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A lot of smart people said that Uber could never become profitable because the core economics couldn't work out: > https://www.bbc.com/news/technology-48227381

by timpera 2mo ago

A lot of smart people said that Uber could never become profitable because the core economics couldn't work out: > https://www.bbc.com/news/technology-48227381 https://www.bbc.com/news/technology-48227381 > https://www.forbes.com/sites/lensherman/2019/08/22/ubers-dubious-path-to-profitability-is-not-a-meme/ https://www.forbes.com/sites/lensherman/2019/08/22/ubers-dub... > https://americanaffairsjournal.org/2019/05/ubers-path-of-destruction/ https://americanaffairsjournal.org/2019/05/ubers-path-of-des... Cory Doctorow, who is close to Ed Zitron and writes a lot in the same way about AI's economics, was of the same opinion: https://doctorow.medium.com/no-ubers-still-not-profitable-2b8054e375ea https://doctorow.medium.com/no-ubers-still-not-profitable-2b... I used to believe this, so I'm not sure what to think of the AI market.

arctic-true 2mo ago
The failures of past doomsayers are important to keep in mind. It’s hard to say “well, but we know things they didn’t know at the time, but this time that won’t happen.” I will observe, however, that Uber’s revenues come from consumers. Consumers are never going to be willing to spend enough on AI to justify OAI and Anthropic’s spending, even if a single company captured all of their demand. They recognized this and pivoted to software engineering and enterprise customers. These are much more sophisticated buyers than someone trying to catch a cab or get a burrito delivered, and more able to be patient or expend resources to find a better, cheaper provider. It also bears mentioning that if any particular AI lab manages to survive and succeed in the way Uber has, there will be several multibillion dollar corporate gravestones behind it. In fact, I don’t even think that nobody can be the Uber of AI. I just think it can’t be OAI or Anthropic. The debt is too great and it’s priced under old assumptions.

by timpera 2mo ago

arctic-true 2mo ago

The failures of past doomsayers are important to keep in mind. It’s hard to say “well, but we know things they didn’t know at the time, but this time that won’t happen.” I will observe, however, that Uber’s revenues come from consumers. Consumers are never going to be willing to spend enough on AI to justify OAI and Anthropic’s spending, even if a single company captured all of their demand. They recognized this and pivoted to software engineering and enterprise customers. These are much more sophisticated buyers than someone trying to catch a cab or get a burrito delivered, and more able to be patient or expend resources to find a better, cheaper provider. It also bears mentioning that if any particular AI lab manages to survive and succeed in the way Uber has, there will be several multibillion dollar corporate gravestones behind it. In fact, I don’t even think that nobody can be the Uber of AI. I just think it can’t be OAI or Anthropic. The debt is too great and it’s priced under old assumptions.