3 ms·

>His argument has never been "this tech doesn't work", but rather "these businesses aren't economically viable" Why? because of cost?

zero_shift 8mo ago
Cost, debt, difficulty forming a moat, gap between what the product promises and what it can do, and the difficulty actually raising capital required. His style is acerbic and (imo) excessive sometimes. But he's also one of a minority of journos actually looking at the numbers and adding them up. Which seems to be a rarity
- hiddencost 8mo ago
  Disagree. He's cherry picking an extremely limited subset of numbers, based on a weak understanding of the industry and a lack of access to a lot of private data, and taking advantage of vulnerable people.
  - zero_shift 8mo ago
    I'm not sure how anyone can respond to that, without asking you to divulge that private data
  - danlitt 8mo ago
    >taking advantage of vulnerable people What on earth do you mean by this? Who is getting taken advantage of?
- simianwords 8mo ago
  cost is going down 20x, 30x over the years so he's wrong about this.
  - zero_shift 8mo ago
    Those are very large reductions - can I ask you for a source? And why is the error bar so large?
    - simianwords 8mo ago
      https://epoch.ai/data-insights/llm-inference-price-trends https://epoch.ai/data-insights/llm-inference-price-trends > The rate of decline varies dramatically depending on the performance milestone, ranging from 9x to 900x per year
  - orwin 8mo ago
    That doesn't matter if the free models are as performant in 6 months. I will never personally pay for a model I can have for free. ChatGPT 5 used to be my preferred model as a DMing help tool, now deepseek and LeChat are the one I use, and are better at what OpenAI model use to be better at. And I think the models hit their limit for my usecase, I don't need better one. I never 'reprompt' anymore, and just roll/improvise with what I got.
    - simianwords 8mo ago
      i find it interesting that in no case do you allow openapi to profit - if the costs go up then they can't make profits - if the costs go down then you won't pay for them
      - orwin 8mo ago
        It's hard to sell something I can have for free. The only way for openAI to get my subscription back would be my country making open-weight ai or deepseek illegal. It was worth the price tbh, but they can't compete with free.
JanneVee 8mo ago
Well from my point of view. When they talk about gigawatt datacenters, then yes it is economically nonviable. You just need to know the scale of a gigawatt to realize that we need to start building power plants and fortifying the power grid to ship a gigawatt of power to a single location. Until the build out which takes years mind you, it is competing with other consumers of power. Lets take another huge consumer of power like a large steel mills use 100 megawatt. So if that power becomes more expensive because of datacenters, then the price of steel will go up. And if the price of steel goes up it affects a lot of things in the economy. We are facing a situation that the short term effects are on memory and storage prices going up and lack of jet engines. Long term we wont be able to build actual buildings and ships without financing it with even more debt than today and everyone in the economy is going to service that debt through the price.
- simianwords 8mo ago
  but the costs of inference have been going down 20x to 30x over the years. so how can you tell it is nonviable? unless you are saying they are not paying market rate for the inference
  - JanneVee 8mo ago
    So, they still booked up all the ram and ssd in the world and still going to use gigawatts of power. The price of energy production is not going to go down 20x and 30x it just means that they can cram in more inference on the same energy consumption if the cost goes down. But they aren't paying the market rate for inference because everything is subsidized with debt and investors money to scale as fast as possibly. They are flushed with money and that is why they can book up all silicon production.
  - surgical_fire 8mo ago
    I have no idea if costs indeed came down 20x-30x. This claim sounds extremely fancy when AI companies bleed money, and will keep bleeding money in the foreseeable future. I don't pretend to know the future. Maybe LLMs become economically viable and are the future, maybe not. I don't really care either way, to be frank. And I use LLMs, btw. I pay for a ChatGPT account, but I find it only moderately useful. I always sort of question myself upon renewal date if it is worth the 20 bucks I spend monthly on it. In no small part I keep using it to keep myself up to date on the best practices of using them in case it becomes standard.
deleted 8mo ago
[deleted]

zero_shift 8mo ago

Cost, debt, difficulty forming a moat, gap between what the product promises and what it can do, and the difficulty actually raising capital required. His style is acerbic and (imo) excessive sometimes. But he's also one of a minority of journos actually looking at the numbers and adding them up. Which seems to be a rarity

hiddencost 8mo ago
Disagree. He's cherry picking an extremely limited subset of numbers, based on a weak understanding of the industry and a lack of access to a lot of private data, and taking advantage of vulnerable people.
- zero_shift 8mo ago
  I'm not sure how anyone can respond to that, without asking you to divulge that private data
- danlitt 8mo ago
  >taking advantage of vulnerable people What on earth do you mean by this? Who is getting taken advantage of?
simianwords 8mo ago
cost is going down 20x, 30x over the years so he's wrong about this.
- zero_shift 8mo ago
  Those are very large reductions - can I ask you for a source? And why is the error bar so large?
  - simianwords 8mo ago
    https://epoch.ai/data-insights/llm-inference-price-trends https://epoch.ai/data-insights/llm-inference-price-trends > The rate of decline varies dramatically depending on the performance milestone, ranging from 9x to 900x per year
- orwin 8mo ago
  That doesn't matter if the free models are as performant in 6 months. I will never personally pay for a model I can have for free. ChatGPT 5 used to be my preferred model as a DMing help tool, now deepseek and LeChat are the one I use, and are better at what OpenAI model use to be better at. And I think the models hit their limit for my usecase, I don't need better one. I never 'reprompt' anymore, and just roll/improvise with what I got.
  - simianwords 8mo ago
    i find it interesting that in no case do you allow openapi to profit - if the costs go up then they can't make profits - if the costs go down then you won't pay for them
    - orwin 8mo ago
      It's hard to sell something I can have for free. The only way for openAI to get my subscription back would be my country making open-weight ai or deepseek illegal. It was worth the price tbh, but they can't compete with free.

JanneVee 8mo ago

Well from my point of view. When they talk about gigawatt datacenters, then yes it is economically nonviable. You just need to know the scale of a gigawatt to realize that we need to start building power plants and fortifying the power grid to ship a gigawatt of power to a single location. Until the build out which takes years mind you, it is competing with other consumers of power. Lets take another huge consumer of power like a large steel mills use 100 megawatt. So if that power becomes more expensive because of datacenters, then the price of steel will go up. And if the price of steel goes up it affects a lot of things in the economy. We are facing a situation that the short term effects are on memory and storage prices going up and lack of jet engines. Long term we wont be able to build actual buildings and ships without financing it with even more debt than today and everyone in the economy is going to service that debt through the price.

simianwords 8mo ago
but the costs of inference have been going down 20x to 30x over the years. so how can you tell it is nonviable? unless you are saying they are not paying market rate for the inference
- JanneVee 8mo ago
  So, they still booked up all the ram and ssd in the world and still going to use gigawatts of power. The price of energy production is not going to go down 20x and 30x it just means that they can cram in more inference on the same energy consumption if the cost goes down. But they aren't paying the market rate for inference because everything is subsidized with debt and investors money to scale as fast as possibly. They are flushed with money and that is why they can book up all silicon production.
- surgical_fire 8mo ago
  I have no idea if costs indeed came down 20x-30x. This claim sounds extremely fancy when AI companies bleed money, and will keep bleeding money in the foreseeable future. I don't pretend to know the future. Maybe LLMs become economically viable and are the future, maybe not. I don't really care either way, to be frank. And I use LLMs, btw. I pay for a ChatGPT account, but I find it only moderately useful. I always sort of question myself upon renewal date if it is worth the 20 bucks I spend monthly on it. In no small part I keep using it to keep myself up to date on the best practices of using them in case it becomes standard.

deleted 8mo ago

[deleted]