Technology

Nice try, I ain't gonna pay anyway

AI Bubble burst coming sooner?

I mean, this is no different than Walmart making prices low until other businesses die out and then raising them.

It is no different than police shoving all the homeless people and drug addicts into one area of town to crash the property prices, and then evicting them once developers buy everything for cheap.

They're purposely operating at a loss in the expectation that they can get ingrained into a ton of workflows, and then gouge everyone absolutely to death while also worsening the quality of the service to make it cheaper for them to run.

If it weren't so horrible for the environment, I'd kind of like it, because all the dumbass executives that are signing up for this are going to get exactly what they deserve. You'd think they'd recognize a scheme when they see one.

I wonder how much they spend for every $0 I pay them.

Of course it is, it’s essentially a scam. They just need enough humans to keep investing until they check out and run with a bailout.

Trust me bro we're so close to profitability bro, just need this IPO to secure funding one last time bro then we'll be profitable bro I swear.

I can't imagine paying for AI when the open source tools have made it so easy to set up a model locally.

reminder than during 2019 there were streaming services popping left and right, all showing tremendous growth because they started from zero, and articles were about how bad Netflix was doing due to having practically no growth compared with the competition (they already had a massive subscriber base). Twist? Netflix was the only streaming service that was actually making a profit, the rest were a massive loss but big growth.

Needless to say most of those streaming services died; who remembers DC streaming service, or Yahoo's? While Netflix is basically as stong as ever, despite the prevalent enshitification happening through the whole industry.

Point of the story? shareholders don't care about stable profitable business, only cancerous growth. AI is like that, zero profits, ton of cost, but as long as they show growth the shareholders are happy, regardless of how cooked the books are.

Honestly Google is likely to beat openAI and Anthropic as things are.

OpenAI and Anthropic have to buy/rent their hardware from Nvidia, while Google is making their own TPU hardware. Google's hardware costs on AI is way lower, every dollar they spend on it goes a lot farther.

And unlike the other two, they're already a profitable company. They're making record profits right now. They don't have a desperate need to figure out how to make back billions on their AI models, they can just keep offering Gemini at a comparatively cheap price and wait for anthropic and open AI to bankrupt themselves.

Now, I'm no MBA, but that seems like a bad business plan...

What is the actual “cost” after they buy the hardware, is that $1000 really pure power usage cost?

It's gonna come crashing down pretty soon. It's gonna hurt all of us. It won't hurt the people responsible nearly enough.

Good thing I don't personally pay them anything

they are spending infinite money for every $1 i pay them

Oh come on bubble, why won't you crash already?

so these crazy prices i hear about being implemented (like at github) should actually be at least 10x higher?

The author is right and wrong. Its subsidised but not by anthropic. The power users who use their plans to the limit are subsidised by the rest of the users. Im an AI hater but I do think anthropic will be profitable next year. Their revenue growth is insane and looks to just be getting started. Claude code took enterprise by storm and now cowork is out.