cross-posted from: https://lemmy.ml/post/54396848

If you want to know whether artificial intelligence is a gigantic economic bubble, don’t just take pundits’ word for it. Major investors are now moving their money to try to protect themselves from the AI bubble popping.

For an industry that we’re told is central to our collective future, the artificial intelligence (AI) industry increasingly seems to be built on a combination of artificially inflated hopes and bad accounting.

The industry’s critics have been raising concerns about its finances for a while: the fact that most of its flagship firms are grossly unprofitable, that they’ve had to jack up their prices to try break even (leading their business customers to pump the brakes on using their products), or that many of the eye-popping investment announcements that are meant to show demand for AI is strong have actually been circular financing — meaning different AI firms cycling money to and from each other.

But none of it has seemed to slow the industry’s boom or the relentless hype machine behind it. Until now, anyway. It used to be that you mostly heard concerns about the industry’s underlying economics in newspapers, blogs, social media posts, and podcasts, and that those concerns went completely unreflected in the markets. But these concerns seem now to have finally bled over into investors’ thinking.

  • Ech@lemmy.ca
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    23 hours ago

    Yeah. That $80 billion loss was all for training I guess 🙄

    • SorryQuick@lemmy.ca
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      13 hours ago

      Well that and the fact that they have a company to run and people to pay. Do you seriously believe inference is not profitable, despite evidence to the contrary being everywhere you look?

    • midribbon_action@lemmy.blahaj.zone
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      19 hours ago

      It’s not exactly $80 billion, $72 billion of that loss is accounting for the rising valuation giving early investors larger paybacks, aka Google and Amazon. The same people who give Anthropic its compute, at a very very healthy discount, are the ones who benefit most from a high valuation.