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>doesn't turn a profit. This isn't the condemnation of AI that you think it is. When you are building an industry, you don't want to be in a "cash cow" phase.

>doesn't turn a profit. This isn't the condemnation of AI that you think it is. When you are building an industry, you don't want to be in a "cash cow" phase. Because the person who is willing to reinvest profits (and further: seek and sink investments) into growth and innovation is going to eat your lunch. ~8 years ago my BIL condemned Tesla with "they aren't profitable" and I explained this to him. Now they're a trillion dollar company.

Arodex 2mo ago
You are basically describing predatory pricing or dumping, where the goal is not to be the best but to starve your competitors to build a monopoly and gouge customers later. Uber tried that and failed. Now they cost as much as normal taxis if not more. Airbnb tried that and now cost as much as hotels if not more. And tesla is a trillion dollar company on paper only. It can vanish into thin air in a day.
- linsomniac 2mo ago
  >You are basically describing predatory pricing I'm describing business. Period. It's incredibly rare to encounter products above a fairly small revenue level (niche products), that haven't come from a company that spent significant time reinvesting profits and therefore being unprofitable. Same for using outside investment. Yes, there are companies who have burned outside investment on things that didn't pan out. Love them or hate them, the AI companies are doing a huge amount of research. And research companies have always cost more than they've generated in revenue.
  - bunderbunder 2mo ago
    Thing is, we don’t have strong reason to believe the AI companies are just reinvesting profits. There’s a lot of credible analysis saying inference COGS also exceeds the prices they charge. In which case they’re just burning the candle at both ends.
  - noduerme 2mo ago
    huh. I remember a time not that long ago when companies had to have a plan to actually, you know, make money in order to attract investors.
  - Arodex 2mo ago
    Betting massively on onion futures is also "business" period air quotes, and yet it is widely accepted as a bad idea and banned. https://en.wikipedia.org/wiki/Onion_Futures_Act https://en.wikipedia.org/wiki/Onion_Futures_Act And it is just one of several "business" methods that are widely regarded as abusing the rules/manipulation and regulated or outright banned. Your AI companies are not just reinvesting profit, they are burning a fuckton of predatory investors'money to try to drive adoption, but also competitors to bankruptcy.
  - unparagoned 2mo ago
    Reinvesting doesn’t impact profits they are making. That’s not how it works
vatsachak 2mo ago
Tesla is a trillion dollar company because it's a meme stock. It has a 300 P/E

Arodex 2mo ago

You are basically describing predatory pricing or dumping, where the goal is not to be the best but to starve your competitors to build a monopoly and gouge customers later. Uber tried that and failed. Now they cost as much as normal taxis if not more. Airbnb tried that and now cost as much as hotels if not more. And tesla is a trillion dollar company on paper only. It can vanish into thin air in a day.

linsomniac 2mo ago
>You are basically describing predatory pricing I'm describing business. Period. It's incredibly rare to encounter products above a fairly small revenue level (niche products), that haven't come from a company that spent significant time reinvesting profits and therefore being unprofitable. Same for using outside investment. Yes, there are companies who have burned outside investment on things that didn't pan out. Love them or hate them, the AI companies are doing a huge amount of research. And research companies have always cost more than they've generated in revenue.
- bunderbunder 2mo ago
  Thing is, we don’t have strong reason to believe the AI companies are just reinvesting profits. There’s a lot of credible analysis saying inference COGS also exceeds the prices they charge. In which case they’re just burning the candle at both ends.
- noduerme 2mo ago
  huh. I remember a time not that long ago when companies had to have a plan to actually, you know, make money in order to attract investors.
- Arodex 2mo ago
  Betting massively on onion futures is also "business" period air quotes, and yet it is widely accepted as a bad idea and banned. https://en.wikipedia.org/wiki/Onion_Futures_Act https://en.wikipedia.org/wiki/Onion_Futures_Act And it is just one of several "business" methods that are widely regarded as abusing the rules/manipulation and regulated or outright banned. Your AI companies are not just reinvesting profit, they are burning a fuckton of predatory investors'money to try to drive adoption, but also competitors to bankruptcy.
- unparagoned 2mo ago
  Reinvesting doesn’t impact profits they are making. That’s not how it works

vatsachak 2mo ago

Tesla is a trillion dollar company because it's a meme stock. It has a 300 P/E