The AI companies could probably be profitable if they weren’t dumping tons of money into new model research, but then they would stagnate and die to the ones who keep moving forward.
Companies using their AI don’t need to worry about that expense.
It’d be so funny if research hits a breakthrough that absolutely collapses the cost of inference, allowing anyone to self host frontier models, eliminating the ability for all the main AI companies to ever recoup their costs.
Well, except where everyone’s data gets sold at bottom dollar in liquidation. Actually, that’d be pretty funny too.
I don’t know if that’ll happen to frontier models, but I definitely see it happening with models that work well enough for the vast majority of personal use.
It’s a definite risk. They do steal your inputs and the outputs they send back to you. They will always have even more powerful models that aren’t released yet. If you avoid sending them all of your code, they could hack you to steal it. They will certainly copy any good ideas their competitors come up with (Meta Muse agent, jev) within weeks, as they all copied claude code and open claw. Answer to OP is “just not yet”.
The unified US establishment goal is to create skynet for global and domestic domination. Theoretically, the AI bond villains could make sufficently sophisticated weapon/control systems to threaten the government, but why bother when it already wants to give them all of our money. “Whoever wins AI, wins” means only first to skynet, wins. Zero relevance to any AI customers, who obviously win through the widest competition/choices on what to use to help them. Not the nationality of the oligarchs that profit off them.
https://naturalfinance.blogspot.com/2026/09/a-global-prosperity-manifesto.html
Why did the snake oil salesman grow old and die? Same reason.
The real reason isn’t that they can’t turn a profit, it’s that they don’t have to.
They don’t have to be profitable because they aren’t fueling growth with profits, they’re fueling it with debt and investment. Like many have noted, they cannot do that forever and will eventually pass that cost to consumers. A significant portion of their existing cost is driven by research, which they can scale back by lobbying for legislation, so that peers getting a leg up is more difficult and small players catching up is almost impossible.
Also, both Anthropic and OpenAI have planned IPOs, where they will inevitably raise a ton of cash. It’s a game of chicken though. How long can they fuel growth without being publicly accountable to balance sheets and shareholders? Whether we like it or not, they will almost certainly transition to being profitable businesses, but only when it is advantageous for them to do so. Right now, it’s not a priority; the priority is growth to the point of diminishing returns.
In a gold rush it is better, on average, to sell the shovels then to mine the gold.
Slop image
Because its a scam.
A scam that will inevitably end humanity on a global scale…… probably.
Nah mankind will continue, but it’ll definitely hurt when this shitshow implodes and possibly takes out the current economic model and quite a few governments with it.
Because nobody but nvidia profits from LLMs.
How’s TSMC doing these days?
Shovel salesmen
This is exactly the question i ask “investment advisor” services when they call asking if i want help managing investments.
For you to have a system that works well enough for me to be interested , there’d be no need for you to spend money on call centers full of people ringing up strangers for money, you could take all of that money and invest it in the plan you are trying to sell me.
I’ve always thought that as well. Surely it wouldn’t take them long to become ludicrously wealthy with their top investing acumen.
Ikr. If I knew a “foolproof” investing strategy to “make loads of money”, I wouldn’t spend my time trying to teach other people about it, id just be using that strategy myself and actually NOT want other people to know about it.
They’re working on it. They just need a little more of your internal documents and source code.
And a lot more money. And so much more power and water. And more data. And more money, too.
They’ll announce soon that personal ai assistants require a blood sacrifice to run, on top of the monthly and metered fees.
They’ll need child-cannibalist rituals minute of work.
Because it is a scam. Just like the people selling, instead of using:
- healing crystals
- essential oils
- blockchain
- penis-enlargement pills
- JIRA
Q: Couldn’t this JIRA ticket just be an email?
A: No! Because JIRA will send you like, 10 emails.
LOL Love the (accurate) JIRA inclusion there
Jira is awful 😞😔
I mean yes, I hate the manager who set up JIRA that way, but JIRA is marketed to and designed for managers to over-complicate it. It is not designed as a tool for engineers to track their work. It is designed for managers to mis-manage teams, because that sells at volume.
I also have other reasons for hating JIRA:
- no ticket hierarchy
- no multiple owners
- slow. so very slow
- sometimes keyboard shortcuts work, sometimes they don’t. There is no apparently pattern.
I mean, it kinda fits with the rest of that category, other than I’ve never been harassed about healing crystals.
Jira, lol.
If I recall correctly, shovel companies made a lot of money while only a few of their shovels actually struck gold.
Recent scholarship confirms that merchants made far more money than miners during the gold rush.
The wealthiest man in California during the early years of the rush was Samuel Brannan, a tireless self-promoter, shopkeeper and newspaper publisher. Brannan opened the first supply stores in Sacramento, Coloma, and other spots in the goldfields. Just as the rush began, he purchased all the prospecting supplies available in San Francisco and resold them at a substantial profit.
Been shouting this from the rooftops since the beginning. If it was half as good as claimed, I would NOT have access to it.
I’d wager it’s simply not possible to be profitable using AI for most use-cases. You either burn way too many tokens on your queries or risk your business falling victim to an under-tokenized AI hallucination.
Or any AI hallucination
I love the assumption that if you spend enough tokens, it won’t hallucinate, like it isn’t a mathematical certainty or anything.
I agree with you, but I liken to to how companies tend to replace competence with bureaucracy. With enough layers, a significant amount of mistakes get caught. It just slows everything down and costs a bunch of money. There are still problems that get through, just less of them.
Right like. The more tokens you spend, the more hallucinations you get.
You can cut hallucinations by 90% just by prompting the LLM to.not guess API and function names and to provide it with full docs or MCP to find docs.
Yeah but it’s not guessing in the first place. It has zero reasoning skills. It just outputs the most likely next word. Even when you ‘tell it not to’
I know I am getting down voted for this because people haven’t tried it. And let me differ, it has reasoning skills, it now gets beyond predicting the next word. And even reducing it to next word is some kind of primitive reasoning.
By experience, by telling the AI to not guess APIs and function names and instead provide it with a way of looking through docs, and inspecting the code and other tools to get it do some tests, the hallucinations disappear. I’ve been able to have better results with this setup.
This is very different than the “no mistakes” joke.
“it has reasoning skills” Nope. It has larger context windows and someone coded in the ability to reprompt itself for “thinking” steps that are literally just a new prompt with the same context that gets fed back in which merely increases the chances of it guessing the next output token correctly.
It still doesn’t “reason”. It still doesn’t know what the words mean. The modified algorithms are just attempting to generate the corrective prompts for you. If you’ve ever messed with them long enough, you’d understand that these, “no wait fix it” prompts have rapidly diminishing returns at the best of times. Their “thinking” is a bandaid, and a piss poor one at that.
I know I am getting down voted for this because people haven’t tried it.
People here have tried it, LLM use is basically enforced at a ton of companies and the tech industry crowd is a huge portion of the population here.
You’re likely being downvoted as you seem to have a fundamental misunderstanding of how LLMs function. LLMs don’t reason. LLMs don’t think. Telling an LLM to not guess might help ever so slightly, but LLMs can and do hallucate search results regularly.
It’s a mistake to trust that LLMs aren’t hallucinating just because you told the LLM to not guess.
I juste don’t want to talk about this any more becausefor me adding those instructions in AGENTS.MD and giving it the full API and language and platform docs dropped significantly the hallucinations. You just disregarding my experience and want me to believe in your assumptions.
It helps, sure. But it still does stupid shit CONSTANTLY.
So do humans. Constantly.
It doing sgupid stuff is another issue separate from hallucinations. Preventing LLM from doing dumb shit is more difficult, you need more guards and harnesses.
This logically leads to a similar question to OP’s again: if it’s so easy to cut down on hallucinations, then why haven’t the designers of this software already integrated that in?
This is kinda fundamental to economics: the moment AI learns to perform some task, that task becomes less valuable.
But then aren’t there just different tasks to do? VisiCalc and Excel didn’t make accountants irrelevant.
That’s the economists angle, yes, but that’s not what I’m getting at.
You can’t make a business with AI because anyone can use an LLM to do anything an LLM can do.
There are exceptions in the short term, but they may not last. For example, we’re paying a hefty subscription fee for an AI service that scrapes financial data from scanned pages. It’s much more accurate than traditional OCR.
Presently its better than its competitors so commands a premium price. However, I don’t think it will enjoy that position for long.
Better question is if you can really build an app as easily as writing a prompt, why would anyone pay you for your app?
Somehow AI bros like to pretend that AI is some secret lifehack despite it being one of the most mainstream things in human history.
It still takes time and effort to be a project manager for app developer agents. Might as well just pay for it and get stuff done today. Instead of spending time on software maintenance, you could just pay for someone else to deal with all that hassle.
Right. But Fermi’s Paradox applies.
Everyone is buying and selling software miracle cure…but all of the software itself is still exaclty as healthy as a con artists prize race horse (not healthy, and actually a mule).
Why does it cost so much to engineer new models? I thought AI can replace software engineers now, shouldn’t the development cost of new models decrease over time?
Why does it cost so much to engineer new models?
We need at least two massive quantum leaps in quality before this stuff can be long-term profitable; and there probably simply aren’t two quantum leaps left in the current pathways being explored.
But turning off all the bots, contracts, and lies would cause the investment money to stop immediately, rather than later.
Everyone perpetrating this scam wants to cash out a tiny bit more before it crashes.
Joking aside - I think the whole “engineer time is expensive, computer time is cheap” approach stopped being true half a decade or so before LLMs were a thing. It was kind of self defeating - you’d think companies were trying to increase their usage of computing resources due to some misconception that it’d automatically decrease work humans have to do, saving them money in the long run.
I don’t have the numbers, but I wouldn’t be surprised if software/hardware costs exceeded engineering costs for about a decade now, with all these inefficient-on-purpose frameworks and with everything being on the cloud and with using various services for the sake of using a service.
You can’t avoid the compute requirements
