{"id":90854,"date":"2024-08-05T04:00:31","date_gmt":"2024-08-05T08:00:31","guid":{"rendered":"https:\/\/quotulatiousness.ca\/blog\/?p=90854"},"modified":"2024-08-20T16:23:58","modified_gmt":"2024-08-20T20:23:58","slug":"short-term-technological-forecast-if-i-were-a-commercial-pilot-id-tell-you-to-return-to-your-seats-and-buckle-up","status":"publish","type":"post","link":"https:\/\/quotulatiousness.ca\/blog\/2024\/08\/05\/short-term-technological-forecast-if-i-were-a-commercial-pilot-id-tell-you-to-return-to-your-seats-and-buckle-up\/","title":{"rendered":"Short-term technological forecast – “If I were a commercial pilot, I\u2019d tell you to return to your seats and buckle up”"},"content":{"rendered":"

Most of this Ted Gioia<\/a> post is behind the paywall (and if you can afford it, I’m sure you’d get your money’s worth for a subscription):<\/p>\n

I anticipate extreme turbulence on every front<\/em> for the remaining five months in 2024. You will see it in politics, business, economics, culture, world affairs, the stock market, and maybe even your own neighborhood.<\/p>\n

That’s one of the themes of my latest arts and culture update below.<\/p>\n

What happened to the AI business model last week?<\/strong><\/p>\n

After almost two years of hype, the media changed its opinion on AI last week. <\/p>\n

\"\"<\/a>

The hype disappeared almost overnight<\/p><\/div>\n

All of a sudden, news articles about AI went sour like reheated 7-Eleven coffee. The next generation AI chips are delayed<\/a>, and 70% of companies are behind in their AI plans<\/a>. There are good reasons for this \u2014 most workers now say AI makes them less<\/em> productive<\/a>.<\/p>\n

People are also noticing that AI businesses want to use the entire electricity grid<\/a> to run their money-losing bots. Meanwhile AI companies are burning through cash at historic levels<\/a>. Even under the best case scenario, this all feels unsustainable.<\/p>\n

But the worst disclosure, in my opinion, came on July 24 \u2014 just eleven days ago<\/em><\/strong>.<\/p>\n

A study published in Nature<\/em><\/a> showed that when AI inputs are used to train AI, the results collapse into gibberish.<\/p>\n

This is a huge issue. AI garbage is now everywhere in the culture, and most of it undisclosed. So there’s no way<\/em> that AI companies can remove it from future training inputs.<\/p>\n

They are caught in the doom loop<\/a> I described last week.<\/p>\n

That same day, the Chief Investment Officer at Morgan Stanley warned investors that AI “hasn’t really driven revenues and earnings anywhere”. One day later, Goldman Sachs quietly released a report<\/a> admitting that the AI business model was in serious trouble.<\/p>\n

Even consulting firms, who make a bundle hyping this tech, are backtracking. Bain recently shared the following chart<\/a> (hidden away at the end of a report) which explains why AI projects have failed.<\/p>\n

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Source<\/a><\/p><\/div>\n

These findings are revealing. They show that management is absolutely committed to AI, but the tools just don’t deliver.<\/p>\n

And, finally, last week the media noticed all this.<\/p>\n

They published dozens of panic-stricken articles. Investors got spooked too \u2014 shifting from greed to fear in a New York minute. Over the course of just two days, Nvidia’s stock lost around $400 billion in market capitalization.<\/p>\n

In this environment, true believers quickly turn into skeptics. The whole AI business model gets scrutinized \u2014 and if it doesn’t hold up, investment cash flow dries up very quickly.<\/p>\n

This is exactly what I predicted 6 months ago<\/a>. Or even a year ago<\/a>.<\/p>\n

I expect that the next few weeks \u2014 or maybe even the next few days \u2014 will be extremely turbulent<\/em> in the AI world.<\/p>\n

Buckle up!<\/p>\n

\n

The dominant AI music company just admitted that it trained its bot on “essentially all music files on the Internet”.<\/strong><\/p>\n

Suno is a huge player in AI music \u2014 it tells investors it will generate $120 billion per year<\/a>. Microsoft is already using its technology<\/a>.<\/p>\n

But there’s a tiny catch.<\/p>\n

The company now admits in a court filing:<\/p>\n