Roundup: Is this peak AI hype?
Read to the end for Elon Musk admitting he’s a fascist
If the AI bubble hasn’t crested yet, I think this week gave us the image that will define the ridiculous enthusiasm of this cycle. Attending Computex in Taipei, Nvidia CEO Jensen Huang signed a woman’s boobs as the value of his company continued to soar to such a degree it even surpassed Apple’s market capitalization to become the second most valuable company in the world.
I’ve been saying for a while that Nvidia is clearly overvalued and will drop quite a bit once this cycle ends, but nothing could make me more convinced of that than seeing a tech CEO being treated like a rockstar. He’s not a “cool” CEO; he’s just another billionaire tech mogul.
My reaction is the same as the man between Huang and the woman who seems to be disgusted by the whole sight. And we’re not the only ones to feel that way.
The Wall Street Journal was the latest publication to throw some cold water on all the AI enthusiasm this week, as columnist Christopher Mims warns that “significant disappointment may be on the horizon” with the rate of AI improvement slowing, reality beginning to set in around what those tools can actually accomplish, and the high cost of AI applications continuing to be a problem. [archive]
According to Mims, AI companies are running out of data to train their models on: they’ve already used up the internet and “there aren’t 10 more internets’ worth of human-generated content for today’s AIs to inhale.” Sequoia also estimates companies have spent $50 billion buying chips from Nvidia to power their AI ambitions, but have pulled in a mere $3 billion in revenue. This isn’t the 2010s when companies could get away with losing billions of dollars a year and still keep chugging along.
Despite some figures that suggest a lot of employees are now using AI tools at work, Mims cites clarifying numbers that show “there is a massive gulf between the number of workers who are just playing with AI, and the subset who rely on it and pay for it.” That’s because some researchers have found that “AI isn’t nearly the productivity booster it has been touted as.”
The AI moment won’t be what Silicon Valley wants us to believe it is. Thank you to Jensen Huang for the image that will illustrate the peak of the bubble.
Sorry for the delay in this week’s roundup! I was at a retreat in the Adirondack Mountains in upstate New York and didn’t get it done before I left. However, the one day delay meant I could pull a different tweet to highlight at the end of the newsletter that’s a further signal of Silicon Valley’s fascist alignment. Not a good thing, but at least an instructive one.
In the roundup, there are some important pieces of Israel’s information campaign against US lawmakers, Musk lying to investors, and a break down of who really runs his companies. Plus, plenty of other important labor details and other news you might have missed during the week.
I don’t have any other media to share this week other than the interview I did on my podcast Tech Won’t Save Us with Joseph Cox about his new book Dark Wire. It’s a fascinating tale of how the FBI made its own encrypted phone network to read the messages of criminals around the world, then carried out the largest ever sting operation with law enforcement agencies the world over.
Have a great week!
— Paris
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