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The OP is not about AI as a field of research. It's about whether the gobs of money invested in "AI" products and services in recent years, fueled by hype and F

by cs702 2y ago

The OP is not about AI as a field of research. It's about whether the gobs of money invested in "AI" products and services in recent years, fueled by hype and FOMO, will earn a return, and whether we are approaching the bust of a classic boom-bust over-investment cycle. Seemingly every non-tech company in the world has been trying to figure out an "AI strategy," driven by hype and FOMO, but most corporate executives have no clue as to what they're doing or ought to be doing. They are spending money on poorly thought-out ideas. Meanwhile, every tech company providing "AI services" has been spending money like a drunken sailor, fueled by hype and FOMO. None of these AI services are generating enough revenue to cover the cost of development, training, or even, in many cases, inference. Nvidia, the dominant software-plus-hardware platform (CUDA is a big deal), appears to be the only financial beneficiary of all this hype and FOMO. According to the OP, the business of "AI" is losing hype, suggesting we're approaching a bust.

rifty 2y ago
> Nvidia appears to be the only financial beneficiary It depends how you look at it. A lot of the spend by big tech can be seen as protecting what they already have from disruption. Its not all about new product revenues it’s about keeping the revenue share in the markets they already have.
dogcomplex 2y ago
Investors need to stop looking at AI as a path to profits, and more as an enormous risk to the profitability of every other business. If AGI gets hit, it's probably not going to stay monopolized for long, nor is it going to be market neutral. Every business is going to need an AI infusion to compete, which many will get, cutting costs and raising efficiencies of each business in an ongoing competitive spiral to the bottom line - which... will be eventually measured in just: robotic labor, energy, and compute. The profit margins on all those businesses shrink to nothing as they become basically utilities. The net effect? Possibly a massive deflation, and "crashing" of the stock market, even as the total utility and value of the system skyrockets. This isn't a bull bet, it's a bear. AI would need to be perfectly monopolized to capture all the gains, and it's increasingly looking like that won't be the case - as all the component pieces are already open source at competitive levels, and any final architecture improvements that cross the final thresholds could be leaked in a 50GB file. Whoever gets to it first has a few months head start, at most, and probably not enough time or control to sell products - or shovels. After that it's a neverending race to zero, to the benefit of the consumer and the detriment of the investor. Nvidia is a great example case. They currently dominate the GPU market, an "essential hardware for AI", yet ternary asic chips specialized for transformer-only architectures are looking quite viable at 1999s tech levels. Wouldn't bet on that monopoly sticking around much longer.

by cs702 2y ago

rifty 2y ago

> Nvidia appears to be the only financial beneficiary It depends how you look at it. A lot of the spend by big tech can be seen as protecting what they already have from disruption. Its not all about new product revenues it’s about keeping the revenue share in the markets they already have.

dogcomplex 2y ago

Investors need to stop looking at AI as a path to profits, and more as an enormous risk to the profitability of every other business. If AGI gets hit, it's probably not going to stay monopolized for long, nor is it going to be market neutral. Every business is going to need an AI infusion to compete, which many will get, cutting costs and raising efficiencies of each business in an ongoing competitive spiral to the bottom line - which... will be eventually measured in just: robotic labor, energy, and compute. The profit margins on all those businesses shrink to nothing as they become basically utilities. The net effect? Possibly a massive deflation, and "crashing" of the stock market, even as the total utility and value of the system skyrockets. This isn't a bull bet, it's a bear. AI would need to be perfectly monopolized to capture all the gains, and it's increasingly looking like that won't be the case - as all the component pieces are already open source at competitive levels, and any final architecture improvements that cross the final thresholds could be leaked in a 50GB file. Whoever gets to it first has a few months head start, at most, and probably not enough time or control to sell products - or shovels. After that it's a neverending race to zero, to the benefit of the consumer and the detriment of the investor. Nvidia is a great example case. They currently dominate the GPU market, an "essential hardware for AI", yet ternary asic chips specialized for transformer-only architectures are looking quite viable at 1999s tech levels. Wouldn't bet on that monopoly sticking around much longer.