Bonum Certa Men Certa

As Microsoft's Debt Surges to Unprecedented 111+ Billion Dollars, How Long Can It Keep Loss Leaders (Such as GitHub) Going?

posted by Roy Schestowitz on Feb 16, 2024,
updated Feb 16, 2024

Based on this report:

Big Tech Struggles to Turn AI Hype Into Profits

The key takeaway:

Microsoft Lost $20 for Every $10 Copilot AI Subscription

"In some cases, losses reached as much as $80 per month."

However, the losses of the Microsoft-owned GitHub service are much higher than these figures. On average, earlier this year, losses reached $20 per user per month. In some cases, losses reached as much as $80 per month. So 1.5 million users means significant losses for the company.

So they lose 240 US dollars per year on each user, selling plagiarism as a service which in turn leads to class action lawsuits.

Is there a viable plan?

AI's economy of scale is unlike that of standard software.

Even Microsoft boosters wrote about it [1, 2] at the time.

Truth be said, GitHub never made any money, just lost a lot of money.

GitHub Is Building a Coder’s Paradise. It’s Not Coming Cheap

It's like YouTube in a sense - a legal liability and hardly an asset if profit matters. GitHub and YouTube have both had mass layoffs and that hasn't helped profitability.

GitHub is in the news again today in relation to lease renewal following reports that it was shutting down all of its offices.

Do you want to depend on GitHub's 'generosity' for your project/s? It's a risky proposition at times of mass layoffs and product/service shutdowns [1, 2, 3].

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