Investors Are Suddenly Getting Concerned That AI Isn't Making Any Serious Money

As ever, the market found a very promising boat, and they had a huge party celebrating the launch of the boat into open water, confident of the wind.

What does it matter that they have no idea where to sail it? They know they are bound for some port, and when they arrive it will be glorious.

Waking up to the bubble predicted by many, observed by many, ongoing as we speak.

I think AI will be transformative for some industries, but it’s not the new “discovery of fire” that people are claiming. If we ever come up with a really conscious and hyper intelligent AI mechanism then that will be the new fire, but LLM ain’t it. So there are gonna be a lot of losers in the next couple of years

[dupe]

Actual article among others: https://www.washingtonpost.com/technology/2024/07/24/ai-bubb...

(Lots of discussion: https://news.ycombinator.com/item?id=41087719)

As the production line trundles along a new batch of developers get their preserving coating of cynicism applied.

Well, I'm not paying a starbucks latte per month for something that has to be taken with two spoons of salt every time.

Maybe one starbucks late per year... just maybe.

Go do more carefully crafted demos to CEOs that don't try to use the product themselves and maybe you'll get some more sales.

Past revolutions on average took a generation to have any impact on productivity (the older generation had to retire basically, allowing companies to part with their old processes and procedures).

AI should be a bit quicker, given its accessibility. Stubborn humans and their bureaucracy will hold that back a bit though. For instance my company is concerned about data privacy, needs to go through the legal departments approval then IT's approval, by the time it's in the actual hands of the user it's obsolete or limited in use case.

Definitely a big opportunity for investors, the long payback period is the issue.

Early thinking was this might be an ‘extending innovation’ meaning it might favor incumbents.

We have at least one new major firm out of the initial boom, with bright prospects, and huge cash burn, but a TON of customers.

The tools are so general right now, there’s a lot to be written. It seems certain that we’ll get cost savings, automation, and almost certain that we’ll get new revenue streams out of this — whoever figures out how to get new revenue that’s not based on SAAS model delivery of cost savings is going to be very happy.

To keep the long view, the last time we had such broad individual mass market adoption of a technical tool regardless of corporate bans and rules was the iPhone, before that, probably Linux in IT departments in the 1990s. People WANT and NEED these LLMs for a lot of daily work. Some folks are going to figure out the business models and make some venture funds very happy.

I'm bullish on AI but I still think it's a bubble.

Who would have thought no one needs 1000 AI tools which are just really at best automation tools

If you're working with text and you have some regularities in your workflow, you can gain some productivity points from current technology. In time most industries will have these regularities, similar to workflow improvements after the introduction of computer.

But I also doubt if it will have that much effect. In general we have diminishing returns from these kind of technology, telegraph's effect on the world was larger than the computer, computers were more valuable than WWW and search engines have smaller effect than WWW. AI may be big, but could it be bigger than search or e-commerce? I doubt it.

I think it's like the web in 1998. It was obvious the web was going to be huge but the companies at the time were overpriced and a lot of capital misallocated.

Well they did oversell LLMs just to make a quick buck... Crypto, "AI", I wonder what's the next bubble. I bet it's property in space or something.

> "Capital continues to pour into the AI sector with very little attention being paid to company fundamentals,"

Maybe I'm just overly optimistic, but on a wider society scale I see a lot worse things they could be pouring money in to (eg Ads). Even if they never make money on it, at least we end up with a lot of open knowledge through all the papers that have been published and even some open-source models that can do some neat things.

When the AI bubble pops it will leave behind a grimy residue. https://buttondown.email/maiht3k/archive/the-grimy-residue-o...

AI made a huge debut. Now it needs to flourish over the 10-15 years just like how .com did

Yes Barclays, we need 12k chatbots, if not 120k chatbots. Now talk less invest more.

Stochastic parrots dont generate infinitely increasing shareholder value? Shocking!

Stochastic parrots don't amount to much

The winter is coming.

suddenly? bro it's been using the same amount of electricity as Bolovia, daily, for months now. this is only coming up now?

Welcome to the trough of disillusionment.