IBM CEO says there is 'no way' spending trillions on AI data centers will pay off at today's infrastructure costs
IBM CEO says there is 'no way' spending trillions on AI data centers will pay off at today's infrastructure costs
The other companies involved know this as well; they’re just not saying the quiet part out loud.
if someone comes up with an alternative way to use a bunch of that infrastructure to make money, I bet they could get a lot of business when the AI bubble pops and suddenly these datacenters are desperate to find a use for themselves
After .com popped, all the money ran to install fiber data infrastructure - a lot of installs put in more capacity than they projected using for 100 years (glass fibers are cheap, digging trenches for them is expensive). The promise of "fiber to the home" is still mostly unrealized, but those trunk lines are out there with oodles of "dark fiber" ready to carry data... someday.
I believe that's pretty much what happened after the dot-com crash. A lot of fiber was laid during the bubble, it went dormant after the crash, but it was useful afterward as the internet continued growing.
You mean like a crazy ai surveillance program? I take it with a grain of salt but I heard ppl say that's how they caught Luigi. They have some super secret prototype program "eye in the sky" thing and they just said it was a mc d's worker as cover.
Even if that doesn't exist yet in the USA, it's definitely in the UK with all their CCTV stuff.
And we know US law enforcement can use things like Ring doorbells.
Trillions of dollars worth of compute mining dogecoin
Meanwhile the planet is dying from all the increased emissions from data center usage.
Datacenters aren't helping, but they're like 3-4% of emissions. It's still manufacturing plastic crap and shipping across the ocean with bunker fuel burn causing 60% of it.
But yeah, increased energy usage isn't helping.
I heard ram pricing is high. There’s their use, an economic one.
So you're saying mining crypto is gonna come back into fashion?
- Krishna was skeptical of that current tech would reach AGI, putting the likelihood between 0-1%.
Altman: “so you’re saying there’s a chance…!”
Just like there's a chance you actually won that Canadian lottery you never signed up for.
Don't worry consumers will pay for all their poor decisions.
Everything will be fine as long as they create digital god. Just gotta keep the plates spinning for a few more years… yeah?
Just ask for more tax breaks. poof Problem gone.
Now guess where that money comes from?
No shit
Nobody wants it to pay off. They want to be the last one standing which will pay off.
The last one standing or the last one left holding the bag?
It’s the same thing. Either way, they get free government money and lots of passive income because they don’t actually have to make anything or do anything to make money.
Will it, though?
For the vast majority of these companies, probably not.
If the company is AI-only, then if/when the bubble bursts, I suspect it'll go under too. Only the biggest players will survive that, like OpenAI, since so many other services call out to their API.
Companies that can pivot back to core markets will be fine, Google, Microsoft. Shovel sellers will mostly be okay too. What that'll look like for them is a period of huge overvaluation and then a return to sanity, you can see similar histories if you look at the stock price of still extant dotcom bubble companies.
And then the hype will be over, there will be a huge crater left in GDP, retirement accounts, and the larger economy, but some "AI" technology will remain — stuff that is actually useful, like transcription, natural speech, noise removal, automated rotoscoping. But the fantasy of replacing information workers and artists will not come to pass, though they probably won't differentiate for the next several years, as the jobs market is decimated all the same by speculation hangover.
I hope not but it probably will.
The last one standing will probably get a bailout by corporate Democrats and every Republican.
Worked for the US after WWII.
Well... for a while at least.
The people, of course
So IBM (PCs are just a passing fad) has a future prediction? Not sure how much weight I should give this.
It’s misleading.
IBM is very much into AI, as a modest, legally trained, economical tool. See: https://huggingface.co/ibm-granite
But this is the CEO saying “We aren’t drinking the Kool-Aid.” It’s shockingly reasonable.
IBM is in the business of consulting. They don’t want their business model getting usurped. Imagine if everyone had access to a bot that could do IBMs job.
I don’t like AI, but this is one reason I can see him saying that.
One day we'll read some of these comments and laugh at how shortsighted they were.
Of course we'll probably have to read them on a manuscript or smeared on a wall with feces because all the world's resources will be used by the huge datacenters that power our AI overlords
So then we're going to drive down the cost of building & developing infrastructure, right?
I wish i knew more about the guts of LLMs because I keep thinking it must be easier to optimize them than to put data centers into space.
Based on the type of AI models IBM has published, they are betting on smaller, specialized models that can run locally or cheaper in a data center. Their strategy seems to be similar to that of thr Chinese, just for different reasons.
For the same reasons. The old rules still work, most of the gold in tech industry is in tall RnD later paid off by scaling indefinitely. Things different from that are either intentionally promoted to inflate a bubble, or popular as a result of wishful thinking where that industry will change in favor of the same curve as with oil and gas. The latter just won't happen.
Data is analogous to oil and gas here. But more like urine in ancient Rome than like something dug up from the ground.
But there's still interest in making some protections and barriers to collection of said data, because otherwise those collecting it are interested to immediately use it for only their own good and not even of other fish in the pond.
It's simple, you just use the resources people need and charge them more to keep everything affordable per quarter. Run out there's plenty of those national parks they've been hoarding from us.
I believe most of the companies are doing it to inflate their share prices.
It's not even about money or financials that add up on balance sheets. It's about market share, political power. When you're Too Big To Fail, balance sheets cease to matter.