5 ms·

The real engine behind "AI" is the bad tech economy

80 points by softwaredoug 3y ago

woah 3y ago
The real engine behind “internet” is the bad tech economy. Vendors need something to sell, companies need to show results to investors, team leads need to justify staffing, devs need to stand out to avoid layoffs. Insert any buzzy topic into this mix it will get eviscerated by the starving packs of tech jackals… regardless of what actual users want. I’m excited about the potential behind the technology. But we’re in a state where many emporers have no clothes, and nobody quite wants to say it.
- softwaredoug 3y ago
  Well "Internet" went through its own boom and bust crash during the dotcom era. With lots of dumb money chasing dumb investments. My hypothesis would be that cycle is going to be very heavily accelerated due to the current economy. Many companies aren't operating from a position of strength, but more of desperation. Some tiny few will do well. Many announcing their "AI thing" suddenly becoming AI companies overnight will probably crash and burn. I could be wrong though.
  - SmoothBrain12 3y ago
    Your thoughts are valid. AI.com is the Pets.com of this generation
    - autokad 3y ago
      We are in a 2nd bigger 'tech' bubble. I hear lots of funny thing said about the era and now' "today is nothing like the dot com bubble, pets.com ... PETS DOT COM!". and I am like, pets.com had a max valuation of 400 million for like a hot minute. Today we have over 1,000 never made a profit tech unicorns. One thousand companies with a market cap of 1 billion+ that has never (and probably never will) made a profit. "you just got to find a company with a strong balance sheet, one that makes money, one that sells the shovels". Had you invested your money in CISCO back then, you'd still be in the red over 23 years later.
      - ahhfhando6698 3y ago
        Geees well when you put it like that you make it sound pretty bad
  - kurthr 3y ago
    The biggest losers on the dotcom crash were actually the failed networking companies "selling shovels" who had many 10s billions invested and then went to zero. Only AOL/TW was really comparable to Worldcom, Globalcrossing, with the $100B failures of Nortel and JDS/Uniphase.. Pets, Boo, Flooz etc made a big ad splashes, but were actually pretty small (single digit $B).
- ravenstine 3y ago
  There have always been naked emperors, but what has changed is the amount of pretend time + energy in the form of currency that society has been willing to produce, and pretendess is the one thing that feeds more pretend ess. The pipeline of pretendness is ignorance, both willing and institutionalized. In prior times, the rubber band would have snapped by now. The fantasy has become so hyper that it seems nobody has a clue whether there is even a "rubber band" at this point.
luma 3y ago
Not really sure what exactly the author is getting at but let's be real: the IT industry is awash with investor dollars hoping to fund the next facebook. AI enters and it starts doing actual, useful work, and now there are a zillion VCs dumping out their wallets trying to get a piece of the next facebook. None of this means that AI is dumb, rather, VCs are dumb and will chase literally anything that smells like money.
- theLiminator 3y ago
  Are they dumb or are they good at investing in stuff on very favorable terms for them and then pumping and dumping their portfolio of hype companies on the unsuspecting masses at a major premium to their initial investment?
  - VoodooJuJu 3y ago
    Can be both dumb and "good" at investing. >If you're so rich, why aren't you so smart? This is a question I wish people would ask more often, but instead, determinism has people associating wealth with merit, and even worse, absence of wealth with absence of merit.
- softwaredoug 3y ago
  Independent of the "real" value of AI My argument would be the sudden pivot of EVERYONE to AI is more indicative of a lack of good prospects for investments, rather than companies actually discovering products users want and like. Of course there's real value, but I'd believe the hype more in a strong tech economy, and am distrustful of every company becoming an AI expert overnight in our current weak tech economy.
  - VirusNewbie 3y ago
    But this is how it's always been. Someone could have funded AI heavily (and a few did) during the web 3.0 hype but most went with the crowd. Same with streaming video services, social media companies, hardware companies, MMOs, search engines, cloud, etc.
HPsquared 3y ago
What does he mean by "bad"? What would a "good" tech economy look like? Hard to define. Easy to misinterpret and argue over our different understandings of what he meant.
- wayeq 3y ago
  "bad" means investors want to make money on their investments, and tech workers want to advance their careers, I guess.
- tonypags 3y ago
  I would define a "bad" company as one that puts profits over people. People includes customers (incl b2b) and employees. A "good" company is one that realizes treating people with respect is a long-term profit driver.
  - kaashif 3y ago
    The way you've phrased that, the good companies still put profit first, it's just that they have a different strategy - treating people well to build loyalty etc.
- prosqlinjector 3y ago
  > What would a "good" tech economy look like? Producing goods and services that real people buy and benefit from.
hx8 3y ago
AI is a marketing term. The people using it are marketing something. You would never use the term in a technical description because it's too ambiguous. Everything he's describing: Companies showing off to investors, devs showing off to management is about marketing.
- dieselgate 3y ago
  Yeah for real. Saw a post on HN yesterday I think with the title something like "Development we call it machine learning, in advertisements it's called AI" or something to that end
benjaminwootton 3y ago
I think the fact that OpenAI fired the starting gun is a bigger factor than an industry wide conspiracy.
icapybara 3y ago
Low effort post. An AI probably wrote it because it’s full of meaningless platitudes.
dmezzetti 3y ago
I'm as much of a skeptic on "AI" as any. It's important to stay grounded and realistic to not unnecessarily create fear. But you can't toss aside the entire space either. It's clear there are many useful ideas and improvements. For example, Retrieval Augmented Generation (RAG) when done right is ready for production apps. Vector search clearly can find matches that BM25 can't. Generative text-to-image models are enabling many to be creative in ways not possible before. The last year+ has produced tools when used right can be quite useful to many.
mustafa_pasi 3y ago
But that is a good! Contrast that with other countries where the financial landscape is super conservative when it comes to investment and innovation, like in many EU countries. Economic growth is lower, jobs are fewer, and salaries are lower, and there are less exciting jobs where you can truly build the future. Americans do not appreciate what they have. You do not want the alternative! Appreciate your overly optimistic dumb money. It is a good thing for everyone.
- giraffe_lady 3y ago
  I don't want to build the future I just want dental care for my children.
  - lalaithion 3y ago
    Universal health care is important, necessary, cheaper than our current system, and I support it. But it's a completely orthogonal concern to the state of the tech economy.
    - waffletower 3y ago
      I see an argument in this thread for laissez faire capitalism; its political ramifications are entirely relevant to the state of universal health care in the United States. The economy is interconnected -- the mathematical concept of orthogonality is rarely appropriate when describing broad economic complexities. But perhaps you should simply suggest that a health care discussion here is off-topic?
      - mustafa_pasi 3y ago
        Culture might be a link between risk taking venture capitalists and less publicly financed social security. However I do not think there is an economic lock that forces a society to be either or. I can easily imagine a society that provides both a good safety net and where capitalists are willing to invest and innovate. I guess what is missing is the right mentality and attitude, so like, our cultures have not evolved to that level yet.
alephnerd 3y ago
This is a dumb take. While there is plenty of BS and vaporware masquerading as "AI", there are plenty of real companies and startups working on leveraging "AI" within their own domains. A business isn't just technology, it's also about the business processes developed, and plenty of AI startups are honing out processes that larger companies will either scoop up, or that these companies will be able to grow up and compete.
nologic01 3y ago
People have short memories. A few years ago hypes like big data and machine learning, blockchain and autonomous cars were pushed relentlessly. The consultants would confidently predict 300 gazillion profits by 2030, everybody would lose their job etc. Then the pandemic happened, momentarily some candid voices admitted that all this digi-crap does not help an iota with our quality of life (or life, period) but the digital WFH hype found just the right meme to sell. Then the pandemic receded but the LLM breakthrough was compiled just-in-time to rekindle the AGI hyperventilation... There is no respite. The tech economy is like the fabled sharks: needs to keep inventing hypes or it will implode.
- demondemidi 3y ago
  If I had a dime for every conference I went to from 20010-2015 that said "IoT will be a 20 trillion dollar market in 10 years", I'd be retired.
  - oh_sigh 3y ago
    I can't remember the name of the company, but they sponsor CPR(Colorado-area NPR affiliate), but they went from being "an IoT company", to "an IoT blockchain company", to an "IoT blockchain with AI" company.
    - josh_cutler 3y ago
      C3 IOT I'm guessing
      - asadotzler 3y ago
        This is the one. C3 IOT became C3 AI without batting a lash. The radio copy is almost identical, with only the name change to catch your ear or avoid sounding dated.
    - demondemidi 3y ago
      That is really funny. I wonder what it is like to be that audacious?
Animats 3y ago
There was a desperate attempt to find something, anything, which was a "must have" item. This fueled the VR boom of 2019 and the metaverse boom of 2021. Both sort of worked technically but turned out to not be that compelling. It's not yet clear how the "AI" boom works out. It may just be too soon. VR is stuck because the headgear remains clunky. The metaverse is stuck because the initial implementations were crap and you need a serious gamer PC to really make it work. AI is now running into the problem that large language models are expensive enough to run that they can't be ad-supported. All three may pay off as the technology progresses.
- wussboy 3y ago
  > VR is stuck because the headgear remains clunky It could be stuck for more than one reason. I would find VR repugnant even if it were as easy to wear as a contact lens.
  - Animats 3y ago
    That may be a generational thing. There are "VR natives". See Phia's Virtual Reality Show.[1] There was a time when people didn't walk around with little screens in their hand. There was a time when only women used keyboards. [1] https://www.youtube.com/channel/UCMMBpWfWUd3xlcOxrot_neA https://www.youtube.com/channel/UCMMBpWfWUd3xlcOxrot_neA
    - wussboy 3y ago
      Agreed. My own personal trajectory was 1. raised without Internet 2. discovered internet and thought it would transform the world for good 3. discovered mobile devices and thought they would transform the world for good 4. discovered social medial and thought it would transform the world for good 5. deeply disillusioned with social media and abandon it 6. think social media festering cancer 7. think mobile device cuts me off from most meaningful social contact 8. abandoned mobile device (but kept Apple Watch for emergencies) I'm curious to know if future generations who started at #4 end up at the same place I did.
- zelon88 3y ago

80 points by softwaredoug 3y ago

woah 3y ago

The real engine behind “internet” is the bad tech economy. Vendors need something to sell, companies need to show results to investors, team leads need to justify staffing, devs need to stand out to avoid layoffs. Insert any buzzy topic into this mix it will get eviscerated by the starving packs of tech jackals… regardless of what actual users want. I’m excited about the potential behind the technology. But we’re in a state where many emporers have no clothes, and nobody quite wants to say it.

softwaredoug 3y ago
Well "Internet" went through its own boom and bust crash during the dotcom era. With lots of dumb money chasing dumb investments. My hypothesis would be that cycle is going to be very heavily accelerated due to the current economy. Many companies aren't operating from a position of strength, but more of desperation. Some tiny few will do well. Many announcing their "AI thing" suddenly becoming AI companies overnight will probably crash and burn. I could be wrong though.
- SmoothBrain12 3y ago
  Your thoughts are valid. AI.com is the Pets.com of this generation
  - autokad 3y ago
    We are in a 2nd bigger 'tech' bubble. I hear lots of funny thing said about the era and now' "today is nothing like the dot com bubble, pets.com ... PETS DOT COM!". and I am like, pets.com had a max valuation of 400 million for like a hot minute. Today we have over 1,000 never made a profit tech unicorns. One thousand companies with a market cap of 1 billion+ that has never (and probably never will) made a profit. "you just got to find a company with a strong balance sheet, one that makes money, one that sells the shovels". Had you invested your money in CISCO back then, you'd still be in the red over 23 years later.
    - ahhfhando6698 3y ago
      Geees well when you put it like that you make it sound pretty bad
- kurthr 3y ago
  The biggest losers on the dotcom crash were actually the failed networking companies "selling shovels" who had many 10s billions invested and then went to zero. Only AOL/TW was really comparable to Worldcom, Globalcrossing, with the $100B failures of Nortel and JDS/Uniphase.. Pets, Boo, Flooz etc made a big ad splashes, but were actually pretty small (single digit $B).
ravenstine 3y ago
There have always been naked emperors, but what has changed is the amount of pretend time + energy in the form of currency that society has been willing to produce, and pretendess is the one thing that feeds more pretend ess. The pipeline of pretendness is ignorance, both willing and institutionalized. In prior times, the rubber band would have snapped by now. The fantasy has become so hyper that it seems nobody has a clue whether there is even a "rubber band" at this point.

luma 3y ago

Not really sure what exactly the author is getting at but let's be real: the IT industry is awash with investor dollars hoping to fund the next facebook. AI enters and it starts doing actual, useful work, and now there are a zillion VCs dumping out their wallets trying to get a piece of the next facebook. None of this means that AI is dumb, rather, VCs are dumb and will chase literally anything that smells like money.

theLiminator 3y ago
Are they dumb or are they good at investing in stuff on very favorable terms for them and then pumping and dumping their portfolio of hype companies on the unsuspecting masses at a major premium to their initial investment?
- VoodooJuJu 3y ago
  Can be both dumb and "good" at investing. >If you're so rich, why aren't you so smart? This is a question I wish people would ask more often, but instead, determinism has people associating wealth with merit, and even worse, absence of wealth with absence of merit.
softwaredoug 3y ago
Independent of the "real" value of AI My argument would be the sudden pivot of EVERYONE to AI is more indicative of a lack of good prospects for investments, rather than companies actually discovering products users want and like. Of course there's real value, but I'd believe the hype more in a strong tech economy, and am distrustful of every company becoming an AI expert overnight in our current weak tech economy.
- VirusNewbie 3y ago
  But this is how it's always been. Someone could have funded AI heavily (and a few did) during the web 3.0 hype but most went with the crowd. Same with streaming video services, social media companies, hardware companies, MMOs, search engines, cloud, etc.

HPsquared 3y ago

What does he mean by "bad"? What would a "good" tech economy look like? Hard to define. Easy to misinterpret and argue over our different understandings of what he meant.

wayeq 3y ago
"bad" means investors want to make money on their investments, and tech workers want to advance their careers, I guess.
tonypags 3y ago
I would define a "bad" company as one that puts profits over people. People includes customers (incl b2b) and employees. A "good" company is one that realizes treating people with respect is a long-term profit driver.
- kaashif 3y ago
  The way you've phrased that, the good companies still put profit first, it's just that they have a different strategy - treating people well to build loyalty etc.
prosqlinjector 3y ago
> What would a "good" tech economy look like? Producing goods and services that real people buy and benefit from.

hx8 3y ago

AI is a marketing term. The people using it are marketing something. You would never use the term in a technical description because it's too ambiguous. Everything he's describing: Companies showing off to investors, devs showing off to management is about marketing.

dieselgate 3y ago
Yeah for real. Saw a post on HN yesterday I think with the title something like "Development we call it machine learning, in advertisements it's called AI" or something to that end

benjaminwootton 3y ago

I think the fact that OpenAI fired the starting gun is a bigger factor than an industry wide conspiracy.

icapybara 3y ago

Low effort post. An AI probably wrote it because it’s full of meaningless platitudes.

dmezzetti 3y ago

I'm as much of a skeptic on "AI" as any. It's important to stay grounded and realistic to not unnecessarily create fear. But you can't toss aside the entire space either. It's clear there are many useful ideas and improvements. For example, Retrieval Augmented Generation (RAG) when done right is ready for production apps. Vector search clearly can find matches that BM25 can't. Generative text-to-image models are enabling many to be creative in ways not possible before. The last year+ has produced tools when used right can be quite useful to many.

mustafa_pasi 3y ago

But that is a good! Contrast that with other countries where the financial landscape is super conservative when it comes to investment and innovation, like in many EU countries. Economic growth is lower, jobs are fewer, and salaries are lower, and there are less exciting jobs where you can truly build the future. Americans do not appreciate what they have. You do not want the alternative! Appreciate your overly optimistic dumb money. It is a good thing for everyone.

giraffe_lady 3y ago
I don't want to build the future I just want dental care for my children.
- lalaithion 3y ago
  Universal health care is important, necessary, cheaper than our current system, and I support it. But it's a completely orthogonal concern to the state of the tech economy.
  - waffletower 3y ago
    I see an argument in this thread for laissez faire capitalism; its political ramifications are entirely relevant to the state of universal health care in the United States. The economy is interconnected -- the mathematical concept of orthogonality is rarely appropriate when describing broad economic complexities. But perhaps you should simply suggest that a health care discussion here is off-topic?
    - mustafa_pasi 3y ago
      Culture might be a link between risk taking venture capitalists and less publicly financed social security. However I do not think there is an economic lock that forces a society to be either or. I can easily imagine a society that provides both a good safety net and where capitalists are willing to invest and innovate. I guess what is missing is the right mentality and attitude, so like, our cultures have not evolved to that level yet.

alephnerd 3y ago

This is a dumb take. While there is plenty of BS and vaporware masquerading as "AI", there are plenty of real companies and startups working on leveraging "AI" within their own domains. A business isn't just technology, it's also about the business processes developed, and plenty of AI startups are honing out processes that larger companies will either scoop up, or that these companies will be able to grow up and compete.

nologic01 3y ago

People have short memories. A few years ago hypes like big data and machine learning, blockchain and autonomous cars were pushed relentlessly. The consultants would confidently predict 300 gazillion profits by 2030, everybody would lose their job etc. Then the pandemic happened, momentarily some candid voices admitted that all this digi-crap does not help an iota with our quality of life (or life, period) but the digital WFH hype found just the right meme to sell. Then the pandemic receded but the LLM breakthrough was compiled just-in-time to rekindle the AGI hyperventilation... There is no respite. The tech economy is like the fabled sharks: needs to keep inventing hypes or it will implode.

demondemidi 3y ago
If I had a dime for every conference I went to from 20010-2015 that said "IoT will be a 20 trillion dollar market in 10 years", I'd be retired.
- oh_sigh 3y ago
  I can't remember the name of the company, but they sponsor CPR(Colorado-area NPR affiliate), but they went from being "an IoT company", to "an IoT blockchain company", to an "IoT blockchain with AI" company.
  - josh_cutler 3y ago
    C3 IOT I'm guessing
    - asadotzler 3y ago
      This is the one. C3 IOT became C3 AI without batting a lash. The radio copy is almost identical, with only the name change to catch your ear or avoid sounding dated.
  - demondemidi 3y ago
    That is really funny. I wonder what it is like to be that audacious?

Animats 3y ago

There was a desperate attempt to find something, anything, which was a "must have" item. This fueled the VR boom of 2019 and the metaverse boom of 2021. Both sort of worked technically but turned out to not be that compelling. It's not yet clear how the "AI" boom works out. It may just be too soon. VR is stuck because the headgear remains clunky. The metaverse is stuck because the initial implementations were crap and you need a serious gamer PC to really make it work. AI is now running into the problem that large language models are expensive enough to run that they can't be ad-supported. All three may pay off as the technology progresses.

wussboy 3y ago
> VR is stuck because the headgear remains clunky It could be stuck for more than one reason. I would find VR repugnant even if it were as easy to wear as a contact lens.
- Animats 3y ago
  That may be a generational thing. There are "VR natives". See Phia's Virtual Reality Show.[1] There was a time when people didn't walk around with little screens in their hand. There was a time when only women used keyboards. [1] https://www.youtube.com/channel/UCMMBpWfWUd3xlcOxrot_neA https://www.youtube.com/channel/UCMMBpWfWUd3xlcOxrot_neA
  - wussboy 3y ago
    Agreed. My own personal trajectory was 1. raised without Internet 2. discovered internet and thought it would transform the world for good 3. discovered mobile devices and thought they would transform the world for good 4. discovered social medial and thought it would transform the world for good 5. deeply disillusioned with social media and abandon it 6. think social media festering cancer 7. think mobile device cuts me off from most meaningful social contact 8. abandoned mobile device (but kept Apple Watch for emergencies) I'm curious to know if future generations who started at #4 end up at the same place I did.
zelon88 3y ago