Ai bubble?
Is AI bubble? #google #meta #amazon #nvidia #netflix #microsoft #apple #uber
The hype around new tech keeps popping up. First crypto, then software in general and now AI. Starting to see a pattern where PR for a certain tech is pushed on social in order to inflate IPO and tech stock value. Im probably an idiot but that’s my two cents
At the end of the day, what is the value proposition for the user. Will it be profitable to the extent they predict, and if so, then maybe it isn't hype, but these short-term hyperbolic movements definitely are hype
I believe it’s not truly a bubble. I think the short term is over-hyped, but long term it’s a hugely transformative technology on par with the internet. The cash flow is there. Just think about any app or site you use today. In a few years they’ll all shift to some integration of LLM for their interface. Custom ML models will run on clusters to crunch large data-sets for analysis on complex problems. And deep learning will be used in robotics for real world automation. If you want to know what the next 10 years will look like, just look at the last year in generative content and extrapolate from there. You’d be smart to get ahead of it. It’s going to mess up a lot of industries and cost a lot of jobs. Hopefully new jobs come out of it.
Sure they will shift to LLM but is it going to change the ARPU? If not then it only means shrinking margins. In that case the GP goes down and sw valuations go down. LLM is anything will be deflationary for sw companies. LLM will be table stakes so every sw company will add them for the same share of the pie, the pie itself is increasing at the same rate with or without LLM. Let’s take service now as an example, will using LLM increase their revenue ? Will workday increase it? Both will use LLM to make their sw easier to use but will it result in them pricing it more, will the market suddenly expand ?
I guess I was thinking more in terms of new use cases than just slapping AI features onto existing I products. The folks who will really stand to benefit will be the ones who are central to AI. Nvidia, cloud providers, companies providing custom models, etc. Then I’m sure we’ll see a bunch of new domain specific companies using AI to supplant the existing solutions. I would imagine something like instead of a store having to do inventory through a system, the ML model is constantly tracking sales, and handling recommendations for ordering. So in that case there is no interface for data entry needed. That’s a dumb example but the point is, we completely rethink what and inventory system looks like.
Stocks like Nvidia being priced as much as Apple… It is transformative tech, but valuations are off the charts.
well said. Its crazy valuations for no reason. People just follow.
The point of bubble is that everyone is positive. Its a bubble when things go up fast. Long term AI has huge potential, but short term market is a 100% bubble.
We need to see how those AI companies gonna be profiting in the end to make a judgement