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I'm not making any claims as to whether AI will become profitable or when, but if there's a new tech that has high potential or is highly desirable, I think it'

I'm not making any claims as to whether AI will become profitable or when, but if there's a new tech that has high potential or is highly desirable, I think it's expected that initially money will be lost. Simply because strategically if there's high long term potential, it initially makes sense to put more money in than you get out of. Not saying that AI is this, but if you determined that you have a golden goose that laid out 10 trillion USD worth of eggs when it got 10 years old, how much would you pay for it in the auction, and what would you have to show for it for the initial 9 years? Now what if the golden goose scaled to 10 trillion each year linearly? First years people sound of mind would overpay for what it makes.

pphysch 1y ago
The issue is we're moving past the "initially" phase and people are starting to suspect that the $10T golden goose is mythical. GPT-5??
- mewpmewp2 1y ago
  I think it's more complex than that. You need to get really specific to calculate the potential value. It's entirely possible that there's 30 use-cases where it's very valuable, it's possible there's 80 use-cases where it's not valuable, and it's unclear how these use-cases are going to balance out in the future. To calculate whether all of this is over or undervalued would require analyzing and understanding all of those use cases and their impact very carefully. There's a lot of direct and indirect value, presumably no one is capable of currently calculating all of that anywhere near accuracy so people are making intuition based guesses on whatever data they can get hold of, but again - not so clear. I personally think that there's many levels of innovation still to come in terms of robotics, APIs/Frameworks/Coding languages/Infra specifically for LLMs to provide easier and more foolproof ways to code and do things otherwise. I think it's far from played out. I personally think that a lot of potential is still untapped.
- patall 1y ago
  Than why don't they raise prices? If AI developers were only worth 200k a year, nobody would pay X times those salaries and development would be cheaper. Similar, if none of the AI coding companies had free offerings, they would have less inference cost or more revenue. Yet they have the feeling that they need to offer those, likely because of competition. The article paints it as if the big companies are a factor of 2 away from profitability. Would absolutely nobody use AI if their tokens were double the price? I highly doubt that.
- tim333 1y ago
  There is also the issue that the investors in present geese may find they don't get the golden egg laying one and it actually gets raised by some other goose farmer, like investing in Digg when Facebook would end up with the eggs.
therein 1y ago
Meanwhile, I stopped using AI months ago. Have no subscriptions to any of the AI services anymore. Life goes on, quality of life is pretty good, haven't suffered in any way nor do I feel like I'm missing out.
- mewpmewp2 1y ago
  Yeah, but I have also dreamed of living in the woods, being completely self sustainable blissfully. It doesn't mean there aren't capitalists out there looking to produce and sell more, and people out there looking to buy.
  - watwut 1y ago
    The difference is that choice to live out in the woods costs you. Choice to not have a phone costs you. A choice to not pay ai at this point ... does not cost you unless you live in special situation.
    - ffsm8 1y ago
      Not getting a phone didn't really cost you either for the first 5-10 yrs. But the people that didn't definitely had a harder time adjusting when it got increasingly annoying to live without a smartphone. It's ultimately a choice you can make, but it definitely also comes with consequences - especially if your dayjob is software - as this is an industry that loves to discriminate against people that aren't aboard the hype train and don't have "10 yrs of experience in d̵o̵c̵k̵e̵r̵ LLMs"
      - uncircle 1y ago
        You forget that the vast majority of software engineering in the real world is boring tech, not the new hotness that’s being peddled on Hacker News. There is a large market for Java, C++ and COBOL engineers to this day, despite all startups on here are talking about React and Rust. There will still be a large need for actual engineers that use their meat brain and are not paid by line committed for the foreseeable future. Not everyone is writing junior-tier boilerplate that benefits from LLMs.
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pphysch 1y ago

The issue is we're moving past the "initially" phase and people are starting to suspect that the $10T golden goose is mythical. GPT-5??

mewpmewp2 1y ago
I think it's more complex than that. You need to get really specific to calculate the potential value. It's entirely possible that there's 30 use-cases where it's very valuable, it's possible there's 80 use-cases where it's not valuable, and it's unclear how these use-cases are going to balance out in the future. To calculate whether all of this is over or undervalued would require analyzing and understanding all of those use cases and their impact very carefully. There's a lot of direct and indirect value, presumably no one is capable of currently calculating all of that anywhere near accuracy so people are making intuition based guesses on whatever data they can get hold of, but again - not so clear. I personally think that there's many levels of innovation still to come in terms of robotics, APIs/Frameworks/Coding languages/Infra specifically for LLMs to provide easier and more foolproof ways to code and do things otherwise. I think it's far from played out. I personally think that a lot of potential is still untapped.
patall 1y ago
Than why don't they raise prices? If AI developers were only worth 200k a year, nobody would pay X times those salaries and development would be cheaper. Similar, if none of the AI coding companies had free offerings, they would have less inference cost or more revenue. Yet they have the feeling that they need to offer those, likely because of competition. The article paints it as if the big companies are a factor of 2 away from profitability. Would absolutely nobody use AI if their tokens were double the price? I highly doubt that.
tim333 1y ago
There is also the issue that the investors in present geese may find they don't get the golden egg laying one and it actually gets raised by some other goose farmer, like investing in Digg when Facebook would end up with the eggs.

therein 1y ago

Meanwhile, I stopped using AI months ago. Have no subscriptions to any of the AI services anymore. Life goes on, quality of life is pretty good, haven't suffered in any way nor do I feel like I'm missing out.

mewpmewp2 1y ago
Yeah, but I have also dreamed of living in the woods, being completely self sustainable blissfully. It doesn't mean there aren't capitalists out there looking to produce and sell more, and people out there looking to buy.
- watwut 1y ago
  The difference is that choice to live out in the woods costs you. Choice to not have a phone costs you. A choice to not pay ai at this point ... does not cost you unless you live in special situation.
  - ffsm8 1y ago
    Not getting a phone didn't really cost you either for the first 5-10 yrs. But the people that didn't definitely had a harder time adjusting when it got increasingly annoying to live without a smartphone. It's ultimately a choice you can make, but it definitely also comes with consequences - especially if your dayjob is software - as this is an industry that loves to discriminate against people that aren't aboard the hype train and don't have "10 yrs of experience in d̵o̵c̵k̵e̵r̵ LLMs"
    - uncircle 1y ago
      You forget that the vast majority of software engineering in the real world is boring tech, not the new hotness that’s being peddled on Hacker News. There is a large market for Java, C++ and COBOL engineers to this day, despite all startups on here are talking about React and Rust. There will still be a large need for actual engineers that use their meat brain and are not paid by line committed for the foreseeable future. Not everyone is writing junior-tier boilerplate that benefits from LLMs.

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