6 ms·

I expect this is the crux of the problem. There aren't any "AI" products that have enough value. Compare to their Office suite, which had 100 - 150 engineers

I expect this is the crux of the problem. There aren't any "AI" products that have enough value. Compare to their Office suite, which had 100 - 150 engineers working on it, every business paid big $$ for every employee using it, and once they shipped install media their ongoing costs were the employees. With a 1,000,000:1 ratio of users to developers and an operating expense (OpEx) of engineers/offices/management. That works as a business. But with "AI", not only is it not a product in itself, it's a feature to a product, but it has OpEx and CapEx costs that dominate the balance sheet based on their public disclosures. Worse, as a feature, it demonstrably harms business with its hallucinations. In a normal world, at this point companies would say, "hmm, well we thought it could be amazing but it just doesn't work as a product or a feature of a product because we can't sell it for enough money to both cover its operation, and its development, and the capital expenditures we need to make every time someone signs up. So a normal C staff would make some post about "too early" or whatever and shelve it. But we don't live in a normal world, so companies are literally burning the cash they need to survive the future in a vain hope that somehow, somewhere, a real product will emerge.

anthonypasq 9mo ago
Your premise that the leaders of every single one of the top 10 biggest and most profitable companies in human history are all preposterously wrong about a new technology in their existing industry is hard to believe. AI is literally the fastest growing and most widely used/deployed technologies ever.
- toomuchtodo 9mo ago
  > Your premise that the leaders of every single one of the top 10 biggest and most profitable companies in human history are all preposterously wrong about a new technology in their existing industry is hard to believe. Their incentives are to juice their stock grants or other economic gains from pushing AI. If people aren't paying for it, it has limited value. In the case of Microsoft Copilot, only ~3% of the M365 user base is willing to pay for it. Whether enough value is derived for users to continue to pay for what they're paying for, and for enterprise valuation expectations to be met (which is mostly driven by exuberance at this point), remains to be seen. Their goal is not to be right; their goal is to be wealthy. You do not need to be right to be wealthy, only well positioned and on time. Adam Neumann of WeWork is worth ~$2B following the same strategy, for example. Right place, right time, right exposure during that hype cycle. Only 3.3% of Microsoft 365 users pay for Copilot - https://news.ycombinator.com/item?id=46871172 https://news.ycombinator.com/item?id=46871172 - February 2026 This is very much like the dot com bubble for those who were around to experience it. https://old.reddit.com/r/explainlikeimfive/comments/1g78sgf/eli5_what_was_the_dot_com_bubble/ https://old.reddit.com/r/explainlikeimfive/comments/1g78sgf/... > In the late 90s and early 00s a business could get a lot of investors simply by being “on the internet” as a core business model. > They weren’t actually good business that made money…..but they were using a new emergent technology > Eventually it became apparent these business weren’t profitable or “good” and having a .com in your name or online store didn’t mean instant success. And the companies shut down and their stocks tanked > Hype severely overtook reality; eventually hype died ("Show me the incentives and I'll show you the outcome" -- Charlie Munger)
- reaperducer 9mo ago
  Your premise that the leaders of every single one of the top 10 biggest and most profitable companies in human history are all preposterously wrong about a new technology in their existing industry is hard to believe. It's happened before. Your premise that companies which become financially successful doing one thing are automatically excellent at doing something else is hard to believe. Moreover, it demonstrates both an inability to dispassionately examine what is happening and a lack of awareness of history.
  - anthonypasq 9mo ago
    > It's happened before. source?
    - reaperducer 9mo ago
      Seriously? Have you just emerged from a hundred-year sleep in a monastery on the top of a mountain?
      - anthonypasq 9mo ago
        should be really easy to conjure up examples then. where every single business leader has been wrong about a new technology to the tune of hundreds of billions of dollars.
- ChuckMcM 9mo ago
  Yup, I've been here before. Back in 1995 we called it "The Internet." :-) Not to be snarky here, as we know the Internet has, in fact, revolutionized a lot of things and generated a lot of wealth. But in 1995, it was "a trillion dollar market" where none of the underlying infrastructure could really take advantage of it. AI is like that today, a pretty amazing technology that at some point will probably revolutionize a lot of things we do, but the hype level is as far over its utility as the Internet hype was in 1995. My advice to anyone going through this for the first time is to diversify now if you can. I didn't in 1995 and that did not work out well for me.
  - RoddaWallPro 9mo ago
    What do you mean exactly by "diversify"? Money/investment-wise?
    - toomuchtodo 9mo ago
      Sell the risky stock that has inflated in value from hype cycle exuberance and re-invest proceeds into lower risk asset classes not driven by said exuberance. "Taking money off the table." An example would be taking ISO or RSU proceeds and reinvesting in VT (Vanguard Total World Stock Index Fund ETF) or other diversified index funds. Taking money off the table - https://news.ycombinator.com/item?id=45763769 https://news.ycombinator.com/item?id=45763769 - October 2025 (108 comments) (not investing advice)
      - ChuckMcM 9mo ago
        What tomuchtodo said. When I left Sun in 1995 I had 8,000 shares, which in 1998 would have paid off my house, and when I sold them when Oracle bought Sun after a reverse 3:1 split, the total would not even buy a new car. Can be a painful lesson, certainly it leaves an impression.
        fallous 9mo ago
        Heh, I was at Netscape when the Sun-Netscape Alliance was created. Tip of the hat to a fellow gray beard. ;)
- rightbyte 9mo ago
  The product is the stock price, not Office or Windows. From that perspective they are doing it right.
  - alsetmusic 9mo ago
    And this is the broken mindset tanking multiple large companies' products and services (Google, Apple, MS, etc). Focus on the stock. The product and our users are an afterthought. Someone linked to a good essay on how success plus Tim Cook's focus on the stock has caused the rot that's consuming Apple's software[0]. I thought it was well reasoned and it resonated with me, though I don't believe any of the ideas were new to me. Well written, so still worth it. 0. The Fallen Apple - https://mattgemmell.scot/the-fallen-apple/ https://mattgemmell.scot/the-fallen-apple/
  - fallous 9mo ago
    The investor being the customer rather than actual paying customers was something I noticed occurring in the late 90s in the startup and tech world. Between that shift in focus and the influx of naive money the Dot Bomb was inevitable. Sadly the fallout from the Dotcom era wasn't a rejection of the asinine Business 2.0 mindset but instead an infection that spread across the entirety of finance.
  - autoexec 9mo ago
    In particular it's the short term stock price. They'll happily grift their way to overinflated stock prices today even though at some point their incestuous money shuffle game will end and the stocks will crash and a bunch of people who aren't insider trading are going to be left with massive losses.
    - saghm 9mo ago
      Stock price increases that don't lead to higher dividends eventually are indistinguishable from Ponzi schemes after the fact.
      - xmcqdpt2 9mo ago
- xyzsparetimexyz 9mo ago
  Doesn't matter what the leaders think if the users hate it and call it slop https://futurism.com/artificial-intelligence/microsoft-satya-nadella-ai-slop https://futurism.com/artificial-intelligence/microsoft-satya...
  - anthonypasq 9mo ago
    right because copilot is bad, that must mean no one uses chatgpt, or claude code, or gemini. they only have billions of MAUs, people must really hate it
- datsci_est_2015 9mo ago
  I find it very easy to believe. The pressures that select for leadership in corporate America are wholly perpendicular to the skills and intelligence for identifying how to leverage novel and revolutionary technologies into useful products that people will pay for. I present as evidence the graveyard of companies and careers left behind by many of those leaders who failed to innovate despite, in retrospect, what seemed to be blindingly obvious product decisions to make.
- bandrami 9mo ago
  Were you around in 2008?
- ajkjk 9mo ago
  every time these companies make a mistake and waste billions of dollars it is well-publicized. so there is plenty of data that they are frequently and preposterously wrong.
  - anthonypasq 9mo ago
    name a technology that every single top tech company has invested billions of dollars in and then has flopped. the metaverse does not count unless google, amazon, microsoft etc was also throwing billions into it.
    - ajkjk 9mo ago
      weird goalpost by that logic financial crashes wouldn't happen
- 6510 9mo ago
  The mistake is simple. It is like the difference between giving you many tools to use vs making you the tool. https://www.youtube.com/watch?v=LRq_SAuQDec https://www.youtube.com/watch?v=LRq_SAuQDec
  - autoexec 9mo ago
    I get the feeling that a lot of people using AI, feeding it their private data, and trusting what it tells them are certainly being tools.
- vor_ 9mo ago
  This industry has seen several bubbles in its existence. Many previously top companies didn't even survive them.
- pjc50 9mo ago
  > top 10 biggest and most profitable companies in human history are all preposterously wrong There's another post on the front page about the 2008 financial crisis, which was almost exactly that. Investors are vulnerable to herd mentality. Especially as it's hard to be "right but early" and watch everyone else making money hand over fist while you stand back. https://news.ycombinator.com/item?id=46889008 https://news.ycombinator.com/item?id=46889008
  - anthonypasq 9mo ago
    this was the top 10 companies in the s and p in 2008 Rank,Company 1,Exxon Mobil 2,General Electric (GE) 3,Microsoft 4,Procter & Gamble 5,Chevron 6,Johnson & Johnson 7,AT&T 8,Walmart 9,JPMorgan Chase 10,Berkshire Hathaway 1 financial institution. 8 of the top 10 currently are tech companies. its completely different
ryandrake 9mo ago
For most software products I use, if the company spent a year doing nothing but fixing P2 bugs and making small performance improvements, that would deliver far, FAR more value to me than spending a year hamfistedly cramming AI into every corner of the software. But fixing bugs doesn't 1. pad engineer's resumes with new technology, or 2. give company leadership exciting things to talk about to their golfing buddies. So we get AI cram instead.
- shigawire 9mo ago
  I think it is more externally driven as well, a prisoners dilemma. I don't want to keep crapping out questionable features but if competitors keep doing it the customer wants it -- even if infrastructure and bug fixes would actually make their life better.
  - bunderbunder 9mo ago
    Last time I saw results of a survey on this, it found that for most consumers AI features are a deciding factor in their purchasing decisions. That is, if they are looking at two options and one sports AI features and the other doesn’t, they will pick the one that doesn’t. It’s possible AI just seems more popular than it is because it’s easy to hear the people who are talking about it but harder to hear the people who aren’t.
    - deleted 9mo ago
      [deleted]
    - nosianu 9mo ago
      Consumers is nice, but far more important are the big corporate purchases. There may be a lot of people there too who don't want AI, but they all depend on decisions made at the top and AI seems to be the way to go, because of expectations and also because of the mentioned prisoner's dilemma, if competitors gain an advantage it is bad for your org, if all fail together it is manageable.
    - skeptic_ai 9mo ago
saidinesh5 9mo ago
> But with "AI", not only is it not a product in itself, it's a feature to a product, but it has OpEx and CapEx costs that dominate the balance sheet based on their public disclosures. Worse, as a feature, it demonstrably harms business with its hallucinations. I think it depends on how the feature is used? I see it as mostly as yet another user interface in most applications. Every couple of years I keep forgetting the syntax and formulas available in Excel. I can either search for answers or describe what i want and let the LLM edit the spread sheet for me and i just verify. Also, as time passes the OpEx and CapEx are projected to reduce right? It maybe a good thing that companies are burning through their stockpiles of $$$ in trying to find out the applicability and limits of this new technology. Maybe something good will come out of it.
- bunderbunder 9mo ago
  The thing about giving your application a button that costs you a cent or two every time a user clicks on it is, then your application has a button that costs you a cent or two every time a user clicks on it.
  - Lio 9mo ago
    For the usecase of "How do I do thing X in Excell" you could probably get pretty far with just adding a small, local LLM running on the user's machine. That would move the cost of running the model to the end user but it would also mean giving up all the data they can from running prompts remotely. It would probably also make Office users more productive rather than replacing them completely and that's not the vision that Microsoft's actual customers are sold on.
    - bunderbunder 9mo ago
      Fair. But I sure wish we could instead solve this problem the way we did 20 years ago: by not having Web search results be so choked off by SEO enshittification and slop that it’s hard to find good information anymore. Because, I promise you, “How do I do thing X in Excel?” did not used to be nearly so difficult a question to answer.
zuminator 9mo ago
100% agree. Office and Windows were hugely successful because they did things that users (and corporations) wanted them to do. The functionality led to brand recognition and that led to increased sales. Now Microsoft is putting the horse before the cart and attempting to force brand recognition before the product has earned it. And that just leads to resentment. They should make Copilot/AI features globally and granularly toggleable. Only refer to the chatbots as "Copilot," other use cases should be primarily identified on a user-facing basis by their functionality. Search Assistant. Sketching Aid. Writing Aid. If they're any good at what they do, people will gravitate to them without being coerced. And as far as Copilot goes, if they are serious as me it as a product, there should be a concerted effort to leapfrog it to the top of the AI rankings. Every few weeks we're reading that Gemini, Claude, ChatGPT, or DeepSeek has broken some coding or problem-solving score. That drives interest. You almost never hear anything similar about Copilot. It comes off as a cut-rate store brand knockoff of ChatGPT at best. Pass.
- Melatonic 9mo ago
  I thought Copilot was just ChatGPT - isn't that the whole point of Microsoft's massive investment in OpenAI ?
  - dahcryn 9mo ago
    they somehow made it worse and use a less capable version with smaller context window. The only potential upside for businesses it that it can crawl onedrive/sharepoint, and acts as a glorious search machine in your mailbox and files. That's the only thing really valuable to me, everything else is not working as it should. The outlook integration sucks, the powerpoint integration is laughably bad to being worthless, and the excel integration is less useful than Clippy. I actually prefer using the "ask" function of github copilot through visual studio code over using the company provided microsoft copilot portal
  - p_ing 9mo ago
    Depends on the flavor. Now has Claude, as well. And Copilot Studio can extend to any model AI Foundry supports.
deleted 9mo ago
[deleted]
PeterStuer 9mo ago
They bet the company on AI. If their AI push fails, everything else does not matter anymore. What you are seeing is desperation and Hail Marys. My guess is every team's metric is probably reduced to tokens consumed through the products owned.
- red-iron-pine 9mo ago
  take it a step further: the global market is stagnant, and the big gains of the 90s-2010s are gone. you either hail mary AI or you watch your margins dwindle; captialism does not allow for no-growth.
mbreese 9mo ago
I think this is a really good take, and not one I’ve seen mentioned a lot. Pre-Internet (the world Microsoft was started for), the man expense for a software company was R&D. Once the code was written, it was all profit. You’d have some level of maintenance and new features, but really - the cost of sale was super low. In the Internet age (the likes of Google and Netflix), it’s not much different, but now the cost of doing business is increased to include data centers, power, and bandwidth - we’re talking physical infrastructure. The cost of sale is now more expensive, but they can have significantly more users/customers. For AI companies, these costs have only increased. Not only do they need the physical infrastructure, but that infrastructure is more expensive (RAM and GPUs) and power hungry. So it’s like the cost centers have gone up in expense by log-units. Yes, Anthropic and OpenAI can still access a huge potential customer base, but the cost of servicing each request is significantly more expensive. It’s hard to have a high profit margin when your costs are this high. So what is a tech company founded in the 1970s to do? They were used to the profit margins from enterprise software licensing, and now they are trying to make a business case for answering AI requests as cheaply as possible. They are trying to move from low CapEx + low OpEx to and market that is high in both. I can’t see how they square this circle. It’s probably time for Microsoft to acknowledge that they are a veteran company and stop trying to chase the market. It might be better to partner with a new AI company that is be better equipped to manage the risks than to try to force a solo AI product.
- kalap_ur 9mo ago
  Yeah. Hyperscalers who are building compute capacities became asset heavy industries. Today's Google, MSFT, META are completely different than 10 years ago and market has not repriced that yet. These are no longer asset light businesses.
- pjc50 9mo ago
  > cost of doing business is increased to include data centers, power, and bandwidth Microsoft Azure was launched in 2010. They've been a "cloud" company for a while. AI just represents a sharp acceleration in that course. Unfortunately this means the software products have been rather neglected and subject to annoying product marketing whims.
GorbachevyChase 9mo ago
To be fair. MS Office product defects should be regarded just as harmful as hallucinations. Try a lookup in excel on fields that might have text.
Bombthecat 9mo ago
For coding,ai is amazing and getting better. Spell checking is also good, grammar better then me lol And pumping out fake news and propaganda, way worth it when you do it

anthonypasq 9mo ago

Your premise that the leaders of every single one of the top 10 biggest and most profitable companies in human history are all preposterously wrong about a new technology in their existing industry is hard to believe. AI is literally the fastest growing and most widely used/deployed technologies ever.

toomuchtodo 9mo ago
> Your premise that the leaders of every single one of the top 10 biggest and most profitable companies in human history are all preposterously wrong about a new technology in their existing industry is hard to believe. Their incentives are to juice their stock grants or other economic gains from pushing AI. If people aren't paying for it, it has limited value. In the case of Microsoft Copilot, only ~3% of the M365 user base is willing to pay for it. Whether enough value is derived for users to continue to pay for what they're paying for, and for enterprise valuation expectations to be met (which is mostly driven by exuberance at this point), remains to be seen. Their goal is not to be right; their goal is to be wealthy. You do not need to be right to be wealthy, only well positioned and on time. Adam Neumann of WeWork is worth ~$2B following the same strategy, for example. Right place, right time, right exposure during that hype cycle. Only 3.3% of Microsoft 365 users pay for Copilot - https://news.ycombinator.com/item?id=46871172 https://news.ycombinator.com/item?id=46871172 - February 2026 This is very much like the dot com bubble for those who were around to experience it. https://old.reddit.com/r/explainlikeimfive/comments/1g78sgf/eli5_what_was_the_dot_com_bubble/ https://old.reddit.com/r/explainlikeimfive/comments/1g78sgf/... > In the late 90s and early 00s a business could get a lot of investors simply by being “on the internet” as a core business model. > They weren’t actually good business that made money…..but they were using a new emergent technology > Eventually it became apparent these business weren’t profitable or “good” and having a .com in your name or online store didn’t mean instant success. And the companies shut down and their stocks tanked > Hype severely overtook reality; eventually hype died ("Show me the incentives and I'll show you the outcome" -- Charlie Munger)
reaperducer 9mo ago
Your premise that the leaders of every single one of the top 10 biggest and most profitable companies in human history are all preposterously wrong about a new technology in their existing industry is hard to believe. It's happened before. Your premise that companies which become financially successful doing one thing are automatically excellent at doing something else is hard to believe. Moreover, it demonstrates both an inability to dispassionately examine what is happening and a lack of awareness of history.
- anthonypasq 9mo ago
  > It's happened before. source?
  - reaperducer 9mo ago
    Seriously? Have you just emerged from a hundred-year sleep in a monastery on the top of a mountain?
    - anthonypasq 9mo ago
      should be really easy to conjure up examples then. where every single business leader has been wrong about a new technology to the tune of hundreds of billions of dollars.
ChuckMcM 9mo ago
Yup, I've been here before. Back in 1995 we called it "The Internet." :-) Not to be snarky here, as we know the Internet has, in fact, revolutionized a lot of things and generated a lot of wealth. But in 1995, it was "a trillion dollar market" where none of the underlying infrastructure could really take advantage of it. AI is like that today, a pretty amazing technology that at some point will probably revolutionize a lot of things we do, but the hype level is as far over its utility as the Internet hype was in 1995. My advice to anyone going through this for the first time is to diversify now if you can. I didn't in 1995 and that did not work out well for me.
- RoddaWallPro 9mo ago
  What do you mean exactly by "diversify"? Money/investment-wise?
  - toomuchtodo 9mo ago
    Sell the risky stock that has inflated in value from hype cycle exuberance and re-invest proceeds into lower risk asset classes not driven by said exuberance. "Taking money off the table." An example would be taking ISO or RSU proceeds and reinvesting in VT (Vanguard Total World Stock Index Fund ETF) or other diversified index funds. Taking money off the table - https://news.ycombinator.com/item?id=45763769 https://news.ycombinator.com/item?id=45763769 - October 2025 (108 comments) (not investing advice)
    - ChuckMcM 9mo ago
      What tomuchtodo said. When I left Sun in 1995 I had 8,000 shares, which in 1998 would have paid off my house, and when I sold them when Oracle bought Sun after a reverse 3:1 split, the total would not even buy a new car. Can be a painful lesson, certainly it leaves an impression.
      - fallous 9mo ago
        Heh, I was at Netscape when the Sun-Netscape Alliance was created. Tip of the hat to a fellow gray beard. ;)
rightbyte 9mo ago
The product is the stock price, not Office or Windows. From that perspective they are doing it right.
- alsetmusic 9mo ago
  And this is the broken mindset tanking multiple large companies' products and services (Google, Apple, MS, etc). Focus on the stock. The product and our users are an afterthought. Someone linked to a good essay on how success plus Tim Cook's focus on the stock has caused the rot that's consuming Apple's software[0]. I thought it was well reasoned and it resonated with me, though I don't believe any of the ideas were new to me. Well written, so still worth it. 0. The Fallen Apple - https://mattgemmell.scot/the-fallen-apple/ https://mattgemmell.scot/the-fallen-apple/
- fallous 9mo ago
  The investor being the customer rather than actual paying customers was something I noticed occurring in the late 90s in the startup and tech world. Between that shift in focus and the influx of naive money the Dot Bomb was inevitable. Sadly the fallout from the Dotcom era wasn't a rejection of the asinine Business 2.0 mindset but instead an infection that spread across the entirety of finance.
- autoexec 9mo ago
  In particular it's the short term stock price. They'll happily grift their way to overinflated stock prices today even though at some point their incestuous money shuffle game will end and the stocks will crash and a bunch of people who aren't insider trading are going to be left with massive losses.
  - saghm 9mo ago
    Stock price increases that don't lead to higher dividends eventually are indistinguishable from Ponzi schemes after the fact.
    - xmcqdpt2 9mo ago
xyzsparetimexyz 9mo ago
Doesn't matter what the leaders think if the users hate it and call it slop https://futurism.com/artificial-intelligence/microsoft-satya-nadella-ai-slop https://futurism.com/artificial-intelligence/microsoft-satya...
- anthonypasq 9mo ago
  right because copilot is bad, that must mean no one uses chatgpt, or claude code, or gemini. they only have billions of MAUs, people must really hate it
datsci_est_2015 9mo ago
I find it very easy to believe. The pressures that select for leadership in corporate America are wholly perpendicular to the skills and intelligence for identifying how to leverage novel and revolutionary technologies into useful products that people will pay for. I present as evidence the graveyard of companies and careers left behind by many of those leaders who failed to innovate despite, in retrospect, what seemed to be blindingly obvious product decisions to make.
bandrami 9mo ago
Were you around in 2008?
ajkjk 9mo ago
every time these companies make a mistake and waste billions of dollars it is well-publicized. so there is plenty of data that they are frequently and preposterously wrong.
- anthonypasq 9mo ago
  name a technology that every single top tech company has invested billions of dollars in and then has flopped. the metaverse does not count unless google, amazon, microsoft etc was also throwing billions into it.
  - ajkjk 9mo ago
    weird goalpost by that logic financial crashes wouldn't happen
6510 9mo ago
The mistake is simple. It is like the difference between giving you many tools to use vs making you the tool. https://www.youtube.com/watch?v=LRq_SAuQDec https://www.youtube.com/watch?v=LRq_SAuQDec
- autoexec 9mo ago
  I get the feeling that a lot of people using AI, feeding it their private data, and trusting what it tells them are certainly being tools.
vor_ 9mo ago
This industry has seen several bubbles in its existence. Many previously top companies didn't even survive them.
pjc50 9mo ago
> top 10 biggest and most profitable companies in human history are all preposterously wrong There's another post on the front page about the 2008 financial crisis, which was almost exactly that. Investors are vulnerable to herd mentality. Especially as it's hard to be "right but early" and watch everyone else making money hand over fist while you stand back. https://news.ycombinator.com/item?id=46889008 https://news.ycombinator.com/item?id=46889008
- anthonypasq 9mo ago
  this was the top 10 companies in the s and p in 2008 Rank,Company 1,Exxon Mobil 2,General Electric (GE) 3,Microsoft 4,Procter & Gamble 5,Chevron 6,Johnson & Johnson 7,AT&T 8,Walmart 9,JPMorgan Chase 10,Berkshire Hathaway 1 financial institution. 8 of the top 10 currently are tech companies. its completely different

ryandrake 9mo ago

For most software products I use, if the company spent a year doing nothing but fixing P2 bugs and making small performance improvements, that would deliver far, FAR more value to me than spending a year hamfistedly cramming AI into every corner of the software. But fixing bugs doesn't 1. pad engineer's resumes with new technology, or 2. give company leadership exciting things to talk about to their golfing buddies. So we get AI cram instead.

shigawire 9mo ago
I think it is more externally driven as well, a prisoners dilemma. I don't want to keep crapping out questionable features but if competitors keep doing it the customer wants it -- even if infrastructure and bug fixes would actually make their life better.
- bunderbunder 9mo ago
  Last time I saw results of a survey on this, it found that for most consumers AI features are a deciding factor in their purchasing decisions. That is, if they are looking at two options and one sports AI features and the other doesn’t, they will pick the one that doesn’t. It’s possible AI just seems more popular than it is because it’s easy to hear the people who are talking about it but harder to hear the people who aren’t.
  - deleted 9mo ago
    [deleted]
  - nosianu 9mo ago
    Consumers is nice, but far more important are the big corporate purchases. There may be a lot of people there too who don't want AI, but they all depend on decisions made at the top and AI seems to be the way to go, because of expectations and also because of the mentioned prisoner's dilemma, if competitors gain an advantage it is bad for your org, if all fail together it is manageable.
  - skeptic_ai 9mo ago

saidinesh5 9mo ago

> But with "AI", not only is it not a product in itself, it's a feature to a product, but it has OpEx and CapEx costs that dominate the balance sheet based on their public disclosures. Worse, as a feature, it demonstrably harms business with its hallucinations. I think it depends on how the feature is used? I see it as mostly as yet another user interface in most applications. Every couple of years I keep forgetting the syntax and formulas available in Excel. I can either search for answers or describe what i want and let the LLM edit the spread sheet for me and i just verify. Also, as time passes the OpEx and CapEx are projected to reduce right? It maybe a good thing that companies are burning through their stockpiles of $$$ in trying to find out the applicability and limits of this new technology. Maybe something good will come out of it.

bunderbunder 9mo ago
The thing about giving your application a button that costs you a cent or two every time a user clicks on it is, then your application has a button that costs you a cent or two every time a user clicks on it.
- Lio 9mo ago
  For the usecase of "How do I do thing X in Excell" you could probably get pretty far with just adding a small, local LLM running on the user's machine. That would move the cost of running the model to the end user but it would also mean giving up all the data they can from running prompts remotely. It would probably also make Office users more productive rather than replacing them completely and that's not the vision that Microsoft's actual customers are sold on.
  - bunderbunder 9mo ago
    Fair. But I sure wish we could instead solve this problem the way we did 20 years ago: by not having Web search results be so choked off by SEO enshittification and slop that it’s hard to find good information anymore. Because, I promise you, “How do I do thing X in Excel?” did not used to be nearly so difficult a question to answer.

zuminator 9mo ago

100% agree. Office and Windows were hugely successful because they did things that users (and corporations) wanted them to do. The functionality led to brand recognition and that led to increased sales. Now Microsoft is putting the horse before the cart and attempting to force brand recognition before the product has earned it. And that just leads to resentment. They should make Copilot/AI features globally and granularly toggleable. Only refer to the chatbots as "Copilot," other use cases should be primarily identified on a user-facing basis by their functionality. Search Assistant. Sketching Aid. Writing Aid. If they're any good at what they do, people will gravitate to them without being coerced. And as far as Copilot goes, if they are serious as me it as a product, there should be a concerted effort to leapfrog it to the top of the AI rankings. Every few weeks we're reading that Gemini, Claude, ChatGPT, or DeepSeek has broken some coding or problem-solving score. That drives interest. You almost never hear anything similar about Copilot. It comes off as a cut-rate store brand knockoff of ChatGPT at best. Pass.

Melatonic 9mo ago
I thought Copilot was just ChatGPT - isn't that the whole point of Microsoft's massive investment in OpenAI ?
- dahcryn 9mo ago
  they somehow made it worse and use a less capable version with smaller context window. The only potential upside for businesses it that it can crawl onedrive/sharepoint, and acts as a glorious search machine in your mailbox and files. That's the only thing really valuable to me, everything else is not working as it should. The outlook integration sucks, the powerpoint integration is laughably bad to being worthless, and the excel integration is less useful than Clippy. I actually prefer using the "ask" function of github copilot through visual studio code over using the company provided microsoft copilot portal
- p_ing 9mo ago
  Depends on the flavor. Now has Claude, as well. And Copilot Studio can extend to any model AI Foundry supports.

deleted 9mo ago

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PeterStuer 9mo ago

They bet the company on AI. If their AI push fails, everything else does not matter anymore. What you are seeing is desperation and Hail Marys. My guess is every team's metric is probably reduced to tokens consumed through the products owned.

red-iron-pine 9mo ago
take it a step further: the global market is stagnant, and the big gains of the 90s-2010s are gone. you either hail mary AI or you watch your margins dwindle; captialism does not allow for no-growth.

mbreese 9mo ago

I think this is a really good take, and not one I’ve seen mentioned a lot. Pre-Internet (the world Microsoft was started for), the man expense for a software company was R&D. Once the code was written, it was all profit. You’d have some level of maintenance and new features, but really - the cost of sale was super low. In the Internet age (the likes of Google and Netflix), it’s not much different, but now the cost of doing business is increased to include data centers, power, and bandwidth - we’re talking physical infrastructure. The cost of sale is now more expensive, but they can have significantly more users/customers. For AI companies, these costs have only increased. Not only do they need the physical infrastructure, but that infrastructure is more expensive (RAM and GPUs) and power hungry. So it’s like the cost centers have gone up in expense by log-units. Yes, Anthropic and OpenAI can still access a huge potential customer base, but the cost of servicing each request is significantly more expensive. It’s hard to have a high profit margin when your costs are this high. So what is a tech company founded in the 1970s to do? They were used to the profit margins from enterprise software licensing, and now they are trying to make a business case for answering AI requests as cheaply as possible. They are trying to move from low CapEx + low OpEx to and market that is high in both. I can’t see how they square this circle. It’s probably time for Microsoft to acknowledge that they are a veteran company and stop trying to chase the market. It might be better to partner with a new AI company that is be better equipped to manage the risks than to try to force a solo AI product.

kalap_ur 9mo ago
Yeah. Hyperscalers who are building compute capacities became asset heavy industries. Today's Google, MSFT, META are completely different than 10 years ago and market has not repriced that yet. These are no longer asset light businesses.
pjc50 9mo ago
> cost of doing business is increased to include data centers, power, and bandwidth Microsoft Azure was launched in 2010. They've been a "cloud" company for a while. AI just represents a sharp acceleration in that course. Unfortunately this means the software products have been rather neglected and subject to annoying product marketing whims.

GorbachevyChase 9mo ago

To be fair. MS Office product defects should be regarded just as harmful as hallucinations. Try a lookup in excel on fields that might have text.

Bombthecat 9mo ago

For coding,ai is amazing and getting better. Spell checking is also good, grammar better then me lol And pumping out fake news and propaganda, way worth it when you do it