Mastodawn

Big companies have an expensive new addiction to AI, and their smack is getting more expensive. Who could have seen this coming? From the WSJ:

"Use of artificial intelligence by big companies is exploding—and the soaring cost has some of them pumping the brakes in a way that could complicate AI’s triumphal march across the economy.
Executives across industries this year have urged employees to integrate AI tools into their work, spending freely to encourage experimentation and seeking to send a message to Wall Street that their companies won’t be left behind in a coming wave of disruption."

"All that enthusiasm has resulted in skyrocketing costs for so-called tokens, the basic unit of measurement for AI computing, as AI model providers seek to balance supply and demand and manage their own costs. Some enterprises have hit their annual budget in just three months or reported seeing their AI spending bills double or triple."

"Now corporate leaders are scrambling to bring down expenses by finding ways to ration AI use in their organizations, steer workers toward cheaper, homegrown tools and help them hone their skills to improve returns."

https://www.wsj.com/tech/ai/corporate-america-is-starting-to-ration-ai-as-cost-skyrockets-1eb99d7a (paywall)

https://archive.ph/v2dwg

@briankrebs LOLz at them successfully rationing anything.

If they knew how to do that in the first place, we wouldn’t be where we are.

elmuerte May 30

@briankrebs with all that spend money... where is the improved quality of life?
Since the start of the whole LLM AI hype I've only seen the quality of life being reduced.

Chris Mackay 🇨🇦May 30

@elmuerte @briankrebs The key question being *whose quality of life?*

elmuerte May 30

@tantramar @briankrebs I doubt the quality of life of extremely rich people improved with the increased wealth combined with the increased scrutiny.

Chris Mackay 🇨🇦May 30

@elmuerte @briankrebs Enough wealth can sheild one from a lot of scrutiny.

elmuerte May 30

@tantramar @briankrebs I doubt any of them love their regular fealty sessions; or their days in court or oversee committees.

Chris Mackay 🇨🇦May 30

@elmuerte @briankrebs Here’s hoping!

@briankrebs I think the cost rise is more to do with the fact Anthropic and OpenAI had previously been massively subsidising the tokens, rather than a huge spike in demand.

BrianKrebs May 30

@davep Yes, the whole scheme definitely has a "first one's free" kind of vibe.

David Plisken 🏳️‍⚧️ BLM! 🇵🇸May 30

@briankrebs @davep first rule of big tech entrapment.

Lightfighter May 30

@briankrebs They are going broke on highly subsidized tokens. Yet another blindingly obvious example of how there is no path to profitability for this product.

BrianKrebs May 30

@Lightfighter Right. Seems like AI kind of sidesteps (or maybe just massively speeds up) most of the normal stages of tech enshittification. When the product itself is shit to begin with, our mental models for how to deal w/ this disconnect are mismatched, imo.

Lightfighter May 30

@briankrebs Both the financial and political worlds have shifted radically of late. I think most are sticking with defensive avoidance rather than fully internalizing the changes. Hoping to slide by this "anomaly" and go back to "normal". The mental trauma of accepting that "normal" is dead is more than they want to consider.

Bytebro 🇬🇧 🇺🇦 🇬🇱May 30

"Well who would have guessed?" said absolutely no-one!

Skyglobe May 30

@briankrebs #Schadenfreude intensifies.

lemgandi May 30

You cannot accurately estimate token spend on a given query. You Cannot Accurately Estimate Token Spend On A Given Query. YOU CANNOT ACCURATELY ESTIMATE TOKEN SPEND ON A GIVEN QUERY.

So you cannot know how much you will spend on AI over an hour. Or a day. Or a quarter.

Maybe humans are actually cheaper.

datum (n=1)May 30

@lemgandi @briankrebs it's literally the halting problem!

John Breen May 30

@briankrebs How long until there is a secondary market for "AI token" prices, short-selling them, etc. Even its own cryptocoin, maybe it will be called BitBucketCoin or something.

Arniepix May 31

@jab01701mid
Bored AI Yacht Club
@briankrebs

Bennett Todd May 30

@briankrebs (singing) "He gives the kids free samples / because he knows full well / that today's young innocent faces / will be tomorrow's clientele"

- Tom Lehrer, The Old Dope Peddler

Bytebro 🇬🇧 🇺🇦 🇬🇱May 30

@bet @briankrebs

"First one is on the house. Enjoy."

Bennett Todd 3h ago

I only just happened on this:

https://futurism.com/artificial-intelligence/microsoft-plots-addicted-to-its-ai

In Leaked Document, Microsoft Plots How to Get People "Addicted" to Its AI

Microsoft explicitly says it wants to "make people addicted" to its new AI personal assistant agent in internal documents.

Futurism

Huh, didn't see that coming 🫠

fuzzyfuzzyfungus May 30

@briankrebs I assume that class solidarity is involved; but it's fascinating how smoothly the WSJ can write a completely nonjudgmental and blame-free article about executives spending hundreds of millions of dollars on the basis of hype and laughably laughably lazy metric design and having that almost immediately not pay off.

If this were an unsexy public sector procurement thing of similar quality I'm guessing they'd have some choice words that are mysteriously not applicable here.

@briankrebs

We just got done implementing AI acceptable use policies because our PE Owners said we have to use AI.

Its been a month. We have maybe 40 users in Claude, Copilot, or Gemini and its already cost us $40,000 roughly.

Most of our internal debate is who gets the bill, because IT is not using AI (except, admittedly to make inside joke teams backgrounds)

For reference: company with about 300 office employees and about 3000 employees total with retail, production, and warehouse staff

ShnoofleBear /ʃnuːfɛlbɛːr/May 30

@nagaram @briankrebs Took all of 4 weeks in our's for this exact scenario. Who woulda thunk it... Why is upper mgmt being paid exorbitant salaries again?

@ShnoofleBear @nagaram @briankrebs

Take the AI costs out of the salaries of those that demand its use.

Publicly traded companies tend to have a problem telling Wall Street that their employees have a deeper understanding of the business than these outsider gambling addicts trading them.

@briankrebs
Fucking, fucking, fucking idiots.

Grease the Subtle May 30

@briankrebs on a whim I checked out Palantir's offerings for procurement and supply chain logistics, as that's what I've done for the past couple decades. I might be out of the loop but I don't get how it brings anything useful to the table. I'm sure there are cases where it's helpful, but there's really not a replacement for experienced brains in a lot of fields, and the fact that people don't realize that is telling on society as a whole. Of course CEOs are groomed to make all the bucks then take their golden parachute out, but that's just another argument for smaller, more agile, more experienced workforces.

Joanie with the Good Hair 😷May 30

@grease It's just a hunch, but my guess is that Palantir's USP is innovation in the violating-the-fundamental-rights-and-freedoms-of-everyone*-on-the-planet space.

[* everyone except Pee Tee]

Max Fenton May 30

@briankrebs lol

Graceless Hippo May 30

Amazing that they had the budget to explode when it comes to AI and yet none for that 0.75% pay rise that they promised 5 years ago.

Look at them. Bastards as far as the eye can see.

Jeff Grigg May 30

@GracelessHippo @briankrebs

Can't afford training either.

Management training to address the serious issues there.

Teamwork training. Lean and Agile.

Empowerment.

Alessandro Corazza 🇨🇦May 30

Companies used to capturing and enshittifying others when another company does the same thing to them:

katzenberger May 30

I have a vague idea who actually needs to "hone their skills to improve returns".

grasshopper May 30

@briankrebs I like this bit, it’s all about the “vibes” when it comes to those pesky returns 😂

Anthropic spokeswoman: “We’re working with customers to give them the tools to make sure the return is something they can see, not just feel.”

puretaste May 30

@grasshopper @briankrebs Also kind of looks like their next offering will be some chatbot that is supposed to measure the impact of the chatbot that you deploy to supposedly fix the errors your chatbot made. Because why not trust the token salesman to tell you that the tokens are _definitely doing work_.

grasshopper May 30

@puretaste @briankrebs

reminds of those matryoshka dolls, but junky AI and not fun 😂

@briankrebs Yes
I have a friend who worked for a big company. The employees were required to use AI. A bunch of them got fired - by email - a couple weeks ago. If your big company insists you use AI, start looking for a new job, because you're training your replacement.

Paul_IPv6 May 30

let they who have never had that discussion with the CFO on "how to get our cloud spend down" throw the first stone. ;)

"go to the cloud, they said! way cheaper than bare metal, they said!"

AI6YR Ben May 30

@briankrebs Ah, this trend cannot come too soon.

@ai6yr @briankrebs This echos of corporations going gonzo for the cloud “put everything in the cloud, the cloud is so cool. Cloud! Cloud! Cloud!”followed super predictably by “oh no these bills are terrible, you don’t need all of this data that you actually need! Pull most of it back!” #CorpLife

Donald Ball May 30

@briankrebs Relatedly, perhaps: in my decades working to build software systems, I have *never* been given a vaguely unlimited budget to spend on my own recognizance on tools, services, consulting, etc. to improve my work. At best, a few hundred bucks a year to spend on continuing education.

Not only are we running a massive experiment without a control group here, we’re not even isolating the variables in question!

Not a Spring Onion May 30

@donaldball @briankrebs

There should be software development companies / contractors that can be paid with tokens.

That way, employees could spend a lot of tokens, but would actually get something in return.
Also, it wouldn't require huge data centers.

Jeff Grigg May 30

@wakame @donaldball @briankrebs

I'm sure I could do remote work from Los Vegas for tokens.

.

(image from https://www.888poker.com/magazine/poker-world/poker-chips-values-and-colors )

me_valentijn May 30

@briankrebs
Unfortunately they seem to be bringing down expenses by firing the humans instead of dialing back on the AI.

Netzblockierer May 30

@briankrebs almost as if this Ai Hype has been a scam all along.

Like NFTs, Shitcoins, Cloud Computing, Microservices, Offshore Outsorcing, Gig Work, …
- No wounder we get Greedflation, when Execs never face Accountability & Consequences for chossing Buzzword-Driven Business Development against all facts!

#Sarcasm #Commentary #BuzzwordDrivenDevelopment #BuzzwordBingo #AI #AIslop #Scam #Economy #Greed #Greedflation #LackOfAccountability #LackOfConsequences #Accountability #Consequences #Executibes #Shitcoins #CloudComputing #Microservices #Offshoring #Outsorcing #GigWork

MrGrumpyMonkey May 30

@briankrebs I don't wanna say I told you so, but "I told you so".

@briankrebs Almost like it wasn't the employee replaceent they wanted after all.

cauZation May 30

@briankrebs Typical abusive #Capitalism, in skewing profits toward the wealthiest.

Worse than Communism, at its opposite.

Replace #FossilFuels #TechBros #Broligarchy with #RootInfrastructure #scientists

AKingsbury May 30

@cauZation @briankrebs

Because scientists, as we all know, are emotionless, objective sources of absolute truth, who never feel greed, do anything unethical, lie, mislead anyone, or do anything to enrich themselves at the cost of others.

cauZation May 31

@AlexanderKingsbury "root infrastructure" implies a sustainable range - not the bipolar duopoly you extend, which is classic Capitalism.

Go move to a Communist country. Maybe an abusive Monarchy is more your speed.

AKingsbury May 31

"bipolar duopoly".

Thank you for that; new one for the collection.

cauZation May 31

@AlexanderKingsbury Sophomoric math.

Most EU countries have a minimum third party.

Keep your abuses locally. Perhaps become a full-blown Capitalist abuser, in the US.

softproof May 30

@briankrebs Alternatively, and more radical by far, hard-pushed corporate leaders could ask staff to use the fluff between their ears for problem solving. I read someplace it still comes free with birth (amazingly enough).

Jeff Grigg May 30

@softproof @briankrebs

It's been harder and harder to find humans who actually do their own thinking these days. That big blob of fat between the ears seems to have been rotting, for many.

😢

When is shrinkflation going to hit AI tokens?

I avoid AI, so I'm not sure what exactly defines what you get for a token. Do you know what a particular input will cost before submitting?