- a far more obvious answer is that any AI that relies on
matrix multiplication or equivalently near-cubic complexity
cannot scale exponentially with existing hardware
and investing in datacenters requires actual
operating revenue(that doesn't grow exponentially) instead of loans and venture capital.
- a hugely rambling article, and I don't see how it's final thesis relates to its argument at all
> Because the AI business model relies on reducing social connections between human beings, it is not sustainable. Thus, there is the AI bubble, and it will burst.
"Because it relies on reducing social connections, i ts, not sustainable" isn't a logical argument. There's plenty of cases where reducing social connections have been sustainable enough to generate immense profits. If anything, social connections are completely antithetical to generating profit. Actual 'social' professions are often the least paid and most overworked jobs with little ability to scale.
- The "bubble" will burst if it turns out that the demand for OpenAI/Anthropic's services is primarily driven by investment-dollars (i.e. VC money) rather than revenue-dollars.
If OpenAI/Anthropic's customers are themselves generating real revenue with reasonable margins, then it's not a bubble at all.
by queensnake
0 subcomment
- He puts the bubble pop down to people needing human connection, 'feeling cared for', but his example shows the AI customer support simply getting nowhere.
- Interesting. A more dystopian take is that human interaction will be limited to a privileged class. The unprivileged will ”have to do” with machine interaction. It’s not really something new. Automation lowers cost. But it the perpetual growth economy there also needs to be more profit, which leaves charging more and/or lowering cost even more as the only viable options. See where this is going? As with food, the unprivileged will have to do with energy rich, low quality, mass produced interaction. Music is the next/current frontier. The privileged will seek out in person events, while the unprivileged will ”have to do” with energy rich, low quality, mass produced machine made culture.
by iLoveOncall
0 subcomment
- > Do you know of a restaurant that’s been losing money for an entire first decade of its operations, and yet remained open? Or any small business in such a situation?
I stopped reading here, which is at the very start of the article, because unlike restaurants there are plenty of examples of companies that remained unprofitable for a decade and then turned a profit.
It also ignores the fact that up until 2022ish, OpenAI wasn't even trying to be a for profit company.
I fully agree that it's a bubble and I think it already has started popping, but this article is low quality and honestly full of basic errors.
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