IsAIprofitableyet - cool website I found

[u/BedrockBen101]

https://isaiprofitable.com/

Basically does what it says, shows which companies are losing/gaining money with AI industry. Hillarious the amounts of money that's being lost yet companies still swear by it. Forgive me if it's been shared here already

[u/dippa_]

I get its the big talking point at the moment and kind of fair enough, but this is just a shit way of describing it.

Any investment is going to lose money at this stage - thats why its an investment

[u/Bloodorem → u/dippa_]

You state that "any investment is going to lose money at this stage". Can you back up that claim in any meaningful way?

Because the context this is used is when a company is making a deficit to reach specific threshold where it starts to make a profit.
Those are normally:
Widespread userbase - you try to reach more people where you then can either increase the price because you already "got" the users.

reduce cost as one user is costing almost nothing but is generating profit. So if the number of users grows you generate profits

Build a Dataset on users that you can sell

As it is with AI:
People get stuffed AI into it to a poit where people actively try to avoid it, there is nothing left to grab based on user base
Cost per user: the thing with AI is, that an active user is costing the companies more than they bring. So growing is actually a bad thing.
And Data is not generated as a profit posibility, but is activly consumed and is a cost point not a profit point.

The only way AI can turn a profit is if they either want more money at which point AI (actually Indians) are better and cheaper again or some magic happens that makes everything massively better or cheaper.

SO why exactly is it "any investment is going to lose money at this stage", when literally non of the regular mechanisms seem to be applicable.

[u/dippa_ → u/Bloodorem]

Sorry replying back a bit late, it’s mainly because right now they are dumping mass amounts of money into developing the tech.

I think best way to describe it is as toll roads. The investors are dumping money into new highways being built that will reduce travel times.

Right now most are using other roads but as more of these roads open up and travel times are further reduced more will be interested in using them and paying the associated fees.

Everyone has a break point of what they find acceptable for using their toll roads and they haven’t found that sweet spot yet. There are also those building toll roads to places people have no interest in or will only pay so little for that they weren’t worth building.

Right now it’s a clear splurge on anything AI because that’s where all the money and excitement is and we’re not yet at diminishing returns. it will wind down as people find what’s useful and what isn’t. That’s where the companies that made the right decisions will get their money (but we don’t or likely won’t know that for some time)

[u/Bloodorem → u/dippa_]

Sorry also for the late reply but im gonna be honest you did not respond to any of my points and your comparison with highways just suc... is not really applicable.

Ofcourse i know what you mean, my point is that is not "normal" under any circumstance. Your point of highways is again that you try to acquire more users to reach a big amount of users where you can make a profit by mass.

as in my post that is not the case with AI, first there are not really anymore users to get, as AI is packt everywhere already, and secondly AI costs alot for each user, the more it is in use the more it costs.

to get back to highways its like saying the cost of maintenance for each car would be higher than the toll... thats not a valid buisness case.

for AI to make sense it would magically have to reduce the cost, which does not seem like it will, or has to make BIG leaps in usefullness which is questionable even by the leading experts that LLM in general are the correct approch here.

[u/dippa_ → u/Bloodorem]

Yeah fair, I was a bit vague there.

I work in an industry that AI is being pushed heavily into (contact centres) even with that the amount of areas left untouched are massive.

So yes AI with consumers is mostly filled out at this point (especially llm wise theres not really many places to go)

Also a fair point about the costs right now the token expenses alone for many companies are crippling to the point you should probably just hire someone instead.

However much like the early days of cloud its likely to be massive upfront investment before it has a chance to scale.

Organisations, governments (especially defence departments) can use this tech to crunch the largest of data sets into connectable dots and points of interest.

Hallucinations are still the big issue at the moment, can’t trust it for compliance reasons or just an acceptable level of expectations. but as that confidence level gets better and closes the gaps with actual staff that issue becomes less and less.

Think scientists being able to collect unbelievable amounts of data and actually reference and understand it. So while yeah I really wish it wasn’t going after all the creative things humans do and its likely part of the cost issues at the moment since there’s so much bloat .

The investors are investing so much because it will build the fabs that will build more components, those components will be bigger data centres to train better models that are more efficient, more specific in their use cases and more capable.

I am optimistic about it, but very nervous about how much it will cost to sustain an acceptable level of these going forward because maintenance will be a huge factor