AI's Dial-Up Era

https://www.wreflection.com/p/ai-dial-up-era

by nowflux • 9 months ago

469 422 9 months ago

arcticbull2• 9 months ago

People tend to equate this to the railroad boom when saying that infrastructure spending will yield durable returns into the future no matter what.

When the railroad bubble popped we had railroads. Metal and sticks, and probably more importantly, rights-of-way.

If this is a bubble, and it pops, basically all the money will have been spent on Nvidia GPUs that depreciate to 0 over 4 years. All this GPU spending will need to be done again, every 4 years.

Hopefully we at least get some nuclear power plants out of this.

ares6232• 9 months ago

The recycling industry will boom. From what demand you ask? We'll find out soon enough.

troupo6• 9 months ago

The boom might not last long enough for western countries to pull heads out of their collective asses and ramp up production of nuclear plants.

It takes China 5 years now, but they've been ramping up for more than 20 years.

simonw• 9 months ago

Yeah, the short-lived GPU deprecation cycle does feel very relevant here.

I'm still a fan of the railroad comparisons though for a few additional reasons:

1. The environmental impact of the railroad buildout was almost incomprehensibly large (though back in the 1800s people weren't really thinking about that at all.)

2. A lot of people lost their shirts investing in railroads! There were several bubbly crashes. A huge amount of money was thrown away.

3. There was plenty of wasted effort too. It was common for competing railroads to build out rails that served the same route within miles of each other. One of them might go bust and that infrastructure would be wasted.

robinhoode• 9 months ago

Railroads need repair too? Not sure if it's every 4 years. Also, the trains I take to/from work are super slow because there is no money to upgrade.

I think we may not upgrade every 4 years, but instead upgrade when the AI models are not meeting our needs AND we have the funding & political will to do the upgrade.

Perhaps the singularity is just a sigmoid with the top of the curve being the level of capex the economy can withstand.

arcticbull2• 9 months ago

For what it's worth they cost a lot less than highways to maintain. Something like the 101 in the Bay Area costs about $40,000 per lane-mile per year, or about $240,000.

Trains are closer to $50-100,000 per mile per year.

If there's no money for the work it's a prioritization decision.

rhubarbtree3• 9 months ago

What percentage of data centre build costs are the GPUs vs power stations, water cooling plants, buildings, roads, network, racks, batteries, power systems, etc

schwarzrules• 9 months ago

> basically all the money will have been spent on Nvidia GPUs that depreciate to 0 over 4 years

I agree the depreciation schedule always seems like a real risk to the whole financial assumptions these companies/investors make, but a question I've wondered: - Will there be an unexpected opportunity when all these "useless" GPUs are put out to pasture? It just seems like saying a factory will be useless because nobody wants to buy an IBM mainframe, but an innovative company can repurpose a non-zero part of that infrastructure for another use case.

paxys3• 9 months ago

There's a lot more to infrastructure spending than GPUs. Companies are building data centers, cooling systems, power plants (including nuclear), laying cables under oceans, launching satellites. Bubble or not, all of this will continue to be useful for decades in the future.

Heck if nothing else all the new capacity being created today may translate to ~zero cost storage, CPU/GPU compute and networking available to startups in the future if the bubble bursts, and that itself may lead to a new software revolution. Just think of how many good ideas are held back today because deploying them at scale is too expensive.

bryanlarsen• 9 months ago

including nuclear

Note that these are just power purchase agreements. It's not nothing, but it's a long ways away from building nuclear.

amluto• 9 months ago

A bunch of the money is being spent on data centers and their associated cooling and power systems and on the power plants and infrastructure. Those should have much longer depreciation schedules.

FridgeSeal• 9 months ago

Imagine the progress we could have made on climate change if this money had been funneled into that, instead of making some GPU manufacturers obscenely wealthy.

bbddg• 9 months ago

Yeah it’s infuriating to think about.

leptons7• 9 months ago

Throwing away the future for "AI" slop.

fjdjcjejdjfje• 9 months ago

This is precisely why the AI bubble is so much worse than previous bubbles: the main capital asset that the bubble is acquiring is going to depreciate before the bubble's participants can ever turn a profit. Regardless of what AI's future capabilities are going to be, it's physically impossible for any of these companies to become profitable before the GPUs that they have already purchased are either obsolete or burnt out from running under heavy load.

vjvjvjvjghv3• 9 months ago

I think the hardware infrastructure may be obsolete but at the moment we are still just beginning to figure out how to use AI. So the knowledge will be the important thing that’s left after the bubble. The current infrastructure will probably be as obsolete as dial up infrastructure.

runarberg3• 9 months ago

The vast majority of the dot-com comparison that I personally see are economic, not technological. People (or at least the ones I see) are claiming that the bubble mechanics of e.g. circular trading and over-investments are similar to the dot-com bubble, not that the AI technology is somehow similar the internet (it obviously isn’t). And to that extent we are in the year 1999 not 1995.

When this article are claiming both sides of the debate, I believe only one of them are real (the ones hyping up the technology). While there are people like me who are pessimistic about the technology, we are not in any position of power, and our opinion on the matter is basically a side noise. I think a much more common (among people with any say in the future of this technology) is the believe that this technology is not yet at a point which warrants all this investment. There were people who said that about the internet in 1999, and they were proven 100% correct in the months that followed.

vjvjvjvjghv3• 9 months ago

Agreed. It would probably be better to keep improving AI before investing that much into infrastructure.

mjr00• 9 months ago

While I mostly agree with the article's premise (that AI will cause more software development to happen, not less) I disagree with two parts:

1. the opening premise comparing AI to dial-up internet; basically everyone knew the internet would be revolutionary long before 1995. Being able to talk to people halfway across the world on a BBS? Sending a message to your family on the other side of the country and them receiving it instantly? Yeah, it was pretty obvious this was transformative. The Krugman quote is an extreme, notable outlier, and it gets thrown out around literally every new technology, from blockchain to VR headsets to 3DTVs, so just like, don't use it please.

2. the closing thesis of

Consider the restaurant owner from earlier who uses AI to create custom inventory software that is useful only for them. They won’t call themselves a software engineer.

The idea that restaurant owners will be writing inventory software might make sense if the only challenge of creating custom inventory software, or any custom software, was writing the code... but it isn't. Software projects don't fail because people didn't write enough code.

solomonb• 9 months ago

Before I got my first full time software engineering gig (I had worked part time briefly years prior) I was working full time as a carpenter. We were paying for an expensive online work order system. Having some previous experience writing software for music in college and a couple /brief/ LAMP stack freelance jobs after college I decided to try to write my own work order system. It took me like a month and it would never have never scaled, was really ugly, and had the absolute minimum number of features. I could never had accepted money from someone to use it but it did what we needed and we ran with it for several years after that.

I was only able to do this because I had some prior programming experience but I would imagine that if AI coding tools get a bit better they would enable a larger cohort of people to build a personal tool like I did.

Kiro• 9 months ago

I don't think his quote is that extreme and it was definitely not obvious to most people. A common thing you heard even around 95 was "I've tried internet but it was nothing special".

alecbz• 9 months ago

basically everyone knew the internet would be revolutionary long before 1995. Being able to talk to people halfway across the world on a BBS? Sending a message to your family on the other side of the country and them receiving it instantly? Yeah, it was pretty obvious this was transformative.

That sounds pretty similar to long-distance phone calls? (which I'm sure was transformative in its own way, but not on nearly the same scale as the internet)

Do we actually know how transformative the general population of 1995 thought the internet would or wouldn't be?

xwolfi3• 9 months ago

In 1995 in France we had the minitel already (like really a lot of people had one) and it was pretty incredible, but we were longing for something prettier, cheaper, snappier and more point to point (like the chat apps or emails).

As soon as the internet arrived, a bit late for us (I'd say 1999 maybe) due to the minitel's "good enough" nature, it just became instantly obvious, everyone wanted it. The general population was raving mad to get an email address, I never heard anyone criticize the internet like I criticize the fake "AI" stuff now.

visarga7• 9 months ago

> Consider the restaurant owner from earlier who uses AI to create custom inventory software that is useful only for them. They won’t call themselves a software engineer.

I have a suspicion this is LLM text, sounds corny. There are dozens open source solutions, just look one up.

bena• 9 months ago

“But the fact that some geniuses were laughed at does not imply that all who are laughed at are geniuses. They laughed at Columbus, they laughed at Fulton, they laughed at the Wright brothers. But they also laughed at Bozo the Clown.”

Because some notable people dismissed things that wound up having profound effect on the world, it does not mean that everything dismissed will have a profound effect.

We could just as easily be "peak Laserdisc" as "dial-up internet".

rainsford• 9 months ago

I was happy to come into this thread and see I was not the first person for whom that quote came to mind. The dial-up Internet comparison implicitly argues for a particular outcome of current AI as a technology, but doesn't actually support that argument.

There's another presumably unintended aspect of the comparison that seems worth considering. The Internet in 2025 is certainly vastly more successful and impactful than the Internet in the mid-90s. But dial-up itself as a technology for accessing the Internet was as much of a dead-end as Laserdisc was for watching movies at home.

Whether or not AI has a similar trajectory as the Internet is separate from the question of whether the current implementation has an actual future. It seems reasonable to me that in the future we're enjoying the benefits of AI while laughing thinking back to the 2025 approach of just throwing more GPUs at the problem in the same way we look back now and get a chuckle out of the idea of "shotgun modems" as the future.

bigwheels• 9 months ago

Benchmark today’s AI boom using five gauges:
1. Economic strain (investment as a share of GDP)
2. Industry strain (capex to revenue ratios)
3. Revenue growth trajectories (doubling time)
4. Valuation heat (price-to-earnings multiples)
5. Funding quality (the resilience of capital sources)
His analysis shows that AI remains in a demand-led boom rather than a bubble, but if two of the five gauges head into red, we will be in bubble territory.

This seems like a more quantitative approach than most of "the sky is falling", "bubble time!", "circular money!" etc analyses commonly found on HN and in the news. Are there other worthwhile macro-economic indicators to look at?

It's fascinating how challenging it is meaningfully compare current recent events to prior economic cycles such as the y2k tech bubble. It seems like it should be easy but AFAICT it barely even rhymes.

rhubarbtree3• 9 months ago

Yep.

Stockmarket capitalisation as a percentage of GDP AKA the Buffett indicator.

https://www.longtermtrends.net/market-cap-to-gdp-the-buffett...

Good luck, folks.

cb321• 9 months ago

Besides your chart, another point along these lines is that the article cites Azhar claiming multiples are not in bubble territory while also mentioning Murati getting essentially infinite price multiple. Hmmmm...

rybosworld• 9 months ago

How valuable is this metric considering that the biggest companies now draw a significant % of revenue from outside the U.S.?

I'm sure there are other factors that make this metric not great for comparisons with other time periods, e.g.:

- rates

- accounting differences

dude2507112• 9 months ago

Consider the restaurant owner from earlier who uses AI to create custom inventory software that is useful only for them.

That is the real dial-up thinking.

Couldn't AI like be their custom inventory software?

Codex and Claud Code should not even exist.

morkalork• 9 months ago

"That side of prime rib is totally in the walk-in, just keep looking. Trust me, bro"

ToucanLoucan3• 9 months ago

Couldn't AI like be their custom inventory software?

Absolutely not. It's inherently a software with a non-zero amount of probability in every operation. You'd have a similar experience asking an intern to remember your inventory.

Like I enjoy Copilot as a research tool right but at the same time, ANYTHING that involves delving into our chat history is often wrong. I own three vehicles, for example, and it cannot for it's very life remember the year, make and model of them. Like they're there, but they're constantly getting switched around in the buffer. And once I started positing questions about friend's vehicles that only got worse.

dude2507112• 9 months ago

But you should be able to say "remember this well" and AI would know it needs a reliable database instead of relying on its LLM cache or whatever. Could it not just spin up Postgres in some Codex Cloud like a human developer would? Not today but in a few years?

dg0• 9 months ago

Nice article, but somewhat overstates how bad 1995 was meant to be.

A single image generally took nothing like a minute. Most people had moved to 28.8K modems that would deliver an acceptable large image in 10-20 seconds. Mind you, the full-screen resolution was typically 800x600 and color was an 8-bit palette… so much less data to move.

Moreover, thanks to “progressive jpeg”, you got to see the full picture in blocky form within a second or two.

And of course, with pages was less busy and tracking cookies still a thing of the future, you could get enough of a news site up to start reading in less time that it can take today.

One final irk is that it’s little overdone to claim that “For the first time in history, you can exchange letters with someone across the world in seconds”. Telex had been around for decades, and faxes, taking 10-20 seconds per page were already commonplace.

saltysalt5• 9 months ago

Not sure the dial-up analogy fits, instead I tend to think we are in the mainframe period of AI, with large centralised computing models that are so big and expensive to host, only a few corporations can afford to do so. We rent a computing timeshare from them (tokens = punch cards).

I look forward to the "personal computing" period, with small models distributed everywhere...

runarberg3• 9 months ago

I actually think we are much closer to the sneaker era of shoes, or the monorail era of public transit.

onlyrealcuzzo2• 9 months ago

Don't we already have small models highly distributed?

saltysalt5• 9 months ago

We do, but the vast majority of users interact with centralised models from Open AI, Google Gemini, Grok...

godshatter• 9 months ago

I use gpt4all and have downloaded some models. It's not that hard, and doesn't take a huge system. It's pretty easy if you use models on their list, it's a bit more work to find the right chat interactive script (forgot what they are called) for your class of model if you downloaded one that's not on the list, but not that hard. I have 8GB VRAM, and it's slow but they work. I like that it's local and private, but then I don't use them for much other than as an oddity that is fun to interact with.

paxys3• 9 months ago

Why would companies sell you the golden goose when they can instead sell you an egg every day?

saltysalt5• 9 months ago

Exactly! It's a rent-seeking model.

mulmen• 9 months ago

Your margin is my opportunity. The more expensive centralized models get the easier it is for distributed models to compete.

codegeek• 9 months ago

You could say the same thing about Computers when they were mostly mainframe. I am sure someone will figure out how to make it commoditized just like personal computers and internet.

worldsayshi• 9 months ago

Well if there's at least one competitor selling golden geese to consumers the rest have to adapt.

Assuming consumers even bother to set up a coop in their living room...

kakapo5672• 9 months ago

Because companies are not some monolith, all doing identical things forever. If someone sees a new angle to make money, they'll start doing it.

Data General and Unisys did not create PCs - small disrupters did that. These startups were happy to sell eggs.

DevKoala• 9 months ago

Because someone else will sell it to you if they dont.

JumpCrisscross5• 9 months ago

Why would companies sell you the golden goose when they can instead sell you an egg every day?

Because someone else can sell the goose and take your market.

Apple is best aligned to be the disruptor. But I wouldn’t underestimate the Chinese government dumping top-tier open-source models on the internet to take our tech companies down a notch or ten.

positron264• 9 months ago

When the consumer decides to discover my site and fund federated and P2P infrastructure, they can have a seat at the table.

anjel• 9 months ago

Selling fertile geese was a winning and proven business biz model for a very long time.

Selling eggs is better how?

cyanydeez• 9 months ago

I think we are in the dotcom boom era where investment is circular and the cash investments all depend on the idea that growth is infinite.

Just a bunch of billionaires jockeying for not being poor.

gowld• 9 months ago

We are also in the mainframe period of computing, with large centralised cloud services.

sixtyj• 9 months ago

Dial-up + mainframe. Mainframe from POV as silos, dial-up internet as the speed we have now when looking back to 2025 in 2035.

chemotaxis• 9 months ago

I look forward to the "personal computing" period, with small models distributed everywhere...

One could argue that this period was just a brief fluke. Personal computers really took off only in the 1990s, web 2.0 happened in the mid-2000s. Now, for the average person, 95%+ of screen time boils down to using the computer as a dumb terminal to access centralized services "in the cloud".

btown• 9 months ago

Even the most popular games (with few exceptions) present as relatively dumb terminals that need constant connectivity to sync every activity to a mainframe - not necessarily because it's an MMO or multiplayer game, but because it's the industry standard way to ensure fairness. And by fairness, of course, I mean the optimization of enforcing "grindiness" as a mechanism to sell lootboxes and premium subscriptions.

And AI just further normalizes the need for connectivity; cloud models are likely to improve faster than local models, for both technical and business reasons. They've got the premium-subscriptions model down. I shudder to think what happens when OpenAI begins hiring/subsuming-the-knowledge-of "revenue optimization analysts" from the AAA gaming world as a way to boost revenue.

But hey, at least you still need humans, at some level, if your paperclip optimizer is told to find ways to get humans to spend money on "a sense of pride and accomplishment." [0]

We do not live in a utopia.

[0] https://www.guinnessworldrecords.com/world-records/503152-mo... - https://www.reddit.com/r/StarWarsBattlefront/comments/7cff0b...

pksebben2• 9 months ago

That 'average' is doing a lot of work to obfuscate the landscape. Open source continues to grow (indicating a robust ecosystem of individuals who use their computers for local work) and more importantly, the 'average' looks like it does not necessarily due to a reduction in local use, but to an explosion of users that did not previously exist (mobile first, SAAS customers, etc.)

The thing we do need to be careful about is regulatory capture. We could very well end up with nothing but monolithic centralized systems simply because it's made illegal to distribute, use, and share open models. They hinted quite strongly that they wanted to do this with deepseek.

There may even be a case to be made that at some point in the future, small local models will outperform monoliths - if distributed training becomes cheap enough, or if we find an alternative to backprop that allows models to learn as they infer (like a more developed forward-forward or something like it), we may see models that do better simply because they aren't a large centralized organism behind a walled garden. I'll grant that this is a fairly polyanna take and represents the best possible outcome but it's not outlandishly fantastic - and there is good reason to believe that any system based on a robust decentralized architecture would be more resilient to problems like platform enshittification and overdeveloped censorship.

At the end of the day, it's not important what the 'average' user is doing, so long as there are enough non-average users pushing the ball forward on the important stuff.

jayd167• 9 months ago

I don't know, I think you're conflating content streaming with central compute.

Also, is percentage of screentime the relevant metric? We moved TV consumption to the PC, does that take away from PCs?

Many apps moved to the web but that's basically just streamed code to be run in a local VM. Is that a dumb terminal? It's not exactly local compute independent...

JumpCrisscross5• 9 months ago

using the computer as a dumb terminal to access centralized services "in the cloud"

Our personal devices are far from thin clients.

positron264• 9 months ago

Makes me want to unplug and go back to offline social media. That's a joke. The dominant effect was networked applications getting developed, enabling community, not a shift back to client terminals.

seemaze• 9 months ago

I think that speaks more to the fact that software ate the world, than locality of compute. It's a breadth first, depth last game.

wolpoli• 9 months ago

The personal computing era happened partly because, while there were demands for computing, users' connectivity to the internet were poor or limited and so they couldn't just connect to the mainframe. We now have high speed internet access everywhere - I don't know what would drive the equivalent of the era of personal computing this time.

torginus3• 9 months ago

I dislike the view of individuals as passive sufferers of the preferences of big corporations.

You can and people do self-host stuff that big tech wants pushed into the cloud.

You can have a NAS, a private media player, Home Assistant has been making waves in the home automation sphere. Turns out people don't like buying overpriced devices only to have to pay a $20 subscription, and find out their devices don't talk to each other, upload footage inside of their homes to the cloud, and then get bricked once the company selling them goes under and turns of the servers.

api3• 9 months ago

There are more PCs and serious home computing setups today than there were back then. There are just way way way more casual computer users.

The people who only use phones and tablets or only use laptops as dumb terminals are not the people who were buying PCs in the 1980s and 1990s, or they were they were not serious users. They were mostly non-computer-users.

Non-computer-users have become casual consumer level computer users because the tech went mainstream, but there's still a massive serious computer user market. I know many people with home labs or even small cloud installations in their basements, but there are about as many of them as serious PC users with top-end PC setups in the late 1980s.

npilk• 9 months ago

But for a broader definition of "personal computer", the number of computers we have has only continued to skyrocket - phones, watches, cars, TVs, smart speakers, toaster ovens, kids' toys...

I'm with GP - I imagine a future when capable AI models become small and cheap enough to run locally in all kinds of contexts.

https://notes.npilk.com/ten-thousand-agents

WhyOhWhyQ• 9 months ago

I guess we're in the kim-1 era of local models, or is that already done?

MSFT_Edging• 9 months ago

I look forward to a possibility where the dumb terminal is less centralized in the cloud, and more how it seems to work in the expanse. They all have hand terminals that seem to automatically interact with the systems and networks of the ship/station/building they're in. Linking up with local resources, and likely having default permissions set to restrict weird behavior.

Not sure it could really work like that IRL, but I haven't put a ton of thought into it. It'd make our always-online devices make a little more sense.

dzonga• 9 months ago

this -- chips are getting fast enough both arm n x86. unified memory architecture means we can get more ram on devices at faster throughput. we're already seeing local models - just that their capability is limited by ram.

8ytecoder• 9 months ago

Funny you would pick this analogy. I feel like we’re back in the mainframe era. A lot of software can’t operate without an internet connection. Even if in practice they execute some of the code on your device, a lot of the data and the heavyweight processing is already happening on the server. Even basic services designed from the ground up to be distributed and local first - like email (“downloading”) - are used in this fashion - like gmail. Maps apps added offline support years after they launched and still cripple the search. Even git has GitHub sitting in the middle and most people don’t or can’t use git any other way. SaaS, Electron, …etc. have brought us back to the mainframe era.

thewebguyd2• 9 months ago

It's always struck me as living in some sort of bizaro world. We now have these super powerful personal computers, both handheld (phones) and laptops (My M4 Pro smokes even some desktop class processors) and yet I use all this powerful compute hardware to...be a dumb terminal to someone else's computer.

I had always hoped we'd do more locally on-device (and with native apps, not running 100 instances of chromium for various electron apps). But, it's hard to extract rent that way I suppose.

tbrownaw• 9 months ago

A lot of software can’t operate without an internet connection

Or even physical things like mattresses, according to discussions around the recent AWS issues.

EGreg• 9 months ago

I actually don’t look forward to this period. I have always been for open source software and distributism — until AI.

Because if there’s one thing worse than governments having nuclear weapons, it’s everyone having them.

It would be chaos. And with physical drones and robots coming, it woukd be even worse. Think “shitcoins and memecoins” but unlike those, you don’t just lose the money you put in and you can’t opt out. They’d affect everyone, and you can never escape the chaos ever again. They’d be posting around the whole Internet (including here, YouTube deepfakes, extortion, annoyance, constantly trying to rewrite history, get published, reputational destruction at scale etc etc), and constant armies of bots fighting. A dark forest.

And if AI can pay for its own propagation via decentralized hosting and inference, then the chance of a runaway advanced persistent threat compounds. It just takes a few bad apples, or even practical jokers, to unleash crazy stuff. And it will never be shut down, just build and build like some kind of kessler syndrome. And I’m talking about with just CURRENT AI agent and drone technology.

graeme• 9 months ago

We have a ton of good, small models. The issues are:

1. Most people don't have machines that can run even midsized local models well

2. The local models are nearly as good as the frontier models for a lot of use cases

3. There are technical hurdles to running local models that will block 99% of people. Even if the steps are: download LM Studio and download a model

Maybe local models will get so good that they cover 99% of normal user use cases and it'll be like using your phone/computer to edit a photo. But you'll still need something to make it automatic enough that regular people use it by default.

That said, anyone reading this is almost certainly technical enough to run a local model. I would highly recommend trying some. Very neat to know it's entirely run from your machine and seeing what it can do. LM Studio is the most brainless way to dip your toes in.

loyalcinnamon• 9 months ago

As the hype is dying down it's becoming a little bit clearer that AI isn't like blockchain and might be actually useful (for non generative purposes at least)

I'm curious what counts as a midsize model; 4B, 8B, or something larger/smaller?

What models would you recommend? I have 12GB of vram so anything larger than 8B might be really slow, but i am not sure

FitchApps• 9 months ago

Try WebLLM - it's pretty decent and all in-browser/offline even for light tasks, 1B-1.5B models like Qwen2.5-Coder-1.5B-Instruct. I put together a quick prototype - CodexLocal.com but you can essentially a local nginx and use webllm as an offline app. Of course, you can just use Ollama / LM Studio but that would require a more technical solution

jijji• 9 months ago

ollama and other peojects already make this possible

raincole2• 9 months ago

"personal computing" period

The period when you couldn't use Linux as your main OS because your organization asked for .doc files?

No thanks.

giancarlostoro• 9 months ago

I mean, people can self-host plenty off of a 5090, heck even Macs with enough RAM can run larger models that I can't run on a 5090.

consumer451• 9 months ago

I like to think of it more broadly, and that we are currently in the era of the first automobile. [0]

LLMs are the internal combustion engine, and chatbot UIs are at the "horseless carriage" phase.

My personal theory is that even if models stopped making major advancements, we would find cheaper and more useful ways to use them. In the end, our current implementations will look like the automobile pictured below.

[0] https://group.mercedes-benz.com/company/tradition/company-hi...

falcor84• 9 months ago

I'm not a big google fan, but I really like the "Google AI Edge Gallery" android app [0]. In particular, I've been chatting with the "Gemma-3n-E2B-it" model when I don't have an internet connection, and it's really decent!

[0] https://play.google.com/store/apps/details?id=com.google.ai....

js8• 9 months ago

Mainframes still exist, and they actually make a lot of sense from physics perspective. It's good idea to run transactions in a big machine rather than distributed, the latter is less energy efficient.

I think the misconception is that things cannot be overpriced for reasons other than inefficiency.

supportengineer• 9 months ago

Imagine small models on a cheap chip that can be added to anything (alarm clock, electric toothbrush, car keys...)

wewewedxfgdf• 9 months ago

Most of the big services seem to waste so much time clunking through updating and editing files.

I'm no expert but I can't help feeling there's lots of things they could be doing vastly better in this regard - presumably there is lots to do and they will get around to it.

righthand• 9 months ago

More like AI’s Diaper-Up Era aka AI’s Analogy Era to Mask It’s Shortcomings

indigodaddy2• 9 months ago

Funny how this guy thinks he knows exactly what's up with AI, and how "others" are "partly right and wrong." Takes a bit of hubris to be so confident. I certainly don't have the hubris to think I know exactly how it's all going to go down.

fragmede4• 9 months ago

But do you have the audacity to be wrong?

indigodaddy2• 9 months ago

Yeah that's interesting, good perspective

confirmmesenpai• 9 months ago

takes a lot of hubris to be sure it's a bubble too.

hitarpetar2• 9 months ago

that's why I always identify the central position of any argument and take it. that way noone can accuse me of hubris

ivape2• 9 months ago

The problem is that the bubble people are so unimaginative, similar to Krugman, that those who have any inkling of an imagination can literally feel like visionaries compared to them. I know I’m describing Dunning-Krueger, but so be it, the bubble people are very very wrong. It’s like, man, they really are unable to imagine a very real future.

teaearlgraycold• 9 months ago

Almost everyone I hear calling our AI hype machine a bubble aren't claiming AI is a short term fluke. They're saying the marketing doesn't match the reality. The companies don't have the revenue they need. The model performance is hitting the top of the S curve. Essentially, this is the first big wave - but it'll be a while before the sea level rises permanently.

bccdee3• 9 months ago

I find the argument for the bubble to be extremely straightforward.

Currently, investment into AI exceeds the dot-com bubble by a factor of 17. Even in the dot-com era, the early internet was already changing media and commerce in fundamental ways. November is the three-year anniversary of ChatGPT. How much economic value are they actually creating? How many people are purchasing AI-generated goods? How much are people paying for AI-provided services? The value created here would have to exceed what the internet was generating in 2000 by a factor of 17 (which seems excessive to me) to even reach parity with the dot-com bubble.

"But think where it'll be in 5 years"—sure, and let's extrapolate that based on where it is now compared to where it was 3 years ago. New models present diminishing returns. 3.5 was groudbreaking; 4 was a big step forward; 5 is incremental. I won't deny that LLMs are useful, and they are certainly much more productized now than they were 3 years ago. But the magnitude of our collective investment in AI requires that a huge watershed moment be just around the corner, and that makes no sense. The watershed moment was 3 years ago. The first LLMs created a huge amount of potential. Now we're realizing those gains, and we're seeing some real value, but things are also tapering off.

Surely we will have another big breakthrough some day—a further era of AI which brings us closer to something like AGI—but there's just no reason to assume AGI will crop up in 2027, and nothing less that that can produce the ROI that such enormous valuations will eventually, inexorably, demand.

techblueberry• 9 months ago

It’s a weird comparison since internet in the dial-up age was a bubble, are you saying the hype machine for AI is in fact smaller than the internet? Are you implying that AI will in fact grow that much more slowly and sustainably than the internet, despite trillions of investment?

Do you think Sam Altman, Jeff Bezos, and Mark Zuckerberg are all wrong saying that we’re in a bubble? Do they “lack imagination?”

Also? What do I need imagination for, isn’t that what AI does now?

Razengan5• 9 months ago

How about a vague prediction that covers all scenarios? XD

*ahem* It's gonna be like every other tool/societal paradigm shift like the smartphone before this, and planes/trains/cars/ships/factories/electricity/oil/steam/iron/bronze etc. before that:

• It'll coalesce into the hands of a few corporations.

• Idiots in governments won't know what the fuck to do with it.

• Lazy/loud civvies will get lazier/louder through it.

• There'll be some pockets of individual creativity and freedom, like open source projects, that will take varying amounts of time to catch on in popularity or fade away to obscurity.

• One or two killer apps that seem obvious but nobody thought of, will come out of nowhere from some nobody.

• Some groups will be quietly working away using it to enable the next shift, whether they know it or not.

• Aliens will land turning everything upside down. (I didn't say when)

Razengan5• 9 months ago

Forgot:

• Militaries will want to kill everyone with it.

sailfast• 9 months ago

I recall the unit economics making sense for all these other industries and bubbles (short of maybe tulips, which you could plant…) . Sure there were over-valuation bubbles because of speculatory demand, but right now the assumption seems to be “first to AGI wins” but that… may not happen.

The key variable for me in this house of cards is how long folks will wait before they need to see their money again, and whether these companies will go in the right direction long enough given these valuations to get to AGI. Not guaranteed and in the meantime society will need to play ball (also not a guarantee)

kaoD• 9 months ago

If you told someone in 1995 that within 25 years [...] most people would find that hard to believe.

That's not how I remember it (but I was just a kid so I might be misremembering?)

As I remember (and what I gather from media from the era) late 80s/early 90s were hyper optimistic about tech. So much so that I distinctly remember a ¿german? TV show when I was a kid where they had what amounts to modern smartphones, and we all assumed that was right around the corner. If anything, it took too damn long.

Were adults outside my household not as optimistic about tech progress?

michaelbuckbee• 9 months ago

To your point, AT&T's "You Will" commercials started airing in 1993 and present both an optimistic and fairly accurate view of what the future would look like.

https://www.youtube.com/watch?v=RvZ-667CEdo

iyn3• 9 months ago

I didn't know about these ads, thanks for sharing! Can't imagine how people reacted to that when they aired — the things they described sound so "normal" today, I wonder if it was seen as far fetched, crazy or actually expected.

Arn_Thor2• 9 months ago

Wow, that genuinely gave me goosebumps. It is incredible to live in a time where so much of that hopeful optimism came to pass.

runarberg3• 9 months ago

That’s how I remember it too. The video is from 1999, during the height of the dot-com bubble. These experts are predicting that within 10 years the internet will be on your phone, and that people will be using their phones as credit cards and the phone company would manage the transaction, the prediction actually comes pretty close to the prediction made by bitcoin enthusiasts.

https://bsky.app/profile/ruv.is/post/3liyszqszds22

Note that this is the state TV broadcasting this in their main news program. The most popular daily show in Iceland.

0xbadcafebee2• 9 months ago

Still waiting on my flying car.

qayxc• 9 months ago

To be fair, that has been a Sci-Fi trope for at least 130 years and predates the invention of the car itself (e.g. personal wings/flying horse -> flying ship -> personal balloon -> flying automobile). So countless generations have been waiting for that :)

jeffhuys• 9 months ago

Might not be waiting for long.

Razengan5• 9 months ago

Indeed, AI now is what people in the 1980s thought computers would be doing in 2000.

skywhopper3• 9 months ago

Except people thought it would get basic facts right.

bitwize• 9 months ago

Recently, in my city, the garbage trucks started to come equipped with a device I call "The Claw" (think Toy Story). The truck drives to your curb where your bin is waiting, and then The Claw extends, grasps the bin, lifts it into the air and empties the contents into the truck before setting it down again.

The Claw allows a garbage truck to be crewed by one man where it would have needed two or three before, and to collect garbage much faster than when the bins were emptied by hand. We don't know what the economics of such automation of (physical) garbage collection portend in the long term, but what we do know is that sanitation workers are being put out of work. "Just upskill," you might say, but until Claw-equipped trucks started appearing on the streets there was no need to upskill, and now that they're here the displaced sanitation workers may be in jeopardy of being unable to afford to feed their families, let alone find and train in some new marketable skill.

So no, we're in the The Claw era of AI, when business finds a new way to funge labor with capital, devaluing certain kinds of labor to zero with no way out for those who traded in such labor. The long-term implications of this development are unclear, but the short-term ones are: more money for the owner class, and some people are out on their ass without a safety net because this is Goddamn America and we don't brook that sort of commie nonsense here.

sjsdaiuasgdia• 9 months ago

FYI, this kind of garbage truck has been around for >50 years [0], so any wide-scale impact on employment from this technology has likely already settled out.

The waste collection companies in my area don't use them because it's rural and the bins aren't standardized. The side loaders don't work for all use cases of garbage trucks.

[0] https://en.wikipedia.org/wiki/Garbage_truck

In 1969, the city of Scottsdale, Arizona introduced the world's first automated side loader. The new truck could collect 300 gallon containers in 30 second cycles, without the driver exiting the cab

yapyap• 9 months ago

Big bias shining through in comparing AI to the internet.

Because we all know how essential the internet is nowadays.

slackr2• 9 months ago

There’s a big difference between the fibre infrastructure left by the dotcom crash, and the GPUs that AI firms will leave behind.

slackr2• 9 months ago

There’s a big difference between the fibre infrastructure left by the dotcom crash, and the GPUs that AI firms will leave behind

gnarlouse3• 9 months ago

I feel like this article is too cute. The internet, and the state of the art of computing in general has been driven by one thing and one thing alone: Moore’s Law. In that very real sense, it means that the semiconductor and perhaps more generally even just TSMC is responsible for the rise of the internet and the success of it.

We’re at the end of Moore’s Law, it’s pretty reasonable to assume. 3nm M5 chips means there are—what—a few hundred silicon atoms per transistor? We’re an order of magnitude away from .2 nm which is the diameter of a single silicon atom.

My point is, 30 years have passed since dial up. That’s a lot of time to have exponentially increasing returns.

There’s a lot of implicit assumption that “it’s just possible” to have a Moore’s Law for the very concept of intelligence. I think that’s kinda silly.

leptons7• 9 months ago

Moore's law has very little to do with the physical size of a single transistor. It postulates that the speed and capability of computers will double every few years. Miniaturization is one way to get that increase, but there are other ways.

The internet, and the state of the art of computing in general has been driven by one thing and one thing alone: Moore’s Law.

You're wrong here... the one thing driving the internet and start of the art computing is money. Period. It wouldn't matter if Moore never existed, and his law was never a thing, money would still be driving technology to improve.

gnarlouse3• 9 months ago

The one thing driving the internet and state of the art computing is money

You're kind of separating yin from yang and pretending that one begot the other. The reason so much money flooded into chip fab was because compute is one of the few technologies (the only technology?) with recursive self improvement properties. Smaller chip fab leads to more compute, which enabled smaller chip fabs though research modeling. Sure: and it's all because humans want to do business faster. But TSMC literally made chips the business and proved out the pure play foundry business model.

Even if Moore's Law was never a thing

Then arguably in that universe, we would have eventually hit a ceiling, which is precisely the point I'm trying to make against the article: it's a little silly to assume there's an infinite frontier of exponential improvement available just because that was the prior trend.

Moore's Law has very little to do with the physical size of a single transistor

I mean it has everything to do with the physical size of a single transistor, precisely because of that recursive self improvement phenomenon. In a universe where moore's law doesn't exist, in 2025 we wouldn't be on 3nm production dies, and compute scale would have capped off decades ago. Or perhaps even a lot of other weird physical things would probably be different, like maybe macroscopic quantum phenomena or just an entire universe that is one sentient blob made from the chemical composition of cheeto dust.

ares6232• 9 months ago

My head canon is that the thing that preemptively pops the bubble is Apple coming out and saying, very publicly, that AI is a dead end, and they are dropping it completely (no more half assed implicit promises).

And not just that, they come out with an iPhone that has _no_ camera as an attempt to really distance themselves from all the negative press tech (software and internet in particular) has at the moment.

ladberg• 9 months ago

Do you know a single person who'd buy an iPhone without a camera? I don't

GalaxyNova• 9 months ago

That's what they used to say about mobile phones with no keyboards :))

krackers• 9 months ago

Maybe not as an iphone, but they could drop the camera and cellular and make an ipod touch.

NemoNobody3• 9 months ago

That would require people that know about AI to actually choose to cancel it - which nobody that actually knows what AI can do, would ever actually do.

The Apple engineers, with their top level unfettered access to the best Apple AI - they'll convince shareholders to fund it forever, even if normal people never catch on.

swyx• 9 months ago

Apple at AI is a dead end because Apple sucks at AI, not because its anything about AI

idiotsecant2• 9 months ago

I would go so far as to say we are still in the computing dial-up era. We're at the tail end, maybe - we don't write machine code any longe, mostly, and we've abstracted up a few levels but we're still writing code. Eventually computing is something that will be everywhere, like air, and natural language interfaces will be nearly exclusively how people interact with computing machines. I don't think the idea of 'writing software' is something that will stick around, I think we're in a very weird and very brief little epoch where that is a thing.

byronic• 9 months ago

how much does the correction here hew to making an AI model just look like standardized API calls with predictable responses? If you took away all the costs (data centers, water consumption, money, etc) I still wouldn't use an LLM as a first choice because it's wrong enough of the time to make it useless -- I have to verify everything it says, which is how I would have approached a task in the first place. If we put that analogy into manufacturing, it's "I have to QA everything off of the line _without exception_ and I get frequent material waste"

If you make the context small enough, we're back at /api/create /api/read /api/update /api/delete; or, if you're old-school, a basic function

jdkee• 9 months ago

Reads like it was written by ChatGPT.

felixfurtak2• 9 months ago

People keep comparing the AI boom to the Dotcom bubble. They’re wrong. Others point to the Railway Mania of the 1840s — closer, but still not quite right.

The real parallel is Canal Mania — Britain’s late-18th-century frenzy to dig waterways everywhere. Investors thought canals were the future of transport. They were, but only briefly.

Today’s AI runs on GPUs — chips built for rendering video games, not thinking machines. Adapting them for AI is about as sensible as adapting a boat to travel across land. Sure, it moves — but not quickly, not cheaply, and certainly not far.

It works for now, but the economics are brutal. Each new model devours exponentially more power, silicon, and capital. It just doesn't scale.

The real revolution will come with new, hardware built for the job (that hasn't been invented yet) — thousands of times faster and more efficient. When that happens, today’s GPU farms will look like quaint relics of an awkward, transitional age: grand, expensive, and obsolete almost overnight.

l9o3• 9 months ago

I think specialized hardware will emerge for specific proven workloads (transformer inference, for example), but GPUs won't become obsolete. They'll remain the experimentation platform for new architectures. You need flexibility to discover what's worth building custom silicon for.

Think 3D printers versus injection molds: you prototype with flexibility, then mass-produce with purpose-built tooling. We've seen this pattern before too. CPUs didn't vanish when GPUs arrived for graphics. The canal analogy assumes wholesale replacement. Reality is likely more boring: specialization emerges and flexibility survives.

roommin7• 9 months ago

Sure, but your R&D infrastructure isn't going to be 1.5 trillion dollars.

realaaa• 9 months ago

I think it'll be a combination of hardware of course, but also better software - surely there is a better way of doing this (like our brains do) which will eventually require less power

fhennig• 9 months ago

Today’s AI runs on GPUs — chips built for rendering video games, not thinking machines. Adapting them for AI is about as sensible as adapting a boat to travel across land.

A GPU is fundamentally just a chip for matrix operations, and that's good for graphics but also for "thinking machines" as we currently have them. I don't think it's like a boat traveling on land at all.

ozgung2• 9 months ago

Another definition: A modern GPU a general purpose computer that can make parallelized and efficient computations. It's optimized to run limited number of operations but on large number of data points.

This happens to be useful both for graphics (same "program" running on on huge number of pixels/vertices) and neural networks (same neural operations on huge number of inputs/activations)

aurareturn6• 9 months ago

Nvidia’s enterprise GPUs having nothing to do with graphics anymore except for the name.

felixfurtak2• 9 months ago

GPUs are massively parallel, sure, but they still have a terrible memory architecture and are difficult to program (and are still massively memory constrained). It's only NVidia's development in cuda that made it even feasible to create decent ML models on GPUs.

hnburnsy• 9 months ago

So weird, I asked AI (Grok) just yesterday how far along we are towards post-scarcity and it replied...

We’re in the 1950s equivalent of the internet boom — dial-up modems exist, but YouTube doesn’t.

atq2119• 9 months ago

Which is ironic, considering that the 1950s were long before the internet boom. The internet didn't even exist yet, let alone dial-up modems.

buu700• 9 months ago

I was curious and looked this up: https://en.wikipedia.org/wiki/Modem#1950s

Mass production of telephone line modems in the United States began as part of the SAGE air-defense system in 1958, connecting terminals at various airbases, radar sites, and command-and-control centers to the SAGE director centers scattered around the United States and Canada.

Shortly afterwards in 1959, the technology in the SAGE modems was made available commercially as the Bell 101, which provided 110 bit/s speeds. Bell called this and several other early modems "datasets".

gizajob4• 9 months ago

Great analysis but one thing overlooked is that current gen advanced AI could in five or ten years (or less) be run from the smartphone or desktop, which could negate all the capex from the hyperscalers and also Nvidia, which presents a massive target for competitors right now. The self same AI revolution we’re seeing created right now could take itself down if AI tooling becomes widespread.

melagonster• 9 months ago

If this happen, everyone's computer will contain one Nvidia GPU.

port3000• 9 months ago

Not really. Apple is a very strong competitor here.

0xbadcafebee2• 9 months ago

It's clear that AI is useful. It's not yet clear how useful. Hype has always obscured real value, and nobody knows the real value until the hype cycle completes.

What is clear, is that we have strapped a rocket to our asses, fueled with cash and speculation. The rocket is going so fast we don't know where we're going to land, or if we'll land softly, or in a very large crater. The past few decades have examples of craters. Where there are potential profits, there are people who don't mind crashing the economy to get them.

I don't understand why we're allowing this rocket to begin with. Why do we need to be moving this quickly and dangerously? Why do we need to spend trillions of dollars overnight? Why do we need to invest half the fucking stock market on this brand new technology as fast as we can? Why can't we develop it in a way that isn't insanely fast and dangerous? Or are we incapable of decisions not based on greed and FOMO?

xwolfi3• 9 months ago

Who is "we" ? I certainly don't spend trillions on frivolities. I think the Saudis via Softbank do, and these people build fake cities in the desert, they are by definition dumb money.

They earn so much from oil and are so keenly aware this will stop, they'd rather spend a trillion on a failure, than keep that cash rotting away with no future investment.

No project, no country, can swallow the Saudi oil money like Sam Altman can. So, they're building enormous data centers with custom nuclear plants and call that Stargate to syphon that dumb money in. It's the whole business model of Softbank: find a founder whose hubris is as big as Saudi stupidity.

hi_hi• 9 months ago

The article seems well researched, has some good data, and is generally interesting. It's completely irrelevant to the reality of the situation we are currently in with LLMs.

It's falling into the trap of assuming we're going to get to the science fiction abilities of AI with the current software architectures, and within a few years, as long as enough money is thrown at the problem.

All I can say for certain is that all the previous financial instruments that have been jumped on to drive economic growth have eventually crashed. The dot com bubble, credit instruments leading to the global financial crisis, the crypto boom, the current housing markets.

The current investments around AI that we're all agog at are just another large scale instrument for wealth generation. It's not about the technology. Just like VR and BioTech wasn't about the technology.

That isn't to say the technology outcomes aren't useful and amazing, they are just independant of the money. Yes, there are Trillions (a number so large I can't quite comprehend it to be honest) being focused into AI. No, that doesn't mean we will get incomprehensible advancements out the other end.

AGI isn't happening this round folks. Can hallucinations even be solved this round? Trillions of dollars to stop computers lying to us. Most people where I work don't even realise hallucinations are a thing. How about a Trillion dollars so Karen or John stop dismissing different viewpoints because a chat bot says something contradictory, and actually listen? Now that would be worth a Trillion dollars.

Imagine a world where people could listen to others outside of their bubble. Instead they're being given tools that re-inforce the bubble.

DanHulton• 9 months ago

Indeed, this could be AI's fusion energy era, or AI's VR era, or even AI's FTL travel era.

nickphx• 9 months ago

Dial-up was actually useful though.

skywhopper3• 9 months ago

Really tired of seeing the story about how, “sure Worldcom et al went bankrupt but their investments in fiber optics gave us the physical infrastructure of the Internet today.”

I mean, sort of, but the fiber optics in the ground have been upgraded several by orders of magnitude of its original capacity by replacing the transceivers on either end. And the fiber itself has lasted and will continue to last for decades.

Neither of those properties is true of the current datacenter/GPU boom. The datacenter buildings may last a few decades but the computers and GPUs inside will not and they cannot be easily amplified in their value as the fiber in the ground was.

blazespin• 9 months ago

KIMI just proposed linear attention. I mean, one breakthrough, and blammo, the whole story changes.

ecommerceguy• 9 months ago

I'm getting ai fatigue. It's ok to rewrite quick emails that i'm having brain farts on but anything deep it just sucks. I certainly can't see paying for it.

aurareturn6• 9 months ago

Weird because AI has been solving hard problems for me. Even finding solutions that I couldn’t find myself. Ie. sometimes my brain cant wrap around a problem, I throw it to AI and it perfectly solves it.

I pay for chatgpt plus and github copilot.

leptons7• 9 months ago

It is weird that AI is solving hard problems for you. I can't get it to do the most basic things consistently, most of the time it's just pure garbage. I'd never pay for "AI" because it wastes more of my time than it saves. But I've never had a problem wrapping my head around a problem, I solve problems.

I'm curious what kind of problem your "brain cant wrap around", but the AI could.

weregiraffe• 9 months ago

Weird because AI has been solving hard problems for me.

Examples or it didn't happen.

DecentShoes• 9 months ago

Can you give some examples??

IgorPartola3• 9 months ago

As an LLM-skeptic who got a Claude subscription, the free models are both much dumber and configured for low latency and short dumb replies.

No it won’t replace my job this year or the next, but what Sonnet 4.5 and GPT 5 can do compared to e.g. Gemini Flash 2.5 is incredible. They for sure have their limits and do hallucinate quite a bit once the context they are holding gets messy enough but with careful guidance and context resets you can get some very serious work done with them.

I will give you an example of what it can’t do and what it can: I am working on a complicated financial library in Python that requires understanding nuanced parts of tax law. Best in class LLM cannot correctly write the library code because the core algorithm is just not intuitive. But it can:

1. Update all invocations of the library when I add non-optional parameters that in most cases have static values. This includes updating over 100 lengthy automated tests.

2. Refactor the library to be more streamlined and robust to use. In my case I was using dataclasses as the base interface into and out of it and it helped me split one set of classes into three: input, intermediate, and output while fully preserving functionality. This was a pattern it suggested after a changing requirement made the original interface not make nearly as much sense.

3. Point me to where the root cause of failing unit tests was after I changed the code.

4. Suggest and implement a suite of new automated tests (though its performance tests were useless enough for me to toss out in the end).

5. Create a mock external API for me to use based on available documentation from a vendor so I could work against something while the vendor contract is being negotiated.

6. Create comprehensive documentation on library use with examples of edge cases based on code and comments in the code. Also generate solid docstrings for every function and method where I didn’t have one.

7. Research thorny edge cases and compare my solutions to commercial ones.

8. Act as a rubber ducky when I had to make architectural decisions to help me choose the best option.

It did all of the above without errors or hallucinations. And it’s not that I am incapable of doing any of it, but it would have taken me longer and would have tested my patience when it comes to most of it. Manipulating boilerplate or documenting the semantic meaning between a dozen new parameters that control edge case behavior only relevant to very specific situations is not my favorite thing to do but an LLM does a great job of it.

I do wish LLMs were better than they are because for as much as the above worked well for me, I have also seen it do some really dumb stuff. But they already are way too good compared to what they should be able to do. Here is a short list of other things I had tried with them that isn’t code related that has worked incredibly well:

- explaining pop culture phenomenon. For example I had never understood why Dr Who fans take a goofy campy show aimed in my opinion at 12 year olds as seriously as if it was War and Peace. An LLM let me ask all the dumb questions I had about it in a way that explained it well.

- have a theological discussion on the problem of good and evil as well as the underpinnings of Christian and Judaic mythology.

- analyze in depth my music tastes in rock and roll and help fill in the gaps in terms of its evolution. It actually helped me identify why I like the music I like despite my tastes spanning a ton of genres, and specifically when it comes to rock, created one of the best and most well curated playlists I had ever seen. This is high praise for me since I pride myself on creating really good thematic playlists.

- help answer my questions about woodworking and vintage tool identification and restoration. This stuff would have taken ages to research on forums and the answers would still be filled with purism and biased opinions. The LLM was able to cut through the bullshit with some clever prompting (asking it to act as two competing master craftsmen).

- act as a writing critic. I occasionally like to write essays on random subjects. I would never trust an LLM to write an original essay for me but I do trust it to tell me when I am using repetitive language, when pacing and transitions are off, and crucially how to improve my writing style to take it from B level college student to what I consider to be close to professional writer in a variety of styles.

Again I want to emphasize that I am still very much on the side of there being a marketing and investment bubble and that what LLMs can do being way overhyped. But at the same time over the last few months I have been able to do all of the above just out of curiosity (the first coding example aside). These are things I would have never had the time or energy to get into otherwise.

boggsi2• 9 months ago

You seem very thoughtful and careful about all this, but I wonder how you feel about the emergence of these abilities in just 3 years of development? What do you anticipate it will be capable of in the next 3 years?

With no disrespect I think you are about 6-12 months behind SOTA here, the majority of recent advances have come from long running task horizons. I would recommend to you try some kind of IDE integration or CLI tool, it feels a bit unnatural at first but once you adapt your style a bit, it is transformational. A lot of context sticking issues get solved on their own.

anonzzzies• 9 months ago

Well deep/hard is different I guess; I use it, day and night, for things I find boring. Boilerplate coding (which now is basically everything that's not pure business logic / logic / etc), corporate docs, reports etc. Everything I don't want to do is done by AI now. It's great. Outside work I use it for absolutely nothing though; I am writing a book, framework and database; that's all manual work (and I don't AI is good at any of those (yet)).

mvdtnz• 9 months ago

It's more like the Segway era when people with huge stakes in Segway tried to convince the world we were about to rebuild entire cities around the new model.

topranks• 9 months ago

Dial-up suggests he knows that many orders of magnitude of performance increase will happen, like with internet connectivity.

I’m not sure that’s a certainty.

simultsop• 9 months ago

MIT Professor, 1993' quote

words to live by...

RyanOD• 9 months ago

Every few years I find myself thinking, "Wow...the latest tech is amazing! We were in the stone ages just a few years ago."

I don't expect that to cease in my lifetime.

Anamon• 9 months ago

I feel like I've been in such a phase for a good 10-15 years now. I miss looking back and marvel at the technological progress we've made, and eagerly anticipating the next exciting thing. For a while now, I look back wondering why so few people seem bothered by the fact that technology becomes worse every year, with fewer features, lower quality, and more stupidity; and new developments are no longer about exciting improvements, but dreading what new thing that used to work perfectly fine is broken now.

For a bit, I thought science and industry were finally starting to see the problem with our quality degradation and tech regression. Instead, the current hype cycle is all about settling for even crappier quality and lower reliability.

BoredPositron• 9 months ago

It took a long long time going from a walking bike to the one we know now. It's not going to be different from AI. Transformers will only get us so far and for the rest we need another tock. AGI is not going to happen with this generation of hardware. We are hitting spatial scaling limits in video and image generation and we are hitting limits with LLMs.

_ink_• 9 months ago

The other claims that AI will create more jobs than it destroys.

Maybe it's my bubble, but so far I didn't hear someone saying that. What kind of jobs should that be, given that both forms, physical and knowledge work, will be automatable sooner or later?

joe_the_user• 9 months ago

I haven't seen that either.

That claim just reads like he's concocted two sides for his position to be the middle ground between. I did that essays in high school but I try to be better than that now.

teiferer• 9 months ago

Regardless of which specific companies survive, this infrastructure being built now will create the foundation for our AI future - from inference capacity to the power generation needed to support it.

Does that comparison with the fiber infra from the dotcom era really hold up? Even when those companies went broke, the fiber was still perfectly fine a decade later. In contrast, all those datacenters will be useless when the technology has advanced by just a few years.

Nobody is going to be interested in those machines 10 years from now, no matter if the bubble bursts or not. Data centers are like fresh produce. They are only good for a short period of time and useless soon after. They are being constantly replaced.

caminante5• 9 months ago

from inference capacity to the power generation needed to support it.

Power gen = yes. Reasoning is trivial due to long useful asset life.

For compute, why would it be any different than fiber in the AI bubble pop case? Less useful, but not useless. Are you misremembering the fiber overbuild era? The fiber investments were impaired and sold off for pennies on the dollar. The value here wouldn't go to zero, either.

zkmon• 9 months ago

The only problem is, similarity with dotcom might only go thus far. For example, dotcom bubble itself might not have a similar thing in the past at that time. This is because the overall world context is different and interaction of social, political and economic forces is different.

So, when people say something about future, they are looking into the past to draw some projections or similar trends, but they may be missing the change in the full context. The considered factors of demand and automation might be too few to understand the implications. What about political, social and economic landscape? The systems are not so much insulated to study using just a few factors.

hansmayer• 9 months ago

More like Bullshit Era

lilerjee• 9 months ago

What are the disadvantages of AI?

The author didn't mention them.

AI companies robbed so much data from the Internet free and without permission.

Sacrificing the interests of owners of websites.

It's not sustainable.

It's impossible for AI to go far.

cbdevidal• 9 months ago

I sometimes wonder, in a world where the data becomes overwhelmingly AI-generated, if AI starts feeding on itself, a copy of a copy of a copy.

catlifeonmars• 9 months ago

We’re already seeing this sort of well poisoning occur.

23434dsf• 9 months ago

HN is struggling to understand

roommin7• 9 months ago

Enlighten us.

delegate• 9 months ago

In the dial-up era, the industry was young, there were no established players, it was all a big green field.

The situation is far from similar now. Now there's an app for everything and you must use all of them to function, which is both great and horrible.

From my experience, current generation of AI is unreliable and so cannot be trusted. It makes non-obvious mistakes and often sends you off on tangents, which consumes energy and leads to confusion.

It's an opinion I've built up over time from using AI extensively. I would have expected my opinion to improve after 3 years, but it hasn't.

geon3• 9 months ago

The LLM architectures we have now have reached their full potential already, so going further would require something completely different. It isn’t a matter of refining the existing tech, whereas the internet of 1997 is virtually technologically identical to what we have today. The real change has been sociological, not technological.

To make a car analogy; the current LLMs are not the early cars, but the most refined horse drawn carriages. No matter how much money is poured into them, you won’t find the future there.

ozgung2• 9 months ago

The LLM architectures we have now have reached their full potential already.

How do we know that?

efficax• 9 months ago

what we can say right now is that we've hit the point of diminishing returns and the only way we're going to get signicantly more capable models is through a technological advance that we cannot forsee (and that may not come for decades if it ever comes)

polynomial2• 9 months ago

Exactly. You're absolutely right to focus on that.

tim3334• 9 months ago

You could see some potential modifications. Already some are multimodal. You'd probably want something to change the weights as time goes on so they can learn. It might be more steam engines needing to be converted to petrol engines.

mkl• 9 months ago

Dial-up modems reached their full 56kbps potential in 1997, and going further required something completely different. It happened naturally to satisfy demand, and was done by many of the same companies and people; the change was technological, not sociological.

I think we're probably still far from the full potential of LLMs, but I don't see any obstacles to developing and switching to something better.

volkl48• 9 months ago

I don't think that comparison works very well at all.

We had plenty of options for better technologies both available and in planning, 56k modems were just the cost effective/lowest common denominator of their era.

It's not nearly as clear that we have some sort of proven, workable ideas for where to go beyond LLMs.

geon3• 9 months ago

Dial-up modems reached their full 56kbps potential in 1997

That's simply not true. Modems were basically the same tech in the dsl era, and using light instead of electricity is a very gradual refinement.

we're probably still far from the full potential of LLMs

Then how come the returns are so extremely diminishing?

I don't see any obstacles to developing and switching to something better.

The obstacle is that it needs to be invented. There was nothing stopping newton from discovering relativity either. We simply have no idea what the road forward even looks like.

Enginerrrd• 9 months ago

The current generation of LLM's have convinced me that we already have the compute and the data needed for AGI, we just likely need a new architecture. But I really think such an architecture could be right around the corner. It appears to me like the building blocks are there for it, it would just take someone with the right luck and genius to make it happen.

netdevphoenix3• 9 months ago

The current generation of LLM's have convinced me that we already have the compute and the data needed for AGI, we just likely need a new architecture

This is likely true but not for the reasons you think about. This was arguably true 10 years ago too. A human brain uses 100 watts per day approx and unlike most models out there, the brain is ALWAYS in training mode. It has about 2 petabytes of storage.

In terms of raw capabilities, we have been there for a very long time.

The real challenge is finding the point where we can build something that is AGI level with the stuff we have. Because right now, we might have the compute and data needed for AGI but we might lack the tools needed to build a system that efficient. It's like a little dog trying to enter a fenced house, the closest path topologically between the dog and the house might not be accessible for that dog at that point because its current capabilities (short legs, inability to jump high or push through the fence standing in between) so while it is further topologically, a longer path topologically might be the closest path to reach the house.

In case it's not obvious, AGI is the house, we are the little dog and the fence represent current challenges to build AGI.

visarga7• 9 months ago

The current generation of LLM's have convinced me that we already have the compute and the data needed for AGI, we just likely need a new architecture.

I think this is one of the greatest fallacies surrounding LLMs. This one, and the other one - scaling compute!! The models are plenty fine, what they need is not better models, or more compute, they need better data, or better feedback to keep iterating until they reach the solution.

Take AlphaZero for example, it was a simple convolutional network, not great compared to LLMs, small relative recent models, and yet it beat the best of us at our own game. Why? Because it had unlimited environment access to play games against other variants of itself.

Same for the whole Alpha* family, AlphaStar, AlphaTensor, AlphaCode, AlphaGeometry and so on, trained with copious amounts of interactive feedback could reach top human level or surpass humans in specific domains.

What AI needs is feedback, environments, tools, real world interaction that exposes the limitations in the model and provides immediate help to overcome them. Not unlike human engineers and scientists - take their labs and experiments away and they can't discover shit.

It's also called the ideation-validation loop. AI can ideate, it needs validation from outside. That is why I insist the models are not the bottleneck.

wazoox• 9 months ago

There are some gross approximations in the comparison. Oversized fibre optics networks laid out in the late 90s were used for years and may even be in part still used today; today's servers and GPUs will be obsolete in 3 to 5 years, and not worth their weight in scrap metal in 10.

The part about Jevons' paradox is interesting though.

hufdr• 9 months ago

What makes this analogy great is that nobody in the dial up days could imagine Google or YouTube. We’re in the same place now nobody knows who becomes “the Google of AI,” and that uncertainty usually means a new platform is being born.

Arn_Thor2• 9 months ago

There is one key way in which I believe the current AI bubble differs from the TMT bubble. As the author points out, much of the TMT bubble money was spent building infrastructure that benefited us many decades later.

But in the case of AI, that argument is much harder to make. The cost of compute hardware is astronomic relative to the pace of improvements. In other words, a million dollars of compute today will be technically obsolete (or surpassed on a performance/watt basis) much faster than the fiber optic cables laid by Global Crossing.

And the AI data centers specialized for Nvidia hardware today may not necessarily work with the Nvidia (or other) hardware five years from now—at least not without major, costly retrofits.

Arguably, any long-term power generation capacity put down for data centers of today would benefit data centers of tomorrow, but I'm not sure much such investment is really being made. There's talk of this and that project, but my hunch and impression is that much of it will end up being small-scale local power generation from gas turbines and the like, which is harmful for the local environment and would be quickly dismantled if the data center builders or operators hit the skids. In other words, if the bubble bursts I can't imagine who would be first in line to buy a half-built AI data center.

This leads me to believe this bubble has generated much less useful value to benefit us in future than the TMT bubble. The inference capacity we build today is too expensive and ages too fast. So the fall will be that much more painful for the hyperscalers.

innagadadavida• 9 months ago

One thing the analysis for textiles vs cars misses I the complexity of the supply chain and the raw materials / components that need to be procured to make the end product. Steel/textiles have simple supply chains and they went through a boom/bust cycle as the demand plateaued. But cars on the other hand will not go through the same pattern - there are too many logistical things that need to line up and the trust factor in each of those steps as well as the end product is quite high.

Software is similar to cars - the individual components that need to be properly procured and put together is very complex and trust will be important - will you trust that you as a restaurant owner vibe coded your payment stack properly or will you just drop in the 3 lines to integrate with Stripe? I think most of the non-tech business owners will do the latter.

baggachipz• 9 months ago

tl;dr: Gartner Hype Cycle[1]

[1] https://en.wikipedia.org/wiki/Gartner_hype_cycle

weare138• 9 months ago

The last AI bubble was AI's dial-up era because it was the dial-up era:

https://en.wikipedia.org/wiki/AI_winter

https://www.youtube.com/watch?v=sV7C6Ezl35A

polynomial2• 9 months ago

Great comment threads here, but the OP article leans too much on AI generated text that is heavy on empty synthetic rhetoric and generative AI clichés.

wosined• 9 months ago

The thing is that the average person now thinks AI is revolutionary. Thus, if you form the analogy correctly, then it tells us that the average person is wrong and that AI is NOT revolutionary. (I'm not arguing either case.)

AI's Dial-Up Era

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