Bob (Robert) Cringely Devoted Three Years of His Life Trying to Profit From LLM Slop and Now He Sounds Off, It's Just Not Working and It Can Crash the Economy Soon
"The labs raising money at valuations with too many zeros are happy"
Bob (Robert) Cringely is widely known, particularly to older people and to geeks in particular. It is mostly because of television. He was up there with some of the familiar faces of "tech" several decades ago and he also broke some news regarding IBM's collapse. He predictions about IBM have aged well. IBM has entered its "government bailout" era. Hours ago he wrote about slop (the circular financing scam): "Look at where the money is going and you can see the permission slip being cashed. Stargate, half a trillion dollars. The hyperscalers, tens of billions each per year. The Anthropic–Akamai arrangement, nearly two billion more. The collective bet of the wealthiest companies in the world is that you fix intelligence — including its honesty — by buying more of it. The data center operators are happy. The chip vendors are ecstatic. The labs raising money at valuations with too many zeros are happy. Everyone in that chain has the same incentive, which is to believe that the answer is more. The customers who will eventually pay for all of it are the ones who should be asking whether any of this is true."
We are already paying for it. The Steam Deck's price has increased to nearly a grand ($1,000), Raspberry Pi 6 is delayed, Raspberry Pi 5 became expensive, and there are all sorts of other examples. As Cory Doctorow put it in 2023 when he addressed the subject in Locus Magazine, "large-scale [GAFAM slop] projects are shockingly expensive to run. Some of their costs are fixed — collecting, labeling and processing training data — but the running costs for each query are prodigious. There’s a massive primary energy bill for the servers, a nearly as large energy bill for the chillers, and a titanic wage bill for the specialized technical staff involved. Once investor subsidies dry up, will the real-world, non-hyperbolic applications for [slop] be enough to cover these running costs? [Slop] applications can be plotted on a 2X2 grid whose axes are “value” (how much customers will pay for them) and “risk tolerance” (how perfect the product needs to be)."
As noted this morning, NVIDIA is particularly sensitive to this. Many "white elephant" data centres will vomit out lots of low-cost and useless hardware, purchased using debt by now-insolvent companies. Why would people buy new stuff? █
Image source: After surgery, a visionary finally sneaks back to work