The immediate catalyst, it seems, is an intensifying focus on capex, or capital expenditures. Microsoft revealed that its spending surged 66% to $37.5 billion in the latest quarter, even as growth in its Azure cloud business cooled slightly. Even more concerning to analysts, however, was a new disclosure that approximately 45% of the company’s $625 billion in remaining performance obligations (RPO)—a key measure of future cloud contracts—is tied directly to OpenAI, the company revealed after reporting earnings Wednesday afternoon. (Microsoft is both a major investor in and a provider of cloud-computing services to OpenAI.)
Please fucking crash I want to be able to buy basic computing hardware again
So much money is tied up in AI, that when it crashes you’re likely to end up poor, or worse, homeless, than being able to afford anything.
I wonder how fast you could run Farcry on one of those AI GPU units.
Pretty sure MS will just seize the OpenAi data centers and repurpose them for Azure and rent out compute time or use it for XBox streaming. Non of the hardware will reach the open market.
Regardless of who owns it or what they do with it, those GPUs will get sold on the used market with plenty of life left. Older AI GPUs, networking equipment (eg 100GbE), SAS drives, etc have been easy to find on eBay and other sites for a long time, because data centers replace hardware long before it’s expected to fail.
Exactly. They have like an 8 year depreciation, but they supposedly become obsolete in a couple of years for whatever cutting edge AI is supposed to be.
Since OpenAI just announced the possibility of bankruptcy, it’s definitely coming. It’s going to be wild for whichever idiot in charge at MS to go down in history as the man who ruined one of the most powerful and integral companies on earth.
Wait, where? I wanna read and savour it.
There is big shit show going on.
https://www.warren.senate.gov/newsroom/press-releases/warren-presses-openai-ceo-on-spending-commitments-and-bailout-requests-after-cfo-suggests-government-backstop
edit: original letter https://www.warren.senate.gov/imo/media/doc/letter_to_openai_from_senator_warren.pdf
Unfortunately that stops pretty quickly when you realise there will be a bailout
Yup. Privatize profits, socialize losses. It’s the way the capitalist machine is able to keep grinding up orphans for the 1%.
idk, it was late last year that Sam said he expected OpenAI revenue to grow steeply, but also that if it doesn’t then the company could go bankrupt by 2027 at the latest.
I found this
https://www.tomshardware.com/tech-industry/big-tech/openai-could-reportedly-run-out-of-cash-by-mid-2027-nyt-analyst-paints-grim-picture-after-examining-companys-finances
I’m here hoping the bankruptcy of OpenAi happens sooner.
lol they havnt even put the ads in yet
They don’t have a product with any actual value or use cases. The ads aren’t going to reverse that. If it were that simple then they would have been able to make profit with their subscription model.
I think we’re quite a long way off before they actually crash and burn, if they ever do. We have no idea how much money the ads will inject and they also receive significant government contracts and will probably get a lot more going forward
If the market can pretend Tesla is worth so much i think it can easily sustain AI for many years
It’s already been several years. Tesla had an actual product that people wanted. Yes, they’ve been doing their best of late to torpedo their market share and brand name but at one point they were doing what they set out to do. Open AI has never done what they said they would do.
Note that Tesla was clearly a viable business, I don’t see the justification for it being 3 times the value of ford, gm, Toyota, and Honda all put together.
Generally people are not challenging the fundamental possibility of these as viable business, just that they don’t make sense at their valuations.
Though I’ll agree that open ai particularly should get some skepticism. To the extent that actionable business models might emerge, I don’t see openai actually in a position to be a big party of any of it. Microsoft and Anthropic seem to mostly own business revenue, ChatGPT is generally not even providing the models people select when they are able to choose.
Kinda but also not entirely. I know a lot of people who use ChatGPT and other AIs at work and it does basically exactly what they want and just gets better
I’m not a proponent but the naysayer doomers are almost as wrong as the tech evangelists
Is it overvalued? Sure
Is it worthless? Absolutely not
That’s cool. I have yet to find a use case for AI. Am I doing it wrong or are they just bad with computers?
I am with gustofwind here. I use AI to help me quickly draft up mindless policies, then read through it and edit it where needed. It is a lot faster than any typing I can do.
I also use it to help me find configs for stuff I deploy, but I make sure it attaches the source link for me, so I can read the original source docs and keep a sane approach to what I am doing.
Again, I also think it is way overvalued, but to say it has not helped me build successful stuff over the past 2 years would be a lie. My 2c
Yes, why do you care about the pointless corporate crap you produce . Ai slop is the desired result you are just letting your pride get in the way.
How would that even work as well? The ads will be in the website, doesn’t most stuff run through API calls? If you force everyone to start paying per call, the business model falls apart instantly.
API calls are already only paid, no?
I’m guessing the ads will be embedded in the answers of the free users (like: it will add to the prompt something like “and don’t forget to plug the sponsor, ridge wallet”)
Oh actually are they? I admit I assumed they were doing the standard bullshit of everything is free to get you integrated, then they start charging. Actually maybe that already happened and this is the result of that.
I’m ready for all those tech psychos to go down, and take Tesla with them.
Doubt that’ll happen for a few mor years unfortunately. I can’t imagine most of the hardware made for AI datacenters is compatible with consumer stuff :/
A lot of it hasn’t actually been made, though. The AI companies have put in orders for future production. That future capacity can be redirected with a wave of a pen.
Yep the good times are over for now.
And even if, it might turn into a black hole for an agonizingly long time.