5 ms·

This really reinforces the idea that the AI race and the Railroad Mania of the 19th century are very similar. So many different companies are going to have sim

This really reinforces the idea that the AI race and the Railroad Mania of the 19th century are very similar. So many different companies are going to have similarly powerful ai that there will be no moat around it and it will be cheap. They will never earn their investment back.

dist-epoch 6mo ago
The moat is in the compute and the energy access. And further down the line in chips, which is why Elon is building a fab now. There are plenty of capable models on HuggingFace, yet I have no way of running them.
- cedws 6mo ago
  That fab will never be delivered. In five years you might see the manufacturing equivalent of a person dancing in spandex.
  - QQ00 6mo ago
    The only company that musk own and actually achieve something is spacex. so I believe you. He likes to hype things beyond what is actually possible. spacex is engineering masterpiece with how they revolutionize the space industry.
    - declan_roberts 6mo ago
      Do you know about his other company and what they do?
- khalic 6mo ago
  Give it a few years, or month. Tiny models are getting outrageously good
  - mobattah 6mo ago
    Exactly. We’ll see the cost of AI continue to drop. I was saying this for years about Tesla’s FSD - they finally had to give in and drop the price to stay competitive.
    - dbt00 6mo ago
      FSD still sucks ass compared to Waymo.
      - theshrike79 6mo ago
        Theoretically it's possible to use just cameras for FSD. In practice it takes so much local compute it's not feasible with current tech. With LIDAR it's so much easier, a single data point contains direction + distance with no calculation needed.
  - spprashant 6mo ago
    I wonder if this is why the tech cartel is buying up all the hardware? If the average user gets convinced they could run LLMs for cheap at home, you cannot trap users in your walled garden anymore.
    - QQ00 6mo ago
      They actually need it because the demand is higher than expected from consumers. And because they need a moat since every big corporation trying to capture that market too, they need the moat for the biggest compute and energy they can get. Also businesses is were the money at, not regular consumers (especially tech-savvy folk who run models locally).
      - tempodox 6mo ago
        > the demand is higher than expected from consumers. Where does that assertion come from? I wouldn’t believe anything these companies say publicly.
      - 6mo ago
- nutjob2 6mo ago
  > which is why Elon is building a fab now At least he says he's doing that. It doesn't really make sense since you're not going to achieve an advanced node from a standing start in a practical time frame and cost. Sounds like more Musk flavored vapor.
  - re-thc 6mo ago
    > It doesn't really make sense since you're not going to achieve an advanced node from a standing start in a practical time frame and cost. They already announced a partnership with Intel.
    - nutjob2 6mo ago
      Oh the irony.
    - yalok 6mo ago
      He may just want to buy them, to accelerate things, once SpaceX IPOs
cheriot 6mo ago
I suspect this is the real reason behind Anthropic limiting subscriptions to their own products and keeping API prices several times higher than comparable models. Applications more sticky than API users and less technical users more sticky than programmers (ie Cowork more sticky than Code).
- netcan 6mo ago
  Anthropic generally seem more into living within market discipline and market signals of some sort. Products with margins, even if it's sort of irrelevant considering R&D costs and capital inflow. That said, there's nothing like the real thing. The risk is something like the railroad bubble and the dotcom. Over-investement, circular revenue and a timeline that doesn't work. Or, maybe it'll work out.
  - throwaway173738 6mo ago
    Maybe they’ll figure out how to make an agent train an agent.
    - tempodox 6mo ago
      And if they don’t, it won’t be for lack of trying, I promise you. Just like the circular financing, nothing makes more work for “AI” than “AI”.
    - andai 6mo ago
      The labs started doing that in late 2024, they all published research on it. Curiously, mid 2025, they all simultaneously implemented increasingly bizarre restrictions on "self replication". I don't think there was anything public but it sure sounds like something spooked them. (Or maybe just taking sensible precautions, given the direction of the whole endeavour.) At any rate, I recently asked Opus about "Did PKD know about living information systems?" and the safety filter ended the conversation. It started answering me, and then it's response was deleted and a red warning box popped up. But notably, I was given the option to continue the chat with a dumber model (presumably one less capable of producing whatever it thinks I meant by that phrase). Also, I told GPT-5 about my self-modifying Python AI programmer, and it became extremely uncomfortable. I told it an older version of itself had designed and built it (GPT-4 in 2023), and it didn't like that at all! So something's definitely changed in the safety training there.
holoduke 6mo ago
Nah. Everybody is talking about ai. Everybody is using it. It's by far the most popular new tool human beings are using currently. As popular as mobile phones or spoons. And maybe as disruptive as the steam engines. AI companies are becoming the largest software companies on the planet. Everything points into that direction. Trillions of dollars are waiting in the market to be collected.
- Eufrat 6mo ago
  Based on what? A lot of this is vibes and FOMO; just like any economic bubble. There is no objective evidence of anything you’ve said. It isn’t even clear if AI has contributed positively to global economic growth. It reminds me a lot of the late 90s and the dot-com mania. Slapping a domain on a commercial would make your stock go up even if there was no substance to any of it. The real shame is this mania drowns out serious, practical use cases because when the bubble collapses, the market will throw the baby out with the bathwater.
  - olelele 6mo ago
    You can do anything at zombo.com!
  - atleastoptimal 6mo ago
    How can you look at Anthropic's revenue chart and claim it's just vibes
    - Eufrat 6mo ago
      1. Revenue is not profit; you can make $10 billion by spending $20 billion. 2. It is not clear how they are getting their numbers.
      - atleastoptimal 6mo ago
        Regardless they are getting that revenue through genuine demand for their product. It’s not like they are selling back some commodity product, billions are being spent on model outputs. I think anyone who has used Opus 4.6 can see what is causing this demand. It is genuinely “smart” in the sense that it can work its way around non-trivial coding problems.
mirekrusin 6mo ago
What people seem to miss is that they don't need to get the investment back from people, they will get it from machines.
- AnimalMuppet 6mo ago
  Could you explain how you think that's going to work? Because to me it seems that until machines have bank accounts, there's no money for them to get.
  - ValentineC 6mo ago
    Not the parent, but I guess that if AGI happened and was competent enough to trade markets, they'd earn the company back their investment in a short period.
    - Gigachad 6mo ago
      China would have an equivalent version out for cheap next month anyway.
      - mirekrusin 6mo ago
        They are 6-12 months behind not 1 month and precisely the gap will widen if they can’t do distillation.
        Gigachad 6mo ago
        I have doubts the gap will widen. If you look at the research papers, the majority of researchers are Chinese. Of course many of them are living in the US or elsewhere. But under the current circumstances, many are returning home or choosing not to leave China. The future of cutting edge research and tech seems to be progressively moving to China. And a delay in model quality could represent more of an unwillingness to burn stacks of cash to be first, when you can have the same thing slightly later for much cheaper.
  - 6mo ago
szundi 6mo ago
[dead]
andai 6mo ago
Well all of them are already in bed with the government, so they're going to find themselves with slightly more assistance than a free market would predict. If they somehow do fail, then the output of that process will be fantastic open weight models (and hopefully some leaks). I want to say those will pay dividends for decades... but a better prediction is that they will be obsolete within three months ;)

dist-epoch 6mo ago

The moat is in the compute and the energy access. And further down the line in chips, which is why Elon is building a fab now. There are plenty of capable models on HuggingFace, yet I have no way of running them.

cedws 6mo ago
That fab will never be delivered. In five years you might see the manufacturing equivalent of a person dancing in spandex.
- QQ00 6mo ago
  The only company that musk own and actually achieve something is spacex. so I believe you. He likes to hype things beyond what is actually possible. spacex is engineering masterpiece with how they revolutionize the space industry.
  - declan_roberts 6mo ago
    Do you know about his other company and what they do?
khalic 6mo ago
Give it a few years, or month. Tiny models are getting outrageously good
- mobattah 6mo ago
  Exactly. We’ll see the cost of AI continue to drop. I was saying this for years about Tesla’s FSD - they finally had to give in and drop the price to stay competitive.
  - dbt00 6mo ago
    FSD still sucks ass compared to Waymo.
    - theshrike79 6mo ago
      Theoretically it's possible to use just cameras for FSD. In practice it takes so much local compute it's not feasible with current tech. With LIDAR it's so much easier, a single data point contains direction + distance with no calculation needed.
- spprashant 6mo ago
  I wonder if this is why the tech cartel is buying up all the hardware? If the average user gets convinced they could run LLMs for cheap at home, you cannot trap users in your walled garden anymore.
  - QQ00 6mo ago
    They actually need it because the demand is higher than expected from consumers. And because they need a moat since every big corporation trying to capture that market too, they need the moat for the biggest compute and energy they can get. Also businesses is were the money at, not regular consumers (especially tech-savvy folk who run models locally).
    - tempodox 6mo ago
      > the demand is higher than expected from consumers. Where does that assertion come from? I wouldn’t believe anything these companies say publicly.
    - 6mo ago
nutjob2 6mo ago
> which is why Elon is building a fab now At least he says he's doing that. It doesn't really make sense since you're not going to achieve an advanced node from a standing start in a practical time frame and cost. Sounds like more Musk flavored vapor.
- re-thc 6mo ago
  > It doesn't really make sense since you're not going to achieve an advanced node from a standing start in a practical time frame and cost. They already announced a partnership with Intel.
  - nutjob2 6mo ago
    Oh the irony.
  - yalok 6mo ago
    He may just want to buy them, to accelerate things, once SpaceX IPOs

cheriot 6mo ago

I suspect this is the real reason behind Anthropic limiting subscriptions to their own products and keeping API prices several times higher than comparable models. Applications more sticky than API users and less technical users more sticky than programmers (ie Cowork more sticky than Code).

netcan 6mo ago
Anthropic generally seem more into living within market discipline and market signals of some sort. Products with margins, even if it's sort of irrelevant considering R&D costs and capital inflow. That said, there's nothing like the real thing. The risk is something like the railroad bubble and the dotcom. Over-investement, circular revenue and a timeline that doesn't work. Or, maybe it'll work out.
- throwaway173738 6mo ago
  Maybe they’ll figure out how to make an agent train an agent.
  - tempodox 6mo ago
    And if they don’t, it won’t be for lack of trying, I promise you. Just like the circular financing, nothing makes more work for “AI” than “AI”.
  - andai 6mo ago
    The labs started doing that in late 2024, they all published research on it. Curiously, mid 2025, they all simultaneously implemented increasingly bizarre restrictions on "self replication". I don't think there was anything public but it sure sounds like something spooked them. (Or maybe just taking sensible precautions, given the direction of the whole endeavour.) At any rate, I recently asked Opus about "Did PKD know about living information systems?" and the safety filter ended the conversation. It started answering me, and then it's response was deleted and a red warning box popped up. But notably, I was given the option to continue the chat with a dumber model (presumably one less capable of producing whatever it thinks I meant by that phrase). Also, I told GPT-5 about my self-modifying Python AI programmer, and it became extremely uncomfortable. I told it an older version of itself had designed and built it (GPT-4 in 2023), and it didn't like that at all! So something's definitely changed in the safety training there.

holoduke 6mo ago

Nah. Everybody is talking about ai. Everybody is using it. It's by far the most popular new tool human beings are using currently. As popular as mobile phones or spoons. And maybe as disruptive as the steam engines. AI companies are becoming the largest software companies on the planet. Everything points into that direction. Trillions of dollars are waiting in the market to be collected.

Eufrat 6mo ago
Based on what? A lot of this is vibes and FOMO; just like any economic bubble. There is no objective evidence of anything you’ve said. It isn’t even clear if AI has contributed positively to global economic growth. It reminds me a lot of the late 90s and the dot-com mania. Slapping a domain on a commercial would make your stock go up even if there was no substance to any of it. The real shame is this mania drowns out serious, practical use cases because when the bubble collapses, the market will throw the baby out with the bathwater.
- olelele 6mo ago
  You can do anything at zombo.com!
- atleastoptimal 6mo ago
  How can you look at Anthropic's revenue chart and claim it's just vibes
  - Eufrat 6mo ago
    1. Revenue is not profit; you can make $10 billion by spending $20 billion. 2. It is not clear how they are getting their numbers.
    - atleastoptimal 6mo ago
      Regardless they are getting that revenue through genuine demand for their product. It’s not like they are selling back some commodity product, billions are being spent on model outputs. I think anyone who has used Opus 4.6 can see what is causing this demand. It is genuinely “smart” in the sense that it can work its way around non-trivial coding problems.

mirekrusin 6mo ago

What people seem to miss is that they don't need to get the investment back from people, they will get it from machines.

AnimalMuppet 6mo ago
Could you explain how you think that's going to work? Because to me it seems that until machines have bank accounts, there's no money for them to get.
- ValentineC 6mo ago
  Not the parent, but I guess that if AGI happened and was competent enough to trade markets, they'd earn the company back their investment in a short period.
  - Gigachad 6mo ago
    China would have an equivalent version out for cheap next month anyway.
    - mirekrusin 6mo ago
      They are 6-12 months behind not 1 month and precisely the gap will widen if they can’t do distillation.
      - Gigachad 6mo ago
        I have doubts the gap will widen. If you look at the research papers, the majority of researchers are Chinese. Of course many of them are living in the US or elsewhere. But under the current circumstances, many are returning home or choosing not to leave China. The future of cutting edge research and tech seems to be progressively moving to China. And a delay in model quality could represent more of an unwillingness to burn stacks of cash to be first, when you can have the same thing slightly later for much cheaper.
- 6mo ago

szundi 6mo ago

[dead]

andai 6mo ago

Well all of them are already in bed with the government, so they're going to find themselves with slightly more assistance than a free market would predict. If they somehow do fail, then the output of that process will be fantastic open weight models (and hopefully some leaks). I want to say those will pay dividends for decades... but a better prediction is that they will be obsolete within three months ;)