I don’t want to be a conspiracy theorist but how much do we think this responds to the Trump admin having documented financial ties to openAI? Trump has proven to me very transactional in dealing with private business.
Already many comments saying this but Ed Zitron is not a person I trust. He's been so biased and wrong on stuff that I consider very obvious and trivial that his complicated analysis with numbers and trends I can't just take at face value.
As an example of obvious wrong things, I remember a tweet of his where he was mocking people talking about agents and agentic coding. He was kind of saying that he was going crazy as agents weren't a thing really and people talking about them like they were real. Something like "agents?! what agents?! these guys hear themselves?!". The answers were full of hundreds of people patiently explaining how they were actually _using_ agents. This wasn't in 2023, it was a couple of months ago.
He just has an audience and an engagement target. His objective is clicks, not informing.
His numbers are based on sources that he says he doesn’t trust, which is quite interesting. While he may be directionally accurate (eg. The revenue needed to match the spend seems lofty at best) he seems to be mixing and matching numbers to create a worst case scenario that doesn’t necessarily line up with reality. Combined with his complete unwillingness to be open minded about anything even tangentially related to AI, and I can’t take him that seriously.
Publications love a doom and gloom rant, which is why he seems to have built an entire career on hysterical anti-ai screeds. It doesn’t mean that he’s right though.
It's disappointing that this article got mindshare when a more neutral author could better argue the bearish case for AI valuations. I want the steelman argument from a more respected individual.
The problem is when untrusted authors take positions, then it circulates widely, then people discredit the author and by proxy the position, when the position could be correct.
The article has a number of emotional appeals in it. Something more focused on raw numbers would foster more curious discussion.
He provided a lot of quantitative analysis in this article. Perhaps an example or two you think these numbers are off-base could help bolster this point?
I think the most compelling part of the article is that these numbers point to a situation where the level of investment required seems unsustainably high by plain dollars.
You don’t really have to agree with the author to see how it plays out. OpenAI and SpaceX and Anthropic need to go public this year to avoid running out of money. There’s no more private money, not enough to fund them. The IPO is the last funding round.
They can continue growing extremely quickly and AI can still be highly useful and maybe be transformative, but still not have the money to fund that growth.
That part he wrote about an AI company gone bust canceling their Oracle contract made Oracle feel like a Nortel analogy to me. If they have a sudden lapse with a big chunk of their customers they are writing down triple digit billions of dollars.
I guess what I'm saying is that I won't look at his numbers since he's an unreliable source from my point of view and there's a chance that he's going to try to deceive me and it's a waste of time for me to listen to him.
I do have other sources of information and I probably agree in general that AI companies are doing pretty shady financial shenanigans. I even think it's possible that openai is in real trouble. But I don't extrapolate that into "AI is useless", which is what he does.
> I guess what I'm saying is that I won't look at his numbers since he's an unreliable source from my point of view and there's a chance that he's going to try to deceive me and it's a waste of time for me to listen to him.
I would agree with you that extrapolating to “AI is useless” is definitely a giant step too far, and that part of the article ruins a lot of the other interesting bits of it.
It’s great that he cites a lot of sources but some of them aren’t great, like the Microsoft story about canceling their Claude spend. I think that particular story isn’t much of an indicator of anything, and it might not even be true.
But the financial part…this guy isn’t the only person out there sounding the alarm about the math not mathing.
FWIW I agree the financials are a bit crazy and OpenAI went a bit nuts with the circular deals. That said, honestly, I don't think it's the end of the world. I think there will probably be some correction/crash and it will probably be healthy. A lot of these circular deals will get canceled, but it's at the end of the day people changing imaginary numbers with each other. The underlying tech I still think it's revolutionary regardless, the same way that the internet was and the tech boom crash at the end of the day was a distraction from the fact that these companies did end up "ruling the world"
This is what critical reading is for. It requires you examining your own assumptions as much as the text's. If you don't engage with something or someone because of your own bias or assumptions, that is also willful ignorance; you also might end up never updating your prior stance when new information emerges.
There is a financial argument and capability argument.
In this case, he doesn't make the claim one follows from the other.
There's no shortage of sources of information. I'll exercise "critical reading" with sources I consider trustworthy to begin with. I've no time to engage with difficult analysis from people who are not worth the effort. You wouldn't engage with every lunacy you read on a tabloid, right? similar principle
Fair enough. I won't debate preferences or how you choose to spend your time. I think one of the merits of his articles is that he surveys and gathers sources that others can engage with. Even if we admit he is biased, that exercise (his writing) alone is valuable because one can contradict or reassess his claims.
Grandparent comment’s primary claim was that Ed has frequently claimed untrue things in the past and so questioned why people would continue going to such a source, but your reply didn't seem to address that at all?
B. AI's output accuracy was already about as high as it would ever be
C. AI users were already declining or was as high as it would ever be.
So we have 3 2024 claims about whether AI was already the biggest/best it would ever be, and whether AI usage was even already shrinking. All ended up being the opposite of true.
Have you looked at whether Ed’s previous claims that went against popular AI views and are testable ended up being true or not?
Does it matter whether an author’s claims like that are true or not for whether you will continue consuming them?
If straightforward claims like the above are so easily disprovable, what makes you believe that he isn't cherry-picking other stats in order to spread misinformation or disinformation, as the individual stats he points to might even be completely true, but if they are cherry-picked, they may be more misleading than elucidative?
If someone has a multi-year history of frequently spreading false claims, should we trust their predictions about future events more than other sources?
He also calls everyone a grifter, when he seems like one himself. Im deeply skeptical of our AI overlords, but its disingenuous to keep pretwnding theres nothing there.
I don't think this works, and other comments have also pointed out the same. You open a position, you receive 200 CVs. Ok, then what, get them all to come in for a couple days work? A company that needs only one position can't possible handle that.
Now you're amazon/google. You have 200 open positions in a certain site/country. You receive 10000 CVs. Same problem, different scale.
So ok, you need to filter CVs, mmm, which sucks, right, so perhaps we do a screen interview? mmm, low signal, maybe....
Truth is, most people who interview people have no idea how to do it. I know because I've done hundreds and nobody ever trained me or explained to me how to do it properly. Over the years I've seen so many people on both sides of the table that I developed a method and I got semi-functional at it but so many people doing interviews shouldn't that bad experiences should be almost expected by now.
I've done at least a few for every company I've worked for. Ironically, the smallest and worst-managed one is also the one that put the most effort into training me on how to do interviews. I'm not sure what to make of that.
Even if we consider what they pay for colossus high (I've no idea, I haven't looked at the numbers), wouldn't this a bit be different from "investing in infrastructure"? They're not building the DC themselves, they're just renting, they can scale down to 0 anytime and not have pressure to recover costs, they don't have debt on the HW, etc.
At least from how it's described in the filing, it sounds like they're committed through 2029 on the deal with SpaceX. So they can't just pull out without a massive lawsuit from SpaceX.
"Pursuant to these agreements, the customer has agreed to pay us $1.25 billion per month through May 2029, with capacity ramping in May and June 2026 at a reduced fee. The agreements may be terminated by either party upon 90 days’ notice."
Both these maps of styles have most of their richness in the past. Modern era is mostly stagnation. I suppose it would be different if I had a map of hip-hop?
I feel there are like 50 load bearing assumptions in this piece of fiction that are dubious at best, definitely speculation. When you put all of them together and chain them in a product of probabilities it becomes tech bro wish fulfilling fantasy. But as usual this is expressed with total confidence and inevitability. This is a perfect encapsulation of all that is wrong with rationalists, TPOT, etc. IMHO.
I'll just suggest that you track your predictions and "update your priors" once they start domino falling.
Could you elaborate on some of these load bearing asumptions?
Maybe your thinking that underneath the corporate SAS economy, theres a giant sea of consumer spending that props it all up.
That might be reasonable, but remember that in this future hyper unequal AI economy, only a handful of ultra wealthy people, most likely through agent proxies, make up more purchasing power than the bottom 95% combined. We're already past the 50% mark in the real world, so this is not implausible.
I'm not saying this is a good future. In fact its absolutely dystopian. But its way more plausible than the fantasy world the author is describing.
I use claude code everyday. Most of my friend circle have a CC max subscription and we talk about and use AI all the time. Not a single one has installed openclaw yet.
For me personally I don't see that it can do a lot of things that CC/codex doesn't do and that _I_ want to do. Also I'm concerned about security.
For a while I wanted some agent I could tell what to do in my PC at home from my phone, so I just vibe coded a web site that can start CC and I used tailscale to secure it.
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