AI's profits are 'being funded by investors rather than earned from customers | Hacker News Reader

AI's profits are 'being funded by investors rather than earned from customers

fortune.com

37 pointsAnon8414 comments

That's wonderful news. Customers are poor so a transfer of money away from them is always increasing inequality, which we already have too much of for some time now.

In every industry the competitions should be so ruthless that investors on average always lose. That's the only way we can counteract rising inequality in absence proper taxation.

By investing, the investor should be buying lottery ticket. And no lottery should be on average paying back more in rewards than the price of sold tickets.

The problem with the modern western world is that interests of business are politically more taken care of than interests of consumers. There should be a political party that disregards business completely and just focuses on the good of consumers. It could have wide support because everyone is a consumer.

That's a valid business model if some company acquired them in the end.

Microsoft will acquire OpenAI for $15B and Google will acquire Anthropic for $10B; the smaller ones will get acquired by Meta, Oracle etc.

Their debts will be passed on to USA/EU population.

Employees will not get to exercise their stock options, but will have some great stories to tell. Somehow RAM will not get cheaper.

Then a new hype wave starts all over.

Lol, I appreciate your cynicism here, but I think it could realistically go worse than that:

- OpenAI and Anthropic convince the US gov to ban open weight models, through bribes or fear respectively. Model weights become contraband, comparable to CSAM, because someone will show you can use uncensored (abliterated) open models to do bad things.

- Duopoly firmly in place, the prices are raised until they become painful. The rest of the world uses Chinese models for a while, but the US applies soft power where it can, similar to copyright and patent restrictions. The justification will be something about open weight models and intellectual property, and the word "pirate" will fall our of favor as the word "terrorist" takes its place.

- US hardware will detect when you're doing what looks like too many matrix multiplies or dot products. Similar to "Trusted Computing", HDMI cables, and other DRM.

- Of course some US people will work around all of this under the radar, but most will be served mediocre models polluted with advertising and only capable of generating memes and slop.

>> US hardware will detect when you're doing what looks like too many matrix multiplies or dot products. Similar to "Trusted Computing", HDMI cables, and other DRM.

You mean like NVIDIA is doing to their GPUs for Crypto?

That's a great example, and proof of how easy it is for them to do.

Interesting forecast, but it unrealistically assumes America still has soft power.

The US international soft power wings have been clipped by an administration that has shown the world that since everything is permitted to the USA, its various coercive threats are vacuous; there is no one home, no moral metabolism. What is true now will not be true in six months. There is no diachronically stable counterparty.

Instead of a shitty but stable american global tech hegemony, what you describe instead is a world where the rest of us get good cheap models, and you all do not.

We see this already with American carmakers. Do any of you really think a new car should cost $70K?

Here in Canada I am looking forward to my $10K BYD. Thanks to the destructive US tarriffs and threats to our sovereignty, we no longer need to care about American squeamishness, and no longer sync our foreign policies to each other's mutual benefit. When the soft power turned hard, we gave ourselves permission to stop caring about protecting markets for American products.

Every country on Earth just unlocked the same permission structure this year. God bless America, you brought us all liberty after all :)

> it unrealistically assumes America still has soft power

I did caveat by saying, "where it can".

I'm very unhappy with what we've been doing here, but until you Canadians bail out of Five Eyes, I think you're still in bed with us. Nothing is simple.

Well, sometimes it is. This happened:

https://www.theglobeandmail.com/politics/article-military-mo...

Trust me. We might not have yet signed the paperwork, but the divorce proceeds apace.

That is not business model. And the acquisition thing can happen when much larger companies who see you as competition to squash exist.

It's literally the business model of a ton of tech companies including most of YC I bet, the author seems to live under a rock?

Yes, a ton of companies don't have a valid business model. That doesn't make it a good idea for OpenAI either.

I believe you mean scam?

https://archive.today/fFxix

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