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I mean, the layoffs we are going through right now are patently due to the high cost of AI buildouts and transitions. Meta is taking on significant debt for the

by aprilthird2021 5mo ago

I mean, the layoffs we are going through right now are patently due to the high cost of AI buildouts and transitions. Meta is taking on significant debt for the first time in a long time to continue their build out plans as AI components have spiked in price. I get what you're saying about how every employee becomes a liability when they are let loose with an AI, and totally agree. But I think the layoffs have a much more financial root because they are so widespread across so many companies and even industries (not just tech)

ethbr1 5mo ago
My point about layoffs is that with widespread AI adoption and without department-targeted layoffs, a company risks their AI spend disappearing into the void. Layoffs + access to AI forces most of that AI use to make up for the layoffs. Which is a pretty shitty way to burn your employees out... but it has a method. (Also, I'd say AI infra companies vs everyone else are apples to oranges. This point would be more applicable to a non-AI infra company that's paying for AI use rather than AI infra capital)
solumunus 5mo ago
I really can’t fathom the Meta strategy at all here.
- ethbr1 5mo ago
  The same as Google's: use overwhelming funding drown any burgeoning product category with the potential to threaten core profit center. Turn a potential existential competition into (a) maybe I win or (b) I commoditize the market and you can't make money at it either.
  - solumunus 5mo ago
    An alternative strategy would be to stack insane amounts of cash while every other competitor is blowing theirs, putting you in an incredible position to deploy capital whenever this bubble pops. This seems so much more obvious, to me at least. I think AI is the future but it’s far more likely than not that the current phase of the market is a bubble and unsustainable. What even has Meta produced with all this AI spend? I’m not even sure what race they’re in. It just seems like a big AGI or nothing gamble. Personally I would be watching all my competitors make that bet and laughing all the way to the bank as my financial position constantly improved relatively. A lot of your competitors are basically practising self harm right in front of you and you’re joining in? Maybe I’m the idiot who is missing something, but I just don’t get it.
    - ethbr1 4mo ago
      That's a big risk for any market with first mover advantage / network effects. How'd Microsoft's mobile efforts go? Sometimes the lead quickly becomes insurmountable, so if you're sitting on a cash flow machine it's not a terrible idea to at least keep pace with new markets.
      - solumunus 4mo ago
        What is the risk for Meta? They will continue to be a social media company that prints money regardless. I'm arguing that they NEVER need to join the AI market, not try and jump in late.

ethbr1 5mo ago

My point about layoffs is that with widespread AI adoption and without department-targeted layoffs, a company risks their AI spend disappearing into the void. Layoffs + access to AI forces most of that AI use to make up for the layoffs. Which is a pretty shitty way to burn your employees out... but it has a method. (Also, I'd say AI infra companies vs everyone else are apples to oranges. This point would be more applicable to a non-AI infra company that's paying for AI use rather than AI infra capital)

solumunus 5mo ago

I really can’t fathom the Meta strategy at all here.

ethbr1 5mo ago
The same as Google's: use overwhelming funding drown any burgeoning product category with the potential to threaten core profit center. Turn a potential existential competition into (a) maybe I win or (b) I commoditize the market and you can't make money at it either.
- solumunus 5mo ago
  An alternative strategy would be to stack insane amounts of cash while every other competitor is blowing theirs, putting you in an incredible position to deploy capital whenever this bubble pops. This seems so much more obvious, to me at least. I think AI is the future but it’s far more likely than not that the current phase of the market is a bubble and unsustainable. What even has Meta produced with all this AI spend? I’m not even sure what race they’re in. It just seems like a big AGI or nothing gamble. Personally I would be watching all my competitors make that bet and laughing all the way to the bank as my financial position constantly improved relatively. A lot of your competitors are basically practising self harm right in front of you and you’re joining in? Maybe I’m the idiot who is missing something, but I just don’t get it.
  - ethbr1 4mo ago
    That's a big risk for any market with first mover advantage / network effects. How'd Microsoft's mobile efforts go? Sometimes the lead quickly becomes insurmountable, so if you're sitting on a cash flow machine it's not a terrible idea to at least keep pace with new markets.
    - solumunus 4mo ago
      What is the risk for Meta? They will continue to be a social media company that prints money regardless. I'm arguing that they NEVER need to join the AI market, not try and jump in late.