It won't happen. Too much $ had already been invested. It will work, one way or the other. It is here to stay.
Ultimately, you can spend what you want; if the product is bad people won’t use it.
Think about it via a manufacturing analogy. I think we can all agree that modern cnc machining is much better for mass manufacturing than needing to hire an equivalent number of skilled craftspeople to match that throughput.
Imagine we had a massive runup of innovation in the cnc manufacturing industry all in one go. We went from cnc lathes to 2d routing tables to 3, then 4, then 5 axis machining all in the span of three years. Investment was so sloshy that companies were just releasing their designs as open source, with the hope that they'd attract the best designers and engineers in the global race to create the ultimate manufacturing platform. They were imagining being able to design and manufacture the next generations of super advanced fighter jets all in one universal machine.
Now these things are great at manufacturing fully custom one-off products, and the technicians who can manipulate them to their fullest are awestruck by the power they now have at their fingertips. They can design absolutely anything they could imagine.
But you know what people really want? Not fighter jets, but cheap furniture. Do you know what it takes to make cheap furniture? Slightly customized variants of the early iterations that were released as open source. Variants that can't be monitized by the companies that spent millions on designing and releasing them.
The tech might work great, but that doesn't mean the investment pays off with the desired returns.
The glaring difference is that specialised machines, usually invented to do an existing task better, faster or more safely, do indeed revolutionise the world. As you pointed out, they perform necessary functions better, faster, and / or more safely.
Note that segues, that weird juice machine etc, we not built to fill a gap or to perform a task better, faster or more safely. Neither were pet rocks or see-through phones. Nobody was sitting around before the Metaverse going 'man, I wish Minecraft could be pre-made and corporate with my work colleagues", and when these things launched the sales pitches were all about "look at the awesome things this tech can do, isn't it great?!", rather than "look at the awesome things this tech will allow you / help you to do, aren't they great?!".
LLMs are really impressive tech. So are segues and those colour-changing t-shirts we had in the 80s. They looked awesome, the tech was awesome, and there were genuine practical applications for doomerist, somewhere.
But they do not allow the average poison to do anything awesome. They don't make arduous tasks faster, better or safer without heavily sacrificing quality, privacy, and sanity. They do not fill a gap in anybody's life.
That's the difference. Most AI is currently a really cool technology that can do a bunch of things and it's very exciting to look at, just like the Segway and the Metaverse. And, really, an ant, or a furby. They are not going to revolutionise anything, because they were more built to. They weren't built to summarise your emails or to improve your coding (there are many princes of software that were built to assist with coding, and they are pretty good) or to perform any arduous or dangerous tasks. They were built to experiment, to push boundaries, to impress, and to sell.
So yes, I 100% agree with you and take your point a little further it's not even that LLM's are too high tech and fancy for most periods. I don't even think that they're products. They are components, or add-ons, being sold as products like extension power cables 50 years before the invention of the plug socket, or flexible silicone phone cases being sold in the era of landlines and phone boxes.
And I'm legit still baffled that so many people seem to have jobs that revolve around reading and writing emails or producing boilerplate code, who are not able to confidently do those things, but aren't just looking for a new job.
Like, it's a tough market, but if you haven't learned to skim-read an email by now, do yourself a favour and find a job that doesn't involve so much skim reading of emails. I don't get it.
I could see US-built AI being a national security concern.
And if that happens, will the taxpayer be on the hook to make investors whole? We shouldn't. If it is nationalized, it needs to be done at a small fraction of the private investment.
If one or more of the AI companies fail, the government would pay what they feel is the market value for the graphics cards, warehouses, and standing desks and it will surely be way less than what the investors have put in.
they failed to grow their capital and they can hold the bag