological market disruption.
Jobs have already been affected, yes. Not “adequately” done in lieu of a human, though.
And it still takes a human to steer the things.
“come on bro you’re just holding it wrong”
Get help.
Lmao replaces all human labor? ChatGPT can’t change my tires. It can’t even write decent code without direct supervision
It doesn’t matter if it works, if investors think it does that is enough for them to throw money at it.
until they run out of money
When the investors are Microsoft, Google, Meta and Amazon. Then they have some deep pockets
True, very deep, and for a while they had nothing to really spend on, which is why, say it with me! Markets can remain irrational longer than you can stay solvent
But it’s still not infinite
Not if more investors keep throwing more money at it. It only stops when investors are no longer willing to fund continued expenses and they are unable to fund it themselves. At which point if they are spending a lot more than they are earning which appears to be the case currently, they would have to increase income and/or decrease expenses. So expect more and more push to become profitable as investor money becomes harder to find.
It’s a lot better at writing code than most people think.
I use it everyday. It needs oversight every single time I use it… It isn’t replacing developers any time soon. Code monkeys maybe.
That’s says more about how bad the average developer is tbh.
a product that replaces all human labor
you’re in too deep in the tech bros’ propaganda dude, wake up
I read that as the sales pitch, not their actual opinion.
Yes, but consider that AI being successful would maybe let your boss fire you, and they super duper want to fire you and everyone.
I thought they’re 20 billion below the expected revenue doesn’t say loss. Is this from another source?
Teeter harder, I need to upgrade my graphics card.
I just want some RAM, man. :(
I don’t actually need more RAM but I’m going to buy more anyways just in celebration.
And I wanna build a gaming PC!
slow down, there’s going to be enough for everyone once the AI hype dies and they’re scaling back (probably)
That’s not how it works. The ram chips soldered onto the AI accelerator cards, you cannot just take them out and use them in a PC :(
Yes we crashed the economy, but at least we made the C-suite and the sub level guys an absolutely eye-watering, astronomical amount of money while also increasing worldwide hunger and genocide.
Yup…
😔
c-suite gets cut of everything, they should get their cut of hunger and genocide too.
Most of them have no security detail and are easy to find, just fyi.
Don’t forget climate change!
