OpenAI has tried to change its deal with Microsoft; Microsoft has tried hedging its bet on OpenAI. The “best bromance in tech” may be unraveling.
  • Tiger Jerusalem@lemmy.worldEnglish
    191·
    2 months ago

    Take a cup a coffee, a comfortable seat, and enjoy the posts from Ed Zitron about OpenAI and the AI fever in general outlining clearly how that hype is a financial disaster waiting to happen. It’s a good read: www.wheresyoured.at

    • Optional@lemmy.worldEnglish
      81·
      2 months ago

      And OpenAI is getting desperate. According to Fortune, OpenAI’s culture is deeply brittle, with a “relentless pressure to introduce products” rushing its o1 model to market as Sam Altman was “eager to prove to potential investors in the company’s latest funding round that OpenAI remains at the forefront of AI development” despite staff saying it wasn’t ready.

      These aren’t the actions of a company that’s on the forefront of anything — they’re desperate moves made by desperate people burning the candle at both ends.

      Yet, once you get past these problems, you run head-first into the largest one: that generative AI is deeply unprofitable to run. When every subscriber or API call loses you money, growth only exists to help flog your company to investors, and at some point investors will begin to question whether this company can stand on its own two feet.

      It can’t.

      OpenAI is a disaster in the making, and behind it sits a potentially bigger, nastier disaster — a lack of any real strength in the generative AI market. If OpenAI can only make a billion dollars as the leader in this market (with $200 million of that coming from Microsoft reselling its models), it heavily suggests that there is neither developer nor user interest in generative AI products.

      Whew. It’s brutal.