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Tech Giants Are Set To Spend $200 Billion This Year Chasing AI (bnnbloomberg.ca) 32

Three months ago, Wall Street punished the world's largest technology firms for spending enormous amounts to develop artificial intelligence, only to deliver results that failed to justify the costs. Silicon Valley's response this quarter? Plans to invest even more. Bloomberg: The capital expenditures of the four largest internet and software companies -- Amazon, Microsoft, Meta and Alphabet -- are set to total well over $200 billion this year, a record sum for the profligate collective.

Executives from each company warned investors this week that their splurge will continue next year, or even ramp up. The spree underscores the extreme costs and resources consumed from the worldwide boom in AI ignited by the arrival of ChatGPT. Tech giants are racing to secure the scarce high-end chips and build the sprawling data centers the technology demands. To do so, the companies have cut deals with energy providers to power these facilities, even reviving a notorious nuclear plant.

Tech Giants Are Set To Spend $200 Billion This Year Chasing AI

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  • by ebunga ( 95613 ) on Friday November 01, 2024 @12:42PM (#64912387)

    Headline should read "waste" not "spend"

    • I wonder if these "investors" really understand what they're buying into. Are the people signing the contracts & cheques doing sufficient due diligence & making sure they understand what GPT LLMs & the like can do & how they work, & most importantly what the already known limitations are, or are they just listening to hype & being wooed by the likes of Sam Altman? I suspect the latter & that this isn't going to end well for anyone... except for those who understand the opportunit
      • by Baron_Yam ( 643147 ) on Friday November 01, 2024 @01:22PM (#64912503)

        Our economies' histories are full of good things being replaced by crappy but much less expensive things. AI is going to replace good people with crappy code, but the price point on the final product will be so attractive we will choose AI even as we complain endlessly about the quality issues with it.

        • Nope. Not even that. So far, only highly knowledgeable & experienced coders can get LLMs to work more efficiently for them. For everyone else, it makes coding take longer, more buggy, & ultimately more expensive.
          • That's one use of AI. There are plenty of others.

            And I disagree even on that one; my whole point was that the quality drop won't be an important factor in the switch.

      • by jhoegl ( 638955 )
        So, the whole thing is a circular jerk of sorts in that they spend investor money on hardware that they can use in other instances besides "AI", and when the eventual colapse happens because the hype train will let everyone know that its really just a dumber search engine, then the stocks will fall, but they will have sold off stocks, and bought on the dip while also owning hardware that can improve the business in other ways.

        Its a stimulation of the tech industry that saw a huge fall from the 2020/2021 t
        • spend investor money on hardware that they can use in other instances besides "AI", and when the eventual collapse

          Similarly the dot-com bubble of the early 2000's paid for lots of internet cabling to the masses that was eventually put to use. It's just that the original investors didn't get a cut because the original companies bellied up.

          Railroad build-out in the late 20th century also built lots of tracks that were later put to good use, but the original investors got screwed by the bubble poppage.

      • They are signing into a massive automation boom that is going to replace tens of millions of jobs with computer software. Bare minimum we are looking at 7 million taxi drivers going away and losing their jobs and their livelihoods in about 5 to 10 years. The only thing holding it back is getting people used to the idea of a self-driving car and working out a few legal problems.

        That is worth trillions. The people investing in it are the ultra wealthy and they've set the system up so that they can't lose.
        • by jhoegl ( 638955 ) on Friday November 01, 2024 @01:29PM (#64912533)
          It absolutely will not do this in the next 10-15 years at least.
        • GPT LLMs & other computational statistics models have nothing to do with actually controlling physical machines in the real world. In the USA, they're prematurely rolling out autonomous taxis & hoping that they can get away with it. They cite general traffic accident statistics rather than anything more representative, like professional driver accident statistics, like those from taxi & limousine drivers. It's just more sales-hype bullshit. Human taxi drivers aren't going anywhere for the forese
      • by taustin ( 171655 )

        I wonder if these "investors" really understand what they're buying into.

        They rarely do, especially with tech companies.

    • Okay and I hope you get your Funny mods, but the joke I was looking involves how we are getting chased by AI-driven spam. The clickbaity title of the story is asking for such... Especially getting chased political garbage spam just now. Should I predict a xitter-storm?

    • And while lots of people lost a lot of money it didn't really matter because they were the ultra ultra wealthy and they made it all back by investing in the winners.

      One of the things people don't understand about how the world works is that the super rich always win because they're the house and the house always wins.

      So if you're somebody like Warren Buffett you throw money around like crazy and lose a ton of money on most of your bets. But the ones that succeed make so much money and give you so mu
    • Ssshhh, my mortgage is funded by hype. It's the dirty secret of IT. Our "Sacklers" will go longer without getting caught because the mayhem is spread thinner and wider than opiate addiction.

  • by MpVpRb ( 1423381 ) on Friday November 01, 2024 @12:52PM (#64912413)

    The good news is that some of that investment will lead to really useful stuff
    The bad news is that most of it will be used to create crap generators

  • by sheph ( 955019 ) on Friday November 01, 2024 @01:10PM (#64912465)
    This is going to be the new dot com bubble. Everybody and their dog with a hair brained scheme throwing around buzzwords to secure venture capital to fund their new startup. When the music stops the results will be the same and there will be a small number of really good ideas to come out of it but most people will lose a bunch of money.
    • by Z80a ( 971949 )

      I find funny the many that are basically just chatGPT with a "please pretend to be the product we're too arsed to actually make" pre prompts

  • In a gold rush... (Score:4, Insightful)

    by Drethon ( 1445051 ) on Friday November 01, 2024 @01:16PM (#64912485)

    Don't hunt the gold, sell the tools.

  • ..."That means there has to be a pony under here somewhere! Keep digging!"
  • by xack ( 5304745 ) on Friday November 01, 2024 @01:17PM (#64912489)
    Again showing poverty is deliberate, as we have the technology, just not the politcal will to solve it.
  • How many trillions will be wasted on this nonsense before everyone wises up and realizes they've been taken for fools?
  • "Three months ago, Wall Street punished the world's largest technology firms for spending enormous amounts to develop artificial intelligence, only to deliver results that failed to justify the costs."

    What does Wall Street know? Reading articles pretending to understand stock movement makes my head spin. Sometimes an article will state a reason for the market's rise, followed one hour later by the exact opposite reason for the sudden fall in the market. The articles are mainly to generate online clicks.

    T

  • You can fix the USA economy with a 10 cent per kilowatt hour tax on power used to train AI. Maybe with 20 cents, you can also reduce the national debt.

    Seriously. There needs to be something good coming out of all this wasted power.

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