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> That's the logic of the whole market today. AI – the world's money-losingest technology – attracts investment at the expense of everything else. I expect Cor

> That's the logic of the whole market today. AI – the world's money-losingest technology – attracts investment at the expense of everything else. I expect Cory to have skepticism about technology that can be exploited for dystopian purposes, but calling AI "the world's money-losingest technology" is out of touch. If AI can support/replace some intellectual work, it'll be revolutionary, and that's what the investment bet is about. I get that the blog post is making a separate point about Musk's companies but it's dissapointing to see mistakes like this in Cory's thinking

bayarearefugee 4mo ago
> calling AI "the world's money-losingest technology" is out of touch In what way is it out of touch or wrong? It is objectively correct today. It may very well not be correct 2 years from now, but his statement was about the present, not the future.
MaysonL 4mo ago
AI is currently a massive money sink. Yes or No?
- ZionBoggan 4mo ago
  Obviously no...? The implications far outweigh the "money sink" notion...
  - ggm 4mo ago
    Obviously yes. On evidence alone the path to profit doesn't exist for most of the massive capital sinks. A small number of players At best MAY return on investment, but in the cycle time capital needs a return, most are functionally incapable AGI isn't happening. So, it's incremental improvements on LLM and Generative methods. Any advance which requires more tech inputs demands more capital. Any advance which requires less tech makes all the existing capex look stupid.
    - HerbManic 4mo ago
      I have noticed that those that are the most optimistic about AI almost always talk in a future-tence. It WILL do this, it COULD achieve that etc.
      - inigyou 4mo ago
        I think Ed Zitron challenged us all to talk to an AI booster without letting them use future tense.
    - ZionBoggan 4mo ago
      [flagged]
- Schiendelman 4mo ago
  Not for me, it means I don't have to hire an engineer right now.
- kcartlidge 4mo ago
  There's a distinction. - For the AI provider it is a massive money sink due to cost/revenue maths - For the AI consumer it's not a massive money sink if you arrange things so your ongoing costs are lower than your savings It isn't a simple yes or no overall, only per side of the fence.
amanaplanacanal 4mo ago
if
deleted 4mo ago
[deleted]
lukol 4mo ago
"money-losingest" -> AI already brings in billions and many AI companies could become profitable in little time if they'd stop R&D and simply keep selling what they already have. yes, it's risky and investment-heavy but it's not a bottomless pit with no path to break even. there are many other recent technologies - NFTs? data centers in space? - that would be a better fit for this label.
- projektfu 4mo ago
  Is that true? If Anthropic stopped last November at versions 4.5, would people keep using it enough to recoup the investment?
  - projektfu 4mo ago
    I think I posted this under the wrong comment.
pfraze 4mo ago
“Losing” is a loaded word choice. If I buy something I’m really happy to have, I probably don’t describe it as losing the money. Obviously the investment expense has been extremely high, which is what the replies are quibbling about.
nelsonfigueroa 4mo ago
> If AI can support/replace some intellectual work, it'll be revolutionary, and that's what the investment bet is about. That's one big "If". From personal experience AI just tends to burn money. Time will tell if the investment pays off but I disagree that, at this time, it is out of touch to say AI is a money sink.
Grombobulous 4mo ago
I share your feeling that LLM-based AI is a high-potential technology. The issue is the objective dollars and cents financials of the situation. It’s literally the technology that is the money-losingest at this time. The commercial utility of the technology can’t become viable just by being really useful. There’s a good accounting argument to be made for AI IPOs happening out of a serious need for capital. I wouldn’t bet money at a casino on this, but if OpenAI went completely out of business or was absorbed into irrelevancy within a calendar year, nobody with a finance background would be surprised. They objectively cannot exist in ~18 months without massive spending cuts or additional cash infusion. And they can’t make their models better and serve more tokens to build that future potential that justify their present valuation without additional capital, which becomes decreasingly efficient as data center build costs skyrocket. AI has wonderful potential but no amazing product is guaranteed commercial viability. If Uber spends $1500 on tokens per employee they might as well spend $0 on AI and hire more real people to compensate. I think about how the railroad barons went through a somewhat similar process. By the end of the American railroad buildout, numerous lines became financially unviable within a few short years or decades, some not even really making it into the automobile era. The only railroad business that ended up with any sort of long term profit viability was freight.
- Schiendelman 4mo ago
  The economy gets bigger every year. Therefore, any similarly proportioned large "thing" becomes the largest of all time. Uber lost tons of money for years, I remember the complaints about them. Investors made lots of money because they believe in future value. You're not being forced to make that bet - "money losing" is great for us if we aren't invested!
  - Grombobulous 4mo ago
    IPO investors in Uber didn’t actually make a lot of money. The stock has only gone up by around 7% per year since going public. I can make over 4% guaranteed by putting the money into a CD. Ironically, we are being forced to make that bet, thanks to NASDAQ’s new indexing rule changes made just for SpaceX. I think what you’re describing is essentially a form of “inflate away the debt.” Sure, if we wait enough decades SpaceX will be legitimately worth trillions of dollars. Uber looks like a little baby loss leader compared to AI companies.
inigyou 4mo ago
It can't. It can only provide the appearance of doing so. It's just the Eliza effect on steroids.
bigbadfeline 4mo ago
> I expect Cory to have skepticism about technology that can be exploited for dystopian purposes, but calling AI "the world's money-losingest technology" is out of touch. Since when stating facts is "out of touch"? Currently AI is losing many billions of dollars, it's a fact. > If AI can support/replace some intellectual work, it'll be revolutionary, and that's what the investment bet is about. "replace some intellectual work" says nothing about the cost of doing it, the losses keep piling up and "revolutionary" pies in the skies come and go without real economic or financial improvement - on the contrary, the economic situation is getting worse mostly due to AI because of the fake urgency of the "AI race". A slower pace of development would cost a lot less and might be economically viable but that's not what we have. > but it's dissapointing to see mistakes like this in Cory's thinking. Again, what mistakes? He's stating facts, you're hyping expectations based on marketing propaganda - who and what is mistaken here?

bayarearefugee 4mo ago

> calling AI "the world's money-losingest technology" is out of touch In what way is it out of touch or wrong? It is objectively correct today. It may very well not be correct 2 years from now, but his statement was about the present, not the future.

MaysonL 4mo ago

AI is currently a massive money sink. Yes or No?

ZionBoggan 4mo ago
Obviously no...? The implications far outweigh the "money sink" notion...
- ggm 4mo ago
  Obviously yes. On evidence alone the path to profit doesn't exist for most of the massive capital sinks. A small number of players At best MAY return on investment, but in the cycle time capital needs a return, most are functionally incapable AGI isn't happening. So, it's incremental improvements on LLM and Generative methods. Any advance which requires more tech inputs demands more capital. Any advance which requires less tech makes all the existing capex look stupid.
  - HerbManic 4mo ago
    I have noticed that those that are the most optimistic about AI almost always talk in a future-tence. It WILL do this, it COULD achieve that etc.
    - inigyou 4mo ago
      I think Ed Zitron challenged us all to talk to an AI booster without letting them use future tense.
  - ZionBoggan 4mo ago
    [flagged]
Schiendelman 4mo ago
Not for me, it means I don't have to hire an engineer right now.
kcartlidge 4mo ago
There's a distinction. - For the AI provider it is a massive money sink due to cost/revenue maths - For the AI consumer it's not a massive money sink if you arrange things so your ongoing costs are lower than your savings It isn't a simple yes or no overall, only per side of the fence.

amanaplanacanal 4mo ago

deleted 4mo ago

[deleted]

lukol 4mo ago

"money-losingest" -> AI already brings in billions and many AI companies could become profitable in little time if they'd stop R&D and simply keep selling what they already have. yes, it's risky and investment-heavy but it's not a bottomless pit with no path to break even. there are many other recent technologies - NFTs? data centers in space? - that would be a better fit for this label.

projektfu 4mo ago
Is that true? If Anthropic stopped last November at versions 4.5, would people keep using it enough to recoup the investment?
- projektfu 4mo ago
  I think I posted this under the wrong comment.

pfraze 4mo ago

“Losing” is a loaded word choice. If I buy something I’m really happy to have, I probably don’t describe it as losing the money. Obviously the investment expense has been extremely high, which is what the replies are quibbling about.

nelsonfigueroa 4mo ago

> If AI can support/replace some intellectual work, it'll be revolutionary, and that's what the investment bet is about. That's one big "If". From personal experience AI just tends to burn money. Time will tell if the investment pays off but I disagree that, at this time, it is out of touch to say AI is a money sink.

Grombobulous 4mo ago

I share your feeling that LLM-based AI is a high-potential technology. The issue is the objective dollars and cents financials of the situation. It’s literally the technology that is the money-losingest at this time. The commercial utility of the technology can’t become viable just by being really useful. There’s a good accounting argument to be made for AI IPOs happening out of a serious need for capital. I wouldn’t bet money at a casino on this, but if OpenAI went completely out of business or was absorbed into irrelevancy within a calendar year, nobody with a finance background would be surprised. They objectively cannot exist in ~18 months without massive spending cuts or additional cash infusion. And they can’t make their models better and serve more tokens to build that future potential that justify their present valuation without additional capital, which becomes decreasingly efficient as data center build costs skyrocket. AI has wonderful potential but no amazing product is guaranteed commercial viability. If Uber spends $1500 on tokens per employee they might as well spend $0 on AI and hire more real people to compensate. I think about how the railroad barons went through a somewhat similar process. By the end of the American railroad buildout, numerous lines became financially unviable within a few short years or decades, some not even really making it into the automobile era. The only railroad business that ended up with any sort of long term profit viability was freight.

Schiendelman 4mo ago
The economy gets bigger every year. Therefore, any similarly proportioned large "thing" becomes the largest of all time. Uber lost tons of money for years, I remember the complaints about them. Investors made lots of money because they believe in future value. You're not being forced to make that bet - "money losing" is great for us if we aren't invested!
- Grombobulous 4mo ago
  IPO investors in Uber didn’t actually make a lot of money. The stock has only gone up by around 7% per year since going public. I can make over 4% guaranteed by putting the money into a CD. Ironically, we are being forced to make that bet, thanks to NASDAQ’s new indexing rule changes made just for SpaceX. I think what you’re describing is essentially a form of “inflate away the debt.” Sure, if we wait enough decades SpaceX will be legitimately worth trillions of dollars. Uber looks like a little baby loss leader compared to AI companies.

inigyou 4mo ago

It can't. It can only provide the appearance of doing so. It's just the Eliza effect on steroids.

bigbadfeline 4mo ago

> I expect Cory to have skepticism about technology that can be exploited for dystopian purposes, but calling AI "the world's money-losingest technology" is out of touch. Since when stating facts is "out of touch"? Currently AI is losing many billions of dollars, it's a fact. > If AI can support/replace some intellectual work, it'll be revolutionary, and that's what the investment bet is about. "replace some intellectual work" says nothing about the cost of doing it, the losses keep piling up and "revolutionary" pies in the skies come and go without real economic or financial improvement - on the contrary, the economic situation is getting worse mostly due to AI because of the fake urgency of the "AI race". A slower pace of development would cost a lot less and might be economically viable but that's not what we have. > but it's dissapointing to see mistakes like this in Cory's thinking. Again, what mistakes? He's stating facts, you're hyping expectations based on marketing propaganda - who and what is mistaken here?