4 ms·

Ed Zitron on CNBC: GenAI Doesn't Work, and Big Tech Is Out of Hypergrowth Ideas

49 points by johnbarron 3mo ago

johnathan101 3mo ago
[flagged]
- claaams 3mo ago
  A big portion of the global economy is currently banking on LLMs being able to do everything.
  - cyanydeez 3mo ago
    So, the "big portion" is money, not people.
  - jqpabc123 3mo ago
    A big portion of the global economy is pure wishful thinking and hype. No one wants to admit it for the obvious reason that the ruse is very profitable.
- tiahura 3mo ago
  "Is an LLM actually the best tool for this yet?"
trio8453 3mo ago
I don't understand the people who have the patience to listen to Zitron. It's all one-tone takes with no place for nuance, you kind of know what he's going to say and the fact the mixes genuine criticism with bad faith arguments doesn't help.
- ElProlactin 3mo ago
  > I don't understand the people who have the patience to listen to Zitron. It's all one-tone takes with no place for nuance... But that's why some people give him the time of day. A lot of people prefer to see things in black and white because it's easier on the brain. Basically, Ed is doing the easy part (pointing out the malinvestment) and not addressing the harder part, which is to predict what comes next in realistic terms. Because the idea that LLMs are just a $30-40 billion/year TAM and there's going to be an epic implosion that leaves only rubble is not the likely outcome. It's a bit like the first .com boom. There was a huge amount of malinvestment and the bubble popping was painful, but there really was a business for people to buy stuff online, to consume paid content online, etc. The malinvestment got sorted and a couple decades on, immense wealth has been created.
  - cassianoleal 3mo ago
    > It's a bit like the first .com boom. There was a huge amount of malinvestment and the bubble popping was painful That's the point though, isn't it? How detached from reality must you be to think this is ok? "Painful" is carrying a lot of weight in that sentence. Painful means people lost their jobs, families broke up, depression, probably suicide, other forms of violence... There must be a better way to go about these things.
    - ElProlactin 3mo ago
      I won't dismiss the human cost but boom and bust cycles have existed for a very long time. This isn't a new thing today, and it wasn't new then either. You can view these things 100% cynically, or you can also consider the possibility that markets over (and also under) shooting are also a form of discovery in which the value of new business models, technologies, etc. are determined. While I'm not personally a fan of today's financial engineering and have concerns about direct government investments in particular, net-net it's probably better to live in economies where capital is abundant and malinvestment is possible, than to live economies where the opposite is true. From the .com days, I personally observed four categories of outcome: 1. Total financial ruin. If we're being honest, this was often the result of individuals who got rich very quickly and spent even more quickly. 2. Survival. Lots of people got laid off and eventually found new jobs when the economy recovered. Their experience was valuable. A decent number of these people went on to ride the recovery boom and are comfortable if not "rich" today. 3. Survival with a story to tell. People who survived and came away with a story to tell ("at one point I was worth millions on paper and 6 months later I was laid off"). 4. Huge windfall. Some people made a lot of money and through luck and/or smarts, managed to walk away from the implosion wealth intact. The truth is that nobody can predict with certainty the future. Markets are the place where humans make bets about the future. Expecting entirely orderly markets in which everything moves at a predictable pace in a predictable way, where no participants win or lose too much, just isn't realistic.
      - cassianoleal 3mo ago
        > net-net it's probably better to live in economies where capital is abundant and malinvestment is possible, than to live economies where the opposite is true. This is a false dichotomy. Not everything needs to exist at the extremes. > boom and bust cycles have existed for a very long time. This isn't a new thing today, and it wasn't new then either. Murder and domestic violence have existed for a very long time. Racism existed for a long time. Slavery existed for a long time. Things can be fixed, or at least improved to reduce the human cost associated with what's essentially a governance choice.
- jgalt212 3mo ago
  Yeah, I used to be a fan of his critiques, but it's basically the opposite of reading Tyler Cowen's blog now.
- therobots927 3mo ago
  [flagged]
- surgical_fire 3mo ago
  I find more nuance in his arguments than on the typical AI hyper in yhe HN comment session. I can sort of predict the talking points I find here. Anyway, I think Zitron is wrong on the usefulness of AI, but I don't need to agree with him on everything. That is the weaker part of his arguments anyway (and, unsurprisingly, where critics here choose to engage with). He has a very solid point on the viability and economics of AI, and I am still to see facts that contradict his analysis there. In fact, what spooks me about AI is not that it can replace me. It can't, that much is clear. I am spooked about the probable economic downturn that it will spawn. All the reckless spending is fun until the bill has to be paid.
- flowerthoughts 3mo ago
  I find his way of talking funny and entertaining. I can't say why, but it's a nice way to waste a few minutes. It's very boring if you're only there for the information.
- mirrormirroron 3mo ago
  > It's all one-tone takes with no place for nuance, you kind of know what he's going to say and the fact the mixes genuine criticism with bad faith arguments doesn't help. This is hillariously self referential.
  - ToValueFunfetti 3mo ago
    Throwaways are for anonymity, not for dodging the guidelines. Please don't pollute the community here.
scotty79 3mo ago
Meanwhile Deepseek just 6x-ed their inference efficiency at zero quality loss.
- comrade1234 3mo ago
  I logged into my account today to look at my balance and saw a notice that they're changing pricing to charge more at peak times. I haven't looked into to it more yet but I'm guessing it will still be significantly cheaper than the American models.
- nchmy 3mo ago
  When you say "just", which innovation are you referring to? Did they literally just announce something or are you referring to something like v4 flash?
  - cassianoleal 3mo ago
    I imagine GP is talking about this - https://news.ycombinator.com/item?id=48696585 https://news.ycombinator.com/item?id=48696585
tyleo 3mo ago
Ed Zitron, He gets things others are missing. He also misses things others are getting. I think it’s nice to have a voice criticizing the fundraising aspect of these companies. I do think we’ll see at least one of them blow up. The technology is obviously useful though. Hundreds of thousands of developers have already changed the way they were working for decades. Some of the criticisms that the technology doesn’t work at all go a bit too far.
- therobots927 3mo ago
  Would you be able to quantify how useful it is? Trillions are at stake here, so you’ll need to get specific.
  - Mistletoe 3mo ago
    Some numbers for the people in the back. https://isaiprofitable.com/ https://isaiprofitable.com/
    - Timshel 3mo ago
      The header looks not too bad until you realize that 2/3 of the industry revenue is Nvidia ... If you remove the shovel sellers (Micron/Nvidia/AMD) revenue is left at $183B.
      - Mistletoe 3mo ago
        Yep you see how deep the scam goes. It’s like in the gold rush if the ONLY people that made money were the one shovel seller.
    - jqpabc123 3mo ago
      Some logic for those who don't do numbers: Token rates need to double in order for the industry to "break even". In reality, just "breaking even" is not enough. Venture capital expects a sizeable return on their investment. So look for token rates to triple. In reality, most companies are not at all prepared to feed AI vendors what they need in order to become profitable. Uber is an early example of what is in store. https://aimagazine.com/news/why-uber-has-already-burned-through-its-ai-budget https://aimagazine.com/news/why-uber-has-already-burned-thro... https://www.forbes.com/sites/janakirammsv/2026/05/17/uber-burns-its-2026-ai-budget-in-four-months-on-claude-code/ https://www.forbes.com/sites/janakirammsv/2026/05/17/uber-bu...
vb-8448 3mo ago
Just keep in mind that Zitron is in the business of content creation. It doesn't mean he's wrong[1] but his job isn't making successful predictions. [1] Actually I think it's right on the overinvestments and ROI claims
- therobots927 3mo ago
  As if the pro-AI crowd doesn’t have a vested interest in how AI is perceived. Ed Zitron is a journalist. Do you say that about every journalist?
  - vb-8448 3mo ago
    It was more a critique to the crowd saying "Zitron is making wrong predictions since 2024" rather than Zitron itself.
jacknews 3mo ago
It actually does work for a whole range of things. Is it a panacea? Of course not, but it is potentially a sustainable business. Except - open models are barely months away from the same performance and there is no moat, so we will see commodity pricing, and the billions being heaped on the fire currently will probably not see a return, unless someone comes up with a genius trading bot perhaps.
rybosworld 3mo ago
I believed that $10-30 billion/year TAM figure is sourced from this research report: https://www.precedenceresearch.com/large-language-model-market https://www.precedenceresearch.com/large-language-model-mark... The TAM figure they arrive at is ~$36 billion by 2030. And for 2026 they claim a TAM of $10.6B OpenAI alone is rumored to be on track for $30B of revenue in 2026. Add in Anthropic, Google, Microsoft, Meta, and Chinese providers, and the revenue being generated from LLM's in 2026 is plausibly in the range of $50-100B already. Whatever your thoughts are on the cash burn to get there are irrelevant. There's at least $50B of LLM usage being paid for in 2026. 5x higher than the figure these research report companies are providing.
- vb-8448 3mo ago
  > There's at least $50B of LLM usage being paid for in 2026 Just out of curiosity, where did you get the 50B figure?
returnInfinity 3mo ago
Folks if you believe this Ed guy, you're soon going be really disappointed. LLMs are big, Codex app is huge. You can control the browser from within codex app with just natural language. Tell codex to perform a few actions, you go get coffee and come back to work done. This is real boost in productivity.
- jordemort 3mo ago
  How many days in a row can you do this, and then still be able to get things done when Codex is unavailable or the price has been raised to $UNAFFORDABLE?
- jaredcwhite 3mo ago
  You can't tell the critics they're completely wrong and not actually address anything they're saying, lol.
  - therobots927 3mo ago
    Oh you sure can. That’s all the boosters do on here.
therobots927 3mo ago
Anyone can explain why this was flagged?
- jqpabc123 3mo ago
  https://www.ycombinator.com/companies/industry/ai https://www.ycombinator.com/companies/industry/ai
  - therobots927 3mo ago
    Haha. Yep there you go
- verdverm 3mo ago
  Because of the comments here that turned into an ideological battle, and that Zitron is a talking head who makes hyperbolic statements within his sometimes valid points. He's playing for a particular crowd, not doing good journalism and reporting. See how his statements created ideologically based comments here? We'd prefer better discourse on HN.
  - therobots927 3mo ago
    For the record I can’t wait for the “ideologically based” comments after this trillion dollar Jenga tower comes crashing down. This place will be censored to shit of course. But that won’t stop people like me from rubbing it in. You know being a Ycombinator proxy, you would think you guys could take a little bit of shit. You certainly don’t hesitate to shove ai down the throat of everyone, without consent obtained.
    - verdverm 3mo ago
      I have no affiliation with YC or HN, just commenting about the likely reasons the community flagged it. when the comments under a post become ideological, as they have here, there is high probability we will flag the post, regardless of the OP content
1vuio0pswjnm7 3mo ago
Zitron is recently a very effective HN comment trigger Guaranteed defensive replies, usually personal attacks, HN commenters cannot seem to ignore him He must be on to something Big Tech is a slave to the dynamics of attention and popularity. They monitor these dynamics in real-time Perhaps Zitron is getting more attention and becoming more popular He was recently on Bloomberg and now CNBC
- tim333 3mo ago
  There's a big boom on and he's one of the two best known naysayers. The other, Gary Marcus, has gone a bit quiet recently.

49 points by johnbarron 3mo ago

johnathan101 3mo ago

[flagged]

claaams 3mo ago
A big portion of the global economy is currently banking on LLMs being able to do everything.
- cyanydeez 3mo ago
  So, the "big portion" is money, not people.
- jqpabc123 3mo ago
  A big portion of the global economy is pure wishful thinking and hype. No one wants to admit it for the obvious reason that the ruse is very profitable.
tiahura 3mo ago
"Is an LLM actually the best tool for this yet?"

trio8453 3mo ago

I don't understand the people who have the patience to listen to Zitron. It's all one-tone takes with no place for nuance, you kind of know what he's going to say and the fact the mixes genuine criticism with bad faith arguments doesn't help.

ElProlactin 3mo ago
> I don't understand the people who have the patience to listen to Zitron. It's all one-tone takes with no place for nuance... But that's why some people give him the time of day. A lot of people prefer to see things in black and white because it's easier on the brain. Basically, Ed is doing the easy part (pointing out the malinvestment) and not addressing the harder part, which is to predict what comes next in realistic terms. Because the idea that LLMs are just a $30-40 billion/year TAM and there's going to be an epic implosion that leaves only rubble is not the likely outcome. It's a bit like the first .com boom. There was a huge amount of malinvestment and the bubble popping was painful, but there really was a business for people to buy stuff online, to consume paid content online, etc. The malinvestment got sorted and a couple decades on, immense wealth has been created.
- cassianoleal 3mo ago
  > It's a bit like the first .com boom. There was a huge amount of malinvestment and the bubble popping was painful That's the point though, isn't it? How detached from reality must you be to think this is ok? "Painful" is carrying a lot of weight in that sentence. Painful means people lost their jobs, families broke up, depression, probably suicide, other forms of violence... There must be a better way to go about these things.
  - ElProlactin 3mo ago
    I won't dismiss the human cost but boom and bust cycles have existed for a very long time. This isn't a new thing today, and it wasn't new then either. You can view these things 100% cynically, or you can also consider the possibility that markets over (and also under) shooting are also a form of discovery in which the value of new business models, technologies, etc. are determined. While I'm not personally a fan of today's financial engineering and have concerns about direct government investments in particular, net-net it's probably better to live in economies where capital is abundant and malinvestment is possible, than to live economies where the opposite is true. From the .com days, I personally observed four categories of outcome: 1. Total financial ruin. If we're being honest, this was often the result of individuals who got rich very quickly and spent even more quickly. 2. Survival. Lots of people got laid off and eventually found new jobs when the economy recovered. Their experience was valuable. A decent number of these people went on to ride the recovery boom and are comfortable if not "rich" today. 3. Survival with a story to tell. People who survived and came away with a story to tell ("at one point I was worth millions on paper and 6 months later I was laid off"). 4. Huge windfall. Some people made a lot of money and through luck and/or smarts, managed to walk away from the implosion wealth intact. The truth is that nobody can predict with certainty the future. Markets are the place where humans make bets about the future. Expecting entirely orderly markets in which everything moves at a predictable pace in a predictable way, where no participants win or lose too much, just isn't realistic.
    - cassianoleal 3mo ago
      > net-net it's probably better to live in economies where capital is abundant and malinvestment is possible, than to live economies where the opposite is true. This is a false dichotomy. Not everything needs to exist at the extremes. > boom and bust cycles have existed for a very long time. This isn't a new thing today, and it wasn't new then either. Murder and domestic violence have existed for a very long time. Racism existed for a long time. Slavery existed for a long time. Things can be fixed, or at least improved to reduce the human cost associated with what's essentially a governance choice.
jgalt212 3mo ago
Yeah, I used to be a fan of his critiques, but it's basically the opposite of reading Tyler Cowen's blog now.
therobots927 3mo ago
[flagged]
surgical_fire 3mo ago
I find more nuance in his arguments than on the typical AI hyper in yhe HN comment session. I can sort of predict the talking points I find here. Anyway, I think Zitron is wrong on the usefulness of AI, but I don't need to agree with him on everything. That is the weaker part of his arguments anyway (and, unsurprisingly, where critics here choose to engage with). He has a very solid point on the viability and economics of AI, and I am still to see facts that contradict his analysis there. In fact, what spooks me about AI is not that it can replace me. It can't, that much is clear. I am spooked about the probable economic downturn that it will spawn. All the reckless spending is fun until the bill has to be paid.
flowerthoughts 3mo ago
I find his way of talking funny and entertaining. I can't say why, but it's a nice way to waste a few minutes. It's very boring if you're only there for the information.
mirrormirroron 3mo ago
> It's all one-tone takes with no place for nuance, you kind of know what he's going to say and the fact the mixes genuine criticism with bad faith arguments doesn't help. This is hillariously self referential.
- ToValueFunfetti 3mo ago
  Throwaways are for anonymity, not for dodging the guidelines. Please don't pollute the community here.

scotty79 3mo ago

Meanwhile Deepseek just 6x-ed their inference efficiency at zero quality loss.

comrade1234 3mo ago
I logged into my account today to look at my balance and saw a notice that they're changing pricing to charge more at peak times. I haven't looked into to it more yet but I'm guessing it will still be significantly cheaper than the American models.
nchmy 3mo ago
When you say "just", which innovation are you referring to? Did they literally just announce something or are you referring to something like v4 flash?
- cassianoleal 3mo ago
  I imagine GP is talking about this - https://news.ycombinator.com/item?id=48696585 https://news.ycombinator.com/item?id=48696585

tyleo 3mo ago

Ed Zitron, He gets things others are missing. He also misses things others are getting. I think it’s nice to have a voice criticizing the fundraising aspect of these companies. I do think we’ll see at least one of them blow up. The technology is obviously useful though. Hundreds of thousands of developers have already changed the way they were working for decades. Some of the criticisms that the technology doesn’t work at all go a bit too far.

therobots927 3mo ago
Would you be able to quantify how useful it is? Trillions are at stake here, so you’ll need to get specific.
- Mistletoe 3mo ago
  Some numbers for the people in the back. https://isaiprofitable.com/ https://isaiprofitable.com/
  - Timshel 3mo ago
    The header looks not too bad until you realize that 2/3 of the industry revenue is Nvidia ... If you remove the shovel sellers (Micron/Nvidia/AMD) revenue is left at $183B.
    - Mistletoe 3mo ago
      Yep you see how deep the scam goes. It’s like in the gold rush if the ONLY people that made money were the one shovel seller.
  - jqpabc123 3mo ago
    Some logic for those who don't do numbers: Token rates need to double in order for the industry to "break even". In reality, just "breaking even" is not enough. Venture capital expects a sizeable return on their investment. So look for token rates to triple. In reality, most companies are not at all prepared to feed AI vendors what they need in order to become profitable. Uber is an early example of what is in store. https://aimagazine.com/news/why-uber-has-already-burned-through-its-ai-budget https://aimagazine.com/news/why-uber-has-already-burned-thro... https://www.forbes.com/sites/janakirammsv/2026/05/17/uber-burns-its-2026-ai-budget-in-four-months-on-claude-code/ https://www.forbes.com/sites/janakirammsv/2026/05/17/uber-bu...

vb-8448 3mo ago

Just keep in mind that Zitron is in the business of content creation. It doesn't mean he's wrong[1] but his job isn't making successful predictions. [1] Actually I think it's right on the overinvestments and ROI claims

therobots927 3mo ago
As if the pro-AI crowd doesn’t have a vested interest in how AI is perceived. Ed Zitron is a journalist. Do you say that about every journalist?
- vb-8448 3mo ago
  It was more a critique to the crowd saying "Zitron is making wrong predictions since 2024" rather than Zitron itself.

jacknews 3mo ago

It actually does work for a whole range of things. Is it a panacea? Of course not, but it is potentially a sustainable business. Except - open models are barely months away from the same performance and there is no moat, so we will see commodity pricing, and the billions being heaped on the fire currently will probably not see a return, unless someone comes up with a genius trading bot perhaps.

rybosworld 3mo ago

I believed that $10-30 billion/year TAM figure is sourced from this research report: https://www.precedenceresearch.com/large-language-model-market https://www.precedenceresearch.com/large-language-model-mark... The TAM figure they arrive at is ~$36 billion by 2030. And for 2026 they claim a TAM of $10.6B OpenAI alone is rumored to be on track for $30B of revenue in 2026. Add in Anthropic, Google, Microsoft, Meta, and Chinese providers, and the revenue being generated from LLM's in 2026 is plausibly in the range of $50-100B already. Whatever your thoughts are on the cash burn to get there are irrelevant. There's at least $50B of LLM usage being paid for in 2026. 5x higher than the figure these research report companies are providing.

vb-8448 3mo ago
> There's at least $50B of LLM usage being paid for in 2026 Just out of curiosity, where did you get the 50B figure?

returnInfinity 3mo ago

Folks if you believe this Ed guy, you're soon going be really disappointed. LLMs are big, Codex app is huge. You can control the browser from within codex app with just natural language. Tell codex to perform a few actions, you go get coffee and come back to work done. This is real boost in productivity.

jordemort 3mo ago
How many days in a row can you do this, and then still be able to get things done when Codex is unavailable or the price has been raised to $UNAFFORDABLE?
jaredcwhite 3mo ago
You can't tell the critics they're completely wrong and not actually address anything they're saying, lol.
- therobots927 3mo ago
  Oh you sure can. That’s all the boosters do on here.

therobots927 3mo ago

Anyone can explain why this was flagged?

jqpabc123 3mo ago
https://www.ycombinator.com/companies/industry/ai https://www.ycombinator.com/companies/industry/ai
- therobots927 3mo ago
  Haha. Yep there you go
verdverm 3mo ago
Because of the comments here that turned into an ideological battle, and that Zitron is a talking head who makes hyperbolic statements within his sometimes valid points. He's playing for a particular crowd, not doing good journalism and reporting. See how his statements created ideologically based comments here? We'd prefer better discourse on HN.
- therobots927 3mo ago
  For the record I can’t wait for the “ideologically based” comments after this trillion dollar Jenga tower comes crashing down. This place will be censored to shit of course. But that won’t stop people like me from rubbing it in. You know being a Ycombinator proxy, you would think you guys could take a little bit of shit. You certainly don’t hesitate to shove ai down the throat of everyone, without consent obtained.
  - verdverm 3mo ago
    I have no affiliation with YC or HN, just commenting about the likely reasons the community flagged it. when the comments under a post become ideological, as they have here, there is high probability we will flag the post, regardless of the OP content

1vuio0pswjnm7 3mo ago

Zitron is recently a very effective HN comment trigger Guaranteed defensive replies, usually personal attacks, HN commenters cannot seem to ignore him He must be on to something Big Tech is a slave to the dynamics of attention and popularity. They monitor these dynamics in real-time Perhaps Zitron is getting more attention and becoming more popular He was recently on Bloomberg and now CNBC

tim333 3mo ago
There's a big boom on and he's one of the two best known naysayers. The other, Gary Marcus, has gone a bit quiet recently.