February 28, 2025 • 43 mins
In the second of this week's two-part episode, Ed Zitron walks you through the dark truth of the generative AI industry - that consumer adoption of Claude, Gemini, Copilot and Perplexity is incredibly small, and it’s time to accept that there is nothing coming to justify the ruinous costs of Large Language Models.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Au Zone Media.
Speaker 2 (00:06):
Hello and welcome to Better Offline. I'm your host ed zitron.
Last part I really laid down how bad things are
for open Ai, how bad a company they are, how
(00:27):
they spent nine billion dollars to lose five billion dollars,
how bad things look. But open Ai they have users.
I mean the users lose the money. Every single user
paying or not loses the money. They can only survive
if they're given more money. They will literally die if
not given more venture capital money. And that really bothers me,
And that bothers me a great deal. Listen to the
episode again if you want to really understand why. But
(00:49):
let's start this one with a very very simple question.
Is generative AI a real industry? Look, the large language
model paradigm is yet to produce a successful mass market product,
and no, large language models are not a success, nor
are they mass market. I know you're gonna say chat
GPT is huge. We've already been through that. I just
talked about that. But surely, surely, right like, it wouldn't
(01:14):
just be open Ai, right like, we've been through this.
But if generative AI was a real industry, there'd be
multiple other players with massive customer bases as a result
of how revolutionary it was, right, like at least close, right,
maybe like half the size, a quarter of the size,
right right, wrong, wrong, so wrong, so very wrong, so
(01:36):
fucking wrong. It boils my blood. It makes me scared
for the future, for the market for Silicon Valley. The
venture capitalists are so fucking wrong, and so are the hyperscalers. Wrong, wrong, wrong.
Let's look at some estimated numbers that I got from
data intelligence firm Center Tower, and that's referring to these
monthly active users on apps and similar web which is
just unique monthly active visitors to websites. And this is
(01:59):
for the biggest players in AI in January twenty twenty five.
And I must be clear, the following really fucked me
up a little. So open AI's chatgpt had three hundred
and thirty nine million active users on chat GPT's app
and two hundred and forty six million unique monthly visitors
to chatgpt dot com in January twenty twenty five. Pretty good, right,
One would assume that everybody else, especially the hyperscalers, they'd
(02:21):
be pretty close behind. Right, They've got way more money,
They've got a ton of advertising, and one would be
wrong Google Gemini. Google's Gemini had a pathetic eighteen million
monthly active users on the Gemini app and a mere
forty seven point three million unique monthly users on their website.
For COMPARISONCNN dot com has over one hundred and fifty
(02:41):
million unique monthly visitors and did not require purchasing billions
of dollars of GPUs. Nevertheless, though, Microsoft, who funds open Ai,
they wouldn't have blown this right. They wouldn't have got
a tiny amount of US right. Wrong, so very wrong.
Microsoft Copilot had an embarrassing eleven million monthly active users
(03:02):
on the Copilot app and fifteen point six million unique
monthly users visitors. I mean to copilot dot Microsoft dot com.
They had a fucking Super Bowl commercial a year ago. Man,
what the hell? These are terrible numbers for a company
with a market capitalization of three trillion dollars that spent
over seventy five billion dollars on capital expenditures in twenty
twenty four. But you know what, maybe it's just that
(03:23):
big tech hasn't worked it out. The plucky start of
the Silicon Valley must have, right. I mean, we've all
heard about perplexity. They seem to be giving away pro
accounts all the time. They're pretty big, right, they must
be wrong. They had an abominable eight million monthly active
users on their app in January and a poultry ten
point six million unique monthly visitors to perplexity dot ai.
This company's raised six hundred and sixty five million dollars.
(03:45):
They have a multi billion dollar valuation. This is absolutely
fucking pathetic. What are we doing here? But you know,
maybe I'm just being a sour pus. Maybe I'm just
being just being a hater. You know, I sit in
my hates thrown and I hate it. I'm like, ooh,
I hate the company so much. Right, that's it. It's bias. Obviously,
there's one hulking Juggernau I've been leaving out and I
would never ever ever leave them out. Because Anthropic has
(04:08):
raised fourteen point seven billion dollars, one would assume with
all this money, with all of the press attention, all
of the people saying that Warrio Ami Day, sorry, Dario
Ami Day, will have Agi in twenty twenty seven around there, right,
they'd be huge. They must be huge. They must be huge,
right right? Right then, So flipping wrong. Anthropics Claude had
(04:31):
I a shit you not two million monthly active users
on the claud app and eight point two million unique
monthly visitors the Claude the AI and that's the web
based version of their app. These numbers are absolutely abominable.
They're trash, they're garbage. Anyone's saying that Anthropic as a
real product is talking out of their asshole. I'll get
to API calls later, don't you worry. But it's time
(04:52):
to wake up and stop yammering about these companies like
they're building the future or have any real product market fit.
What a goddamn joke. I am furious. Getting these numbers
pissed me off so much. I have had these chonder
fucks telling me, oh Ed, you have no idea how
big this is? Oh Ed, They're tiny. This is so small.
I know. I said it'd be calm. I said it'd
be calm. But when you spend two years having people
(05:14):
calling you a hater and a cynic at, a pessimist
and a pig and a dog and they spray you
at their hoses, you get a little angry about this stuff.
And also, why is nobody I'm a pr guy who
does a podcast and a newslre why am I the
person to say it? But what's really funny is that
the recently emerged deep Seak had twenty seven million monthly
active users on the deep seak Act app and seventy
(05:37):
nine point nine million unique monthly visitors to deepseak dot
com in January. This figure, by the way, doesn't capture
deep Seak's China based users, who at least on mobile
access the app through a variety of different marketplaces. From
what I can tell, the deep Seak Act app I
keep speaking like Kathy, I guess, but I'm gonna keep
this going. We don't need to edit that the app
has nearly ten million downloads on the Vivo Store, which
(05:59):
is just one of the different Android app marketplaces serving
mainline China. It's not even one of the biggest. But
for the sake of simplicity, assume that all of these
numbers refer to those outside of China, where most, if
not all, of the Western made chatbots are blocked by
the Great Firewall. But let me put this all into perspective.
The entire combined monthly active users of Microsoft Copilot, Claude Gemini,
Deep Seek, and it perplexitis apps amount to sixty six
(06:23):
million monthly active users, or nineteen point four to seven
percent of the entire monthly active users of chat GPT's
mobile app. Web traffic slightly improves things, I say sarcastically,
with one hundred and sixty one million unique monthly visitors
that visited the websites for Copilot, Claude, Gemini, Deep Seek,
and Perplexity making up sixty five point sixty nine percent
of all the traffic that went to chatgpt dot com. However,
(06:46):
I'd argue that including deep Seek vastly overinflates these numbers.
They're an outlier, and they're also relatively new, and they've
enjoyed a big moment in the media, so we can
leave them out for a second. Without deep Sea, Copilot, Claude, Gemini,
and Perplexity made up a total of thirty nine million
monthly active users across their apps, and a grand total
of eighty one point seven million unique monthly visitors Without
(07:07):
chat gpt, it appears that the entire general IVAI app
market is a little more than half the size of
Pokemon Goo its peak, which had around one hundred and
forty seven million monthly active users. Though this number is
kind of hard to chase down. I've heard two hundred million. Nevertheless,
even if it was one hundred million, it would still
be more. And while one can say I missed a
few apps xais, Grock and Mason's rufirst character Ai, there
(07:30):
isn't really a chance in hell they cover the shortfall.
These numbers aren't simply pissed poor. They're a sign that
the market for general ivai is incredibly small, and based
on the fact that every single one of these apps
only loses money, they're actively harmful to their respective investors
or owners. I do not think this is a real industry,
and I believe that if we pulled the plug on
the venture capital aspect tomorrow, it would die. It would
(07:52):
die within a month, maybe two. But let's talk about
API course, and this is when companies plug their apps
into open AIS models, anthropics models, Google's models, any company's
models to power some sort of supposedly amazing Generalivai feature.
And the counter I hear a lot is that these
API calls are a kind of hidden adoption, that there's
this massive swell of engaged, happy customers using Genera ivai.
(08:13):
They're just not using it on any of the major apps,
and the connection to these models that that's the real
success story here, because people are adopting general ivai, they're
just doing it through other apps. This isn't the case.
Open Ai, as I've established, is the largest player in
general ivai, making more revenue roughly four billion dollars in
twenty twenty four, though they lost five billion dollars after
(08:34):
revenue again open ai lost. They spent nine billion dollars
in twenty twenty four to lose five billion dollars. Anyway,
they still made more than everyone else in every other
private AI company. The closest I can get to an
estimate on how many actual developers integrate their applications through
open Ai is a statement from open ai from October
twenty twenty four's dev Day, where they said they had
over three million developers building apps using open AI's models.
(08:57):
And as I've discussed in the past, open AI's revenue
is heavily weighted towards its subscription business, with licensing access
to its models like GPT four to O making up
less than thirty percent around a billion dollars of their revenue,
and subscriptions to their premium products like chech, GPD plus teams, business,
pro government and so on make up the majority, around
three billion dollars in twenty twenty four. My argument's fairly simple.
(09:19):
Open ai is the most well known player in GENERITIAI,
and thus we can extrapolate from it to draw conclusions
about the wider industry. In the event that there was
a huge, meaningful industry integrating generative AI into distinct products
with mass market consumer adoption, open AI's API business would
be doing far, far more revenue. But let's get a
little more specific about what an API call is. When
(09:41):
a business plugs open AI's models or any other GENERATIVEAI
companies models into their apps and the customer triggers one,
such as just asking the app to summarize an email,
open ai charges the business both for the prompt, which
is the input, and the result, which is the output.
As a result, where weekly active users might be indicative
of attention to open AI's products, API calls are farm
more more indicative consumer and enterprise adoption and usage. In fact,
(10:05):
to be clear, I acknowledge that there are a lot,
a non specific amount, but a fair amount of app
developers and companies adopting GENERATIVEAI. However, judging on the revenue
both from open AI's developer focused business and the lack
of any real revenue for any business integrating GENERATIVAI, I
hypothesize that customers, which include developers integrating open AI's models
into both consumer facing apps and enterprise focused apps, are
(10:27):
not actually using these features that much. I should add
the open ai makes about two hundred million dollars a
year selling their models through Microsoft, meaning that their API
business may be as small as eight hundred million dollars. Again,
this is not profit, its revenue. Before we go forward,
there is also an alternative open ai is charging way, way,
way less for their models than they should, which is
(10:48):
an argument I made in the subprime AI crisis last year.
But accepting this argument means that at some point open
ai will have to become profitable, which they've shown no
signs of doing so, or they're going to have to
charge the action costs of running their unprofitable models. Do
you not see the problem there? If they have to
raise all the prices for this thing that people aren't
really using, why would they keep it? But you're wondering,
(11:11):
probably how bad is this for anthropic It's pretty disastrous.
The Information reported recently that Anthropic was projected, and I
should be clear this means made up, that they will
make at least twelve billion dollars in revenue in twenty
twenty seven, despite the fact they only made around nine
hundred million dollars in twenty twenty four and lost five
point six billion dollars. Somehow, Anthropic is currently raising two
(11:34):
billion dollars at a sixty billion dollar valuation for a
business that loses billions of dollars a year, with an
app within in store base of two million people and
a web present smaller than that of a niche hobbyist
news outlet. The Information also adds and CNBC reports as
well that sixty to seventy five percent of that revenue
came from API course, though this number is from September
twenty twenty four. So what they're making most of their
(11:57):
money from people integrating it, and they're making what a
few hundred million dollar dollars and it costs them billions
of dollars to serve this small customer base. This company
is not worth sixty billion dollars. Anthropic has raised fourteen
point seven billion dollars to create an also ran large
language model company that some people like more than open Ai,
with a competing consumer facing large language model called Claude
(12:17):
that has an install base of maybe two percent of
the five free to play games made by Clash of
Clans develop a super cell. Anthropic, much like open Ai,
has categorically failed to productize its large language model, but
the only product it appears to have pushed being computer use,
which is like operator by open Ai, and it's similarly useless,
and it can sometimes successfully do in minutes what would
(12:39):
only take you a few seconds with your hands. Anthropic,
like OpenAI, also has no mote. While they have, they've
got kind of chain of thought reasoning in their models
that has been, as I mentioned, commoditized by deep Seek.
Its models, again like OpenAI, are totally unprofitable. They're unsustainable
and heavily dependent on training data that has either run
out or is running out. Anthropic CEO Dario ami Day
(13:02):
is also a sleazy con man who, like Sam Mortmon,
continually promises that his company's AI systems will become powerful
and autonomous in a way that they've never shown they
have any possibility of becoming. He loves talking about AGI.
He's just like Sam Mortmon, He's just as big a conman.
Fuck Dario ama Day. Any investor in Anthropic needs to
seriously consider what it is they're investing in. Anthropic has,
(13:23):
other than iterating on its large language model, claud shown
little fundamental differentiation from the rest of the industry. Anthropics business, again,
like OpenAI, is entirely propped up by venture capital and
hyperscalar dollars Google and Amazon in this case, and without
them it would absolutely die almost immediately because they have
only ever lost money. Anthropics products are both unpopular and commoditized,
(13:46):
and they lost five point six billion dollars last year.
Stop dancing around this fact, stop it. Stop doing this.
We need to stop. If you remember of the media
writing about this, listening to this, I need you to
fucking stop. We by not reporting this every article, it's
journalistic malpractice. These companies will die. How can you not
see this? Let's talk about perplexity, and my general view
(14:19):
on perplexity is who gives a shit? Who cares perplexity?
A company valued at nine billion dollars towards the end
of twenty twenty four has eight million people a month
using its app, but the Financial Times reporting that they
have a grand total of fifteen million monthly active users
for an unprofitable search engine. Perplexity, like every Generativai company,
only ever loses money, and its product, Generaivai powered search
(14:40):
is so commoditized that it's actually remarkable that they still exist.
I mean, they're bigger than Anthropic. That's crazy. Other than
the slick design, there's little to be excited about here,
and eight million monthly active users is pathetic. It's embarrassing,
deeply embarrassing for a company with the majority of its
users on mobile aravins. Rivinus is a desperate man with
questionable intent that made a half hearted attempt to merge
(15:02):
with TikTok in January. Really funny bother, It's like, hey,
I have a really shitty company that loses a bunch
of money. Can I merge with your beloved app for
some reason? Like you need to do this. Also, their
product rips off journalists. By the way, they had a
whole thing for so they were just ripping fucking content.
Did it with Business Insider two. It's disgusting, But any
investor in Perplexity needs to ask themselves, what is it
(15:22):
I'm investing in an unprofitable search engine, an unprofitable large
language model company, A company that has such poor adoption
of its product that was prepared to become the shell
corporation for TikTok. Hmmm, Personally, I'd be concerned about the
bullshit numbers they keep making up. The information reported to
Perplexity said they'd make one hundred and twenty seven million
dollars in twenty twenty five and six hundred and fifty
six million dollars in twenty twenty six. How much money
(15:44):
did it make in twenty twenty four just over fifty
six million dollars. Is it profitable?
Speaker 1 (15:48):
Fuck?
Speaker 2 (15:48):
No, Perplexiti's product is commoditized, and they make less than
a quarter of the revenue of the baseball team in
the Oakland Athletics in twenty twenty four at least, though
I should add the Perplexity's app is marginally more popular.
It really is time to stop humoring these companies, though.
It's time to stop writing about them like their gifted children.
They are horrible. They are abominations of startups. They are
(16:10):
abominations of capitalism, which is already fairly abominable. I'm really
just disgusted reading these numbers. Jokeified me one hundred times.
I didn't even need to put on the joker makeup.
It just appeared on my skin naturally. I'm currently high
kicking around this sound cube I record everything in. But
really all of this is far more apocalyptic for the hyperscalers.
(16:31):
The Wall Street Journal reports that Microsoft intends to spend
ninety three point seven billion dollars in capital expenditures in
twenty twenty five, or roughly eighty five hundred and eighteen
dollars per monthly active user of the co Pilot app
in January twenty twenty five. Google is planning to spend
seventy five billion dollars on capital expenditures in twenty twenty five,
or roughly foury one hundred and sixty seven per monthly
active user of the Gemini app in January twenty twenty five.
(16:54):
Sundhapashai wants Gemini to be used by five hundred million
people before the end of twenty twenty five, and number
five so unrealistic that someone at Google should be fired,
and that someone is sunned up as shy. The fact
of the matter is that if Google and Microsoft can't
make generative AI apps work, if they can't get meaningful
consumer penetration. This entire industry is screwed. There really are
no optimistic ways to look at these numbers, and yes
(17:17):
I'm repeating myself. Microsoft Copilot had eleven million monthly active
users on the Copilot app and fifteen point six million
unique monthly visitors the coopilot dot Microsoft dot com. Google
Gemini had eighty million monthly active users on the Gemini
app and forty seven point three million unique monthly users
visitors even to their website. These are utterly pathetic considering
(17:38):
Microsoft and Google scale, especially given the latters complete dominance
over Google Search and web search in general, and the
ability to funnel customers to Gemini for millions, perhaps billions,
Google is the first page that they see when they
open a web browser. Google should be owning this by now. Look,
forty seven point three million unique monthly visitors is a
lot of people, But considering that Google spent five fifty
(18:00):
two zero point five four billion dollars in capital expenditures
in twenty twenty four, it's hard to see whether return
is or even whether a tone could be. Google, like
most companies, does not break out revenue from AI. Just
to be clear, if they were doing well, they would,
though they do love to say stuff like a strong
quarter was driven by our leadership in AI and momentum
across the business, which means nothing. By the way that
(18:23):
shit is made for journalisticy and go oh, that means
they're making money in AI. When a company's making money
in something, they'll tell you directly. And as a result
of its unwillingness to share hard numbers, all we have
to look at are numbers like those that received from
similar webons Centre Tower, and it's fair to suggest that
Gemini and its associated products have been a complete flop.
(18:43):
We're still Google spent one hundred and twenty seven point
five four billion dollars in capital expenditures in twenty twenty
three and twenty twenty four, combined with an estimated seventy
five billion like I said for twenty twenty five, what
the fuck is going on? Yes, Google is likely making
revenue from people running generally AIM and Google Cloud, and
yes they're likely making money from forcing AI onto Google
(19:04):
Workspace customers by raising the prices and saying you get
this for quote free. But Google, like every single other
general IVAI company, is losing money on every single general
IVAI prompt, and based on these monthly active user numbers,
nobody really cares about Gemini at all. Actually, I take
that back. Some people care about Gemini. Not that many,
(19:24):
but some. And it's far more fair to say that
nobody cares about Microsoft Copilot, despite Microsoft shoving it in
every corner of our lives. Eleven million monthly active users
for its unprofitable, heavily commoditized large language model app is
a joke, as are the fifteen point six million monthly
active users for its web presents, probably because it does
exactly the same shit that every other LMM does, and
if one knows it's powered by chet GPT, it's just
(19:46):
it's remarkable. Microsoft's copil app isn't just unpopular, it's irrelevant.
For comparison, Microsoft Teams has, according to a post for
Microsoft from the end of twenty twenty three, over three
hundred and twenty million months active users. That's more than
ten times the amount of monthly active users of the
Copilot app in January twenty twenty five, and the Copilot
(20:07):
website combined, and unlike Copilot teams, makes Microsoft money now.
I obviously don't have the numbers on people that accidentally
click the Copilot button in Microsoft Office or bing dot com.
But I do know that Microsoft isn't making much money
on AI at all. Microsoft reported in its last earnings
that it was making thirteen billion dollars of annual revenue,
a projected number based on current contracts versus booked money.
(20:29):
And this was on their artificial intelligence products. Now I've
made this point again and again and again, and I'm
going to keep making it. But revenue is not the
same thing as profit, and Microsoft does not have an
artificial intelligence part of its earnings breakdowns. These numbers are
cherry picked from across the entire suite of Microsoft products,
such as selling Copilot add ons to their Microsoft three
sixty five enter price suite. And by the way, The
(20:49):
Information reported in September twenty twenty four that Microsoft had
only sold Copilot to around one percent of their customers
buying three sixty five. They also make it selling access
to open AIS models on this roughly a billion dollars
in revenue, and people running their own models, and the
zore cloud, Microsoft's cloud compute platform for context. By the way,
Microsoft made sixty nine point sixty three billion dollars in
(21:09):
revenue in its last quarter, thirteen billion dollars of annual
revenue not profit, is about three point twenty five billion
dollars in quarterly revenue off of upwards of two hundred
billion dollars of capital expenditure since twenty twenty three. The
fact that neither Gemini nor Copilot has any meaningful consumer
penetration isn't just a joke. It should be sending alarm
(21:31):
bells through Wall Street. While Microsoft and Google may make
money outside of consumer software, both companies have desperately tried
to cram Copilot and Gemini down consumer's throats, and they
have categorically unquestionably failed or while burning billions of dollars
to do so. But ed ed, what about get hubcopilot?
All right, let's talk about git hub coopilot, shall we.
According to a report from The Wall Street Journal from
(21:53):
October twenty twenty three, Microsoft was losing an average of
more than twenty dollars a month per user on the
paid of gitthub copilot, what with some users costing them
more than eighty dollars a month. Jesus christ. Microsoft said
a year later that gethub copilot had one point eight
million paid subscribers, which is pretty good, except like all
generativio products, it loses money. Like I just bloody said,
(22:16):
I must repeat that Microsoft will have spent over two
hundred billion dollars in capital expenditures by the end of
twenty twenty five. In return, Microsoft got one point eight
million paying customers for a product that, like everything else
I'm talking about, is heavily commoditized. Basically, every LM can
generate code that some are better than others, by which
I mean they all introduced security issues into your code.
But nevertheless, and somehow, Microsoft loses money even when the
(22:39):
users use it paid. Am I getting through to you yet?
Is this working? If you are working for a hedge
fund and investment bank or anyone like that, please get
in touch. I will protect your identity. Is anyone around
you freaking out because they should be? They should be. Man,
I'm freaking out a little, and I just keep all
my money in a big box under my bed. I don't
(22:59):
have that I do anyway, not going to do that. Jug. So,
one of the arguments people make is that AI is everywhere,
But it's important to remember that the prevalence of AI
you seeing it in different apps, is not proof of
its adoption, but the intent of companies to shove it
into everything, And the same goes for businesses integrating AI
that are really just mandating people dick around with Copilot
or chat GPT and I'm really not kidding, no really.
(23:22):
KPMG bought forty seven thousand Microsoft Copilot subscriptions last year,
a significant discount to be familiar with any AI questions
their customers may have. Management consultancy PwC bought one hundred
thousand enterprise subscriptions, becoming open AI's largest customer in the process,
as well as their first reseller, and have created their
own internal generative AI called Chach PwC. The PWSC stuff
(23:46):
as absolutely hate. It's really cool that when you actually
talk to the users, they just fucking hate it. And
while you may see AI everywhere, integrations of generative AI
are indicative more of the decision making of the management
behind the platforms and the demands of the market more
than any consumer demand. Enterprise software is more often than
not sold in bolt to managers or c suite executive tasks,
(24:06):
less with company operations and messy things like doing staff
for making sure the company runs, more with seeming on
the forefront of technology. In practical terms, this means that
there is a lot of demand to put AI in stuff,
and some demand to buy stuff with AI on it
by enterprise buying software, but little evidence that this actually
leads the significant user adoption or usage. I'd argue this
(24:30):
is because large language models do not really lend themselves
to features that would provide meaningful business returns. And I
think everyone can agree on that, Like there are things
like summarizing emails, which I'll get to get to that
in a second. Look. In fact, let's do it now.
Let's briefly talk about where large language models work, where
they are actually good. And some of you are not
going to love this, but I know there's one of
(24:51):
you is that yes, yes, now I will get ahead.
I've got him now, I have him in my sights,
to be clear, And this is really dealing with the
am actually responses. I'm not saying and really have never
meant to say that large language models have no use
cases or no customers. People really do use them. They
use them for coding, for searching defined libraries of documents,
(25:12):
for generating draft materials, for brainstorming, for summarizing and searching documents,
These are useful, but they're not magical. They're cool, but
that's about it, and their coolness or usefulness is a
tiny little ant compared to the costs and stealing from
millions of people and damaging our power grid in our planet. Okay, okay,
(25:32):
so you're probably wondering. I brought it up earlier. Agents.
You've heard about agents. Mark Benioff wankin Off about agents.
Sam Allman talking about agents. They loved, They loved talking
about agents, right, they love saying agents of the future.
When a company uses the term agent, they're intentionally trying
to be deceitful, because the term agent means autonomous AI
that does stuff without you touching. It goes off and
(25:53):
does things for you with one command, and it knows
what to do. Remember, these models don't know anything. The
problem this definition is that everybody has used it to
refer to what is actually a chatbot that can do
some things while connected to a database, which I would
regularly called a chatbot personally. In open AI and anthropics case,
agents refer to a model that controls the computer. This
is closer to the truth other than the fact that
(26:15):
their agents are so unreliable as to be disqualifying, and
the tasks they succeed at, like searching trip advisor, are
very simple and did not need automating. Next time you
hear the agent actually look at what the product does,
and maybe you flick a booger at the person. But Ed, Ed,
you just burst into my door and having a nice
diet coke and you're in my house. What are you
doing here?
Speaker 1 (26:34):
Ed?
Speaker 2 (26:34):
What about artificial general intelligence? Aren't they going to turn
this into artificial general intelligence? No, they're not. Get out
of my house. Generative AI is probabilistic and large language
models do not know anything because they are guessing what
the next part of a particular output would be based
on the imput in reasoning models. They might look at
that a few times go oh, maybe it's not this,
maybe it's this. They are not making decisions. Generative AI
(26:55):
does not make decisions. They are probability machines, which in
turn makes them own only as reliable as probability can
be and as conscious no matter how intricate the system
may be or how much infrastructure is built. As a
pair of dice, we do not understand how human intelligence works,
and as a result, it's completely laughable to imagine we'd
be able to simulate it. Large language models do not
(27:17):
create or resemble, or they're not artificial intelligence. They are
at most the most powerful parrot in the world, trained
to respond to stimulus with what they guess is the
correct answer, and they're pretty good at it. They're pretty good. Right,
It's pretty cool, except we shouldn't be burning hundreds of
billions of dollars to make them slightly better at this.
(27:38):
Let me put it in simpler terms. Imagine if you
made a machine that threw a bouncy ball down a
hallway and it was really really you got really good
at dialing in to throw the ball so that it
followed a fairly exact trajectory. Would you think the arm
was intelligent? Would you think the ball was intelligent? Would
you think that the ability to precisely do something or
more reliably do something would make it smart. The point
(28:01):
I'm making about large language models is that they're a
cool concept with some interesting things they can do. But
they've been used as a cynical marketing vehicle to raise
money for open AI by lying about what they're capable
of doing, starting with calling them artificial intelligence. All right, really, though,
(28:30):
at this point, I need to ask a very fucking
simple question. Where is the goddamn money? Where is the
goddamn money? Where's the money? Sammy, Sammy, give me the money.
Where's the money? Money me money now? Sam Mortman, where
is the money? Dario Ama Day, where's the money? Satya Nadella,
where's the money? Summed up Ashai? Where's the money? Mark Benioff,
where's the money? Where is the goddamn money? Because revenue
(28:51):
is not the same as profit, I will say it again,
revenue is not the same as profit. And even then, Google, Amazon,
and to an extent, Microsoft, the company's making the most
investments in AI, do not want to state what the
revenue is on AI. I hypothesize the reason that they
do not want to disclose it is that it's pretty
goddamn small. It is extremely worrying that so few companies
(29:13):
are willing to directly disclose their revenue from selling services
that are allegedly revolutionary. Why Salesforce says they close two
hundred AI related deals in their last earnings. How much
money did they make? Why does Google get away with
saying that they have growing demand for AI and nothing else?
Is it? Because nobody's making that much money. As a sidebar,
(29:34):
I can find and I've really really looked like one
company that appears to be making profit from genera ivai
during a consultancy that helps generaivai companies find people to
train their models. That made three hundred million dollars in
revenue in twenty twenty four and reach an indeterminate amount
of profitability. We don't know if it was like a
million dollars or not, while Microsoft may disclose it made
(29:54):
thirteen million dollars in AI revenue that's annualized, so projected
based on current contracts rather than actual money in accounts,
and does not speak to the specific line items like
one would say. If said line items, we're not going
to make. The market say, hey, what the fuck? Put
aside whatever fantastical beliefs you may have about the future,
and tell me right now what business use case exists
that justifies burning hundreds of billions of dollars, damaging our
(30:16):
power grid, hurting our planet, and stealing from millions of
people to train these models. Even if you can put
troublesome things like morals or the basic principles of finance aside,
can AI evangelists not see that their dream is failing.
Can they not see that nothing is really happening, That
general ivai at best can be kind of cool, yet
mostly sucks and comes at this unbearable moral, financial, and
(30:38):
environmental cost. Is any of this really worth it? And
where exactly does this end? Do you AI evangelist gone
to your head, your life contingent on the truth, leaving
your lips believe that this goes much further than you
see today? Do not know if these AI people see
that this kind of sucks? Do they not see that
general ifai runs contrary to the basic tenets of what
(30:59):
makes science fiction call It doesn't make humans better. It
reduces their work to a stagnant, unremarkable slop in every
way it can, and reduces the cognition of those who
come to rely on it, And it costs hundreds of
billions of dollars and a return to fossil fuels. For
some fucking reason, it isn't working. The users aren't there,
the revenue isn't there. The best time to stop this
was two years ago, and the next best time to
(31:20):
stop is as soon as humanly possible. Generatifai is a
group delusion, its own kind of real life hallucination. What
you're seeing in the news is not the success of
the artificial intelligence industry, but a runaway narrative created by
and sustained by Sam Altman, Open Ai, Dario Amadee, and
of course satch In Nedella these fucking people. What you're
(31:41):
watching is not a revolution but a repetitious public relations
campaign for one company that accidentally time the launch of
chat GBT with a period of deep desperation in big tech,
one so profound that it will likely drag half a
trillion dollars worth of capital expenditures along with it. The
bubble will only burst when either the markets or the
hyperscalers accept that they've chased their own tales toward oblivion.
(32:02):
There is no justification for any of the capital expenditures
related to generative AI. We are approaching the limit of
what transformer based architecture can do, if we haven't already
reached it. No amount of beating off about test time, compute,
and connecting large language models to other large language models
is going to create a new use case for this technology,
and even if it did, it's unlikely that it ever
makes enough money to make it profitable. I will keep
(32:25):
talking about this stuff until I'm proven wrong. I do
not know why more people aren't more worried about this.
The financials are truly damning. The user numbers are so
small as to be insignificant. The costs are so ruinous
that they will likely cost tens of thousands of people
their jobs, and one of the hyperscalar CEOs their job
along with it, although admittedly I'm a lot less upset
about that. And they're going to inflict damage on tech
(32:46):
valuations that may well rival the dot com boom or worse.
And if the last point feels distant to you, ask yourself,
what's in your retirement savings? That's right, Google, Microsoft, and
hundreds of other companies that will be hurt by the
contagion of an aiding. I should also not be the
person saying this, or at least I shouldn't be one
(33:06):
of the first. These numbers are horrifying, and I have
no idea why nobody else is worried. There's no industry here,
there is no money. There's no proof that this will
ever turn into a real industry, and far more proof
that it will cost more money than it will ever make.
Im perpetuity open AI and anthropic are not real companies.
They're freeloaders living on venture backed welfare for an indeterminate
(33:27):
amount of time. Because the entire tech industry has agreed
to rally around the world's most unprofitable software, and, like
any other free ride that doesn't actually produce anything, when
the money goes away, they're fucked. Seriously, why are investors
funding open Ai? Do they seriously believe it's necessary to
let Sam Altman and open Ai continue to burn five
or more billion dollars a year on the off chance
(33:48):
he's able to create something that's alive. This motherfucker can't
create something that's profitable. What's the end point here? How
many more billions? Where's the fucking money? Sammy? Where is it?
Sam Moorman? Where's my god damn money? Where's my money? Sam?
I say all this because generativeai is open Ai. The
consumer adoption of this software is completely failed, and it's
(34:10):
going nowhere fast Chat GPT is sustained entirely on deranged,
specious hype drummed up by a media industry that thinks
it's more remarkable to write down the last lie that
Sam Moltman told than say that open ai has lost
nine billion dollars in the last year to Sorry, they
spent nine billion dollars to lose five billion dollars in
last year, and they intend to more than double that
number in twenty twenty five for absolutely no reason. Look, look,
(34:35):
it's time to stop humoring open ai and time to
stop directly stating that it is a bad business without
a meaningful product. We also really need to be clear
that the generative AI industry does not really exist without
open Ai, and thus this company must justify its existence.
And let's be abundantly clear, open Ai cannot exist any
further without further venture capital investment. This company has absolutely
(34:59):
no path to sustain in itself, no mode, and loses
so much money that it will need more than fifty
billion dollars to continue in its current form in the
next year. I don't know how I'm wrong, and I've
sat and thought through and researched a great deal on
how I might be. I can't find any compelling arguments.
I don't know what to do, but tell you what
I think and why I think that way, and hope
that you the listener understand a little bit more about
(35:21):
what I think is going on, because this really bothers me.
As I've said before, I grew up on the compute.
The computer made me who I am. Seeing the tech
industry like this sickens me because it's getting money away
from people doing cool shit to the least cool people
doing the least coolshit possible, and it's frustrating. But I'll
leave you with one thought and one thing that particularly
(35:41):
bothers me about GENERATIVAI. Regular people, for the most part
of my experience, do not seem to want this. While
there are occasionally people I'll mate you use chat GPT
to rewrite part of an email, most of the people
I may feel like AI was forced upon them. With
that in mind, I believe that Apple is actually radicalizing
millions of people against GENERATIVEAI by forcing them to reckon
with the terrible summaries, awful suggested texts, and horribly designed
(36:04):
user interface choices from Apple Intelligence, one of the worst
product launches I think I've seen in my life. Something
about generative AI has caused the hyperscalers to truly lose
their minds, and the intrusion of GENERATIVAI into both Microsoft
Office and Google Docs has turned just about everybody I
know in the business world against them. The resentment boiling
against this software is profound because the tech industry has
(36:24):
become desperate and violative, showing such contempt for their customers
that even Apple will force an inferior experience upon their
customers to please the will of the rot economy and
the growth at all cost mindset of the markets. Let's
be frank, nobody really needs anything generative AI does. Large
language models hallucinate too much to be truly reliable, a
problem that will require entirely new branches of mathematics to solve,
(36:48):
and their most common consumer facing functions like summarizing an article,
practicing for a job interview, or writing a business plan
are not really things people need or massively benefit from.
Even if these things weren't ruinously expensive damaging to the environment.
I believe general if AI is turning regular people against
the tech industry thanks to how much they're trying to
force it upon them and make them use the bad idea,
(37:10):
and it isn't working. Nobody wants this ship. They're intrigued
by the idea, then immediately bounce off of it in
many cases once they see what it can or can't do.
This software is being forced on people at scale by
corporations desperate to seem futuristic without any real understanding as
to why they need to do so, and whatever use
cases may exist for large language models are dwarfed by
(37:31):
how utterly unprofitable this whole fucking fiasco is. But I
want you to do something. If this whole thing has
pissed you off, if hearing about these companies has enraged
you as it has enraged me. I want you to
tell your friends, your family that open Ai spent nine
billion dollars to lose five billion dollars. I want you
to talk about the fact that large language models don't
(37:51):
really have a market. That chat GPT is a marketing
con That Sachinidella of Microsoft has burned probably will burn too,
un billion dollars chasing software that does the same thing
as everyone else. That Tim Cook of Apple has forced
Apple Intelligence barely functional software on millions and millions of
people because Apple has no more ideas. That Mark Zuckerberg
(38:12):
of Meta has pushed AI on everything because he has
no more ideas left, and it's going to burn so
much money in Meta and Sam Altman and Daria Amaday
are two fucking liars, two liars who will tell you
that their software will turn into artificial general intelligence. They're lying.
They're all lying. And Sundharpeshai of Google is the arc
liar who went in Google io and talked about a
(38:34):
completely fictional AI agent returning some shoes. The only reason
that companies like this lie like this is because the
truth is boring. The truth is mediocre. Believe your goddamn
eyes when you use chat GPT and you say, what
the fuck is this? Why does this matter? You're not crazy,
You're not an idiot because you can't see the magic
of generative AI. The people pushing this stuff are rather credulous.
(38:58):
They're either bought or they're making a shit ton of
money and lying to you. I refuse to let them
keep doing so. Better off Lene exists to kind of
explain this stuff as plainly as possible. You can reach
out to me if I wasn't clear about something. I
love feedback. Please be nice to me. I guess is
what I ask. But I love doing this. I am
scared of how this ends. I think it's going to
(39:18):
really hurt the markets. Could be three months, could be
six months, could be eighteen months. I don't know, and
I don't really think it's the right thing to do
to predict, but I'll tell you this, a better tech
industry can come out of this collapse. I don't know
how severe the collapse is. I don't think like Google's
going to die ornything. It's going to hit tens of
thousands of people's jobs, It's going to hit the markets hard.
(39:39):
I don't know if a recession is possible. I'm not
a financial guy, but I'll tell you this, the tech
industry needs. They need to realize how bad this is.
They need consumers to tell them, and honestly, consumers not
using it should have told them. But they clearly haven't
worked that shit out, have they. But I'll leave you
with this. I think when this there's going to be
(40:01):
a lot of people that need to apologize. A lot
of people in the media, the Casey Newtons of the world,
the Caros Wishes of the world, the people claim in
this the early days of the internet again boo. I
think the thing we really need to do is make
our dispersure known to these tech companies. Find the feedback forms,
go online and talk about them. Say their names. Say
(40:22):
their names to the friends you have who are mad
at this too, which should be a lot of them.
Say their names again and again and again. You ask me,
how can things change? These people only have their names.
They have more money than any of us can mind,
they have all of this power, and as a result,
they actually only have their seo their names. How do
you think propagar Ragavan feels, by the way, when you
(40:43):
google his name and all you see is me, the
smiling man. I believe that enough of us just talking
shit on these people. And I don't mean being irate.
I don't mean making stuff up. We're not them. We
don't have to operate with lies. We can operate with truths,
such as Microsoft is propping up AI a venture welfare client.
All these people hate the poor so much, but they
(41:05):
love welfare when it means maybe making money or maybe
burning billions of dollars. So fuck their name's up. Talk
shit about them, Talk them to your friends. I don't
care if you mentioned better offline. Just tell people what
they've done. Tell people that Generative AI loses money on
every single fucking move. It's so sickening, it's so boring,
and it's most decidedly not the future. You are not
(41:25):
crazy if you don't think this is amazing. You're being
lied to. What you're seeing is a marketing campaign. And
I will continue to walk you through this stuff, and
if I'm wrong somehow, I will correct myself every goddamn time,
because I deeply care about giving you what I know
and what I've seen, and the things I've reported in
these two episodes scared the shit out of me, both
(41:47):
for the markets and the fact that so many rich
people are willing to be so goddamn stupid, and it
made me really angry because it shows such contempt, contempt
for the media and contempt for the user, and I
will not bloody accept it. It's such a pleasure to
do this show. I'm very lucky to do so. Thank
(42:12):
you for listening to Better Offline. The editor and composer
of the Better Offline theme song is Mattersowski. You can
check out more of his music and audio projects at
Mattasowski dot com M A T T O S O
W s KI dot com. You can email me at
easy at Better offline dot com, or visit Better Offline
dot com to find more podcast links and of course,
(42:33):
my newsletter. I also really recommend you go to chat
dot Where's youreed dot at to visit the discord, and
go to our slash Better Offline to check out our reddit.
Thank you so much for listening.
Speaker 1 (42:44):
Better Offline is a production of cool Zone Media. For
more from cool Zone Media, visit our website cool Zonemedia
dot com, or check us out on the iHeartRadio app,
Apple Podcasts, or wherever you get your podcasts.
Au Zone Media.
Speaker 2 (00:06):
Hello and welcome to Better Offline. I'm your host ed zitron.
Last part I really laid down how bad things are
for open Ai, how bad a company they are, how
(00:27):
they spent nine billion dollars to lose five billion dollars,
how bad things look. But open Ai they have users.
I mean the users lose the money. Every single user
paying or not loses the money. They can only survive
if they're given more money. They will literally die if
not given more venture capital money. And that really bothers me,
And that bothers me a great deal. Listen to the
episode again if you want to really understand why. But
(00:49):
let's start this one with a very very simple question.
Is generative AI a real industry? Look, the large language
model paradigm is yet to produce a successful mass market product,
and no, large language models are not a success, nor
are they mass market. I know you're gonna say chat
GPT is huge. We've already been through that. I just
talked about that. But surely, surely, right like, it wouldn't
(01:14):
just be open Ai, right like, we've been through this.
But if generative AI was a real industry, there'd be
multiple other players with massive customer bases as a result
of how revolutionary it was, right, like at least close, right,
maybe like half the size, a quarter of the size,
right right, wrong, wrong, so wrong, so very wrong, so
(01:36):
fucking wrong. It boils my blood. It makes me scared
for the future, for the market for Silicon Valley. The
venture capitalists are so fucking wrong, and so are the hyperscalers. Wrong, wrong, wrong.
Let's look at some estimated numbers that I got from
data intelligence firm Center Tower, and that's referring to these
monthly active users on apps and similar web which is
just unique monthly active visitors to websites. And this is
(01:59):
for the biggest players in AI in January twenty twenty five.
And I must be clear, the following really fucked me
up a little. So open AI's chatgpt had three hundred
and thirty nine million active users on chat GPT's app
and two hundred and forty six million unique monthly visitors
to chatgpt dot com in January twenty twenty five. Pretty good, right,
One would assume that everybody else, especially the hyperscalers, they'd
(02:21):
be pretty close behind. Right, They've got way more money,
They've got a ton of advertising, and one would be
wrong Google Gemini. Google's Gemini had a pathetic eighteen million
monthly active users on the Gemini app and a mere
forty seven point three million unique monthly users on their website.
For COMPARISONCNN dot com has over one hundred and fifty
(02:41):
million unique monthly visitors and did not require purchasing billions
of dollars of GPUs. Nevertheless, though, Microsoft, who funds open Ai,
they wouldn't have blown this right. They wouldn't have got
a tiny amount of US right. Wrong, so very wrong.
Microsoft Copilot had an embarrassing eleven million monthly active users
(03:02):
on the Copilot app and fifteen point six million unique
monthly users visitors. I mean to copilot dot Microsoft dot com.
They had a fucking Super Bowl commercial a year ago. Man,
what the hell? These are terrible numbers for a company
with a market capitalization of three trillion dollars that spent
over seventy five billion dollars on capital expenditures in twenty
twenty four. But you know what, maybe it's just that
(03:23):
big tech hasn't worked it out. The plucky start of
the Silicon Valley must have, right. I mean, we've all
heard about perplexity. They seem to be giving away pro
accounts all the time. They're pretty big, right, they must
be wrong. They had an abominable eight million monthly active
users on their app in January and a poultry ten
point six million unique monthly visitors to perplexity dot ai.
This company's raised six hundred and sixty five million dollars.
(03:45):
They have a multi billion dollar valuation. This is absolutely
fucking pathetic. What are we doing here? But you know,
maybe I'm just being a sour pus. Maybe I'm just
being just being a hater. You know, I sit in
my hates thrown and I hate it. I'm like, ooh,
I hate the company so much. Right, that's it. It's bias. Obviously,
there's one hulking Juggernau I've been leaving out and I
would never ever ever leave them out. Because Anthropic has
(04:08):
raised fourteen point seven billion dollars, one would assume with
all this money, with all of the press attention, all
of the people saying that Warrio Ami Day, sorry, Dario
Ami Day, will have Agi in twenty twenty seven around there, right,
they'd be huge. They must be huge. They must be huge,
right right? Right then, So flipping wrong. Anthropics Claude had
(04:31):
I a shit you not two million monthly active users
on the claud app and eight point two million unique
monthly visitors the Claude the AI and that's the web
based version of their app. These numbers are absolutely abominable.
They're trash, they're garbage. Anyone's saying that Anthropic as a
real product is talking out of their asshole. I'll get
to API calls later, don't you worry. But it's time
(04:52):
to wake up and stop yammering about these companies like
they're building the future or have any real product market fit.
What a goddamn joke. I am furious. Getting these numbers
pissed me off so much. I have had these chonder
fucks telling me, oh Ed, you have no idea how
big this is? Oh Ed, They're tiny. This is so small.
I know. I said it'd be calm. I said it'd
be calm. But when you spend two years having people
(05:14):
calling you a hater and a cynic at, a pessimist
and a pig and a dog and they spray you
at their hoses, you get a little angry about this stuff.
And also, why is nobody I'm a pr guy who
does a podcast and a newslre why am I the
person to say it? But what's really funny is that
the recently emerged deep Seak had twenty seven million monthly
active users on the deep seak Act app and seventy
(05:37):
nine point nine million unique monthly visitors to deepseak dot
com in January. This figure, by the way, doesn't capture
deep Seak's China based users, who at least on mobile
access the app through a variety of different marketplaces. From
what I can tell, the deep Seak Act app I
keep speaking like Kathy, I guess, but I'm gonna keep
this going. We don't need to edit that the app
has nearly ten million downloads on the Vivo Store, which
(05:59):
is just one of the different Android app marketplaces serving
mainline China. It's not even one of the biggest. But
for the sake of simplicity, assume that all of these
numbers refer to those outside of China, where most, if
not all, of the Western made chatbots are blocked by
the Great Firewall. But let me put this all into perspective.
The entire combined monthly active users of Microsoft Copilot, Claude Gemini,
Deep Seek, and it perplexitis apps amount to sixty six
(06:23):
million monthly active users, or nineteen point four to seven
percent of the entire monthly active users of chat GPT's
mobile app. Web traffic slightly improves things, I say sarcastically,
with one hundred and sixty one million unique monthly visitors
that visited the websites for Copilot, Claude, Gemini, Deep Seek,
and Perplexity making up sixty five point sixty nine percent
of all the traffic that went to chatgpt dot com. However,
(06:46):
I'd argue that including deep Seek vastly overinflates these numbers.
They're an outlier, and they're also relatively new, and they've
enjoyed a big moment in the media, so we can
leave them out for a second. Without deep Sea, Copilot, Claude, Gemini,
and Perplexity made up a total of thirty nine million
monthly active users across their apps, and a grand total
of eighty one point seven million unique monthly visitors Without
(07:07):
chat gpt, it appears that the entire general IVAI app
market is a little more than half the size of
Pokemon Goo its peak, which had around one hundred and
forty seven million monthly active users. Though this number is
kind of hard to chase down. I've heard two hundred million. Nevertheless,
even if it was one hundred million, it would still
be more. And while one can say I missed a
few apps xais, Grock and Mason's rufirst character Ai, there
(07:30):
isn't really a chance in hell they cover the shortfall.
These numbers aren't simply pissed poor. They're a sign that
the market for general ivai is incredibly small, and based
on the fact that every single one of these apps
only loses money, they're actively harmful to their respective investors
or owners. I do not think this is a real industry,
and I believe that if we pulled the plug on
the venture capital aspect tomorrow, it would die. It would
(07:52):
die within a month, maybe two. But let's talk about
API course, and this is when companies plug their apps
into open AIS models, anthropics models, Google's models, any company's
models to power some sort of supposedly amazing Generalivai feature.
And the counter I hear a lot is that these
API calls are a kind of hidden adoption, that there's
this massive swell of engaged, happy customers using Genera ivai.
(08:13):
They're just not using it on any of the major apps,
and the connection to these models that that's the real
success story here, because people are adopting general ivai, they're
just doing it through other apps. This isn't the case.
Open Ai, as I've established, is the largest player in
general ivai, making more revenue roughly four billion dollars in
twenty twenty four, though they lost five billion dollars after
(08:34):
revenue again open ai lost. They spent nine billion dollars
in twenty twenty four to lose five billion dollars. Anyway,
they still made more than everyone else in every other
private AI company. The closest I can get to an
estimate on how many actual developers integrate their applications through
open Ai is a statement from open ai from October
twenty twenty four's dev Day, where they said they had
over three million developers building apps using open AI's models.
(08:57):
And as I've discussed in the past, open AI's revenue
is heavily weighted towards its subscription business, with licensing access
to its models like GPT four to O making up
less than thirty percent around a billion dollars of their revenue,
and subscriptions to their premium products like chech, GPD plus teams, business,
pro government and so on make up the majority, around
three billion dollars in twenty twenty four. My argument's fairly simple.
(09:19):
Open ai is the most well known player in GENERITIAI,
and thus we can extrapolate from it to draw conclusions
about the wider industry. In the event that there was
a huge, meaningful industry integrating generative AI into distinct products
with mass market consumer adoption, open AI's API business would
be doing far, far more revenue. But let's get a
little more specific about what an API call is. When
(09:41):
a business plugs open AI's models or any other GENERATIVEAI
companies models into their apps and the customer triggers one,
such as just asking the app to summarize an email,
open ai charges the business both for the prompt, which
is the input, and the result, which is the output.
As a result, where weekly active users might be indicative
of attention to open AI's products, API calls are farm
more more indicative consumer and enterprise adoption and usage. In fact,
(10:05):
to be clear, I acknowledge that there are a lot,
a non specific amount, but a fair amount of app
developers and companies adopting GENERATIVEAI. However, judging on the revenue
both from open AI's developer focused business and the lack
of any real revenue for any business integrating GENERATIVAI, I
hypothesize that customers, which include developers integrating open AI's models
into both consumer facing apps and enterprise focused apps, are
(10:27):
not actually using these features that much. I should add
the open ai makes about two hundred million dollars a
year selling their models through Microsoft, meaning that their API
business may be as small as eight hundred million dollars. Again,
this is not profit, its revenue. Before we go forward,
there is also an alternative open ai is charging way, way,
way less for their models than they should, which is
(10:48):
an argument I made in the subprime AI crisis last year.
But accepting this argument means that at some point open
ai will have to become profitable, which they've shown no
signs of doing so, or they're going to have to
charge the action costs of running their unprofitable models. Do
you not see the problem there? If they have to
raise all the prices for this thing that people aren't
really using, why would they keep it? But you're wondering,
(11:11):
probably how bad is this for anthropic It's pretty disastrous.
The Information reported recently that Anthropic was projected, and I
should be clear this means made up, that they will
make at least twelve billion dollars in revenue in twenty
twenty seven, despite the fact they only made around nine
hundred million dollars in twenty twenty four and lost five
point six billion dollars. Somehow, Anthropic is currently raising two
(11:34):
billion dollars at a sixty billion dollar valuation for a
business that loses billions of dollars a year, with an
app within in store base of two million people and
a web present smaller than that of a niche hobbyist
news outlet. The Information also adds and CNBC reports as
well that sixty to seventy five percent of that revenue
came from API course, though this number is from September
twenty twenty four. So what they're making most of their
(11:57):
money from people integrating it, and they're making what a
few hundred million dollar dollars and it costs them billions
of dollars to serve this small customer base. This company
is not worth sixty billion dollars. Anthropic has raised fourteen
point seven billion dollars to create an also ran large
language model company that some people like more than open Ai,
with a competing consumer facing large language model called Claude
(12:17):
that has an install base of maybe two percent of
the five free to play games made by Clash of
Clans develop a super cell. Anthropic, much like open Ai,
has categorically failed to productize its large language model, but
the only product it appears to have pushed being computer use,
which is like operator by open Ai, and it's similarly useless,
and it can sometimes successfully do in minutes what would
(12:39):
only take you a few seconds with your hands. Anthropic,
like OpenAI, also has no mote. While they have, they've
got kind of chain of thought reasoning in their models
that has been, as I mentioned, commoditized by deep Seek.
Its models, again like OpenAI, are totally unprofitable. They're unsustainable
and heavily dependent on training data that has either run
out or is running out. Anthropic CEO Dario ami Day
(13:02):
is also a sleazy con man who, like Sam Mortmon,
continually promises that his company's AI systems will become powerful
and autonomous in a way that they've never shown they
have any possibility of becoming. He loves talking about AGI.
He's just like Sam Mortmon, He's just as big a conman.
Fuck Dario ama Day. Any investor in Anthropic needs to
seriously consider what it is they're investing in. Anthropic has,
(13:23):
other than iterating on its large language model, claud shown
little fundamental differentiation from the rest of the industry. Anthropics business, again,
like OpenAI, is entirely propped up by venture capital and
hyperscalar dollars Google and Amazon in this case, and without
them it would absolutely die almost immediately because they have
only ever lost money. Anthropics products are both unpopular and commoditized,
(13:46):
and they lost five point six billion dollars last year.
Stop dancing around this fact, stop it. Stop doing this.
We need to stop. If you remember of the media
writing about this, listening to this, I need you to
fucking stop. We by not reporting this every article, it's
journalistic malpractice. These companies will die. How can you not
see this? Let's talk about perplexity, and my general view
(14:19):
on perplexity is who gives a shit? Who cares perplexity?
A company valued at nine billion dollars towards the end
of twenty twenty four has eight million people a month
using its app, but the Financial Times reporting that they
have a grand total of fifteen million monthly active users
for an unprofitable search engine. Perplexity, like every Generativai company,
only ever loses money, and its product, Generaivai powered search
(14:40):
is so commoditized that it's actually remarkable that they still exist.
I mean, they're bigger than Anthropic. That's crazy. Other than
the slick design, there's little to be excited about here,
and eight million monthly active users is pathetic. It's embarrassing,
deeply embarrassing for a company with the majority of its
users on mobile aravins. Rivinus is a desperate man with
questionable intent that made a half hearted attempt to merge
(15:02):
with TikTok in January. Really funny bother, It's like, hey,
I have a really shitty company that loses a bunch
of money. Can I merge with your beloved app for
some reason? Like you need to do this. Also, their
product rips off journalists. By the way, they had a
whole thing for so they were just ripping fucking content.
Did it with Business Insider two. It's disgusting, But any
investor in Perplexity needs to ask themselves, what is it
(15:22):
I'm investing in an unprofitable search engine, an unprofitable large
language model company, A company that has such poor adoption
of its product that was prepared to become the shell
corporation for TikTok. Hmmm, Personally, I'd be concerned about the
bullshit numbers they keep making up. The information reported to
Perplexity said they'd make one hundred and twenty seven million
dollars in twenty twenty five and six hundred and fifty
six million dollars in twenty twenty six. How much money
(15:44):
did it make in twenty twenty four just over fifty
six million dollars. Is it profitable?
Speaker 1 (15:48):
Fuck?
Speaker 2 (15:48):
No, Perplexiti's product is commoditized, and they make less than
a quarter of the revenue of the baseball team in
the Oakland Athletics in twenty twenty four at least, though
I should add the Perplexity's app is marginally more popular.
It really is time to stop humoring these companies, though.
It's time to stop writing about them like their gifted children.
They are horrible. They are abominations of startups. They are
(16:10):
abominations of capitalism, which is already fairly abominable. I'm really
just disgusted reading these numbers. Jokeified me one hundred times.
I didn't even need to put on the joker makeup.
It just appeared on my skin naturally. I'm currently high
kicking around this sound cube I record everything in. But
really all of this is far more apocalyptic for the hyperscalers.
(16:31):
The Wall Street Journal reports that Microsoft intends to spend
ninety three point seven billion dollars in capital expenditures in
twenty twenty five, or roughly eighty five hundred and eighteen
dollars per monthly active user of the co Pilot app
in January twenty twenty five. Google is planning to spend
seventy five billion dollars on capital expenditures in twenty twenty five,
or roughly foury one hundred and sixty seven per monthly
active user of the Gemini app in January twenty twenty five.
(16:54):
Sundhapashai wants Gemini to be used by five hundred million
people before the end of twenty twenty five, and number
five so unrealistic that someone at Google should be fired,
and that someone is sunned up as shy. The fact
of the matter is that if Google and Microsoft can't
make generative AI apps work, if they can't get meaningful
consumer penetration. This entire industry is screwed. There really are
no optimistic ways to look at these numbers, and yes
(17:17):
I'm repeating myself. Microsoft Copilot had eleven million monthly active
users on the Copilot app and fifteen point six million
unique monthly visitors the coopilot dot Microsoft dot com. Google
Gemini had eighty million monthly active users on the Gemini
app and forty seven point three million unique monthly users
visitors even to their website. These are utterly pathetic considering
(17:38):
Microsoft and Google scale, especially given the latters complete dominance
over Google Search and web search in general, and the
ability to funnel customers to Gemini for millions, perhaps billions,
Google is the first page that they see when they
open a web browser. Google should be owning this by now. Look,
forty seven point three million unique monthly visitors is a
lot of people, But considering that Google spent five fifty
(18:00):
two zero point five four billion dollars in capital expenditures
in twenty twenty four, it's hard to see whether return
is or even whether a tone could be. Google, like
most companies, does not break out revenue from AI. Just
to be clear, if they were doing well, they would,
though they do love to say stuff like a strong
quarter was driven by our leadership in AI and momentum
across the business, which means nothing. By the way that
(18:23):
shit is made for journalisticy and go oh, that means
they're making money in AI. When a company's making money
in something, they'll tell you directly. And as a result
of its unwillingness to share hard numbers, all we have
to look at are numbers like those that received from
similar webons Centre Tower, and it's fair to suggest that
Gemini and its associated products have been a complete flop.
(18:43):
We're still Google spent one hundred and twenty seven point
five four billion dollars in capital expenditures in twenty twenty
three and twenty twenty four, combined with an estimated seventy
five billion like I said for twenty twenty five, what
the fuck is going on? Yes, Google is likely making
revenue from people running generally AIM and Google Cloud, and
yes they're likely making money from forcing AI onto Google
(19:04):
Workspace customers by raising the prices and saying you get
this for quote free. But Google, like every single other
general IVAI company, is losing money on every single general
IVAI prompt, and based on these monthly active user numbers,
nobody really cares about Gemini at all. Actually, I take
that back. Some people care about Gemini. Not that many,
(19:24):
but some. And it's far more fair to say that
nobody cares about Microsoft Copilot, despite Microsoft shoving it in
every corner of our lives. Eleven million monthly active users
for its unprofitable, heavily commoditized large language model app is
a joke, as are the fifteen point six million monthly
active users for its web presents, probably because it does
exactly the same shit that every other LMM does, and
if one knows it's powered by chet GPT, it's just
(19:46):
it's remarkable. Microsoft's copil app isn't just unpopular, it's irrelevant.
For comparison, Microsoft Teams has, according to a post for
Microsoft from the end of twenty twenty three, over three
hundred and twenty million months active users. That's more than
ten times the amount of monthly active users of the
Copilot app in January twenty twenty five, and the Copilot
(20:07):
website combined, and unlike Copilot teams, makes Microsoft money now.
I obviously don't have the numbers on people that accidentally
click the Copilot button in Microsoft Office or bing dot com.
But I do know that Microsoft isn't making much money
on AI at all. Microsoft reported in its last earnings
that it was making thirteen billion dollars of annual revenue,
a projected number based on current contracts versus booked money.
(20:29):
And this was on their artificial intelligence products. Now I've
made this point again and again and again, and I'm
going to keep making it. But revenue is not the
same thing as profit, and Microsoft does not have an
artificial intelligence part of its earnings breakdowns. These numbers are
cherry picked from across the entire suite of Microsoft products,
such as selling Copilot add ons to their Microsoft three
sixty five enter price suite. And by the way, The
(20:49):
Information reported in September twenty twenty four that Microsoft had
only sold Copilot to around one percent of their customers
buying three sixty five. They also make it selling access
to open AIS models on this roughly a billion dollars
in revenue, and people running their own models, and the
zore cloud, Microsoft's cloud compute platform for context. By the way,
Microsoft made sixty nine point sixty three billion dollars in
(21:09):
revenue in its last quarter, thirteen billion dollars of annual
revenue not profit, is about three point twenty five billion
dollars in quarterly revenue off of upwards of two hundred
billion dollars of capital expenditure since twenty twenty three. The
fact that neither Gemini nor Copilot has any meaningful consumer
penetration isn't just a joke. It should be sending alarm
(21:31):
bells through Wall Street. While Microsoft and Google may make
money outside of consumer software, both companies have desperately tried
to cram Copilot and Gemini down consumer's throats, and they
have categorically unquestionably failed or while burning billions of dollars
to do so. But ed ed, what about get hubcopilot?
All right, let's talk about git hub coopilot, shall we.
According to a report from The Wall Street Journal from
(21:53):
October twenty twenty three, Microsoft was losing an average of
more than twenty dollars a month per user on the
paid of gitthub copilot, what with some users costing them
more than eighty dollars a month. Jesus christ. Microsoft said
a year later that gethub copilot had one point eight
million paid subscribers, which is pretty good, except like all
generativio products, it loses money. Like I just bloody said,
(22:16):
I must repeat that Microsoft will have spent over two
hundred billion dollars in capital expenditures by the end of
twenty twenty five. In return, Microsoft got one point eight
million paying customers for a product that, like everything else
I'm talking about, is heavily commoditized. Basically, every LM can
generate code that some are better than others, by which
I mean they all introduced security issues into your code.
But nevertheless, and somehow, Microsoft loses money even when the
(22:39):
users use it paid. Am I getting through to you yet?
Is this working? If you are working for a hedge
fund and investment bank or anyone like that, please get
in touch. I will protect your identity. Is anyone around
you freaking out because they should be? They should be. Man,
I'm freaking out a little, and I just keep all
my money in a big box under my bed. I don't
(22:59):
have that I do anyway, not going to do that. Jug. So,
one of the arguments people make is that AI is everywhere,
But it's important to remember that the prevalence of AI
you seeing it in different apps, is not proof of
its adoption, but the intent of companies to shove it
into everything, And the same goes for businesses integrating AI
that are really just mandating people dick around with Copilot
or chat GPT and I'm really not kidding, no really.
(23:22):
KPMG bought forty seven thousand Microsoft Copilot subscriptions last year,
a significant discount to be familiar with any AI questions
their customers may have. Management consultancy PwC bought one hundred
thousand enterprise subscriptions, becoming open AI's largest customer in the process,
as well as their first reseller, and have created their
own internal generative AI called Chach PwC. The PWSC stuff
(23:46):
as absolutely hate. It's really cool that when you actually
talk to the users, they just fucking hate it. And
while you may see AI everywhere, integrations of generative AI
are indicative more of the decision making of the management
behind the platforms and the demands of the market more
than any consumer demand. Enterprise software is more often than
not sold in bolt to managers or c suite executive tasks,
(24:06):
less with company operations and messy things like doing staff
for making sure the company runs, more with seeming on
the forefront of technology. In practical terms, this means that
there is a lot of demand to put AI in stuff,
and some demand to buy stuff with AI on it
by enterprise buying software, but little evidence that this actually
leads the significant user adoption or usage. I'd argue this
(24:30):
is because large language models do not really lend themselves
to features that would provide meaningful business returns. And I
think everyone can agree on that, Like there are things
like summarizing emails, which I'll get to get to that
in a second. Look. In fact, let's do it now.
Let's briefly talk about where large language models work, where
they are actually good. And some of you are not
going to love this, but I know there's one of
(24:51):
you is that yes, yes, now I will get ahead.
I've got him now, I have him in my sights,
to be clear, And this is really dealing with the
am actually responses. I'm not saying and really have never
meant to say that large language models have no use
cases or no customers. People really do use them. They
use them for coding, for searching defined libraries of documents,
(25:12):
for generating draft materials, for brainstorming, for summarizing and searching documents,
These are useful, but they're not magical. They're cool, but
that's about it, and their coolness or usefulness is a
tiny little ant compared to the costs and stealing from
millions of people and damaging our power grid in our planet. Okay, okay,
(25:32):
so you're probably wondering. I brought it up earlier. Agents.
You've heard about agents. Mark Benioff wankin Off about agents.
Sam Allman talking about agents. They loved, They loved talking
about agents, right, they love saying agents of the future.
When a company uses the term agent, they're intentionally trying
to be deceitful, because the term agent means autonomous AI
that does stuff without you touching. It goes off and
(25:53):
does things for you with one command, and it knows
what to do. Remember, these models don't know anything. The
problem this definition is that everybody has used it to
refer to what is actually a chatbot that can do
some things while connected to a database, which I would
regularly called a chatbot personally. In open AI and anthropics case,
agents refer to a model that controls the computer. This
is closer to the truth other than the fact that
(26:15):
their agents are so unreliable as to be disqualifying, and
the tasks they succeed at, like searching trip advisor, are
very simple and did not need automating. Next time you
hear the agent actually look at what the product does,
and maybe you flick a booger at the person. But Ed, Ed,
you just burst into my door and having a nice
diet coke and you're in my house. What are you
doing here?
Speaker 1 (26:34):
Ed?
Speaker 2 (26:34):
What about artificial general intelligence? Aren't they going to turn
this into artificial general intelligence? No, they're not. Get out
of my house. Generative AI is probabilistic and large language
models do not know anything because they are guessing what
the next part of a particular output would be based
on the imput in reasoning models. They might look at
that a few times go oh, maybe it's not this,
maybe it's this. They are not making decisions. Generative AI
(26:55):
does not make decisions. They are probability machines, which in
turn makes them own only as reliable as probability can
be and as conscious no matter how intricate the system
may be or how much infrastructure is built. As a
pair of dice, we do not understand how human intelligence works,
and as a result, it's completely laughable to imagine we'd
be able to simulate it. Large language models do not
(27:17):
create or resemble, or they're not artificial intelligence. They are
at most the most powerful parrot in the world, trained
to respond to stimulus with what they guess is the
correct answer, and they're pretty good at it. They're pretty good. Right,
It's pretty cool, except we shouldn't be burning hundreds of
billions of dollars to make them slightly better at this.
(27:38):
Let me put it in simpler terms. Imagine if you
made a machine that threw a bouncy ball down a
hallway and it was really really you got really good
at dialing in to throw the ball so that it
followed a fairly exact trajectory. Would you think the arm
was intelligent? Would you think the ball was intelligent? Would
you think that the ability to precisely do something or
more reliably do something would make it smart. The point
(28:01):
I'm making about large language models is that they're a
cool concept with some interesting things they can do. But
they've been used as a cynical marketing vehicle to raise
money for open AI by lying about what they're capable
of doing, starting with calling them artificial intelligence. All right, really, though,
(28:30):
at this point, I need to ask a very fucking
simple question. Where is the goddamn money? Where is the
goddamn money? Where's the money? Sammy, Sammy, give me the money.
Where's the money? Money me money now? Sam Mortman, where
is the money? Dario Ama Day, where's the money? Satya Nadella,
where's the money? Summed up Ashai? Where's the money? Mark Benioff,
where's the money? Where is the goddamn money? Because revenue
(28:51):
is not the same as profit, I will say it again,
revenue is not the same as profit. And even then, Google, Amazon,
and to an extent, Microsoft, the company's making the most
investments in AI, do not want to state what the
revenue is on AI. I hypothesize the reason that they
do not want to disclose it is that it's pretty
goddamn small. It is extremely worrying that so few companies
(29:13):
are willing to directly disclose their revenue from selling services
that are allegedly revolutionary. Why Salesforce says they close two
hundred AI related deals in their last earnings. How much
money did they make? Why does Google get away with
saying that they have growing demand for AI and nothing else?
Is it? Because nobody's making that much money. As a sidebar,
(29:34):
I can find and I've really really looked like one
company that appears to be making profit from genera ivai
during a consultancy that helps generaivai companies find people to
train their models. That made three hundred million dollars in
revenue in twenty twenty four and reach an indeterminate amount
of profitability. We don't know if it was like a
million dollars or not, while Microsoft may disclose it made
(29:54):
thirteen million dollars in AI revenue that's annualized, so projected
based on current contracts rather than actual money in accounts,
and does not speak to the specific line items like
one would say. If said line items, we're not going
to make. The market say, hey, what the fuck? Put
aside whatever fantastical beliefs you may have about the future,
and tell me right now what business use case exists
that justifies burning hundreds of billions of dollars, damaging our
(30:16):
power grid, hurting our planet, and stealing from millions of
people to train these models. Even if you can put
troublesome things like morals or the basic principles of finance aside,
can AI evangelists not see that their dream is failing.
Can they not see that nothing is really happening, That
general ivai at best can be kind of cool, yet
mostly sucks and comes at this unbearable moral, financial, and
(30:38):
environmental cost. Is any of this really worth it? And
where exactly does this end? Do you AI evangelist gone
to your head, your life contingent on the truth, leaving
your lips believe that this goes much further than you
see today? Do not know if these AI people see
that this kind of sucks? Do they not see that
general ifai runs contrary to the basic tenets of what
(30:59):
makes science fiction call It doesn't make humans better. It
reduces their work to a stagnant, unremarkable slop in every
way it can, and reduces the cognition of those who
come to rely on it, And it costs hundreds of
billions of dollars and a return to fossil fuels. For
some fucking reason, it isn't working. The users aren't there,
the revenue isn't there. The best time to stop this
was two years ago, and the next best time to
(31:20):
stop is as soon as humanly possible. Generatifai is a
group delusion, its own kind of real life hallucination. What
you're seeing in the news is not the success of
the artificial intelligence industry, but a runaway narrative created by
and sustained by Sam Altman, Open Ai, Dario Amadee, and
of course satch In Nedella these fucking people. What you're
(31:41):
watching is not a revolution but a repetitious public relations
campaign for one company that accidentally time the launch of
chat GBT with a period of deep desperation in big tech,
one so profound that it will likely drag half a
trillion dollars worth of capital expenditures along with it. The
bubble will only burst when either the markets or the
hyperscalers accept that they've chased their own tales toward oblivion.
(32:02):
There is no justification for any of the capital expenditures
related to generative AI. We are approaching the limit of
what transformer based architecture can do, if we haven't already
reached it. No amount of beating off about test time, compute,
and connecting large language models to other large language models
is going to create a new use case for this technology,
and even if it did, it's unlikely that it ever
makes enough money to make it profitable. I will keep
(32:25):
talking about this stuff until I'm proven wrong. I do
not know why more people aren't more worried about this.
The financials are truly damning. The user numbers are so
small as to be insignificant. The costs are so ruinous
that they will likely cost tens of thousands of people
their jobs, and one of the hyperscalar CEOs their job
along with it, although admittedly I'm a lot less upset
about that. And they're going to inflict damage on tech
(32:46):
valuations that may well rival the dot com boom or worse.
And if the last point feels distant to you, ask yourself,
what's in your retirement savings? That's right, Google, Microsoft, and
hundreds of other companies that will be hurt by the
contagion of an aiding. I should also not be the
person saying this, or at least I shouldn't be one
(33:06):
of the first. These numbers are horrifying, and I have
no idea why nobody else is worried. There's no industry here,
there is no money. There's no proof that this will
ever turn into a real industry, and far more proof
that it will cost more money than it will ever make.
Im perpetuity open AI and anthropic are not real companies.
They're freeloaders living on venture backed welfare for an indeterminate
(33:27):
amount of time. Because the entire tech industry has agreed
to rally around the world's most unprofitable software, and, like
any other free ride that doesn't actually produce anything, when
the money goes away, they're fucked. Seriously, why are investors
funding open Ai? Do they seriously believe it's necessary to
let Sam Altman and open Ai continue to burn five
or more billion dollars a year on the off chance
(33:48):
he's able to create something that's alive. This motherfucker can't
create something that's profitable. What's the end point here? How
many more billions? Where's the fucking money? Sammy? Where is it?
Sam Moorman? Where's my god damn money? Where's my money? Sam?
I say all this because generativeai is open Ai. The
consumer adoption of this software is completely failed, and it's
(34:10):
going nowhere fast Chat GPT is sustained entirely on deranged,
specious hype drummed up by a media industry that thinks
it's more remarkable to write down the last lie that
Sam Moltman told than say that open ai has lost
nine billion dollars in the last year to Sorry, they
spent nine billion dollars to lose five billion dollars in
last year, and they intend to more than double that
number in twenty twenty five for absolutely no reason. Look, look,
(34:35):
it's time to stop humoring open ai and time to
stop directly stating that it is a bad business without
a meaningful product. We also really need to be clear
that the generative AI industry does not really exist without
open Ai, and thus this company must justify its existence.
And let's be abundantly clear, open Ai cannot exist any
further without further venture capital investment. This company has absolutely
(34:59):
no path to sustain in itself, no mode, and loses
so much money that it will need more than fifty
billion dollars to continue in its current form in the
next year. I don't know how I'm wrong, and I've
sat and thought through and researched a great deal on
how I might be. I can't find any compelling arguments.
I don't know what to do, but tell you what
I think and why I think that way, and hope
that you the listener understand a little bit more about
(35:21):
what I think is going on, because this really bothers me.
As I've said before, I grew up on the compute.
The computer made me who I am. Seeing the tech
industry like this sickens me because it's getting money away
from people doing cool shit to the least cool people
doing the least coolshit possible, and it's frustrating. But I'll
leave you with one thought and one thing that particularly
(35:41):
bothers me about GENERATIVAI. Regular people, for the most part
of my experience, do not seem to want this. While
there are occasionally people I'll mate you use chat GPT
to rewrite part of an email, most of the people
I may feel like AI was forced upon them. With
that in mind, I believe that Apple is actually radicalizing
millions of people against GENERATIVEAI by forcing them to reckon
with the terrible summaries, awful suggested texts, and horribly designed
(36:04):
user interface choices from Apple Intelligence, one of the worst
product launches I think I've seen in my life. Something
about generative AI has caused the hyperscalers to truly lose
their minds, and the intrusion of GENERATIVAI into both Microsoft
Office and Google Docs has turned just about everybody I
know in the business world against them. The resentment boiling
against this software is profound because the tech industry has
(36:24):
become desperate and violative, showing such contempt for their customers
that even Apple will force an inferior experience upon their
customers to please the will of the rot economy and
the growth at all cost mindset of the markets. Let's
be frank, nobody really needs anything generative AI does. Large
language models hallucinate too much to be truly reliable, a
problem that will require entirely new branches of mathematics to solve,
(36:48):
and their most common consumer facing functions like summarizing an article,
practicing for a job interview, or writing a business plan
are not really things people need or massively benefit from.
Even if these things weren't ruinously expensive damaging to the environment.
I believe general if AI is turning regular people against
the tech industry thanks to how much they're trying to
force it upon them and make them use the bad idea,
(37:10):
and it isn't working. Nobody wants this ship. They're intrigued
by the idea, then immediately bounce off of it in
many cases once they see what it can or can't do.
This software is being forced on people at scale by
corporations desperate to seem futuristic without any real understanding as
to why they need to do so, and whatever use
cases may exist for large language models are dwarfed by
(37:31):
how utterly unprofitable this whole fucking fiasco is. But I
want you to do something. If this whole thing has
pissed you off, if hearing about these companies has enraged
you as it has enraged me. I want you to
tell your friends, your family that open Ai spent nine
billion dollars to lose five billion dollars. I want you
to talk about the fact that large language models don't
(37:51):
really have a market. That chat GPT is a marketing
con That Sachinidella of Microsoft has burned probably will burn too,
un billion dollars chasing software that does the same thing
as everyone else. That Tim Cook of Apple has forced
Apple Intelligence barely functional software on millions and millions of
people because Apple has no more ideas. That Mark Zuckerberg
(38:12):
of Meta has pushed AI on everything because he has
no more ideas left, and it's going to burn so
much money in Meta and Sam Altman and Daria Amaday
are two fucking liars, two liars who will tell you
that their software will turn into artificial general intelligence. They're lying.
They're all lying. And Sundharpeshai of Google is the arc
liar who went in Google io and talked about a
(38:34):
completely fictional AI agent returning some shoes. The only reason
that companies like this lie like this is because the
truth is boring. The truth is mediocre. Believe your goddamn
eyes when you use chat GPT and you say, what
the fuck is this? Why does this matter? You're not crazy,
You're not an idiot because you can't see the magic
of generative AI. The people pushing this stuff are rather credulous.
(38:58):
They're either bought or they're making a shit ton of
money and lying to you. I refuse to let them
keep doing so. Better off Lene exists to kind of
explain this stuff as plainly as possible. You can reach
out to me if I wasn't clear about something. I
love feedback. Please be nice to me. I guess is
what I ask. But I love doing this. I am
scared of how this ends. I think it's going to
(39:18):
really hurt the markets. Could be three months, could be
six months, could be eighteen months. I don't know, and
I don't really think it's the right thing to do
to predict, but I'll tell you this, a better tech
industry can come out of this collapse. I don't know
how severe the collapse is. I don't think like Google's
going to die ornything. It's going to hit tens of
thousands of people's jobs, It's going to hit the markets hard.
(39:39):
I don't know if a recession is possible. I'm not
a financial guy, but I'll tell you this, the tech
industry needs. They need to realize how bad this is.
They need consumers to tell them, and honestly, consumers not
using it should have told them. But they clearly haven't
worked that shit out, have they. But I'll leave you
with this. I think when this there's going to be
(40:01):
a lot of people that need to apologize. A lot
of people in the media, the Casey Newtons of the world,
the Caros Wishes of the world, the people claim in
this the early days of the internet again boo. I
think the thing we really need to do is make
our dispersure known to these tech companies. Find the feedback forms,
go online and talk about them. Say their names. Say
(40:22):
their names to the friends you have who are mad
at this too, which should be a lot of them.
Say their names again and again and again. You ask me,
how can things change? These people only have their names.
They have more money than any of us can mind,
they have all of this power, and as a result,
they actually only have their seo their names. How do
you think propagar Ragavan feels, by the way, when you
(40:43):
google his name and all you see is me, the
smiling man. I believe that enough of us just talking
shit on these people. And I don't mean being irate.
I don't mean making stuff up. We're not them. We
don't have to operate with lies. We can operate with truths,
such as Microsoft is propping up AI a venture welfare client.
All these people hate the poor so much, but they
(41:05):
love welfare when it means maybe making money or maybe
burning billions of dollars. So fuck their name's up. Talk
shit about them, Talk them to your friends. I don't
care if you mentioned better offline. Just tell people what
they've done. Tell people that Generative AI loses money on
every single fucking move. It's so sickening, it's so boring,
and it's most decidedly not the future. You are not
(41:25):
crazy if you don't think this is amazing. You're being
lied to. What you're seeing is a marketing campaign. And
I will continue to walk you through this stuff, and
if I'm wrong somehow, I will correct myself every goddamn time,
because I deeply care about giving you what I know
and what I've seen, and the things I've reported in
these two episodes scared the shit out of me, both
(41:47):
for the markets and the fact that so many rich
people are willing to be so goddamn stupid, and it
made me really angry because it shows such contempt, contempt
for the media and contempt for the user, and I
will not bloody accept it. It's such a pleasure to
do this show. I'm very lucky to do so. Thank
(42:12):
you for listening to Better Offline. The editor and composer
of the Better Offline theme song is Mattersowski. You can
check out more of his music and audio projects at
Mattasowski dot com M A T T O S O
W s KI dot com. You can email me at
easy at Better offline dot com, or visit Better Offline
dot com to find more podcast links and of course,
(42:33):
my newsletter. I also really recommend you go to chat
dot Where's youreed dot at to visit the discord, and
go to our slash Better Offline to check out our reddit.
Thank you so much for listening.
Speaker 1 (42:44):
Better Offline is a production of cool Zone Media. For
more from cool Zone Media, visit our website cool Zonemedia
dot com, or check us out on the iHeartRadio app,
Apple Podcasts, or wherever you get your podcasts.
Host
Ed Zitron
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